Colombo (LNW): The Ministry of Defence has responded to several claims made by former Minister Wimal Weerawansa in his recently launched book “Nine: The Hidden Story” involving Gen. Shavendra Silva, Chief of Defence Staff (CDS) and former Army Commander), stressing that they are baseless and therefore, false.
The Full Statement:
Clarification by the Ministry of Defence on a statement made by Hon. Wimal Weerawansa MP regarding the Chief of Defence Staff and former Army Commander
Deputy National Security Advisor Level Meeting of the Colombo Security Conclave, a security conference organized between friendly countries in the South Indian Ocean region, was held in India on 07 July 2022. The Ministry of Defence emphasizes that under the directions and approval of the then President of Sri Lanka and the Defence Ministry, the Chief of Defence Staff (CDS) and former Commander of the Army General Shavendra Silva participated in the Meeting representing the Government of Sri Lanka.
Appearing on the “Paththare Visthare” programme of Hiru TV, today (26 Apr), Journalist Chamuditha Samarawickrama quoting from the speech made by Hon. Wimal Weerawansa MP at the launching ceremony of his book “Nine; The Hidden Story” (නවය; සැඟවුනු කතාව), had alleged that the first plan by those behind the protests on May 09, 2022 was to assassinate the then Executive President and the defence heads inside the President‟s House and that General Shavendra Silva‟s visit to India, aroused suspicion.
Accordingly, the Ministry of Defence further emphasizes that the above statement is baseless and the Chief of Defence Staff and former Commander of the Army General Shavendra Silva was on an official visit to India in July 2022 to attend the meeting of the Colombo Security Conclave with the approval of the then President of Sri Lanka and Ministry of Defence.
Colombo (LNW): Tourism Minister Harin Fernando’s ceaseless absence at the Cabinet meetings over the past weeks has raised speculations about the ‘opposition MP-turned-rogue’ Minister’s stance in serving in the Cabinet, in what theorists suggest as a signal to turn down the Ministry.
Being a member of the Cabinet, which is the Executive body that approves the highest decisions of the state administration, one should attend to all Cabinet meetings, bearing the collective responsibility of the Cabinet, considered of which a number of Cabinet Ministers have already warned Fernando not to miss the meetings.
But Fernando has seemingly not changed his habit of avoiding these meetings, hence the speculations being surfaced, according to sources.
Political sources claimed that the Tourism Minister’s ceaseless conduct has also attracted President Wickremesinghe’s special attention, raising the possibility of developing a ground for the two to personally discuss this matter soon.
PMD: In a special statement delivered to Parliament on April 26, President Ranil Wickremesinghe announced that Sri Lanka is on the path of renaissance and is re-emerging as a success story, with the expectation of support from the entire nation to carry it forward.
The President highlighted the progress made in the Sri Lankan economy, which had previously collapsed due to riots, arson, and state bankruptcy. In just eight months, the country has turned its fortunes around and is now known as the ‘Sri Lanka comeback story’.
The President also spoke about the International Monetary Fund agreement, which he presented to Parliament. He acknowledged that the country had failed to implement previous agreements with the International Monetary Fund, despite entering into 16 such agreements.
However, the President emphasized that there is no other active option for Sri Lanka but to sign an agreement with the International Monetary Fund at present.
President Ranil Wickremesinghe reassured the public that the restructuring of local debt would not harm members of the Employees’ Provident Fund.
Furthermore, he stated that a social safety net has been implemented to protect low-income people and create financial stability in the country.
With these measures in place, the President is optimistic about Sri Lanka’s future and urged the nation to work together towards a brighter future.
Following is the full statement made by President Wickremesinghe;
I would like to address the concerns that have been raised in the media and elsewhere about the economic and financial issues that our country has faced. In July 2022, Sri Lanka was hit with riots, arson, and state bankruptcy, causing a complete loss of trust in our country. However, after eight months, we have managed to turn things around and it’s now being called the Sri Lanka comeback story. We have entered the path of renaissance and are reborn, and I am counting on the support of the whole country to take it forward.
Let me give you a brief overview of the situation we faced. Our tax cuts in late 2019 cost us 4% of gross domestic product, and things only got worse with the Covid epidemic. In February 2022, the Sri Lankan Rupee depreciated by 40% against the US Dollar within three months, and it continued to depreciate. Economic growth contracted by 7.8% throughout 2022, and inflation in September 2022 exceeded 70%, with food inflation rising as high as 95%.
In this challenging backdrop, I decided to assume the presidency in July 2022 because I believed that our country could recover. If I had not taken responsibility during a time of agitations and protests, our country would have been completely destroyed. I didn’t hesitate even when the paintings in my home library were burnt down and destroyed.
At that time, Sri Lanka’s total debt was 83.6 billion US dollars, with foreign debt at 41.5 billion US dollars and domestic debt at 42 billion US dollars. By now, our overall debt ratio as a percentage of GDP has become 128%. Due to non-repayment of bilateral and private loans, the amount of outstanding debt from April to December 2022 was estimated at 2.7 billion US dollars.
By the middle of 2022, Sri Lanka was unable to import goods and services from abroad due to the worsening foreign exchange deficit. In May 2022, interest related to foreign loans failed to be paid. This was the first time in the history of Sri Lanka that we had to face such a situation.
As soon as I took over the government, I began negotiations with the International Monetary Fund, the World Bank, and the Asian Development Bank. As a result, in September, we reached an agreement with the International Monetary Fund regarding extended credit facilities.
The comprehensive credit facility consists of six major reforms, which are as follows:
(a) Revenue Based Fiscal Consolidation – This reform includes institutional changes related to the public finance sector, strengthening the social security network, and introducing business reforms in the public sector.
(b) Restructuring of Public Debt
(c) Implementation of multiple strategies to ensure the restoration of financial stability, including the formation of foreign reserves under a flexible foreign exchange rate regime.
(d) Implementation of relevant policies and reforms to ensure the stability of the financial sector.
(e) Implementation of structural reforms necessary to control corruption – In this regard, the Minister will present the relevant draft.
(f) Taking necessary measures to enhance economic growth
Today, we received the financing assurance from foreign creditors, with the Paris Club and India working together to grant it. India was the first to publish it, and we are grateful for that.
China is expected to deal with it separately, so we will discuss with the Paris Club and India on one hand and negotiate with China on the other. After these discussions, we will have talks with private creditors. This agreement will enable us to receive approximately $3 billion from the International Monetary Fund over the next four years, with the potential to obtain about $7 billion from other institutions. This money is crucial for us.
Additionally, we have regained the trust of foreign banks and financial institutions, with economic stability already being established in the country. Social Security is receiving more funding, and investors are showing a keen interest in Sri Lanka.
We have entered into agreements with the International Monetary Fund 16 times in the past, but we have not fully implemented them. On the 17th occasion, when we achieve stability, we must address our long-term weaknesses and move forward with a new program.
One of the points to address is debt restructuring talks with our bilateral countries and private creditors. We want to restructure these loans, as failure to do so will result in a loss of liquidity. In order for the government to move forward, the restructuring must be done in rupees or dollars. The government wants to obtain funds for this service.
Therefore, we must first negotiate with foreign creditors. We hope to initiate these discussions soon, with domestic debt restructuring also being considered. A final decision has not yet been made, but it is important to discuss this issue. Negotiations cannot be held with terms and conditions already in place. It is easier for us to join negotiations without conditions.
Every aspect must be given special attention to ensure that no one is harmed in the process. Some banks may express their inability to cope with the program, but it is important for them to accept it in order to move the economy forward.
There are concerns that the stock market may collapse, and some may not be able to offer different conditions. However, decisions will be made in parliament, and appropriate measures will be taken to ensure that no harm is done to anyone, such as the members of the Employees Provident Fund.
We have initiated necessary programs to support the poor, and the World Bank has provided funding for this. We are currently implementing a program to give aid to those who truly deserve it and remove those who do not. Our aim is to create financial stability and protect the low-income people.
To achieve these objectives, we are holding joint discussions with the Paris Club and India on one platform, while separate negotiations with China are also underway. We have nothing to hide, and several steps need to be taken in this regard.
We have taken 09 prior actions (PAs) which we agreed to so we are qualified. Under that these are;
Fiscal Consolidation
• Cabinet approval of revenue measures to support fiscal consolidation during 2023 in line with program parameters.
• Parliament approval of a revised 2022 Budget that is in line with program parameters.
• Submission to Parliament of the 2023 Appropriation Bill that is in line with program parameters.
Fiscal Structural Reforms –
• Cabinet approval to automate monthly retail fuel price adjustment as prescribed by the 2018 fuel pricing formula to achieve cost recovery.
• Cabinet Approval to automate semi-annual cost-recovery based electricity price adjustment.
Multiple pillars –
• Cabinet approval of the new Central Bank Act with amendments from the bill submitted to Parliament in November 2019 in consultation with IMF- Staff. That has been done and we have to pass the bill here.
Financial Stability –
• Cabinet approval of Banking (Special Provisions) Act to strengthen key elements of the CBSL’s Crisis management powers.
• Hiring by the CBSL of an independent firm to conduct banking sector diagnostic exercise based on Terms of Reference and time line established in consultation with IMF staff.
Price Stability –
• Increase policy interest rates by 100 basis points to ensure forward – looking real policy rates on firmly upward path
The next item is I want to inform the House of the Proposed Quantitative Performance Criteria (PC) and Indicative Targets (IT).
Central Government primary balance 2022 -895 Bn by end December we want to make it -209 Bn.
The net official international reserves US$ -3 Bn 540,000. By end December we want it to be -1 billion 592,000.
Net credit to the government of the CBSL Rs. 2 Trillion 834 billion. By end December it should be 2 Trillion 740 Billion.
The Stock of expenditure arrears of the Central government 2022 60 Billion it will be 30 billion.
Central government tax revenue flow 2022 it was 1 Trillion 751,000 end March it was 650 billion but I must say we have fallen short in some areas such as Customs because the imports have been reduced, but on other had we have increased direct Taxation. The tax revenue finally the target for the end of the year is 2.9 billion.
Social spending by the central government 142 billion by 2022, 187 Bn by end of 2023. The Treasury guarantees ceilings was 1.159 Trillion last year and it will go up to 1 Trillion700 Bn.
I would like to tell you the Structural Benchmarks required for macroeconomic adjustment.
• Parliamentary approval of the new Central Bank Act which will be tabled in parliament next month –
• Completion of the asset quality review component of bank diagnostic exercise for the two largest state-owned banks and the three largest private sector banks
• Parliamentary approval of the welfare benefit payment scheme and the application of the new eligibility criteria to identify low-income families for receiving welfare benefit payments – End of May
• Cabinet approval of a comprehensive strategy to restructure the balance sheets of the CEB, CPC, Sri Lankan Airlines, and the Road Development Authority – End-JUNE
• Cabinet approval of a full revision of the Banking Act – End-JUNE
• Enact new anti-competition legislation to harmonize it with the United Nations Convention against Corruption, pending comprehensive asset recovery provisions. it is a new anti-corruption legislation – End-JUNE
• Cabinet approval of revenue measures to support fiscal consolidation during 2024 – End-JULY
• Development by the CBSL of a roadmap for addressing banking system capital and Foreign exchange liquidity shortfalls and intervening in banks assessed to be non-viable – End-JULY
Completion of the rollout of the ITMIS, expanding its coverage to all 220 heads – End-SEP
Publication of the report of an IMF-led governance diagnostic technical assistance mission to assess Sri Lanka’s anti-corruption framework – End-SEP
Submission to Parliament for the first reading of the 2024 Appropriation Bill – End-OCT
Determination by the MOF of the size, timing, instruments, and terms and conditions for potential government recapitalization of viable banks which are unable to close capital shortfalls from private sources – End-OCT. 2023
Parliamentary approval of the 2024 Appropriation Act and the spending allocations in line with program parameters – End-DEC. 2023
Submission to Parliament of a new PFM law that will authorize the budget formulation process, roles and responsibilities of relevant agencies, and information and accountability requirements – End-DEC. 2023
Improve the Bulk Supply Transaction Account (BSTA) to accurately measure the electricity subsidy, and start using it to determine the cost recovery based electricity tariff and government transfer requirement – End-DEC. 2024
Parliament approval of a full revision of the Banking Act – End-DEC. 2023
Set retail fuel prices to their cost-recovery levels with monthly formula based adjustments, and compensate the CPC for providing any fuel subsidies with on budget transfers – Continuous
Adjust the end-user electricity tariff schedule to its cost-recovery with semi-annual formula-based adjustments on a forward-looking basis in January and July each year – Continuous
The last one is Achieving Debt Sustainability
• Debt stock: Public debt should decline below 95 per cent of GDP by 2032
• Post-programme gross financing needs: average annual gross financing needs of the central government during 2027- 32 should remain below 13 per cent of GDP compared to 34.6% in 2022
• Post-programme foreign exchange debt service: annual foreign exchange debt service of the central government should remain below 4.5 per cent of GDP in each year over 2027-32 compared to 9.4% in 2022
• Programme financing gaps: debt service reduction during 2023-27 should be sufficient to close external financing gaps.
Under staff baseline scenario, US$17 billion in debt service reduction is required, including the arrears accumulated in 2022
So we are trying to get a 17 billion debt reduction on that side. Do you want it or not. Are we going in for debt restricting? We can’t manage without debt restructuring. That is what I want to make it clear to all the members.
However stability alone is not enough for us. In actuality, the nominal GDP for 2019 was just $89 billion during this period. The gross domestic product will be the same in 2028 as it was in 2019. If we stay with the growth rate of 3%, we can lose the national income of nine years. If we maintain the current growth rate of 3%, we may lose nine years of national revenue. Furthermore, it has been predicted that the Sri Lankan GDP will decrease by around 3% in 2023.
Economic positivity will likely be confirmed in the fourth quarter of 2023. If the economy grew at least 3% or 7% each year starting in 2019, our GDP would be worth 110 billion dollars. But if we go to 5%, it will be 130 billion dollars. In fact we believe we will be able to reach 3% or 4% in the first two to three years.
Following that, we must aim for a growth rate of at least 6% to 7% over this time period. That should be agreed upon by everyone in this House. However, this may be done at 7% or 8%. We have opportunities for that. That is why we are restructuring the entire legal system. Some regulations have to be removed. Some people wonder why corporations are being sold. They can be better run by the private sector. We leave them to the private sector.
In addition, various restrictions have been imposed for 25 to 30 years, depending on the preferences of each ministry. Let us now look at the economy and decide which limits will be retained and which will be lifted. A highly competitive social fair market system is required. We require a green economy. The economy must be digitalized. There are several activities available for this. Agriculture is being modernized, and new industries are being introduced. That is something I will address separately.
We have no other option but the IMF agreement. There have not been alternative suggestions. If there is no other alternative, let’s approve this. I also urge the opposition to work together. Let’s get both parties together and pass this.
Representatives of the International Monetary Fund visit our country every six months. Therefore if there are any shortcomings, we may address them and find a solution. Trade unions have highlighted concerns about taxation. All of these people will discuss and come up with a solution, and then we will all join together and develop a single national policy framework.
What is the country’s national policy framework till 2048? There are policies and initiatives in place for the first five years. Let’s discuss them. There is a national assembly. In particular, there are other committees. Let’s make the entire parliament a government to implement this program. Let’s get together for this. There may be differing viewpoints. However, everyone must back this initiative.
Now we have to build the country for 2048. If we do not accomplish this, we would be betraying the country’s youth. Their future has been destroyed. Think about the youth of the country. Don’t just think about grabbing power only. If this program is not done, none of us will be able to survive in another two or three years. So I urge everyone to come together to approve this. After that we will come together and prepare the set of policies required until 2048. I also, urge you to provide support to implement the program during the next five years.
Colombo (LNW): Showers or thundershowers will occur at several places over most parts of the island after 2.00pm, and fairly heavy showers above 75 mm are likely at some places in Western, Sabaragamuwa and North-western provinces and in Galle and Matara districts, the Department of Meteorology said in a statement today (27).
Showers may occur in the Eastern province and in coastal areas of the southern province during the morning too.
General public is kindly requested to take adequate precautions to minimise damages caused by temporary localised strong winds and lightning during thundershowers.
Marine Weather:
Condition of Rain:
Showers or thundershowers will occur at several places in the sea areas around the island.
Winds:
Winds will be north-easterly to easterly over sea area around the island and wind speed will be (20-30) kmph.
State of Sea:
The sea areas around the island will be slight to moderate. Temporarily strong gusty winds and very rough seas can be expected during thundershowers.
President Ranil Wickremesinghe says Domestic Debt Re-structuring will not be suspended even if banking services and stock market collapse: asks banks to take over responsibility and carry forward the economy: warns he will close the stock market if it collapses.
Mass Media Minister and Economic Guru of SLPP Dr Bandula Gunawardena says it will not be possible to re-structure the foreign debt without re-structuring the local debt: outlines the massive borrowing of USD 12.5 bn during the period 2015 to 2019.
Former Minister Wimal Weerawansa says the US controlled Gotabaya Rajapaksa and the “Aragalaya”: also says when GR decided to flee the country, India and US wanted him to fire PM Wickremesinghe before announcing his resignation: opines Wickremesinghe’s residence may have been set on fire to put him down mentally and force him to resign: further says the US Ambassador has requested the Speaker to take over the Presidency following the resignation of GR.
Former President Maithripala Sirisena alleges Cardinal Ranjith is “impatient” with the investigations into the Easter Sunday attacks: also says the Cardinal is only keen to send him (Sirisena) to the gallows: adds many countries have taken 10 to 15 years to conclude similar terrorist attack investigations.
Controversy erupts over 7 Senior Deputy Inspectors General of Police, including L S Pathinayake, Ajith Rohana, S C Medawatte and Priyantha Weerasooriya being transferred with immediate effect.
Industry insiders say more fintech start-up firms are relocating to other countries to overcome funding issues and other red tape in doing business: add that the “Fintech sandbox” which is a framework set up by the Central Bank to allow small-scale, live testing of financial innovations by private firms in a controlled environment under the regulator’s supervision, has not done much to the industry.
Transport Minister Dr Bandula Gunawardena says the structure of an “Authority” is more suitable to provide an efficient service to the public and generate enough revenue to keep a public service commercially afloat in a sustainable manner: asserts a Railway authority will generate enough revenue for the government to run the railway operations across the country at a profit within 2 years.
CB Governor Nandalal Weerasinghe says Sri Lanka has decided to allow Indian tourists to make payments in Indian Rupees: expresses support to link digital payment interfaces between the 2 countries.
Ambassador of China Qi Zhenhong hands over the new Out-Patient Dept building with 8 stories & 50,000 square feet, to the National Hospital: Minister of Health Keheliya Rambukwella says China decided to donate the project in response to a request by former President Mahinda Rajapaksa during his term as Head of State: also says the project is the largest ever, single grant by China.
International Chess Master Susal de Silva of Nalanda College and Women Candidate Master Dahamdi Sanudula of Musaeus College emerge champions at the Sri Lanka Open and Women’s National Chess Championships: it’s Susal de Silva’s 3rd consecutive year as National Champion.
Colombo (LNW): The United States State Department has banned Wasantha Karannagoda, Governor of the North-Western Province and former Navy Commander, from entering the US Soil, levelling up allegations of human rights violations committed in his capacity as the Navy Commander during the plight of war.
Karannagoda and his wife Srimathi Asoka Karannagoda are banned from entering the US.
Colombo (LNW):The Government has begun preparation work on a master plan for developing Nuwara Eliya to preserve the scenic beauty and ban the construction of buildings above four storeys in the major tourist city.
The move aims to put an end to the unplanned spreading out of buildings in Nuwara Eliya which is included in the Government’s New Town Development Plan and Nuwara Eliya Tourism Plan.
“President Wickremesinghe in his recent visit to Nuwara Eliya emphasized the importance of developing the district as a striking city that can attract tourists throughout the year.
He also insisted on plans prioritizing to create a pleasant environment for tourists to relax rather than focusing on constructing large and tall buildings,” Cabinet Co-Spokesman and Minister Bandula Gunawardena said at the post-Cabinet meeting media briefing yesterday.
He said the Cabinet of Ministers approved the appointment of a task force to come up with the Master Plan for Nuwara Eliya and to limit the construction of new buildings above four storeys in the Nuwara Eliya district from 1 May.
The task force will be headed by the Governor of the Central Provinces under the coordination of the President’s Office with the contribution of all relevant parties.
The Urban Development Authority has been given authority to issue required regulations stipulated by its Act.
The Cabinet has noted that the beauty of the city of Nuwara Eliya is gradually decreasing due to the improper development that is being carried out in the Nuwara Eliya area and it has greatly affected the tourism industry.
Therefore, the need to prepare a detailed tourism development master plan has arisen in order to create the necessary environment for the growth of tourism in the area, a statement on the cabinet decisions said.
Accordingly the cabinet of ministers has approved the proposals tabled by the President to prepare the Nuwara Eliya Tourism Development Master Plan under the coordination of the Presidential Secretariat with the involvement of all relevant parties.
Furthermore, the cabinet approval has been granted to appoint a task force headed by the Governor of the Central Provinces to regulate the construction of new buildings and to impose regulations in accordance with the provisions of the Urban Development Authority Act.
Colombo (LNW): Sri Lanka has improved its position to 73 out of 139 countries in the latest global Logistics Performance Index (LPI) compiled by the World Bank, up from 92nd place in the previous assessment made in 2018.
Sri Lanka has an LPI score of 2.8 in the 2023 index released last week whilst in the list the score was 2.65. Sri Lanka has been ranked at number 73 along with Argentina, Montenegro, Rwanda, Serbia, and Solomon Islands.
In terms of infrastructure, Sri Lanka’s ranking improved to 89th place from 104; as per logistics competence and quality the country was ranked at number 81st up from 85th; 59th in terms of timeliness up from 113th and in tracking and tracing .
Sri Lanka was 65th up from 81st and in international shipments Sri Lanka rose to 75th as against 108th in 2018 ranking. In terms of customs, Sri Lanka has slipped to 84th position from 77th place reinforcing the need to reform and overhaul archaic procedures and regulations.
Singapore tops the ranking up from 5th place from the previous report compiled in 2018 and displaced Germany from the top slot. Finland was ranked second whilst Denmark, Germany, Netherlands and Switzerland are group as third rank.
UAE (up from 14th place), Hong Kong figure as 7th ranked along with Austria, Belgium, Canada and Sweden.
The World Bank’s LPI is a measure of countries’ ability to move goods across borders with speed and reliability.
The seventh edition of Connecting to Compete, the LPI Report comes after three years of unprecedented supply chain disruptions during the COVID-19 pandemic, when delivery times soared.
The LPI measures the ease of establishing reliable supply chain connections and the structural factors that make it possible, such as the quality of logistics services, trade and transport-related infrastructure, and border controls.
“Logistics are the lifeblood of international trade, and trade in turn is a powerful force for economic growth and poverty reduction,” said World Bank Trade, Investment and Competitiveness Global Director Mona Haddad.
“The Logistics Performance Index helps developing countries identify where improvements can be made to boost competitiveness,” Haddad added.
The LPI 2023 Report said on average across all potential trade routes, 44 days elapse from the time a container enters the port of the exporting country until it leaves the destination port, with a standard deviation of 10.5 days. That span represents 60% of the time it takes to trade goods internationally.
According to LPI 2023, end-to-end supply chain digitalization, especially in emerging economies, is allowing countries to shorten port delays by up to 70% compared to those in developed countries. Moreover, demand for green logistics is rising, with 75% of shippers looking for environmentally friendly options when exporting to high income countries.
“While most time is spent in shipping, the biggest delays occur at seaports, airports and multimodal facilities. Policies targeting these facilities can help improve reliability,” said World Bank
r. Such policies include improving clearance processes and investing in infrastructure, adopting digital technologies, and incentivising environmentally sustainable logistics by shifting to less carbon-intensive freight modes and more energy-efficient warehousing.
Colombo (LNW): Making Sri Lanka’s long delayed ambitious forex raising endeavour a reality, the Colombo Stock Exchange (CSE) has introduced the initiative of listing and trading of Green Bonds for the first time in the Sri Lankan stock market, with effect from 25th April 2023.
Under the Green Bonds concept, proceeds are invested exclusively in green projects that generate climate or other environmental benefits.
Among these projects are renewable energy, energy efficiency, sustainable waste management, sustainable land use (forestry and agriculture), biodiversity, clean transportation, and clean water.
The Government was planning to issue green bonds in July 2022 in order to raise US $ 2 billion under forex raising initiative of former CB Governor Ajith Nivard Cabraal prior to the declaration of preemptive debt default by present Governor Nandalal Weerasinghe on 12 April 2022, official and media reports revealed.
This plan to issue $ 2 billion in green bonds around July 2022 had been in the pipeline, but was postponed following the sudden decalation of preemptive debt default but its still on the cards
Green bonds are fixed-income Government securities issued under the promise of using the capital raised to wholly or partly finance projects and activities promoting a broad range of environmental objective
During Mr Cabraal’s tenure as CB Governor Sri Lanka had been seeking to issue $ 1 billion worth of green bonds in July 2022 and another $ 1 billion in September 2022.
This was part of over $ 10 billion in inflows targeted during 2022, not inclusive of the inflows targeted under the previous six-month plan, which largely failed to materialize following debt default.
According to the CSE statement, the objective of enabling regulations for the issue of green bonds in the Sri Lankan stock market is to facilitate Sri Lankan corporates to raise capital.
It will be used for green projects and to foster greater transparency and accountability in the use of proceeds from the Green Bond, and to ensure reporting of the impact of the green projects for which the proceeds of the bond was used.
The Green Bonds will have the same features of a Corporate Debenture and will be listed on the Debt Market segment of the CSE.
The main difference between a Corporate Debenture and a Green Bond is the usage of the proceeds.
In a Green Bond, the proceeds have to be exclusively used for financing or refinancing in part or in full, new or existing eligible green projects which are aligned with at least one international Green Bond standard set out above.
The Green Bonds will be traded on the Automated Trading System (ATS), similar to Corporate Debentures. The trading parameters currently applicable to Corporate Debentures will also apply to Green Bonds as well, CSE officials said.
The potential issuers of Green Bonds are any public company incorporated under the Companies Act and any statutory body established/incorporated under a statute.
Colombo (LNW):The World Bank (WB) has pledged support to Sri Lanka under its Development Policy Financing Program while the Asian Development Bank (ADB) has agreed to provide a special loan and grant pouring millions of dollars into treasury coffers.
These two financial mobilizations amounting to US$501 million strengthen the country’s foreign reserves are to be received by the treasury as an immediate response of international financial agencies following the unlocking of $ 3 billion IMF Extended Fund Facility recently, two Finance Ministry top officials confirmed.
The World Bank will extend a $ 150 million grant to strengthen the financial sector of Sri Lanka.
The Government said in line with the International Monetary Fund’s (IMF) Extended Funding Facility (EFF) Program, the country has implemented a comprehensive economic stabilization and recovery program with necessary reforms to address macroeconomic challenges.
Discussions have been held with the World Bank in regard to obtaining loan facilities of the bank for Sri Lanka Deposit Insurance and Liquidity Support Scheme under Sri Lanka Financial Sector Security Network Project, finance ministry official said.
The proposed loan amount of $150 million is expected to be used to strengthen the financial and institutional capacity of the Financial Safety Network targeting the Deposit Insurance Scheme with the aim of increasing the strength and efficiency of the financial sector.
This can preserve stability and lead to the resumption of a good financial intermediary system,”he added.
The Cabinet of Ministers at its meeting on Monday approved the proposal tabled by President Ranil Wickremesinghe as the Minister of Finance, Economic Stabilization and National Policies, to proceed with further activities to obtain the World Bank grant
Sri Lanka will get support from the World Bank Development Policy Financing Program, to support the on-going economic stabilization and recovery process.
The Government said in line with the International Monetary Fund’s (IMF) Extended Funding Facility (EFF) Program, the country has implemented a comprehensive economic stabilization and recovery program with necessary reforms to address macroeconomic challenges.
“The World Bank has agreed to support the program through its Development Policy Financing Program and will provide its support based on the 3 key areas of economic governance transformation, growth and competitiveness improvement, and protection of the poor and vulnerable,” another senior official said.
The President has already directed the treasury officials to carry out the entire coordination process of the proposed World Bank program by the Presidential Secretariat and to authorize the Department of Foreign Resources to conduct negotiations with the World Bank in relation to obtaining the relevant funds.
In the meantime the ADB will provide a special loan facility of $ 350 million based on policies and another loan grant of $ 1.5 million as technical assistance in order to strengthen the stability and administration.
The Cabinet of Ministers on Monday at its meeting approved plans to obtain new financial and technical support from the Asian Development Bank (ADB) to aid the on-going recovery from the economic crisis.
The Government said parallel to the comprehensive funding facility approved by the International Monetary Fund (IMF), the Asian Development Bank has agreed to provide a special loan facility.
Accordingly, the Cabinet of Ministers approved the proposal furnished by President Ranil Wickremesinghe as the Minister of Finance, to entrust the responsibility to the Ministry Secretary for processing the further activities on obtaining the relevant loan.
