- Increase of Central Bank holdings of Treasury Bills (money printing) under Governor Weerasinghe registers a massive Rs.995 bn in 11 months: up from Rs.1,730 bn on 5Apr22 to Rs.2,725 bn by 15Mar23: a staggering Rs.121 bn “printed” on 15Mar23 alone.
- Several Tamil politicians and civil society representatives seek audience with the Mahanayake Theras on the full implementation of the 13th Amendment: group to be led by TMTK MP C V Wigneswaran.
- Govt Printer Gangani Liyanage says the printing of ballot papers for the postal voting of the upcoming LG election is stopped as required funds are yet to be received from the Treasury: says she intends to inform this in writing to the Elections Commission.
- LKR dips further from 344.68 to 346.33 against the USD: so far, the LKR has plummeted by Rs.20.81 (6.4%) in just 6 days in spite of CB Governor Weerasinghe’s remarks that the LKR will strengthen: “grey market” quotes LKR at over Rs.375.00 per USD: many analysts expect the LKR to weaken further.
- GMOA Secretary Dr Haritha Aluthge says the GMOA has received a letter from the Presidential Secretariat that the President will present the Personal Income Tax proposals by Trade Unions to the IMF at the 1st review of the EFF.
- Western Province Senior Deputy Inspector General Deshabandu Tennakoon to be appointed as the 36th Inspector General of Police: current IGP C D Wickramaratne due to retire on 25th March.
- National Institute of Mental Health Director Dr Rohan Ratnayake says a suicide takes place in Sri Lanka once every 4 hours: also says 2,833 men & 574 women committed suicide in 2022: further says the number of suicides amongst apparel factory employees has increased.
- SLPP rebel MP and former SEC Chairman Dr Nalaka Godahewa says the week long appreciation of the LKR was a “joke”: queries how a bankrupt country which is in a serious contraction could have a currency that is appreciating.
- CB Governor Nandalal Weerasinghe rejects appeal by Vehicle Importers Association to grant permission to resume vehicle imports: vehicle imports have been restricted since March 2020 due to the forex shortage, but the CB Governor has claimed recently that large amounts of Forex has been received by the Central Bank.
- Sri Lanka suspended from voting during FIFA elections when nearly 2,000 delegates including top football executives from the world football governing body met in Kigali for the long-awaited 73rd FIFA Congress.
Sri Lanka Original Narrative Summary: 17/03
Showers to be expected in Western, Sabaragamuwa and North-western provinces
Showers or thundershowers will occur at a few places in Western, Sabaragamuwa and North-western provinces and in Galle and Matara districts during the afternoon or night.
Several spells of light showers may occur in the coastal areas of the Batticaloa, Ampara and Hambanthota districts.
General public is kindly requested to take adequate precautions to minimize damages caused by temporary localized strong winds and lightning during thundershowers.
Chinese Embassy donates material for police uniforms
The Chinese Embassy, yesterday (15), handed over a donation of material to the Government of Sri Lanka as a donation for the production of police uniforms.
The donation was made by the Ambassador of China to Sri Lanka, H.E. Qi Zhenhong, to the Minister of Public Security, Mr Tiran Alles. This donation was made at the Presidential Secretariat in the presence of President Ranil Wickremesinghe.
Chief of Staff and Senior Advisor to the President on National Security, Mr Sagala Ratnayake and Secretary to the President, Mr Saman Ekanayake, were also present at the event.
Re-implement the tax policy imposed by Mangala Samaraweera – Marikkar
Samagi Jana Balawega media chief, Member of Parliament SM Marikkar requests the government to re-implement the tax policy imposed by the then Finance Minister Mangala Samaraweera in 2019.
Marikkar said this while addressing a press conference held in Colombo yesterday (16).
Deshabandu Tennakoon 36th IGP of Sri Lanka Police?
Colombo (LNW): Senior Deputy Inspector General (SDIG) of Police Deshabandu Tennakoon has been nominated by President Wickremesinghe to be appointed as the 36th Inspector General of Police (IGP) of Sri Lanka Police, top sources divulged.
His promotion as the new IGP of Sri Lanka Police will come in filling the post to be vacant after the retirement of his predecessor Chandana Wickramaratne on March 20, 2023, according to sources.
StanChart Sees Opportunity for Sri Lanka Investors as IMF Deal Nears
- Bond levels on the shorter-end look good to buy: StanChart
- IMF to decide on much-needed $2.9 billion loan next week
Bloomberg: Foreign investors are likely to raise holdings of Sri Lanka government bonds, betting that a successful deal with the International Monetary Fund next week would unlock more funding to stabilize the nation’s finances, according to Standard Chartered Plc.
“The moment we have clarity on the debts, the restructuring process, the interest rates will fall and investors will want to time it right and get into the bond space pretty early,” said Bingumal Thewarathanthri, the chief executive officer for the UK bank in Sri Lanka.
Investors are expected to pile into local bonds, lured by one of the most attractive yields among emerging Asian nations, he said.
The IMF plans to decide on the $2.9 billion funding package next week after China earlier this month gave assurances that it will support the nation’s debt restructuring, clearing the biggest hurdle for approval. The nation grappled with soaring costs, depleted funds and severe supply shortages for much of 2022 as it pursued a loan program with the IMF after a debt default in May.
“You can’t wait until the debt restructuring is over, after that the price points will be very different,” said Thewarathanthri. Current bond levels on the shorter-end, mainly on t-bills look good to buy. If you’re looking at taking a stake in any of the larger corporates or banks, “this is the time,” he said. Sri Lanka’s one-year treasury bill yields about 26%, compared with around 7% for two-year notes in India and 6.38% for similar-maturity Indonesian bonds.
In efforts to secure the bailout package, Sri Lanka repurposed funds, tightened its belt and raised interest rates to the most since 2001. The nation fell into a deeper recession last quarter as borrowing costs at a two-decade high to rein in inflation took their toll on the $89 billion economy.
UK govt considers banning TikTok from govt phones
Sky News: TikTok is expected to be banned from UK government phones later today, Sky News understands.
Cabinet Office minister Oliver Dowden will make a statement to Parliament this afternoon on “the security of government devices”, where it is understood he will confirm the ban.
The Chinese-owned video-sharing app has been under increasing scrutiny over its security and data privacy, with concerns it could be used to promote pro-Beijing views or gather user data – something TikTok strongly denies.
The EU Commission and more than half of US states and Congress have already introduced a ban over concerns around potential cyber attacks.
Prime Minister Rishi Sunak has hinted at following suit, saying the UK will “look at what our allies are doing”.
Earlier this week, security minister Tom Tugendhat told Sky News he had asked the National Cyber Security Centre (NCSC) to look into the app as it was “absolutely essential” to keep the UK’s “diplomatic processes free and safe”.
The UK’s parliament shut down its own account last year after MPs raised concerns about the firm’s links to China.
But TikTok has called government bans “misguided and based on fundamental misconceptions”.
Responding to Mr Tugendhat’s remarks last week, a spokesman for the app said the company would be “disappointed” if the UK government banned it.
They added: “Similar decisions elsewhere have been based on misplaced fears and seemingly driven by wider geopolitics, but we remain committed to working with the government to address any concerns.”
2022 GDP growth rate negative: Census Statistics
By: Isuru Parakrama
Colombo (LNW): The year-on-year (y-o-y) Gross Domestic Product (GDP) growth for 2022 indicates a negative growth of 7.8 per cent, Census Statistics data revealed.
The Census report reveals estimated GDP at the current price and at constant (2015) price in the production approach and other macroeconomic indicators for the fourth quarter of 2022, from 01st of October to 31st of December.
The GDP for the year 2022 at constant price (2015) has declined to Rs. 12,017,849 million from Rs. 13,037,934 million recorded in the previous year.
The y-o-y GDP growth rate for 2022 is reported to be a negative growth rate of 7.8 per cent.
The setback has also affected the three main economic sectors of Agriculture, Industry and Service activities, leading to a decline of 4.6 per cent, 16 per cent and 2 per cent in order in 2022.
The GDP for Sri Lanka for the fourth quarter of the year 2022 at the constant price (2015) has declined to Rs. 2,917,721 million from Rs. 3,331,073 million recorded in 2021, registering a negative growth rate of 12.4 per cent.
Full report: http://www.statistics.gov.lk/NationalAccounts/StaticalInformation/Reports/press_note_2022q4_en
Sri Lanka to set up two floating solar power plants with Korean grant
Government is to embark on a floating solar project as it can potentially work well with hydro power generation. Any new power generation also requires new power infrastructure but if solar puts near hydro, the same power infrastructure can be used, a World Bank expert said.
Sri Lanka has many water bodies that could potentially be used for floating solar,” said World Bank Senior Water Supply and Sanitation Specialist Kristoffer Welsien.
The Cabinet nod has been granted to install two floating solar plants as a pilot project with 6.83 billion Korean Won funding from the South Korean government.
The Minister of Power and Energy Kanchana Wijesekera on Monday sought the approval of the Cabinet of Ministers to sign the discussion paper with the Korea Institute for Advancement of Technology and the Department of External Resources to start and implement the pilot project.
Under the Framework Convention on Grant Aid signed between the Republic of Korea and Sri Lanka in 2009, the Minister of Trade, Industry and Energy of the Republic of Korea has agreed to provide a grant amounting 6.83 billion Korean Won for the floating solar power project.
The implementation of a pilot project is aimed to install floating solar panel power plants with 1 MW capacity on the surface of Kiriibban Wewa reservoir and Chandrika Wewa reservoirs in the Ratnapura District.
Korea Institute for Advancement of Technology is acting as the monitoring agency for the pilot project on behalf of the South Korean government.
Sri Lanka needs to add an estimated 11,000 MW to its power grid within the next two decades to meet growing demand. Adding large-scale floating solar plants would not only make electricity greener and affordable but improve Sri Lanka’s overall economic competitiveness as well.
By identifying large water bodies for floating solar, Sri Lanka also can tap into the multiple benefits of lower evaporation, higher solar panel efficiency due to cooling effect, complementarity with hydro power generation and, efficient management of peak hours.
While environmental and social impacts need to be carefully studied and managed, strategic, and well-managed floating solar projects could also improve water quality by limiting algae growth.
The synergies from combining floating solar with existing hydropower plants can be significant and can add much-needed diversity to Sri Lanka’s power generation mix, the World Bank expert said.
Sri Lanka’s power mix could potentially benefit from greater solar power generation during the day and a switch to hydro in the night. Seasonally, floating solar could produce power during the dry months while throughout the monsoon rains hydro could play a larger role in the energy mix.
Sri Lanka has also trialled a small pilot floating solar project, but its capacity is just some tens of kW. Experts believe that to reap economies of scale and for floating solar to make a significant contribution to power generation, projects need to be scaled up to about 100MW-200MW.
UK launches its new trade preferences scheme in Sri Lanka
The UK Government has launched its new trade preferences scheme in Sri Lanka by holding a series of events in Colombo for the new trade preferences scheme – the Developing Country Trading Scheme (DCTS), which will come into force this year.
Total bilateral trade (goods and services) between the UK and Sri Lanka each year is £1.4bn between the UK and Sri Lanka each year.
Over 99% of goods exported from Sri Lanka were eligible for duty-free access to the UK and the £69million of tariffs saved on exports to the UK from Sri Lanka under UK trade preferences.
The Developing Countries Trading Scheme (DCTS) will replace the UK Generalised Scheme of Preferences and will come into force in 2023. Under the scheme, Sri Lanka is eligible for zero tariffs on 92% of products.
Over 150 additional products will be brought into scope of the new scheme, including milled grains, pet food products and dairy products.
“The UK’s new Developing Countries Trading Scheme provides Sri Lankan and UK businesses with a fresh opportunity to diversify and deepen supply chains and reduce the cost of exporting to the UK.
The UK government hopes businesses will take advantage of the great opportunities we have highlighted through our events this week,” British High Commissioner Sarah Hulton OBE said.
The main event was organized in partnership with the Council for Business with Britain –the UK-Sri Lanka bilateral trade association.
UK officials showcased high potential value chains and products that can benefit from the new scheme.
This was based on research into UK retailers’ and consumers’ buying considerations, as well as insights from Sri Lankan producers, trade programmes and policymakers.
While Sri Lanka exports numerous high value products to the UK including textiles, tea and rubber, there has been a steady decline in trade volumes between Sri Lanka and the UK since 2018.
Under UK trade preferences, Sri Lankan exports will benefit from generous tariff cuts and new products will be brought into scope, facilitating access to the UK market for Sri Lankan businesses across a wide range of industries.
“The Developing Countries Trading Scheme will support businesses by giving them the tools to export duty-free to the UK, opening up markets and boosting consumer choice.
The new scheme has been designed to grow free and fair trade with 65 countries, including Sri Lanka, thereby creating jobs and boosting their economies.
The DCTS offers one of the most generous sets of trading preferences in the world and demonstrates the UK’s commitment to building long term, mutually beneficial relationships with countries like Sri Lanka.
During the visit to Colombo, DCTS officials also met the Minister of Trade, Commerce, and Food Security, Nalin Fernando.
They additionally delivered further information sessions and engagements in partnership with the Ceylon Chamber of Commerce, Department of Commerce, EDB, and BOI, Joint Apparel Association Federation, European Chamber of Commerce Sri Lanka, AmCham Sri Lanka, and Rotary International.
The sessions focused on sharing insights including current trends, UK market purchasing criteria, barriers to trade and what can be done to unlock Sri Lanka’s trade and investment potential.