By: Isuru Parakrama

Colombo (LNW): A number of low-lying areas in the Matara and Galle districts have severely been affected by flooding caused by the overflowing of Nilwala and Gingganga rivers due to adverse weather conditions yesterday (14).

Low-lying areas of Thawalama, Neluwa, Morawaka, Akuressa, Athuraliya, Pitabeddara and Kotapola have been inundated by the flooding, correspondents said.

Traffic was disrupted on the Deniyaya – Akuressa route due to the collapse of several mounds, and bus services were also temporarily suspended.

A similar situation followed in Alapaladeniya of Neluwa – Morawala route, disrupting traffic.

The Akuressa – Thawalama main road was inundated in Thangalla area.

Meanwhile, traffic was disrupted in Mapalagama – Malamura route due to the flooding caused by the overflowing of Gingganga river.

In the backdrop, electricity was also disrupted in a number of areas including Thawalama, Neluwa, Morawaka, Opatha and Weerapana.

During a recent press conference, Opposition MP Harsha de Silva warned against the potential risks of domestic debt optimization, stressing the need for extreme caution. De Silva cautioned that if not managed carefully, domestic debt optimization could become a burden rather than a relief for the economy.

Citing the net debt relief Laffer curve, de Silva stated that the more we increase the haircut on banks, the more likely we are to hit the curve’s negative impact zone, where debt restructuring becomes counterproductive, thus leading to a negative impact on the economy. Harsha provided another example of this phenomenon: taxes on wine and spirits. High taxation has resulted in a drop in consumption, which, in turn, has substantially reduced the expected revenue for the Excise Department. Therefore, de Silva emphasized that the risk of capital adequacy in banks could result from debt optimization, which is when a bank’s capital falls below the recommended levels, raising questions about its stability.

Harsha emphasized the need for discussions on this complex issue to occur in the Committee on Public Finance. By summoning relevant officials and utilizing data to work the numbers, the committee could help avoid potential blame down the road.

Furthermore, Harsha proposed the establishment of a Financial Sector Support Fund to ensure macro-stability. He suggested that multilateral organizations like the World Bank and ADB would lend money to establish this fund, as over 1 billion dollars would be needed.

Another issue raised by Harsha concerns the Employees Provident Fund (EPF), where hard-earned people’s pension money lies. Harsha questioned whether the EPF, established to provide positive real interest rates, as envisioned by Minister Illangaratne when bringing in the act, had fulfilled its mandate. Harsha believes that people ought to get a positive interest rate that has been adjusted for inflation, as opposed positive nominal interest rate. However, as per current statistics, this has not been the case. The real interest rate has been declining since 2015, with the rate being -47.2% in 2022. The EPF has already been subjected to a 32% haircut in US dollar terms, as the value of the fund in 2021 was $15.8 billion, and by the end of 2022, it was $9.5 billion due to the rupee crashing and the impact of inflation. Harsha proposed that if the interest rate given to the recipient is less than 2.5%, the Central Bank should be given a loan from the Treasury to give the recipients a minimum of 2.5% interest. Harsha hopes that this proposal would be discussed in Parliament and that necessary legislation would provide relief to the already suffering middle class.

Harsha reiterates support for the IMF program but suggests tweaking it to make it more bearable for the people. Additionally, if Sri Lanka needs to undergo domestic debt restructuring, Harsha proposes extending a warrant, a domestic debt restructure warrant, in other words, a derivative or put option, to creditors subjected to domestic debt restructuring. Harsha suggests that since the government has promised the people stability and an increase in GDP growth to 3% by 2027, the people have agreed to tough measures like high taxes and a reduction in subsidies. Therefore, if the economy grows beyond expectations, the extra growth should be extended to the people to honor their sacrifices. Harsha expressed support for establishing discussions on this topic. Finally, the SJB believes that the government ought to treat both foreign and domestic creditors equally and non-discriminately, with the primary goal being to stabilize the country’s debt while minimizing its impact on the EPF and banks.

By: Isuru Parakrama

Colombo (LNW): Intensified by rainy conditions, a major increase in the number of dengue cases can be expected in Sri Lanka, and the record in 2023 so far is three times higher than that of the corresponding period of the last two years, revealed Deputy Director of Medical Services Dr. G. Wijesuriya.

The majority of cases are from the Colombo and Gampaha districts, and the people are advised to take measures such as destroying habitats available for mosquitoes, using mosquito repellents, not letting water stagnate and wearing protective clothing, Dr. Wijesuriya told media.

He added that a total of 45 children are currently receiving treatment for dengue at the Lady Ridgeway Children’s Hospital, and a majority of children infected are between the ages 05 – 14.

Despite any congestion being non-existent in normal hospital wards, minor congestion could be observed at Intensive Care Units in several hospitals, he went on, adding that in the case of children, there are several children being treated for dengue haemorrhagic fever.

By: Isuru Parakrama

Colombo (LNW): Public servants will be required to resume the scanning of their fingerprints, a logging system that was suspended on January 3, 2022 due to the Covid-19 pandemic, starting from Monday (15) as a mandatory move.

Accordingly, public servants will be required to scan their fingerprints when reporting for duty and leaving the offices.

The system that was suspended last year has been reactivated now, and therefore, it will be mandatory for state sector employees to log in, starting from Monday.

Foreign Minister Ali Sabry during his visit to Stockholm to participate in the 2^nd EU – Indo Pacific Forum, had cordial bilateral discussions with his Swedish counterpart Tobias Billström, committing to strengthen engagement in all spheres of the bilateral relationship.

While recalling the decades-old, multi-faceted, partnership between the two countries and peoples, the two ministers agreed to suitably commemorate in 2024, the 75th Anniversary of diplomatic relations, which were established in 1949.

Ministers Sabry and Billström discussed all areas which straddle the long-standing engagement, including in the political, economic, development spheres.

The two ministers placed strong emphasis on economic cooperation between the two countries, and agreed to work together in several areas, including investment, trade, IT, climate and environment.

Foreign Minister Sabry briefed his Swedish counterpart on the trajectory of the economic recovery, following the Extended Fund Facility (EFF) with the IMF. He appreciated Swedish support within the Paris Club, during the IMF negotiations with Sri Lanka.

Discussions on the economic relations focused on improving trade, diversifying production bases for Swedish supply chains, further enhancing business linkages in the IT sector, manufacturing, tourism, and investment particularly taking into account Sri Lanka’s strategic location and the emergence of the financial hub within the Colombo Port City.  He also spoke of the opportunities for diversification of supply sources for Swedish and global supply chains.

The Sri Lankan Minister also briefed the Swedish side on the progressmade in the reconciliation process, including the significant steps taken on judicial and legislative reform, release of land and highlighted the importance of economic advancement, and livelihood sustenance in the process. Discussions also focused on early the convening of the bilateral political consultations. 

The two Ministers also exchanged views on international developments, including their impact on economic stability and progress in different parts of the world.

At the second EU-Indo Pacific Ministerial Forum Minister Sabry co-moderated the 1^st roundtable discussion on “Building more sustainable & inclusive prosperity together” and will continue his bilateral consultations with several other visiting European and Asian countries on the sidelines of the main forum.

Embassy of Sri Lanka

Stockholm

14 May 2023

By: Staff Writer

Colombo (LNW): Despite the decision to slash the price of milk powder by Rs. 200 per kilo with effect from May 15, the existing price will remain till May 23, as there is a delay in shipments, announced the Milk Powder Importers Association.

Accordingly, with the new shipments, the price reduced milk powder packs will be distributed from May 23, said Union member Prof. Lakshman Weerasuriya.

Earlier, a decision was taken to slash the prices of imported milk powder by Rs. 200 per kilo following discussions between Trade Minister Nalin Fernando and milk powder importers.