The World Bank Country Manager in Colombo, Chiyo Kanda, called on the Minister of Foreign Affairs Prof. G.L. Peiris at the Ministry of Foreign Affairs on 27 May, 2022.
Minister Peiris sought assistance from the World Bank until long term assistance materializes through the IMF, other international institutions and donor countries. The Minister highlighted the severity of the challenges in reducing the budget deficit at the forthcoming budget. The Minister stated that short term financial assistance from the World Bank would be appreciated until sustainable solutions are found.
The World Bank Country Manager stated that her office is also working with other organizations such as ADB, Asian Infrastructure Investment Bank (AIIB), and UN office and encourages them for ‘re-purposing’ their already committed projects to help the people of Sri Lanka at this difficult time. She said that the World Bank will disburse approximately USD 700 Million to Sri Lanka within the next few months.
The Colombo Magistrate’s Court today (30) adjourned the hearing of a case filed against six persons, including former Minister Wimal Weerawansa, until August 29.
The Cinnamon Gardens Police have filed a case against the then UN High Commissioner for Human Rights, against him, for obstructing public protests by blocking roads around the UN office in Colombo during Prince Seyed Al Hussein’s visit to Sri Lanka in 2016.
Jayantha Samaraweera, Mohamed Muzammil, Weerakumara Dissanayake, Piyasiri Wijenayake and Roger Seneviratne, who were prominent figures in the NFF led by Wimal Weerawansa, have been named as the other accused in the case.
A news item says Gotabaya Rajapaksa on Saturday assured Governor Nandalal Weerasinghe that the Central Bank will be fully supported to conduct its duties independently. He gave this assurance during a meeting with CBSL and Monetary Board member Sanjeewa Jayawardena. According to the news item “The President fully assured them that the Governor and the Monetary Board has his fullest and unqualified assurance of freedom to discharge their functions independently and without any extraneous constraints,” .
This is the same team, the President lambasted one year ago saying CBSL should do their job or go home. Nandalal led the team. He said “ please allow me to sleep”. Now 12 months later he is singing another song. In fact, the Bond report found Nandalal guilty of neglecting his duty. The President should read the report now that he has the time. The President has now appointed a Finance Minister who knows the subject very much more than than him.
Moreover, under the leadership of the President the country for the first time in history, was made bankrupt. What more Mr President, the IMF Managing Director has said publicly the country is in this sad plight due to the mismanagement of the government. The country is in such a precarious situation Mr President now to play politics and leave it in the hands of Nandalal.
His four text book decisions has only aggravated the situation further, rather than easing the burden of the people, the decisions have heaped more burdens on the people. This is now become a humanitarian crisis. Most people can now only afford to have 1 meal a day. Nandalal should fix it or take the responsibility for a potential food riot, if he continues to take the high road. He should talk less and do more. Unlike Nandalal, most Sri Lankans don’t have PR in Australia to run to in a crisis. The President, Prime Minister and the Governor and their back street boys will have no where to run if another riot breaks out due to food shortages . Hunger makes people desperate .
CBSL Actions
The Governor’s decision to double the interest rates have killed several small business and finished their livelihoods. The rich and the financial institutions are merry making by investing in treasury bonds at 20+%.
His decision to shut the open account that was keeping the flow of low end consumer items was shortsighted. No goods have been ordered post 10 th of June according to sources. There will be soon a food crisis and no incomes. His war with the Havala has resulted in remittances dipping significantly. The worst thing was defaulting on $78 million . Did the CBSL consult the stakeholders before doing this? He has virtually shut all the funding lines for the country.
This is the worst decision next to defending the LKR and floating it subsequently by the previous two governors . Nandalal without projecting himself like a savior to the President, who understands no economics , should stand up to scrutiny and act as a public servant instead of following the former Governor who was anyway a politician. 60% of the people are steadily becoming destitutes, thanks to the decisions of our bureaucrats and politicians who operate at 30,000 feet. It is simply not fair to destroy the livelihoods of hardworking Sri Lankans, who have no where to go like the President, Basil Rajapakse or Nandalal Weerasinghe. Only the gods can save Sri Lanka the way we are going.
Following is an action plan to generate an additional inflow of $ 8 billion per annum from 12 key strategies. These 12 strategies do not incur an additional capital investment for the Government.
1) Increase foreign currency bank deposits by $ 5 billion within 5 years
• Issue a 10-year residence visa for foreign citizens who would deposit $ 100,000 in banks for 10 years in Sri Lanka.
• If this scheme is initiated, Sri Lanka can generate $ 5 billion worth of foreign currency deposits.
• To achieve the target of $ 5 billion in foreign currency deposits, 50,000 residence visas need to be issued within five years, each year 10,000 residence visas to be issued.
• An online application system and an online approval process should be in place for foreign currency bank account openings.
• An additional foreign currency deposit of $ 1 billion per annum can be secured by initiating this action item.
2. Extend the tourist visa validity period to 6 months to increase tourism revenue by 10%
• Permit the issuance of six-month valid tourist visas instead of one-month valid tourist visas.
• If the estimated tourism revenue is $ 4.5 billion, by introducing six-month-valid tourist visas, Sri Lanka’s tourism revenue can increase by 10%, which is an additional revenue of $ 450 million.
Sri Lanka has an annual shortage of inflows of $ 6 billion to accommodate basic needs such as fuel, gas, medicine, fertiliser, and food. By implementing the proposed 12 key strategies, an additional annual income of $ 8 billion can be generated as future cash inflows. It will be easier to build confidence in Sri Lanka’s macroeconomic stability and unlock international financing from International Financial Institutions such as International Monetary Fund, and World Bank, if additional cash inflows as suggested in the above action plan are generated to reduce the deficit in the balance of payments
3. $ 2.5 billion outflow from study abroad students to reduce by 20% and recover the current outflow of $ 2.5 billion by attracting more foreign students
• Currently, 35,000 new students are leaving the country for higher studies in a year. In addition, 70,000 students are already engaged in foreign universities for higher studies as 2nd or 3rd-year students.
• Since 105,000 Sri Lankan students have chosen foreign universities for their study purposes, there is a foreign currency outflow of $ 2.5 billion per annum.
• To reduce $ 2.5 billion outflow by 20% and to attract more foreign students, the below actions are to be taken:
a) Local private higher education institutions such as NSBM, SLITT, and E-Soft are to be established under the recognition of the University Grants Commission and to be recognised as private universities in Sri Lanka.
b) Offer tax holidays and other incentives for new private university establishments and existing small-capacity private universities for their expansions.
c) Global rankings of Sri Lanka’s public universities to be improved.
d) Introduce an International Education Strategy to attract more foreign students and under that, initiate a program named “Study in Sri Lanka” to attract foreign students to select Sri Lanka as their higher educational hub.
e) A task force should be formed and targets to be given to attract 35,000 foreign students to Sri Lanka via the “Study in Sri Lanka” program. This will mitigate the current outflow of $ 2.5 billion, which is a cause of 35,000 local students going abroad for higher education.
* An annual saving of $ 500 million can be achieved by initiating this project.
4. Introduce international student visas to earn foreign student fees and increase international education income
• Private higher education institutions such as NSBM, SLITT, CINEC, E-Soft, Horizon, and IIT should be allowed to enrol international students based on 3 to 4-year student visas.
• Following best practices of global student visas issued by countries such as Australia, New Zealand, Canada, UK, and USA, an online student visa application system should be introduced.
• Through this, 35,000 international student visas should be issued as a solution to the current outflow of $ 2.5 billion from 35,000 local study abroad students.
In order to increase monthly funds from $ 290 to $ 1,000, the unskilled labour force should be given the necessary qualifications and training, targeting foreign countries that offer high-salary jobs. With this implementation, Sri Lanka can earn foreign worker remittances of $ 24 billion per annum within a 10-year period
5. Increase foreign worker remittances from $ 7 billion (pre-COVID) to $ 24 billion per annum by forming a 10-year plan
a) Increase monthly funds sent by migrant workers from $ 290 to $ 1,000.
• Monthly, 2 million migrant workers on average send $ 290 to their families as funds during the pre-COVID period.
• In order to increase monthly funds from $ 290 to $ 1,000, the unskilled labour force should be given the necessary qualifications and training, targeting foreign countries that offer high-salary jobs. With this implementation, Sri Lanka can earn foreign worker remittances of $ 24 billion per annum within a 10-year period.
b) Due to COVID-19, the number of workers departing from Sri Lanka has decreased when compared to pre COVID-19 period. Form a committee to identify current challenges and find solutions to increase the number of workers departing from Sri Lanka.
c) Maintain Telegram groups per foreign country to improve conditions in the sector of foreign employment for Sri Lankan migrant workers.
• Invite all Sri Lankan migrant workers who are working/used to work in other countries to join the relevant country’s Telegram group.
• The main objective of this group is to collect the above segments’ views, and suggestions they might have for further improvement opportunities within Sri Lanka’s foreign employment.
• A dedicated team should be appointed by the Sri Lanka Foreign Employment Bureau to collect these ideas.
• On a weekly basis conduct meetings to take necessary actions to solve/find solutions to current challenges or to implement various new methods to develop this sector.
• This team should report to the Minister of Foreign Employment on a weekly basis, with the identified challenges and solutions given to those challenges.
• Sri Lankan foreign employment agencies should conduct monthly performance reviews on the number of foreign jobs they may have secured for Sri Lanka with the Minister of Foreign Employment.
d) Initiate a program for all Sri Lankan foreign missions based in various countries to find and share what are the most in-demand and highest paid jobs in their destinations. Ensure Sri Lankan migrant workers are placed at those destinations for high-salary jobs.
• For those jobs, develop teaching and training materials following global best curriculums.
e) Maintain another Telegram group to provide training and improve the skills of migrant workers.
• Short videos on subjects such as personal development, behavioural training, best grooming and hygiene practices, language training opportunities, customer service, etc. to share for all to access.
f) Conduct Government-sponsored workshops for foreign employment agencies in Sri Lanka to increase overseas job placement numbers for Sri Lankan migrant workers.
g) Start a website that would contain details of available global jobs for Sri Lankan migrant workers to access.
h) Develop the existing eldercare assistant vocational program and increase the number of eldercare assistant migrant workers to earn $ 1 billion inward worker remittances.
• Tertiary and Vocational Education Commission and the private sector should collaborate and create a plan to produce 100,000 migrant workers, as eldercare assistants targeting the Europe market.
• Necessary training should be given targeting a monthly salary of $ 1,200 or more for the migrant worker.
• Short courses that can be completed within 3 months’ time should be introduced under the eldercare assistant TVET program.
• For example, the University of Moratuwa, and DP Education launched a free online course on Trainee: Full Stack Development. The website to access the course is https://open.uom.lk
• Advanced Level bio stream students who are competent in the English language can be selected for this program.
• If 100,000 elder care assistants are produced who can receive a monthly salary of $ 1,200, Sri Lanka can earn $ 1 billion worth of inward worker remittances.
i) Identify all other on-demand overseas jobs, such as patient care assistants, drafters, bricklayers, air conditioning and mechanical services plumbers, and hairdressers, and create/update existing TVET curriculums targeting those on-demand jobs. Refer to other countries’ skilled migration occupation lists to identify more high-demand jobs.
j) Collaborate with employment agencies in other countries to find jobs for Sri Lanka migrant workers.
• Yearly, $ 1.3 billion savings can be made by initiating above mentioned activities.
6. Increase foreign direct investments
• Increase regional competitiveness by introducing tax holidays and other incentives.
• Appoint a committee to improve the rankings of,
a) Global Innovation Index
b) Corruption Perception Index
c) Global Competitiveness Index
7. Generate $ 5 billion from ICT earnings
• Existing State university-owned ICT, engineering, and programming degrees are to be made available for private education institutions to use and offer as external degrees for their students.
• Every six months, exams can be held following the procedures of State universities. Over a five-year period, 500,000 students should get educated and enter the IT industry.
• For example, the University of Moratuwa, and DP Education launched a free online course on Trainee: Full Stack Development. Website to access the course is https://open.uom.lk
• Public universities should also make their ICT related courses available online by 10 times, to increase the student enrolment numbers. This will lead to a high number of students getting ICT qualified and industry ready to enter the ICT field.
• As a result, ICT related earnings can reach up to $ 5 billion.
• An additional earning of $ 750 million per annum can be achieved by initiating above mentioned suggestions.
8. Establish budget airline hubs to generate $ 2 billion
• In countries such as Thailand, Singapore, Malaysia, and Vietnam, 50% of tourist arrivals are on budget airlines.
• In Sri Lanka, out of the 80,000 hotel rooms, only 30,000 hotel rooms are classified as 5 or 4 stars or any star category. Balance 50,000 hotel rooms are in the budget accommodation category.
a) Transform Ratmalana and Mattala airports into international budget airline hubs.
b) Attract more budget airlines (low-cost carriers) to arrive in Sri Lanka to accommodate low-cost carrier passengers.
• With such an initiative, 1 million additional tourist arrivals can be expected. This would result in generating $ 2 billion in earnings.
c) Encourage the establishment of domestic airline services.
d) Existing airports in Trincomalee, Batticaloa, Koggala and Digana in Kandy should attract high volumes of domestic aircraft by initiating the following:
• Landing, ground handling, and parking rates are to be revised and reduced for domestic airline carriers to be able to afford.
• As a result, the economic benefits of tourism will spread to far corners of Sri Lanka.
• Annual income generation of $ 2 billion can be achieved through the above-mentioned initiatives.
9. Generate $ 600 million income with coconuts
• Annually, 1.5 million coconut seedlings are planted. Through a 5-year program, 20 million additional new seedlings can be planted. This is achieved by planting an additional 4 million seedlings every year.
• As a result, an additional harvest of 1.2 billion nuts is produced.
• If one coconut product is sold at an export price of $ 0.50 cents. From 1.2 billion coconuts, we can generate $ 600 million of income.
10. Outward payments can be deposited in $ to earn interest payments in USD
• Outward payments such as dividend payments, air and sea transport fees, travel, construction, insurance, royalty fees, telecommunication, and computer service fees can be converted to USD.
• These can be deposited for a three-year period with an interest rate decided by the Sri Lankan Government. For example, at a 6% interest rate.
• Annual deposits of $ 300 million can be received by implementing this action item.
Public universities should also make their ICT related courses available online by 10 times, to increase the student enrolment numbers. This will lead to a high number of students getting ICT qualified and industry ready to enter the ICT field. As a result, ICT related earnings can reach up to $ 5 billion
11. Save $ 1 billion by allowing the private sector to invest in new power plants powered by solar or coal in Norochcholai and Sampur
• For the current 900 MW power generation using coal, the total coal consumption cost at the current market price is $ 50 million per month. Thus, the annual coal consumption cost to generate power is $ 600 million.
• In addition, the current 900 MW power generation using diesel and furnace oil cost at the current market price is $ 135 million per month. Thus, the annual cost of fuel is $ 1,620 million.
• As cost-saving power generation solutions, below 2 options are proposed:
Option 1: Solar farms
• To generate 900 MW of power during the daytime, 2,000 MW solar farms are needed.
• To generate 900 MW of power during the night time, diesel and furnace oil plants are to be maintained. (Fuel cost to operate the plant is $ 800 million)
• The private sector should be allowed to invest in the suggested 2,000 MW solar farms.
• By implementing option 1, a saving of $ 800 million can be achieved.
Option 2: Coal power plant
• Current diesel and furnace oil power plants that generate 900 MW can be replaced by constructing an additional new plant for 300 MW in Norochcholai and by constructing a new plant in Sampur for 600 MW. This will lead to a saving of $ 1 billion per annum.
• Therefore, private sector companies should be given the opportunity to invest in constructing the 2 power generating plants in Norochcholai (300MW) and Sampur (600MW).
• Per year, from option 1, $ 800 million and from option 2, $ 1 billion can be saved.
12) Save $ 200 million on palm oil
• The current outflow of $ 200 million can be saved if the ban on planting palm oil trees in Sri Lanka is lifted.
Economic revival of Sri Lanka
• Sri Lanka has an annual shortage of inflows of $ 6 billion to accommodate basic needs such as fuel, gas, medicine, fertiliser, and food.
• By implementing the proposed 12 key strategies, an additional annual income of $ 8 billion can be generated as future cash inflows.
• It will be easier to build confidence in Sri Lanka’s macroeconomic stability and unlock international financing from International Financial Institutions (IFIs) such as International Monetary Fund (IMF), and World Bank (WB), if additional cash inflows as suggested in the above action plan are generated to reduce the deficit in the balance of payments.
DIG DJ Palihakkara has been appointed as the Senior DIG in charge of the Western Province.
It is said that the appointment has been made by IGP CD Wickramaratne with effect from 14 days only.
Accordingly, the Senior DIG in charge of the Western Province Deshabandu Tennakoon, who has been on leave for two weeks from today, has been temporarily appointed as the Acting DIG until he returns to duty after completing his leave, according to the Police Headquarters.
Although the Attorney General’s Department has instructed the police to transfer Deshabandu Tennakoon, who is facing serious charges in connection with the May 9 attack on the Galleface protest site, from the Western Province, the police still do not seem to be doing so.
Shashi Weerawansa, the wife of former Minister Wimal Weerawansa, who was convicted of obtaining an informal diplomatic passport by submitting false information to the Department of Immigration and Emigration, has requested to be released on bail. It is reported that the decision has been postponed until tomorrow (31).
She was sentenced to two years imprisonment and a fine of Rs. 100,000 by the Colombo Magistrate’s Court last Friday.
Her lawyers on the same day requested the court to release her on bail subject to the condition of filing an appeal in the High Court and the consideration of that request was adjourned till today.
Accordingly, it has been decided today to consider the bail application tomorrow.
The Ministry of Power and Energy has decided to limit the issuance of diesel stocks to fuel stations. It is reported that the release of kerosene has also been limited.
Minister Kanchana Wijesekera says that steps have been taken to release limited diesel and kerosene oil in order to manage fuel stocks.
Petroleum Corporation sources say that the remaining stock of diesel is only enough for five days. Accordingly, there is a risk that diesel will have to be issued only for essential services in the future.
The next diesel ship is scheduled to arrive in Sri Lanka on June 01 and the other diesel ship is scheduled to arrive two weeks later.
Prime Minister Ranil Wickremesinghe has appointed an expert committee to advise on stabilizing the country’s economy. It is reported that special powers have also been given to this committee.
The committee is headed by former Secretary to the Treasury RS Samaratunga, comprising Governor of the Central Bank Dr. Nandalal Weerasinghe, Secretary to the Treasury Mahinda Siriwardena, former Governor of the Central Bank Dr. Indrajith Coomaraswamy, Dr. Sharmini Cooray and St. Daniel.
In addition, Diesel de Mel, Dr. Sarath Rajapathirana, Dinesh Weerakkody, Anushka Wijesinghe, Daniel Alphonso and Dishni Weerakoon represent the Advisory Committee on Stabilizing the Economy.
As soon as the Prime Minister was sworn in, several committees were set up to address the crisis facing the people, including the fuel issue, the essential medicines issue and the essential food items issue.
A suspect has been arrested in connection with the murder of a nine-year-old girl in the Atalugama area. The police have arrested a resident near the house of the deceased girl.
The victim went missing when she went to a shop about 200 meters from her house to buy chicken and was later found hiding in a nearby swamp.
Police have arrested a person who was running a fort on the land adjacent to the relevant place. Police also found a muddy saree under his bed.
Further investigations into the incident are ongoing.
