The second reading of the revised Budget Appropriation Bill, which was prepared by amending the Budget Appropriation Bill passed for 2022, commenced in Parliament.
The bill was tabled in Parliament by President Ranil Wickremesinghe in his capacity as the Finance Minister.
Beginning the speech, the President noted that many people do not have a proper understanding of the depth of the huge crisis befallen the country.
He emphasised that welfare economy cannot continue and added that the privatisation of loss making public institutions should be a mandatory step.
More than 8.5 million Sri Lankans who are unable to settle debts due to increased interest rates and not being able to secure enough income to pay their debts have been listed in the Credit Information Bureau of Sri Lanka (CRIB).
In the last year and a half, the interest rates charged for loans from banks and other fiscal bodies has surged from 8.5 per cent to 18 per cent and the interest rates for leasing from 12 per cent to 34 per cent, making it impossible for a lot of people to repay their debt instalments and leasing instalments for houses and businesses.
TOKYO, Aug 30 (Reuters) – Japan will coordinate with other creditors to resolve Sri Lanka’s deepening financial crisis, Finance Minister Shunichi Suzuki said on Tuesday, urging all creditor nations to gather and discuss the South Asian nation’s debt at the same table.
“We are concerned about Sri Lanka’s severe socio-economic situation,” Suzuki told reporters.
Sri Lanka must accelerate talks with the International Monetary Fund (IMF) on a bailout, while all bilateral creditors, including China and India, must gather to discuss the issue, Suzuki said.
“Japan wants to actively cooperate with other creditor countries and public organisations.”
Japan is seeking to organise an all creditors’ conference, hoping it could help solve Sri Lanka’s debt crisis, and it is open to hosting such talks possibly with China, sources with knowledge of the situation told Reuters last week. read more
It remains unclear whether top creditor China would join and a lack of clarity remains about Sri Lanka’s finances, one source told Reuters.
President Ranil Wickremesinghe told Reuters this month that Sri Lanka would ask Japan to invite the main creditor nations to talks on restructuring bilateral debts. He said he would discuss the issue with Prime Minister Fumio Kishida in Tokyo next month.
“I believe it is important for the Sri Lankan government to try to improve its economic and fiscal conditions in coordination with the IMF, Paris Club (of major creditor countries) and others, while maintaining transparency,” Japanese Foreign Minister Yoshimasa Hayashi said.
“We plan to consider our response, while watching such moves and the situation in Sri Lanka, and consulting with Sri Lanka, other donors and international organisations.”
The island nation of 22 million people off India’s southern tip, with debt at 114% of annual economic output, is in social and financial upheaval from the impact of the COVID-19 pandemic, severely depleted foreign reserves and runaway inflation.
An IMF team met Wickremesinghe on Wednesday to discuss a bailout, including restructuring $29 billion in debt, as the country seeks a $3 billion IMF aid programme.
The Colombo High Court today (30) ordered three persons including Ruling Party MP Johnston Fernando be granted bail in connection with the case filed against them on the allegation of incurring a loss of over Rs. 1.1 million to the government by dismissing a group of employees of SATHOSA from their duties and deploying them for political affairs in 2013.
Accordingly, the three were released on a cash bail of Rs. 50,000 each and two sureties of Rs. 1 million each. The Court also banned their overseas travels until the end of the trial.
Along with MP Fernando are former Chairman of SATHOSA Eraj Fernando and its former Director Mohammed Zakir as defendants to the case.
Sri Lanka’s Information Technology service sector, one of the leading US dollar earners of the country, is set to crash as a result of the decision of the Finance Ministry on the recommendation of the Central Bank headed by Governor Nandalal Weerasinghe to ban the importation of IT devices and peripherals.
This will badly affect working from home, total shutdown of many critical operations, huge cyber security threats to businesses and loss of its valuable data, asides the present exodus of skilled employees migrating an even larger amount likely to consider it, and the loss of employability to many.
The All Ceylon Communication Owners’ Association (ACCOA) said that the prices of mobile phones and accessories would go up again as per the prices announced by the major importers.
ACCOA Chairman Indrajith Perera noted that the prices of the existing mobile phones and accessories would go up to higher prices, which they could not determine.
Mobile phones have since become very essential and vital devices and the most common accessories such as chargers, back covers, displays, cables, screen protection shields and other electronic parts are also considered extremely vital to maintain the devices.
Federation of Information Technology Industry Sri Lanka (FITIS) cautioned that there is a serious danger of technological platforms in the country breaking down due to this decision to save dollars at present.
It also pointed out that imports of computers and allied peripherals and devices are already at a minimum level due to the shortage of US dollars in the country for the past few months.
“The proper maintenance of technological platforms has become challenging as a result of this.
Specially computer hardware items such as servers, networking equipment, notebook, laptop and desktop computers and firewall equipment are essential to carry out connected work of any type.
Issuing a statement, FITIS said that its members expect to meet President Ranil Wickremesinghe and have a discussion with him on relaxing the ban.
FITIS also pointed out that the inclusion of IT devices and peripherals in the list of proscribed articles could have been due to a genuine oversight.
FITIS noted that hardware, peripherals and devices are essential to maintain the information and communications technology without breaking down.
Keeping connected the peripherals and devices live is essential for updating data systems, maintaining computer and communications networks and renewing licenses,” FITIS said.
The apex IT body in Sri Lanka said the measure of constraining many hardware products banned from being imported whilst leaving many local entities crashing can further mean the exit of many multinationals. Many software development firms accounting for export revenue are foreseen to be reduced due to equipment shortages.
FITIS Chairman Dr. Prasad Samarasinghe said that the move can seen as reducing pressure on forex reserves with the dollar crisis, in reality, the damage may be more severe with this action.
TIS Hardware Chapter President Gnanam Sellathurrai stressed that “now with the ban specifically equipment’s such as servers, network appliances, notebooks and desktops, and firewalls are the key platforms that maintain all kinds of activity online.
It can be any software which runs on the hardware unit, but the hardware is the main unit that necessitates for any of the programs to be set on any digital activity”.
Adding to the burden when replacements are needed, Sellathurrai expressed displeasure asserting that: “When devices are to be serviced, replaced, or be renewed with the relevant licenses, the choice of postponement is not the solution.
If delayed, the entire country’s technological platform may crash part by part. “Examples would be instances where the connectivity is lost between the head office’s central infrastructure and the branch when the interconnecting device breaks off, he said.
Therefore, it is essential that an understanding regarding the intensiveness of the problem is supposed; as already due to the forex shortage, where the country has been short supplied for the past three quarters, he added.
The maximum retail price of an egg has been increased by Rs. 05. Accordingly, the price of eggs will surge up to Rs. 50.
The egg producers in Sri Lanka raised their objections to the recently issued gazette by the Trade Minister declaring the prices of eggs, saying that they could not sell eggs at those prices. According to the gazette, the maximum price of a white egg was Rs. 43 and a red or brown egg, Rs. 45.
The egg producers pointed out that the amount was not enough to cover the cost of production of an egg, demanding that the price of eggs be raised to at least Rs. 50. The egg producers also suspended the release of eggs to the wholesale market in objection to the gazette.
Given consideration to the producers’ continuous demand, the Trade Ministry has decided to increase the price of eggs up to Rs. 50. Ministry officials added that they will soon declare a fixed price for eggs.
Prior to the gazette declaration, eggs were sold for around Rs. 60 – 70 in the local market.
The Samagi Jana Balawegaya (SJB) has won the division election of Pelmadulla, Bambarabotuwa, Marapana Various Services Cooperative Society in a historic move overthrowing a 23 year-old rule loyal to the political stream representing the Sri Lanka Podujana Peramuna (SLPP).
Accordingly, 65 SJB representatives have been elected and only 54 SLPP members managed to secure seats.
The second reading of the 2022 budget amendment bill is set to take place in Parliament today (30).
Accordingly, President Ranil Wickremesinghe in his capacity as the Finance Minister will deliver the budget speech in Parliament.
The 2022 budget is set for revision in this manner given the unique circumstances that have arisen amidst the economic crisis.
Attention is also believed to be paid to the tax revisions related to providing necessary relief to the people as well as to increase the state revenue.
The Government has taken prompt action to boost locally produced dairy products, to prevent any shortages in the market following the ban on the importation of several diary products .
Sri Lanka’s Department of Agriculture is still to take any step towards the development of dairy sector although it has signed a memorandum of understanding in June to implement a US$27 million project.
It is aimed to double the milk production of Sri Lankan dairy farmers under the U.S. Department of Agriculture’s “Food for Progress” initiative.
Top officials of the Agriculture Ministry should redouble their efforts to make this initiative a reality otherwise the country will lose much needed dolar assistance as an unutilised grant.
The Agriculture Ministry said attention has been drawn to producing dairy products such as butter, cheese, milk powder, and yoghurt, following the temporary ban imposed by the Government on the import of 300 products.
The move comes following an industry review meeting chaired by Agriculture Minister Mahinda Amaraweera with officials of the National Livestock Development Board (NLDB) and the MILCO Ltd.
Noting the shortage of animal feed in the country, the production of liquid milk has dropped by about 34%, and the liquid milk quantities received by the two companies have also reduced considerably.
Taking the facts into consideration, the Agriculture Minister has directed officials to prioritise the production of the most demanded and essential products such as milk powder.
He has also advised officials to promote liquid milk consumption among the public, as it was more nutritious and economical for the consumers and industries.It was pointed out that producing a kilo of milk powder, requires over four litres of liquid milk.
“US aided Food for Progress” project began in late 2017 and has already benefited 25,000 Sri Lankan dairy farmers, increasing their milk production by an average of 68 percent to date.
An estimated 80,000 Sri Lankans will ultimately receive assistance from this program, as part of the United States’ continued efforts to support food security and economic growth in Sri Lanka.
After unforeseen delays including the COVID pandemic, the U.S. Embassy and the Sri Lankan Department of Agriculture renewed this partnership agreement two months ago.
Food for Progress’ Market-Oriented Dairy Project partners with a U.S. non-profit organization called the International Executive Service Corps to help Sri Lankan farmers increase dairy production by providing them with the skills they need to improve farm operations and management.
It will also provide better access to financing, so farmers can expand their businesses and reach new markets.
