The International Monetary Board will be arriving in the island today (Wednesday 24) to finalize discussions and to reach Staff-Level Agreement which will lead to to gain IMF Board Approval and unlock loan package including additional much-needed multilateral financings ,official sources said.
Sri Lanka is to continue engagement with creditors in order to obtain financing assurances although debt restructuring plan, which is crucial to reaching the eagerly awaited agreement with the IMF, is yet to be finalized.
A staff-level agreement would be an important milestone towards the IMF Board approval for the EFF programme, which in turn would help unlock bridging finance to support the much-needed external financing for Sri Lanka,” the Finance Ministry said.
The ministry shared that the Sri Lankan authorities are working with debt restructuring advisor Lazard and Clifford Chance to reach a consensus on debt restructuring arrangements with the creditors.
“The advisors have already prepared the analytical framework for the debt operation, prior to formal engagements with Sri Lanka’s creditors,” the ministry said.
The statement highlighted that the government is committed to engaging its creditors in good faith, with a view to reaching a comprehensive debt restructuring programme that provides a fair and sustainable outcome for all stakeholders.
According to Central Bank Governor Dr. Nandalal Weerasinghe ,the International Monetary Fund’s disbursement of the Extended Fund Facility to Sri Lanka can be expected by the end of the year, subject to the success of debt restructuring with creditors and successful negotiations with the IMF.
Speaking on Bloomberg Television, the Governor also discussed inflation in Sri Lanka, monetary policy and the country’s domestic debt.
Asked whether he can give the IMF assurances that Sri Lanka’s debt is sustainable without restructuring domestic debt, he said: “This is exactly what we are discussing with the IMF.”
“First part is to reach a staff-level agreement on the overall macro fiscal policy framework for the next 3-4 years and the medium-term framework, that we are coming closer to reaching an agreement on a macro fiscal framework,”he disclosed.
“The second part is for us to agree and negotiate with the debt targets for us to make our medium to long term debt sustainable. We are in the process of having this discussion. Only after that basically we can say where the debt targets we have to meet.”
He said that they are currently discussing with the IMF and that they hope to reach that agreement as well. “Then only we will approach the creditors,” he said.
Once we reach the staff-level agreement, then the timeline is set. Then we have to approach all our external creditors and start negotiating and discussing in good faith for us to obtain a relief on the debt service payments, he added.
“It is essential to get ‘financial assurance’ from Sri Lanka’s external creditors he said adding that CB thinks next about 3-4 months, hopefully if all goes well, if all external creditors are cooperating with the Sri Lankan government’s debt management strategy, then hoping that we would be able to get financial assurance somewhere is December.
This will be the requirement for IMF to allow the Central Bank to submit its paper to the executive board enabling them for disbursing the Extended Fund Facility of Around US $ 3 billion in tranches commencing from towards the end of this year, he claimed.
IMF team arrives in the island today to reach the Staff-Level Agreement
SL Apparel sector calls for trade deals with EU, US and the UK
The apparel sector stakeholders are calling for trade deals with the EU, US and the UK that suit Sri Lanka’s realities.
Secretary General of the Joint Apparel Association Forum (JAAF) Yohan Lawrence emphasized the importance of retaining GSP+ post December 2023 as regional peers such as Vietnam and India have already signed or gained renewed focus on securing FTAs with the EU.
He also highlighted that Sri Lanka must push for better trade agreements with the EU, US and the UK that suit Sri Lanka’s realities while looking for opportunities in countries like China and India.
Lawrence identified this as vital for the apparel industry to gain the temporary boost it needs to aid the country’s economic recovery.He expressed these views at a workshop held under the theme ‘De-risking Sri Lankan Apparel’.
The UK-based start-up Kavida collaborated with the American Chamber of Commerce (AMCHAM) in Sri Lanka to launch ‘Resilient Sri Lanka’, a new industry forum aimed at facilitating supply chain resilience in the manufacturing sector.
It navigated the numerous supply chain risks within the apparel industry characterized by post-COVID-19 realities, growing uncertainties in the global geopolitical landscape, market volatilities and the need for resilience in the face of such external shocks.
The topic of discussion was timely and highlighted efforts taken by the Sri Lankan apparel industry to navigate through these supply chain disruptions via innovation and collaboration with the tech industry.
Kavida also launched its new AI platform with the aim of enabling procurement managers ensure on-time delivery and improve supplier collaboration.
The Joint Apparel Association Forum pledged support to the effort of identifying technology-intensive solutions in the focus areas of discussion.
Lawrence highlighted that Sri Lanka’s largest export markets – the US, EU and the UK, have their own share of troubles due to supply chain disruptions including shipment delays contributing to high inflation.
The UK’s inflation recorded at 10% is the highest in the last 40 years, with Germany anticipating double digit inflation. He reiterated that “there is opportunity in crisis”.
“With growing global trade shifts, the EU is looking at an EU-Asia connectivity strategy, a trade system based on sustainable, comprehensive, rules based connectivity, ensuring prosperity, safety and resilience of people.
Sri Lanka already has an excellent track record of delivering products to customers in difficult times. However, we need to ensure these opportunities are not taken away from us.”
Lawrence also stressed that Sri Lanka must work on a framework to ensure compliance with global trade legislation placing a greater onus on the supplier to prove they have robust systems and risk analysis mechanisms in place and have done their due diligence.
The event showcased a panel with key industry leaders displaying a positive outlook on how the know-how and innovation culture of the tech industry can complement the scale and resilience of the apparel industry to move beyond the barriers of the supply chain.
The forum also brought together US and UK fashion brands that pledged support to Sri Lanka and the apparel industry in this hour of crisis.
Four including Nagamuwa and Stalin, granted bail!
The Fort Magistrate’s Court has granted bail to Duminda Nagamuwa, Secretary of Frontline Socialist Party, Joseph Stalin, Secretary of Sri Lanka Teachers Union, Father Jeevantha Peiris and Nalin Gunawardena, who were accused of forcibly entering the Presidential Palace.
They have been released on bail on personal bail of Rs 05 lakh each.
Ranil’s interim budget to be presented to the Parliament on 31st
The interim budget report prepared by revising the adopted budget for the year 2023 is to be submitted to the Parliament on August 31. It is reported that President Ranil Wickremesinghe will present the interim budget to Parliament as the Minister of Finance.
After the presentation of the budget, 03 days have been reserved for the debate on the budget report. Accordingly, the budget debate will be held on September 01, 02, 03.
GR is ready to return to SL if his security is guaranteed – Reuters
Reuters reports that former President Gotabaya Rajapaksa’s return to Sri Lanka will be delayed by another two weeks.
Earlier, the former president’s close friends had told the media that he would come to the island on the 24th. However, it was later reported that his arrival would be delayed.
Reuters reports that Rajapaksa is ready to come to the island in the first week of next September and further states that if his security is confirmed, he will come to Sri Lanka even before then.
Reuters reports that the cost of living in Thailand has led to the ex-president’s trip to Sri Lanka hastening.
No new recruitments for public service!
The Ministry of Finance has informed the Examinations Department of Sri Lanka not to hold any examination for public service recruitment. Apart from this, it has been notified to suspend the results of the recent recruitment competitive exams.
Due to the current financial crisis, the payment of salaries of public servants has also gone into crisis and due to this, the government is engaged in an effort to reduce the number of public servants.
The Ministry of Education says that due to this decision, it has not been possible to release the results of the examination for the selection of aesthetic subjects, home economics and English teachers for public schools held last February. The education authorities say that the examination department has not yet been notified to release the results as the recruitments have to be done if the results of the relevant examination are released.
According to this year’s budget proposals, the recruitment of government employees has been suspended.
Today marks 1 Year Death Anniversary of Mangala Samaraweera – Mathaka Mangala commemoration to be held on 26th
It has been a year since Mangala Samaraweera, who was a revolutionary in Sri Lankan politics, passed away. Mangala Samaraweera passed away on August 24 last year due to being infected with Covid.
A special event has been organized in Matara tomorrow (26) to commemorate the first year. The Mathaka Mangala commemoration ceremony has been arranged to be held that day at 03:00 pm at the Old Holland Trade Center, Nupe, Matara.
There, a discussion will be held involving Professor Rohan Samarajeeva and Shehan Maleka Gamage and it will be moderated by Randula de Silva.
A feature related to Anushka Udana (Wasthi Production) has also been included.
Today and tomorrow, a special almsgiving will be held at the Bolgoda house for the first year.
10 US Congressmen Ask Secretary of State to take Action Against Sri Lanka
A letter has been sent to US Secretary of State Anthony Blinken and USAID head Samantha Power asking them to take necessary measures against the repressive laws in force in Sri Lanka. 10 US Congressmen have signed this letter.
Pointing out that the right of citizens to protest must be protected and the use of violence against peaceful protesters and journalists must be immediately stopped, the Congressmen request the Secretary of State and the head of USAID to put pressure on the Government of Sri Lanka through all possible means.
The Congressmen emphasize that all possible measures should be taken to stabilize Sri Lanka and immediate steps should be taken to provide relief to the Sri Lankan people through USAID.
Import of 300 items temporary banned
The Ministry of Finance has issued an announcement suspending the import of over 300 items. President Ranil Wickremesinghe as the Minister of Finance has signed this announcement.
According to this decision, the import of the relevant goods will be implemented from August 23.
Person who stole 03kg of rice to feed his children starving for 04 days arrested
A person who stole 03 kg of rice and some other items has been arrested by the Borella police. The arrest was made based on a tip given by the security guards of the store.
The suspect, a resident of Dehiwala area, has told the Police that his two children have been starving without food for 04 days. Further, he has mentioned that these items were stolen to quench their hunger.
It is reported that the sub-inspector who investigated this incident has reimbursed the value of the relevant goods and released the suspect.
Due to the economic crisis that has ensued in the country, the prices of essential commodities including food have risen to a level that the ordinary people can no longer afford and due to this, such thefts are reported daily.
OV