The Colombo Magistrate Court today (26) issued an order barring the holding of any protests causing public nuisance by blocking the Fifth Lane and surrounding roads and schools in the Kurunduwatte Police Division where Prime Minister Ranil Wickremesinghe’s residence is located.
The order was issued based on a request by the Kurunduwatte Police.
MIAP
Prime Minister Ranil Wickremesinghe has pointed out the need to make policy decisions based on an export oriented economy. Only these policies can assist the export industry overcome the current economic crisis facing the country.
The Prime Minister made this statement when he met the heads of banks this morning (26).
The Prime Minister pointed out that there are many challenges to be faced in the future, both locally and abroad.
About seventy countries are facing difficulties in the current global crisis. Mr. Wickremesinghe said that Sri Lanka is ranked first amongst those countries. There is a high risk of rising international interest rates. The danger of rising international food prices is also being observed at this moment. However, the Prime Minister explained that Sri Lanka has a small window in which if the correct policies are taken we can reduce the impact.
The Central Bank said it would be difficult to find a definitive solution to these problems until an agreement was reached with the International Monetary Fund.
The focus was on providing loan deferral relief based on the needs of essential customers.
The Governor of the Central Bank and a number of local and foreign bankers joined the discussion with Prime Minister Ranil Wickremesinghe.
Prime Minister Ranil Wickremesinghe has offered a digital space for the youth to join the protesters at GotaGoGama agitation ground in GalleFace and discuss their problems and collect ideas and suggesttions for the future.
Accordingly, the Prime Minister has opened up a space in his website, pmoffice.gov.lk for the youth to connect.
Anyone including those in the GotaGoGama agitation ground wanting a change can submit their views and proposals to the government through the Prime Minister’s Official Website.
Wickremesinghe has been positive about the people’s protest from the beginning and is of the view that it should continue. He had also appointed a committee chaired by former MP Ruwan Wijewardena to extend support required by GotaGoGama.
MIAP
Treasury Bills to the value of Rs.1,206 billion were issued to the CBSL in the 551 days since CBSL’s Covid-driven monetary accommodation of the Government, from 13th March 2020 to 14th September 2021 while Professor W D Lakshman was Governor, at an average of Rs.2.2 b per day. As a result, the Treasury Bills holdings of the Central Bank increased to Rs.1,284 b by 14th September 2021.
Thereafter, during Governor Ajith Nivard Cabraal’s term of about 203 days from 15th September 2021 to 5th April 2022, the Treasury Bill holdings of the CBSL increased by Rs.446 b at an average of Rs.2.2 b per day, to reach Rs.1,730 billion.
Since then, under Governor Dr Nandalal Weerasinghe, a further Rs.244 b has been added to the CBSL Treasury Bill holdings upto 20th May 2022, at an average Rs.5.4 b per day, to reach Rs.1,974 b, even after the CBSL policy rates had been increased by an unprecedented 7% and Sri Lanka has not paid back any Forex debt during that 45 day period.
Washington, DC – May 25, 2022: An International Monetary Fund (IMF) team led by Mr. Peter Breuer and Mr. Masahiro Nozaki conducted a virtual mission with the Sri Lankan authorities during May 9-24 on an economic program that could be supported by an IMF lending arrangement. The IMF team met with Honorable Prime Minister Ranil Wickremesinghe at the concluding meeting, following technical discussions with the economic team led by Governor Nandalal Weerasinghe of the Central Bank of Sri Lanka and the Secretary of the Treasury Mahinda Siriwardana. The team also met with representatives of the private sector, the financial sector, and development partners.
At the conclusion of the mission, the IMF team issued the following statement:
“Sri Lanka is facing difficult economic conditions and severe balance of payments problems. Recent economic indicators suggest that economic activities have been negatively affected by fuel and power shortages. Rising global food and oil prices have further added to the balance of payments pressures. Inflation has accelerated driven by many factors, including the shortages of goods, fuel price increases, and currency depreciation. In this context, we are deeply concerned about the impact of the ongoing crisis on the people, particularly the poor and vulnerable groups.
“The IMF team held technical discussions on a comprehensive reform package to restore macroeconomic stability and debt sustainability. The team made good progress in assessing the economic situation and in identifying policy priorities to be taken going forward. The discussions focused on restoring fiscal sustainability while protecting the vulnerable and poor; ensuring credibility of the monetary policy and exchange rate regimes; preserving financial sector stability; and structural reforms to enhance growth and strengthen governance. We expect that these discussions will help the authorities formulate their reform program.
“IMF staff will continue to monitor the economic and political situation very closely and engage with the authorities to formulate concrete measures under an IMF-supported program, as well as broader stakeholders to support a timely resolution of the crisis. We reaffirm our commitment to support Sri Lanka at this difficult time, in line with the IMF’s policies. “Staff express their gratitude to the authorities for their constructive engagement and support during the mission.”
Indrajith Coomaraswamy the former Governor CBSL recently issued a statement supporting the current Governor Nandalal Weerasinghe.
How ethical is this? It was Coomaraswamy who recommended Nandalal to the current post. Whilst Coomaraswamy was Governor he made Nandalal the CBSL CEO. Coomaraswamy was strong in research, so according to sources he was struggling when it came banking, markets and risk.
He was heavily dependent on others. Central Bank sources say the current Governor is virtually dependent on Coomaraswamy since he lacks confidence and also too theoretical in his decisions. He is not a practical man, they noted. As a result his policy interventions are pushing the country into a bigger crisis.
The current debt crisis is also due to excessive commercial borrowings of Coomaraswamy at rates way above market. Bandula Goonwardana has repeatedly said this in Parliament.
Coomaraswamy has still not given an explanation as to why he borrowed 1 Billion USD, when the crisis ridden Yahapalana government was about to collapse. Questions are asked if a third party was involved given his closeness to a wheeler dealer Yahapalana minister in the last government.
These must be investigated?
Sri Lanka after the CBSL decision to announce default has been officially declared in default by ratings agencies after the non-payment of coupons on two of its sovereign bonds. This should have never happened in the first place if the CBSL had been proactive instead of reactive.
Sri Lanka is now desperate for a sustainable loan package from the IMF while undertaking structural reforms that would draw new investments into the country.
Ex Governor Nivard Cabraal though he adopted a cavalier approach had total control of the situation, sources say he never would have never defaulted on a paltry payment of $78 million USD. The default has virtually shut the door for local companies to borrow from overseas. The implications of this decision will be seen for years.
Adolf
General Shavendra Silva’s term as the Commander of the Sri Lanka Army is due to end on June 01, 2022.
Following his retirement, General Silva thereafter is set to continue his role as the Chief of Defence Staff (CDS).
As his successor, Major General Vikum Liyanage of the Gajaba Regiment is set to become the Commander of the Sri Lanka Army, according to sources.
MIAP
There is a risk that the fuel supply to the aircraft will be disrupted due to the fuel crisis. According to the Director of Operations at the airport and the airline, the remaining jet fuel will be sufficient for another five days only.
Shehan Sumanasekera, Director of Operations, says that aircraft arriving in Sri Lanka for refueling will have to be diverted to airports in India, Maldives, Singapore and other countries in the region.
Due to this crisis, there is a risk of foreign airlines operating flights with Sri Lanka moving to other countries to obtain jet fuel.
Laugfs Gas will be released in the next six days, said its chairman K.H. Wegapitiya.
He says that it will be possible to release gas to the market as it has been able to open letters of credit.
Laugfs Gas has not been released to the market for a long period of time and consumers who have purchased the gas cylinders have been severely inconvenienced.
The CID has recorded a statement from former Prime Minister Mahinda Rajapaksa regarding the May 9 attack on the Golf Face protest site.
It is said that the CID has recorded statements from the former Prime Minister for nearly three hours last evening (25).
