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Japanese Embassy denies reports on unwillingness to support SL

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Japanese Embassy denies reports on unwillingness to support SL

The Japanese Embassy in Sri Lanka has categorically denied media reports on the Japanese government’s unwillingness to support Sri Lanka amidst the economic crisis befallen the isand nation, a statement by the Prime Minister’s office emphasised.

Earlier a Daily Mirror headline, saying “Japan will not help Sri Lanka now” raised controversy leading to the spawning of a potential diplomatic rift between the two countries, following which KATSUKI Kotaro, the Deputy Head of the Japanese Mission in Sri Lanka responded saying that the claim is false.

The announcement by the PM’s office in this regard urges all media to correct the report with equal prominence, as this inadequate reporting could have a detrimental impact on the country’s economic recovery and the cordial relationship between the two states.

MIAP

Dhammika Perera takes steps to expand the one-day passport service

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Dhammika Perera takes steps to expand the one-day passport service

Investment Promotion Minister Dhammika Perera has taken steps to expand the one-day service of obtaining passports to the regional offices, which was limited to the head office of the Immigration and Emigration Department in Colombo so far. He mentioned this at the press conference held in Colombo today.

Accordingly, from next Monday, the immigration department’s regional offices in Matara, Vavuniya, Kandy will have the opportunity to obtain passports under the one-day service.

In view of the current crisis, a large number of Sri Lankans are coming to get their passports in the hope of going abroad and due to this, large queues are seen near the Battaramulla head office as well as near the regional offices. Sometimes people have to wait in line for days to get your passports.

UK Parliament lauds Sri Lanka’s social protection systems

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UK Parliament lauds Sri Lanka’s social protection systems

Britain on Tuesday said that the existing social protection systems, including the Samurdhi programme, provide essential support to the most vulnerable communities in Sri Lanka and will be crucial at this difficult time.

In response to a question by Conservative MP that what recent assessment that the State for Foreign, Commonwealth and Development Affairs has made of the effectiveness of the Samurdhi programme in Sri Lanka, Parliamentary Under-Secretary (Foreign, Commonwealth and Development Office) Vicky Ford said that “The Sri Lankan authorities have taken a number of measures to help support the public, including an economic relief package of Rs. 200bn ($1bn) announced in January 2022.”

“The UK recognises the economic challenges that Sri Lanka is facing. We continue to monitor the economic situation in Sri Lanka closely, including the impact economic issues are having on food security and livelihoods,” she said in a written answer to UK Parliament

She also stated“This package includes a Rs. 5000 ($25) monthly allowance for public sector employees, pensioners and disabled soldiers. Under the scheme, Rs. 1000 ($5) has been allocated to the beneficiaries of the government’s largest welfare programme ‘Samurdhi’, and a number of taxes and levies have been removed from essential foods and medicines. The Government of Sri Lanka agreed on May 2 to provide a special three-month cash allowance from May to July worth Rs. 13.36 billion to 3.34 million families affected by the current economic crisis, with funding from the World Bank of which the UK is a major donor.

“We regularly discuss economic policy with the Sri Lankan Government and encourage efforts to improve economic growth and protect vital economic interests such as key industries, commodities, employment and livelihoods,” she added.

In response to a question that the human development and social economic indicators of Sri Lanka in comparison to other South East Asian countries, Ms Ford “We continue to encourage a peaceful, democratic, and inclusive approach to resolving the current political and economic challenges.”

She said that the most recent available data (2020) for Sri Lanka indicates that it performs well against South Asia neighbours on high-level human development and social economic indicators, particularly infant mortality rates.

“However, the available data does not capture the severity of the current economic crisis and impact of recent economic shocks such as Covid-19, the Russia-Ukraine crisis, the floating of the Sri Lankan Rupee (LKR) and Sri Lanka’s debt default in May 2022. We have not made a recent assessment comparing Sri Lankan indicators to those in South East Asian countries,” she added

IMF bailout package preparation for Sri Lanka gains significant progress

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IMF bailout package preparation for Sri Lanka gains significant progress

A new IMF-supported programme to extend the extended fund facility to Sri Lanka is being developed to restore macroeconomic stability and debt sustainability, while protecting the poor and vulnerable, safeguarding financial stability, and stepping up structural reforms to address corruption vulnerabilities and unlock the country’s growth potential.

An International Monetary Fund (IMF) mission team led by Messrs. Peter Breuer and Masahiro Nozaki visited Colombo from June 20 to 30, 2022 to discuss IMF support for Sri Lanka and the authorities’ comprehensive economic reform program. Ms. Anne-Marie Gulde-Wolf, Deputy Director of the IMF’s Asia and Pacific Department, participated in policy discussions.

The IMF team had constructive and productive discussions with the authorities on economic policies and reforms to be supported by an IMF Extended Fund Facility (EFF) arrangement.

Significant progress was made, and discussions will continue virtually towards reaching a staff-level agreement on the EFF arrangement in the near term.

Latest talks with Sri Lanka has made significant progress towards developing a policy package to stabilize the country the International Monetary Fund said, but the country also has to move forward on debt restructuring to finalize a bailout.

“The staff team and the authorities made significant progress on defining a macroeconomic and structural policy package,” an IMF statement said.

“Because public debt is assessed as unsustainable, Executive Board approval would require adequate financing assurances from Sri Lanka’s creditors that debt sustainability will be restored.”

Sri Lanka has appointed financial and legal advisors to negotiate with creditors.

At least one sovereign bond holder with over 250 million dollars has gone to court seeking full payment.

The team had constructive and productive discussions with the Sri Lankan authorities on economic policies and reforms to be supported by an IMF Extended Fund Facility (EFF) arrangement.

The staff team and the authorities made significant progress on defining a macroeconomic and structural policy package.

The discussions will continue virtually with a view to reaching a staff-level agreement on the EFF arrangement in the near term. Because public debt is assessed as unsustainable, Executive Board approval would require adequate financing assurances from Sri Lanka’s creditors that debt sustainability will be restored.

“In this context, discussions focused on designing a comprehensive economic program to correct the macroeconomic imbalances, restore public debt sustainability, and realize Sri Lanka’s growth potential. Discussions advanced substantially during the mission, including on the need to reduce the elevated fiscal deficit while ensuring adequate protection for the poor and vulnerable.

Given the low level of revenues, far-reaching tax reforms are urgently needed to achieve these objectives. Other challenges that need addressing include containing rising levels of inflation, addressing the severe balance of payments pressures, reducing corruption vulnerabilities and embarking on growth-enhancing reforms.

Japan says that they cannot give aid as the rulers cannot be trusted

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Japan says that they cannot give aid as the rulers cannot be trusted

Sri Lanka is facing a huge crisis, but the Japanese ambassador to Sri Lanka has said that there is no possibility of considering giving aid at this time.

A group of members of the Tamil National Alliance met the Japanese Ambassador to Sri Lanka Misukoshi Hideki yesterday (30) and discussed the crisis situation facing the country.

The ambassador has said that if aid is given, it cannot be expected that it will be properly managed and that the aid will have to be delayed until trust is built in the rulers of this country.

However, the ambassador has further emphasized that assistance can be considered later.

Crisis-hit Sri Lanka lifts ban on Qatar Charity to secure fuel  from Doha

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Crisis-hit Sri Lanka lifts ban on Qatar Charity to secure fuel  from Doha

In a desperate move to woo fuel supply from Doha Sri Lanka has lifted a ban on Qatar Charity, months after the government froze the charity’s accounts accusing it of funding Islamic terrorism together with a prominent lawyer. 

This assurance was given by Power and Energy Minister Kanchana Wijesekera who led a delegation to discuss possibilities of securing a fuel credit line to Sri Lanka when he met Qatar Charity officials in Doha on June 29.

“Met the Officials of the Qatar Charity yesterday. Conveyed the message that the Defense Ministry has informed the Attorney General its decision to lift the ban on the fund which was imposed in 2019,” Wijesekera tweeted.He also discussed the Charity’s work in Sri Lanka and globally.

 However no pocitive response has been received from Qatari authorities on Sri Lnka ‘S request for oil credilne and other assistance for the ialsnad nation to over comen the fuel crisisas the Sri Lanakn delegation failed to convince them . informed sources in Qatar said. 

Sri Lankan diplomats in the Middle East have noted that the governments there do not give as much priority to Sri Lankan issues as they did before the island nation’s political leaders’ action soured diplomatic relations. 

A former police minister and a close ally of President Gotabaya Rajapaksa Sarath Weerasekara told parliament on January 07 2021 that the ringleader of the Easter Sunday suicide bombers Zaharan Hashim had conducted lectures in an organisation maintained by Sri Lankan lawyer Hejaz Hisbullah. 

The organisation, named ‘Pearl of Unity’, and its local branc was funded by Qatar Charity which Weerasekara claimed was banned by the United Nations.

The Criminal Investigation Department (CID) subsequently froze the accounts of Qatar Charity in Sri Lanka.

The move, along with President Rajapaksa’s flat refusal to honour Qatar’s request through the Organisation of Islamic Countries (OIC) to stop cremating Sri Lanka’s minority Muslims who died of COVID-19, soured the Middle Eastern nation’s relations with Sri Lanka.

Wijesekera’s statement on lifting the ban comes at a time Sri Lanka is gradually coming to a standstill as it does not have any fuel imports until mid next month. Wijesekera on Sunday June 26 before leaving to Qatar told reporters that he was exploring possibilities of importing fuel from the oil-rich country.

During his visit, Wijesekera met Saad Sherida Al-Kaabi, the Qatar Minister of State for Energy Affairs and the President and CEO of Qatar Energy, and discussed the supply of petroleum products, liquid petroleum (LP) gas and liquefied natural gas (LNG) to Sri Lanka to overcome the energy crisis with the assistance of Qatar Energy and the Qatar Development Fund.

The minister also met Deputy Director General of the Qatar Fund for Development and said that he “discussed a possible credit line facility for petroleum and gas supply” and was “informed that funds has been allocated for medical supplies and will consider the request for a credit facility [and] support the IMF program”.

Despite many leaders of the ruling Sri Lanka Podujana Peremuna (SLPP) approaching Middle Eastern countries for fuel, President Rajapaksa administration has hardly got a positive response, government officials told EconomyNext.

The legal case involved with Qatar Charity saw the arrest of Hejaz Hisbullah Hisbullah by the CID on April 14, 2020, who was placed under a detention order by President Rajapaksa, under the Prevention of Terrorism Act (PTA) for allegedly “aiding and abetting” the Easter Sunday bombers and for engaging in activities deemed “detrimental to religious harmony among communities.”

He was detained for a long time without being charged. However, amid mounting international pressure, the government charged him before a court released him on bail early this year.

Qatar is one of the top foreign employment providers for Sri Lanka along with the United Arab Emirates.

Sri Lanka inflation hits 54.6% in June 2022

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Sri Lanka inflation hits 54.6% in June 2022

Surface inflation rose to 54.6% in June 2022 based on the Colombo Consumer Price Index, according to the Department of Census and Statistics.

Inflation in the food category was recorded at 80.1% while in the transport category it was recorded at 128%.

Sri Lanka Tourism introduces ‘Emergency Unit’ to facilitate visitors

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Sri Lanka Tourism introduces ‘Emergency Unit’ to facilitate visitors

Sri Lanka Tourism Development Authority (SLTDA) has set up a special ‘Emergency Unit’ to facilitate uninterrupted services provided by the industry amidst the economic crisis, Chairman of  SLTDA disclosed. 

The new unit has been established under the direction of Tourism Minister Harin Fernando and Ministry Secretary Chulananda Perera, while the special Emergency Unit will be headed by SLTDA Director – Domestic Tourism and Community Relations Upali Rathnayake.

The unit will be facilitated for emergency requirements of the service providers including destination management companies (DMCs) and accommodation entities that handle the tourists currently in the country and new visitors expected till 10 July.

On 28 June, the Government declared that the remaining fuel stocks will only be distributed among essential services till 10 July. Subsequently, Minister Fernando taking to Twitter announced that tourism has been declared an essential service, and the new unit was set up to ensure transport for all tourists.

The Minister also noted that the unit can be reached via hotline 1912 or 112 437759 for assistance.

All registered DMCs are requested to provide the information of the tourists currently handled by them and expected visitors till 10 July. The tourism industry stakeholders could contact the Emergency Unit for the assistance required during this period, particularly for fuel requirements.

The unit will make necessary arrangements to ensure the supply of fuel required for tourist vehicles on the move on receipt of the requests, supported by authentic information.

It will be open 24-hours till today and thereafter operated from 8.00 a.m. to 8.00 p.m.

A total of 18,305 tourists arrived during the first 19 days of the month, whilst pushing the cumulative figure to 396,826 so far. 

Meanwhiele Sri Lanka’s tourism industry stakeholders yesterday warned that the industry is likely to further crumble if relevant authorities continue to delay in extending the necessary intervention.

The Hotels Association of Sri Lanka (THASL), Sri Lanka Association of Inbound Tour Operators (SLAITO), and the Association of Small and Medium Enterprises (ASMET) reiterated the need for the Central Bank to act on the Cabinet decision on providing breathing space for the industry’s loan repayments. 

The representatives asserted the longer the Central Bank takes to facilitate the extension of the loan moratorium, the more the sector will bleed.

“The next six months is crucial for us. To revive we need to sustain and for that it is imperative to have the moratorium extended. The sector players are struggling to pay salaries and suppliers to stay afloat due to the drop in tourist arrivals. The delay in providing the relief is hitting us hard,” said THASL Past President Hiran Cooray addressing a joint press conference yesterday.

He cautioned that hotels have already downsized operations and the increasing difficulties will compel a significant proportion of the formal tourism sector to close operations in the near future.

 Halting operations in the tourism sector would mean loss of foreign currency earnings which the economy is in dire need to come out of the current crisis situation.

Earlier this month (June 8), the Cabinet gave the nod to extend the moratorium given to the crisis-hit tourism industry until December 31 of this year. The approval was made after industry stakeholders repeatedly asserted the need for more time for loan paybacks.

However, it has been 20 days since the decision was made, but the Central Bank is yet to take the necessary steps to provide the relief.

The moratorium granted by private sector banks on loans taken by the tourism industry expired on March 31, and the moratorium granted by State banks on tourism industry loans will expire on June 30.

The industry’s estimated debt including the accumulated interest is estimated to be over Rs. 500 billion

If the Tea Auction is done in USD instead of LKR, SL can pay for fuel from that income?

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If the Tea Auction is done in USD instead of LKR, SL can pay for fuel from that income?

Fuel shortages and fuel queues are becoming a normal part of daily life for the people of Sri Lanka. The tragedy here is that due to the shortage of fuel, the daily income of a large number of people in the country is blocked and they are falling into utter destitution.

People queuing for fuel are also debating what the solution is to the fuel shortage and why the government is not implementing it.

The world-renowned Ceylon Tea brand earns a large export income. But the Colombo tea auction is still held in rupees. If the tea auction was held in US dollars, the country would be able to earn that revenue directly in dollars, which would also enable the country to import the required amount of petrol, say three-wheeler drivers waiting in fuel queues. They question whether the government is not taking such a step because it does not have that much understanding.

In this regard, we also investigated the facts and found that Kenya has decided to hold its Mombasa tea auction in US dollars in this way and has achieved successful results. A research report prepared on that can be read in the following link.

In fact, if the government decides to hold the Colombo Tea Auction in dollars, that money could be used entirely to import fuel or chemical fertilizers needed for the country’s agriculture. This would raise US $ 900 million annually. Needless to say, this is a huge amount of money.

The possibility of holding the Colombo Tea Auction in dollars was discussed in Parliament last month but no decision has been taken yet.

SJB and JVP should be gathered for the “Waga Sangramaya” program – PM

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SJB and JVP should be gathered for the “Waga Sangramaya” program – PM

Prime Minister Ranil Wickramasinghe says that Samagi Jana Balawegaya and Janata Vimukthi Peramuna should be gathered to the “Waga Sangramaya” program implemented by the government in order to face the upcoming food crisis.

He had stated this when the Committee on Food Safety met yesterday (30).

Minister Dinesh Gunawardena, Mahinda Amaraweera and other ministers and officials attended this committee meeting.

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