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.
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.
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.
Central Bank Governor Nandalal Weerasinghe says it is impossible for anyone to bring inflation below 30% – 40% in the next six months.
“There will be only a limited amount of economic activity in the country within the next three to six months. That means the economy is shrinking. Our forecast for this year is that the economy will shrink at a rate higher than any year we have ever experienced in history. No one can bring inflation below 30% – 40% in the next six months. This is an issue that severely affects the poor and vulnerable. Especially if the government does not provide assistance, it will be difficult for the low-income poor to live on their income. You will see poverty levels rising in this country. Most will fall below the poverty line. As the economy shrinks, more and more people will lose their jobs. This is because small and medium scale industries cannot function normally. ”
Nandalal Weerasinghe said this while participating in a discussion organized by the Press Club of the Sri Lanka Press Institute yesterday (25).
Russia is considering Sri Lanka’s request for fuel from Russia, said Anastasia Haklova, First Secretary of the Russian Embassy in Sri Lanka.
The Russian Embassy in Sri Lanka will provide the necessary assistance in this regard, she said.
However, the first secretary has told the media that reports that a meeting had been held between the Russian ambassador to Sri Lanka and the Sri Lankan Minister of Energy in this regard were untrue.
