July 21, Colombo (LNW): President Ranil Wickremesinghe has declared the necessity of replacing the temporarily suspended Parate law with a new bill addressing bankrupt enterprises.

In his announcement, President Wickremesinghe proposed a bill that includes provisions for restructuring loans taken by Micro, Small, and Medium Enterprises (MSMEs).

Additionally, a new institution called “Enterprise Sri Lanka” will be established to support and assist MSME entrepreneurs.

The President emphasised the government’s dedication to encouraging and empowering these business owners in Sri Lanka.

President Wickremesinghe made these remarks at the “Critical Initiative to Revitalise Sri Lanka’s Micro, Small, and Medium-Scale Economy” event, organised by the Ceylon Federation of MSME, at the Bandaranaike Memorial International Conference Hall (BMICH) in Colombo.

A copy of the newly drafted bill can be provided to the Ceylon Federation of Micro, Small, and Medium Enterprises. The President invited MSMEs to submit their views and suggestions on the bill.

Furthermore, he mentioned the possibility of arranging a discussion with the International Monetary Fund delegation visiting Sri Lanka at the end of this month to address the issues faced by MSMEs.

During the event, the President of the Sri Lanka Micro, Small, and Medium Enterprises Federation, Mrs Sashika De Silva, presented a special commemorative gift to President Wickremesinghe.

President Wickremesinghe elaborated on the economic challenges the country faced, the steps taken to stabilise the economy, and the measures to support small and medium enterprises.

He outlined the removal of subsidies and the increase in VAT as part of the strategy to manage the country’s economy with its own resources.

He highlighted the introduction of the ‘Aswesuma’ programme, which provides benefits to 2.4 million low-income earners, and the ‘Urumaya’ programme, aimed at granting land rights to 2 million people.

The President also announced the establishment of a National Bank for Development and emphasised the importance of boosting exports.

He encouraged MSMEs to review the new bill and discuss their needs and concerns with the government and the IMF representatives.

The event was attended by former Finance Minister Ravi Karunanayake, President’s Senior Advisor Neranjan Dev Adhitya, Secretary of the Ministry of Industries Shantha Weerasinghe, Industrial Development Board Chairman Dr Saranga Alahapperuma, President Counsel Ronald C. Perera, as well as chairmen and representatives of public and private banks, and officials from the Ceylon Micro, Small, and Medium Enterprises Federation.

July 21, Colombo (LNW): Asanka Abeygunasekara, the former Director General of the Institute of National Strategic Studies of Sri Lanka (INSSSL), has been taken into custody by the police.

Abeygunasekara, who had an outstanding open warrant issued by the Inland Revenue Department (IRD), was apprehended at Bandaranaike International Airport (BIA) in Katunayake this morning (21), according to police reports.

July 21, Colombo (LNW): A few showers may occur in Western and Sabaragamuwa provinces and in Galle and Matara districts, but mainly fair weather will prevail elsewhere of the island, the Department of Meteorology said in its daily weather forecast today (21).

Strong winds of about (50-55) kmph can be expected at times over Western slopes of the central hills and in Northern, North-central and North-western provinces and in Trincomalee, Monaragala and Hambantota districts.

Fairly strong winds about (30-40) kmph can be expected at times elsewhere of the island.

Marine Weather:

A comprehensive financial package has been formulated to support micro, small, and medium-scale enterprises (MSMEs) in Sri Lanka. 

This initiative, introduced  on the directions of President Ranil Wickremasinghe aims to revitalize MSMEs by providing investment and working capital, particularly to those affected by the Covid-19 pandemic and the 2022 economic crisis.

President Wickremesinghe emphasized the importance of strengthening MSMEs for the country’s progress, noting that small and medium-scale entrepreneurs were the most affected by the recent economic collapse.

The government is prioritizing their recovery and has announced the establishment of a National Development Bank to provide necessary capital to MSMEs.

A detailed analysis reveals a significant employment reduction in non-agricultural MSMEs. From employing 2,796,600 people in 2018, the number decreased by 8.8% to 2,551,200 in 2022, resulting in a loss of 245,400 jobs. 

The economic crises have severely impacted MSME employment, emphasizing critical challenges in debt management and access to finance. 

Effective debt management strategies and improved financial resource access are essential for the sustainability and growth of these enterprises. 

The reliance on banks highlights the importance of formal financial systems, while the varied dependence on other financial institutions and money lenders reflects the diverse financing needs and challenges different enterprise sizes face. 

The data suggests enhancing financial resilience and adaptability is crucial for MSMEs to navigate economic uncertainties successfully.

The financial package involves 15 participating financial institutions, including Licensed Commercial Banks and Licensed Specialized Banks, offering loans at subsidized interest rates to support MSMEs that have maintained operations despite the ongoing crisis.

 These loans are categorized into two main types: support for MSMEs and assistance for MSMEs with non-performing loans. 

The Ministry of Industries will issue recommendation letters to eligible MSMEs requiring financial support with the potential to upgrade their businesses.

The Micro, Small, and Medium Enterprises Strengthening Investment Loan scheme offers loans at a concessional interest rate of 7% for ten years, with a maximum limit of Rs. 15 million. A total of Rs. 13 billion has been allocated for this scheme. 

For MSMEs under the non-performing loans category, a working capital loan of up to Rs. 5 million is provided for five years at an interest rate of 8%.

The total allocated amount for this initiative is Rs. 5 billion. Participating financial institutions include Bank of Ceylon, People’s Bank, Regional Development Bank, State Mortgage and Investment Bank, Hatton National Bank, Seylan Bank, Sampath Bank, Commercial Bank, DFCC Bank, National Development Bank, Nations Trust Bank, Sanasa Development Bank Ltd., Union Bank, Pan Asia Bank, and Cargills Bank.

Special attention is given to sectors such as agriculture, tourism, manufacturing, technical and export-oriented industries, and women-led MSMEs (excluding trading, leasing, and business rental) that require working capital financing. 

Sri Lanka is setting an ambitious target to collect 40 percent of its taxes directly through income, wealth, and property taxes by 2025, up from the current 30 percent. 

This strategy aims to expand the tax net and take legal action against tax evaders, according to State Finance Minister Ranjith Siyambalapitiya.

 He pointed out that achieving a stable economy requires state revenue to be 15 percent of the GDP, noting that the country’s previous financial troubles were due to revenue falling to 8.3 percent of the GDP.

The state minister made this statmentment in the backdrop of government revenue excluding grantsincreased by 48.3 percent to Rs. 1,216.0 billion in the first four months of 2024 compared toRs. 820.1 billion in the same period of 2023.

Thiswas mainly due to the increase in tax revenueby 50.5 percent to Rs. 1,117.8 billion from Rs.742.6 billion.

The focus on direct taxes, which are typically paid by individuals with higher incomes and substantial asset ownership, comes in response to the severe economic crisis that led to a sovereign debt default. In response, both direct and indirect taxes have been increased. 

The current administration, led by President Ranil Wickremesinghe, is also considering introducing new wealth, property, and inheritance taxes next year, as part of commitments made to the International Monetary Fund (IMF).

Siyambalapitiya stated that once the government achieves the target of 15 percent state revenue with 40 percent direct taxes, they plan to reduce indirect taxes and raise the threshold level for Pay As You Earn (PAYE) tax, which is currently at 100,000 rupees.

While acknowledging the challenges in increasing tax revenue from 8.3 percent to 13 percent of GDP, he expressed confidence in reaching the 15 percent target with public cooperation. He assured that the government is ready to cut taxes once the desired economic level is reached, though no specific date can be promised.

Siyambalapitiya noted that state revenue has increased to nearly 13 percent of the gross domestic product (GDP) from 8.3 percent in 2022. 

When the recovery process began, the tax structure was heavily skewed with 80 percent of taxes being indirect and only 20 percent being direct. This meant that both rich and poor were equally burdened by taxes. The current ratio has improved to 70:30, with direct taxes now contributing 30 percent.

The government’s goal is to further improve this ratio to 40:60 by 2025, meaning 40 percent of tax revenue will come from those who can afford to pay taxes, and 60 percent will come from indirect taxes. This shift aims to create a fairer tax system.

Sri Lanka’s economy outperformed expectations in the first quarter, but the outlook for the rest of the year and beyond remains uncertain, according to the Asian Development Bank (ADB). 

Despite surpassing the April forecast, the ADB cautioned that projections for 2024 and 2025 are clouded by the upcoming election cycle.

Economists and analysts have raised policy reforms and continuity as some of the key concerns as the island nation gears up for elections this year. 

Meanwhile, South Asia as a region is on course to largely achieve ADB April 2024 growth forecasts. 

According to the ADB, downward revisions for GDP growth in Bangladesh and Maldives over the forecast period are offset in 2024 by upward revisions for Bhutan, Nepal, and Pakistan, leaving the region’s 2024 growth forecast unchanged at 6.3 percent.

In terms of inflation, forecasts for South Asia are nudged up to 7.1 percent in 2024 and maintained at 5.8 percent in 2025. Although inflation forecasts of Bhutan, India, and Pakistan for FY2024 and FY2025 remain the same as in ADB forecasts for April 2024, the inflation projections for Bangladesh and Maldives are now expected to be higher.

In the case of Sri Lanka, the inflation forecast for 2024 is revised down as supply-side conditions improved alongside better external buffers and the availability of foreign currency, the Asian Development Bank said.

The Central Bank of Sri Lanka (CBSL) in its third monetary policy review in May, noted the incoming data suggests that headline inflation is likely to be below the targeted level of 5 percent in the upcoming months. It said this is due to the combined impact of the administered price adjustments and eased food prices, although some upside risks remain. 

However, inflation is expected to eventually align with and remain around the target level over the medium term, supported by appropriate policy measures.

The Government has reduced the prices of fuel and electricity tariff easing the burden of cost of living of the people while paving the way for debt sustainability 

Following successive credit rating downgrades and the loss of access to global capital markets in early 2020, Sri Lanka’s foreign currency reserves steadily declined until April 2022, and usable reserves had declined to near zero levels. 

On April 12th 2022 the government implemented a temporary moratorium on the service of Sri Lanka’s official bilateral debt and external commercial debt

This situation has now been reversed following the government’s efforts to gain US$ 2.9 billion IMF  Extended Fund Facility after approaching  the international lender 17 times without gaining much results due to the bungling of previous regimes. .  

But President Ranil Wickremasighe has been turning around every economic blunder made by his predecessors and created fiscal and debt stability to a considerable level with the support of his cabinet ministers during the past two years.

Now Sri Lnka cannot go back wards from its forward march which will definitely bring relief for the suffering people soon easing the cost of living burden as a result of reducing fuel and electricity prices,and other favourable economic indicators several economic experts said. 

July 20, Colombo (LNW): President Ranil Wickremesinghe emphasized that efforts are underway to position Sri Lanka as the regional hub for human capital development. 

He stressed the need to re-evaluate the National Vocational Qualification (NVQ) to align with internationally accepted standards, such as those in Australia.

President Ranil Wickremesinghe made these remarks while addressing the Sri Lanka Human Capital Summit 2024 held) at Temple Trees under the theme of “Unlocking Sri Lanka’s Economic Potential by Building a Future-Ready Workforce,” focussing on nurturing, harnessing, and amplifying human capital

The Sri Lanka Human Capital Summit was inaugurated in 2016 based on a concept introduced by President Ranil Wickremesinghe during his tenure as Prime Minister.

 The President aimed to establish a platform that would bring all stakeholders together to address the skills challenges facing Sri Lanka. 

This initiative aims to go beyond mere economic growth and transform Sri Lanka from a lower-middle-income economy to a developed nation.

The transformation relies on the ability to cultivate talent, foster innovation, and empower every citizen. While there are multiple industries to consider, the summit prioritizes the pillars for their significant impact and strategic potential on Sri Lanka’s economy: Public Sector Capacity, Information Technology, Tourism, Financial Services and Start-ups

He expressed his intent to seek assistance from Australia to strengthen and modernize Sri Lanka’s education system.

 He stressed the importance of collective efforts among BIMSTEC countries and seeking support from international partners to build a robust education system. President Wickremesinghe underscored the necessity of systemic changes, advocating for reforms and the strengthening of education and training systems.

President Wickremesinghe also underscored the importance of integrating power and land connectivity in a strategic move to enhance Sri Lanka’s economic growth.

 Speaking on the subject, the President stated that while power connectivity is vital, land connectivity stands as the most crucial sector for development. 

He highlighted how the Tamil Nadu economy, which competes with Maharashtra and Gujarat, along with Andhra Pradesh and Telangana, could significantly benefit from accessing Sri Lanka’s ports in Trincomalee and Colombo. This integration, according to the President, would benefit both countries.

President Wickremesinghe stressed the need for expansion in various identified areas, advocating for a friendly approach to both foreign and local investments and called for a focus on human capital formation, pointing out that financial capital is essential for developing human capital. 

He highlighted the necessity of prioritizing the vocational and technical sectors, given that many who left the country were vocationally and technically qualified.

1. President Ranil Wickremesinghe has emphasized that there should be no fear regarding the constitutional amendment. Furthermore, Wickremesinghe expressed that Sri Lanka is unique in maintaining democracy following universal suffrage the President’s Media Division (PMD) said in a statement.
2. Leader of the National People’s Power (NPP) MP Anura Kumara Dissanayake left for a visit to Japan on Thursday, it was reported.
   MP Dissanayake is travelling to Japan to attend a public meeting with Sri Lankans residing in Japan, which has been organized by the NPP’s foreign affairs committee.
3. The 22nd Constitutional Amendment was published via Gazette by order of the President. The 22nd Amendment involves changing the existing clause in Article 83 (b), from “exceeding six years” to “exceeding five years.” The Amendment was gazetted after the Secretary of the Ministry was instructed by the Justice Minister to defer the publication of the 22nd Constitutional Amendment in the official Gazette.
4. Minister of Trade, Commerce, and Food Security Nalin Fernando stated that if the business community fails to pass on government-provided concessions to consumers, price controls will need to be implemented for certain goods. He also announced that proposals to amend the Consumer Act are planned to be submitted to Parliament within the next two weeks.
5. Professor W.M.T Madhujith has been appointed to the post of Vice Chancellor of the University of Peradeniya by President Ranil Wickremesinghe.
6. The Sri Lanka Computer Emergency Readiness Team (SL CERT) has initiated an investigation into 40 government information systems in order to determine if they have been compromised by the mass global IT outage in software provided by a leading US-based cyber security firm.
7. SriLankan Airlines announced that its internet booking services have been fully restored as of 08:30 GMT (02.00 pm local time), following a global outage of third-party service providers that affected the airline’s online booking services.
8. Minister of Aviation Nimal Siripala de Silva has officially inaugurated the runway development project at the Hingurakgoda Airport, which is set to become Sri Lanka’s sixth international airport. According to a government decision, construction work to modernize Hingurakgoda Domestic Airport for international flight operations commenced under the initiative of the Minister of Ports, Shipping and Aviation.
9. The Commissioner General of Elections, Saman Sri Ratnayake says that there are no impediments to declaring the Presidential Election by the gazetting of the 22nd Amendment to the Constitution. Furthermore, the Elections Commissioner General stated that the commission has the power to fairly hold the upcoming elections despite any incoming influence.
10. Sri Lankan actor and former MP Ranjan Ramanayake’s foundation has announced a donation programme to distribute free laptops to students in need. Accordingly, the laptops will be distributed on Tuesday (July 23) from 09.30 am to 01.00 pm at the Lotus Hall at BMICH in Colombo. The free laptop donation by The Ranjan Ramanayake Foundation is being conducted with the support of Indu Herath residing in the USA.

July 20, Colombo (LNW): President Ranil Wickremesinghe announced that while the government is inviting large-scale investors from both domestic and international sources to explore new investment opportunities in the rebuilding of Sri Lanka, it is also implementing a programme to support small and medium-scale businesses affected by the recent economic crisis.

The President made these remarks during a meeting with representatives of Passenger Transport Three-wheeler Associations on Thursday (18) at the Sri Lanka Exhibition and Convention Centre in Colombo.

The President stressed that the benefits of Sri Lanka’s economic progress should extend to the general public. He emphasized his commitment to this responsibility and vowed to never deviate from it, highlighting the special measures the government has taken to support this goal.

During the event, stickers were being pasted on three-wheelers as part of a new initiative. Additionally, representatives from Passenger Transport Three-wheeler Associations presented a memorandum to the President, including requests for the protection of the professional rights of three-wheeler drivers.

President Wickremesinghe further elaborated, stating, “Three-wheelers have become a crucial mode of transportation for the people. While farming continues on one side, many earn their livelihood by driving three-wheelers. In the 2022-2023 Yala season, we had a good harvest, and the subsequent Maha season also saw strong results. The 2023-2024 seasons were similarly fruitful, leading to increased income for farmers and a boost in agricultural trade.

In 2023, the arrival of foreign tourists also played a significant role. The influx of tourists strengthened the economy of three-wheeler drivers. Farmers support food production, while three-wheeler drivers contribute to transporting tourists. These two sectors have collectively helped in reviving the country’s economy.

This economic progress has been crucial in rescuing Sri Lanka from bankruptcy within two years, a remarkable achievement as no other country has recovered from bankruptcy in such a short time. We managed to secure debt relief of approximately USD 8 billion and emerged from bankruptcy.

Today, the country has achieved a level of stability, and we need to continue progressing from this point. If we do not implement the agreement with the International Monetary Fund (IMF), we risk economic collapse with no viable alternative. It is crucial for everyone to be aware of this reality.

Several suggestions have been made regarding the professional development of three-wheeler drivers. These proposals need to be implemented, and we must engage with relevant associations to ensure their successful execution. Professional regulations are necessary, and we acknowledge their importance. It is up to you to determine the best approach. We must also consider welfare aspects.

As we look to the future, particularly with the focus on electric vehicles due to climate change, we must consider the concession provided to existing vehicles. The global community is still experimenting with these technologies, and we need to align our actions with global trends.

To advance the country’s economy, we need both local and foreign investors. This will not only create more employment opportunities but also boost exports. As we focus on economic development, we must remember those who suffered during the last crisis. My primary goal is to ensure that the benefits of this economic progress reach the general public.

We have implemented the Aswasuma programme, tripling the funds allocated for welfare benefits and increasing the number of beneficiaries. During the last New Year season, we provided 10 kilograms of rice for two months. The Urumaya programme was introduced to grant freehold land rights, and arrangements were made to transfer ownership of flats in urban areas to the residents. Additionally, we are planning to establish plantation villages. These efforts are all aimed at improving the lives of ordinary citizens.

We are inviting large-scale investors, both domestic and international, to invest in the country. Simultaneously, we have introduced measures to support the general public, including small and medium businesses affected by the previous economic crisis.

Three-wheel drivers are also a priority as we advance the economy. We must consider the consequences of disrupting this economic system or violating lending conditions. We have reached a crucial point. To ensure continued progress, we must adhere to the International Monetary Fund’s programme, and I urge everyone to recognize this necessity.”

Former Finance Minister Ravi Karunanayake noted that as the country makes positive strides, professional drivers have come together to form several new transport associations by merging existing ones, aiming to advance the country under a unified economic policy. He recalled the dark times of long queues and the challenges faced during President Wickremesinghe’s early days in office, emphasizing the current positive direction of the country.

Sampath Ranasinghe, Chairman of the Joint Transport Society Centre, highlighted the severe disruptions faced by the transport sector during the COVID-19 pandemic and subsequent fuel shortages. He praised the methodical approach of President Wickremesinghe in advancing the country’s economy post-crisis.

Secretary of the International Chamber of Commerce, Hemakumara Gunasekara, emphasized the significance of the President meeting with professional three-wheeler drivers, recognizing their vital role in society and the importance of addressing their issues through established associations.

The event was attended by Member of Parliament Premanath C. Dolawatta, Patron of the United Three-wheeler Drivers and Owners Association Mahinda Kahandagama, Rahuman Palli, Chairman of the United Passenger Transport Three-wheeler Drivers Association, and representatives from various transport associations and three-wheeler drivers.