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Godahewa warns of economic challenges

Published

2 years ago

2023/09/19

Former State Minister Dr. Nalaka Godahewa, MP yesterday pointed out that a careful look at the Central Bank’s 2023 data revealed that the much-touted promise to build a thriving export-oriented economy under the current government was only a pipedream.

Addressing the media at the Nidahasa office at Nawala where he dealt with economic issues, the dissident SLPP MP said that according to the Central Bank’s data, by the end of the first half of 2023, the trade account exhibited a much expanded deficit of $364 million, a significant departure from the $22 million surplus recorded in June 2022. Furthermore, export earnings and import expenditures for the first half of 2023 had both declined by 10 percent and 18.6 percent, respectively, compared to the previous year. Earnings from industrial products, primarily driven by the apparel industry, had contracted by 12%, plummeting from $5,260 million in the first half of 2022 to $4,616 million—a drop of $650 million. Notably, the garment industry, a critical export sector, experienced an 18% decrease, declining from $5,260 million to $2,461 million in compared to the first half of 2022, resulting in a substantial $516 million reduction.

Dr. Godahewa argued that this compelling evidence pointed to a failure in achieving an export-oriented economy, as advocated by the President. However, he also emphasised that tourism revenue and remittances from foreign workers, which were not included in the trade balance, could potentially offset the balance of payments deficit if the government continued to postpone settling foreign debts. Consequently, he pointed out that there should be no issue with importing oil and gas until debt repayment commenced, stressing that economic growth was the only way to manage the country while servicing debts simultaneously.

Nonetheless, Dr. Godahewa noted that the overall state of the economy was concerning, with four consecutive quarters of economic contraction. In the first quarter of 2023 alone, the economy had contracted by 11.5%. He speculated that the contraction in the second quarter would be even more pronounced, although the central bank reports were delayed.

The MP expressed optimism that the government would secure the second installment of the promised $2.9 billion loan over five years from the IMF. However, he cautioned against viewing this positively, as many of the measures taken could have long-term detrimental effects on the country. For example, he highlighted the reduction of employees’ pensions due to domestic debt restructuring and the loss of numerous jobs due to the government’s economic mismanagement, particularly in key employment sectors such as construction and the garment industry.

To meet IMF demands, the government had raised taxes, leaving the working population financially strained. The government aimed to increase tax revenue by 70% by 2023, with tax revenue expected to rise from 1852 billion rupees in 2022 to 3130 billion rupees in 2023. This meant a 70% reduction in disposable income for most people, who already spent the majority of their earnings on basic necessities like food, electricity, and water.

Dr. Godahewa emphasized that there was little money left for essential expenses like education, healthcare, and clothing. This tax burden had driven professionals to leave the country in large numbers, with over 800 doctors, more than 300 specialist doctors, over 1000 engineers, over 500 university professors, and thousands of other professionals departing in the first half of 2023. This brain drain raised concerns about the nation’s ability to build and develop in the future.

The MP asserted that the government’s unreasonable tax policy was ineffective. They pointed out that when taxes were reasonable, people and businesses were more compliant, whereas excessive taxes led to emigration and business closures. By June 2023, the government had only managed to collect 77% of the expected tax revenue, even amidst a significant economic downturn.

The MP also criticized the government for attempting to stifle democratic processes, referencing recent remarks by the President and the Leader of the United National Party concerning the availability of funds for oil and gas in the event of a 2024 election.

Dr. Godahewa argued that the government’s decision to cancel local government elections due to financial constraints was questionable. For the local government election, the Election Commission had initially requested 10 billion rupees, which was later reduced to 4 billion rupees. Despite this, the government claimed it couldn’t afford to allocate the 4 billion rupees for the election, even though they had earmarked an additional 1390 billion rupees as government expenditure for 2023 compared to 2022. Dr. Godahewa pointed out that a mere 0.3% of the total estimated government expenditure was required to fund the election.

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Related Topics:Dr Nalaka Godahewa Former State Minister Dr. Nalaka Godahewa

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Maintaining public trust is a fundamental responsibility of the Police Department – President

Published

1 hour ago

2025/04/8

Priyan

Attending the passing out parade of the 82nd batch of the Special Task Force (STF) at the Katukurunda STF Training Camp in Kalutara on Monday (07), President Anura Kumara Disanayake emphasized the need for a progressive transformation within the Sri Lanka Police to ensure the rule of law, order and authority.

The President noted that the public places its trust in the Sri Lanka Police to uphold the supremacy of the law and maintaining that trust is a fundamental responsibility of the Police Department.

Addressing the newly commissioned officers, President Disanayake stated that how one serves and respects their profession is reflected in their career and urged the officers to embrace their professional duty in a way that contributes meaningfully to the transformative change the country requires.

Highlighting the current state of institutional breakdown in many sectors, the President pointed out that the people have already initiated change by altering the political authority, but reiterated that political transformation alone is insufficient. Instead, a comprehensive and positive transformation across all sectors is necessary for national progress.

The President further emphasized that new police officers carry the responsibility of meeting public expectations. He called on them to ensure public safety and security and to prevent the nation from falling prey to organized crime and drug-related issues.

He also stated that the younger generation must take responsibility for the motherland, bearing that duty on their shoulders and should strive to steer both their personal future and the future of the country in a positive direction.

President Disanayake concluded by saying that joining the regular service of the Sri Lanka Police today should be remembered by all as a significant and powerful step forward.

The President further noted that the service rendered by the Special Task Force (STF) on behalf of the public during times of emergency and disaster is highly commendable.

A total of 118 newly recruited Sub-Inspectors and 231 Probationary Police Constables who successfully completed their basic training graduated during the ceremony.

President Anura Kumara Disanayake awarded certificates and honours to officers who demonstrated exceptional performance during the training programme.

A commemorative token was also presented to President Disanayake, who attended the ceremony as the Chief Guest.

An operational demonstration by STF officers on a simulated battlefield was presented as part of the event.

Established in 1983 under the theme “Victory is Certain”, the Sri Lanka Police Special Task Force is currently recognized as a prestigious unit deployed for VIP protection, crime and organized crime suppression and narcotics control efforts aimed at building a drug-free nation.

The ceremony was attended by Minister of Public Security and Parliamentary Affairs Ananda Wijepala, Minister of Health and Mass Media Dr. Nalinda Jayatissa, Deputy Minister of Public Security Sunil Watagala, Secretary to the Ministry of Public Security Ravi Seneviratne, Acting Inspector General of Police Priyantha Weerasooriya, STF Commanding Officer Senior Deputy Inspector General of Police Samantha de Silva, along with other senior police officers, the parents of graduating officers and other invitees.

[PMD]

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Submission of gazette notifications for the concurrence of the Parliament.

Published

2 hours ago

2025/04/8

Priyan

The Cabinet of Ministers approved the resolution furnished by the President, in his capacity as the Minister of Finance, Planning and Economic Development to submit the following notification / order / rule published in the government gazette notification to the Parliament for its concurrence:

• Notification on the revision of tax limit of luxury on motor vehicles under the Finance Act No. 35 of 2018 published in the extraordinary gazette notification No. 2421 / 41 dated 31.01.2025.

• Rule issued under the Production Levy (Special Provisions) Act No. 13 of 1989 on revision of production levy rate for vehicles operated with electricity published in the extraordinary gazette notification No. 2421 / 42 dated 31.01.2025

• Order issued under the Finance Act No. 25 of 2003 on extension of the period on which the 50% relief is active which is given to the deviation levy published in the extraordinary gazette notification No. 2421 / 30 dated 31.01.2025

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Cabinet approval to prepare new Act for securing the rights of plant species

Published

2 hours ago

2025/04/8

Priyan

Although there are legal provisions for the right to publish, technical planning, right of patent, trademarks and enterprises etc, in the Intellectual Property Act No. 36 of 2003, there are no provisions for securing the rights of plant species (relevant to breeders, researchers and farmers).

In addition, no patents can be issued for flora and fauna according to the provisions of the intellectual rights act. Therefore, approval of the Cabinet of Ministers was granted at their meeting held on 22.05.2024 to introduce a new act for securing the rights of plant species.

Wherefore, the Legal Draftsman has pointed out that policy approval of the new Cabinet of Ministers should be taken to complete the drafting of the new flora species rights securing act.

Accordingly, the Cabinet of Ministers granted approval to the proposals submitted by the Minister of Agriculture, Livestock, Lands and Irrigation for the preparation of the said draft bill.