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ISBs amounting to USD 10,000 mn issued by Yahapalana govt. ruined economy, says Mahinda
SLPP leader and former President Mahinda Rajapaksa, MP yesterday (20) alleged that USD 10,000 mn in new ISBs (International Sovereign Bonds) issued between 2015 and 2019 by the Yahapalana administration, comprising the UNP and the SLFP, had debilitated the economy.
Rajapaksa said that when he was voted out in January 2015, the outstanding ISB debt was only USD 5,000 mn. The Gotabaya Rajapaksa government ( 2020-2022) paid off USD 2,500 million in outstanding ISBs, which meant that only USD 2,500 million in ISBs now remained from his era.
The following is the text of the statement: Around 40 professional associations and trade unions representing vital sectors of the economy and the public services have been agitating for a reduction in income taxes for many months. In the meantime, the high tax burden has precipitated an exodus of educated and highly trained professionals from the country giving rise to a new crisis. Following increases in the VAT through the Budget for 2024, tax policy is set to become a major political issue in 2024.
The call to reduce taxes is based on solid economic principles. When taxes are low, both individuals and corporations have more money to spend and invest and this acts as a driver of the economy. Low taxes was a cornerstone of my government’s policy and it made a major contribution to the unbroken nine-year economic boom that this country experienced between 2006 and 2014. So as not to burden the people with taxes, my government of 2006-2014 restricted the overall year-on-year increase in government tax revenue to around Rs. 100 billion a year. Through careful economic management, my government reduced the debt to GDP ratio from 90% at the end of 2005 to 69% at the end of 2014 thus ensuring the feasibility of the low tax regime.
However, over the past several years there have been well-funded propaganda campaigns promoting a headlong and mindless opposition to everything, even remotely associated with the name ‘Rajapaksa,’ including the low tax policy. In order to blacken the very concept of low taxes, some even claimed that the Rajapaksa-led governments reduced taxes to help cronies. That is an outright lie. Tax exemptions can be granted only under laws like the Board of Investment Act and the Strategic Development Projects Act in order to attract investors for specified projects.
After 2015, the low tax regime was rejected in favour of a high tax regime. Unsurprisingly, Sri Lanka’s growth rate declined precipitously after 2015 ending up at 0.2 below zero by 2019. Due to bad economic management, the period from 2015 to 2019 saw an increase in taxes while at the same time experiencing a precipitous increase in foreign debt. When I was voted out in January 2015, the outstanding International Sovereign Bond debt was only USD 5,000 million. The Gotabaya Rajapaksa government of 2020-2022 paid off USD 2,500 in outstanding ISBs which means that only USD 2,500 million in ISBs now remains from my era.
Over USD 10,000 million in new International Sovereign Bonds were taken between 2015 and 2019. Hence we still have an outstanding ISB stock of USD 12,500 million. It was this USD 10,000 million in new ISBs taken between 2015 and 2019 that broke the back of our economy. When the Covid-19 pandemic struck Sri Lanka a few months after I became Prime Minister at the end of 2019, we wrote to the IMF in March 2020 asking for emergency assistance. The IMF wrote back saying that our debt levels disqualifies us from their emergency relief package.
They then proposed a raft of conditions that would qualify us for IMF assistance but those conditions would have made it impossible for us to face the Covid-19 threat in the manner that we did in 2020 and 2021. The present government is now implementing stringent conditions as part of an IMF programme. Thus one thing led to another, finally resulting in a situation where we now see top professionals holding multiple university degrees and professional qualifications agitating on the streets, demanding a reduction in taxes.
The SLPP which I lead is a part of the government. However the present Head of the Government and Head of State is the leader of a different political party with different policies. In a situation where this country was faced with complete anarchy, Parliament elected a President to serve the remainder of former President Gotabaya Rajapaksa’s term. The new President successfully restored law and order to the country. He is now directing government policy as the Executive President. At this moment, the primary duty of the SLPP is to ensure a stable government until the next national elections.
In the future, every member of the public should pay special attention to the tax policy and the past economic practices of the political party they vote for. As elections draw closer, once again we see attempts to hustle people blindly and unthinkingly in various directions through ramped up propaganda and social media hysteria. Whatever decision the people make at the next elections should be based on rational thinking, proper facts and correct data. We are still living through the consequences of January 2015 and this country cannot afford another mistake like that again.”
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BASL calls for conscience vote on 22nd Amendment
The Bar Association of Sri Lanka (BASL) yesterday called on all political parties, represented in Parliament, to allow their members to vote on the proposed 22nd Amendment to the Constitution according to their conscience, stressing that the responsibility for deciding whether the Bill should be enacted now rests with Parliament.
In a statement issued after the Supreme Court’s determination on the 22nd Amendment Bill, BASL President Rajeev Amarasuriya and General Secretary Nalin de Silva have said the SC’s determination should not be interpreted as an endorsement of the proposed constitutional amendment as a matter of policy.
The BASL has said the SC’s jurisdiction, under Articles 120, 121 and 123 of the Constitution, was to determine the constitutional requirements for the enactment of the Bill, including whether the Bill, or any of its provisions, required approval at a referendum under Article 83.
“The determination is therefore not a determination as to whether the proposed amendment is good or bad policy, desirable or undesirable, wise or unwise, or whether Parliament ought to enact it,” the BASL said.
Full text of the BASL statement: The Supreme Court has now delivered its Determination on the Twenty-Second Amendment to the Constitution Bill and determined that the Bill does not require the approval of the People at a Referendum.
In terms of Articles 120, 121 and 123 of the Constitution, the jurisdiction of the Supreme Court in relation to the Bill is to determine the constitutional requirements for its enactment, including importantly whether the Bill, or any provision thereof, requires the approval of the People at a Referendum by virtue of Article 83.
The Determination is therefore not a determination as to whether the proposed Amendment is good or bad policy, desirable or undesirable, wise or unwise, or whether Parliament ought to enact it.
This distinction is also evident from Sri Lanka’s previous constitutional amendments. During the 48 year history of the second republican Constitution there have been many amendments which passed constitutional muster but nevertheless had a negative effect on democracy, constitutionalism, the independence of the judiciary and the rule of law.
The question that now arises is whether Parliament ought to enact the proposed Amendment. That responsibility rests with Parliament and with each individual Member of Parliament when they vote on the Bill.
In making that decision, Members of Parliament should be mindful of the possible and probable consequences the 22nd Amendment will have on our nation. They should also consider the lack of transparency and a proper consultative process in the introduction of the 22nd Amendment. As representatives of the people they should also consider the concerns that have been expressed in relation to the proposed Amendment by a broad cross-section of society including the Maha Nayakes of the Three Nikayas, the Catholic Bishops’ Conference in Sri Lanka, the Church of Ceylon, the Bar Association of Sri Lanka, the Judicial Service Association, the Commonwealth Lawyers Association, LAWASIA, the International Association of Judges, the United Nations Special Rapporteur on the Independence of Judges and Lawyers, the French National Bar Council, and more than 40 Professional Associations and Unions, including the Government Medical Officers’ Association and other leading professional bodies.
Accordingly, the Bar Association of Sri Lanka calls upon all the political parties in Parliament to allow the Members of Parliament to speak and vote on the 22nd Amendment according to their conscience.
The responsibility now lies with Members of Parliament, when called upon to vote, to take a principled position according to their conscience giving due consideration to their constitutional responsibility, their representative capacity and most importantly their duty to the sovereign People of Sri Lanka.
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IMF: Sri Lanka on course for 2027 market return
SL to regain access to international financial and capital markets next year in line with IMF projections
Sri Lanka is on course to regain access to international financial and capital markets around 2027, in line with the International Monetary Fund’s (IMF) current economic projections, IMF Mission Chief Evan Papageorgiou said yesterday.
Papageorgiou said the IMF’s core assumptions under Sri Lanka’s economic programme continued to envisage the country returning to international capital markets in 2027.
“Our previous assumption that Sri Lanka will go back to capital markets still stands. We still have a good trajectory to achieving this in 2027 or thereabouts, and that should be the goal,” he said.
Papageorgiou stressed that Sri Lanka could not rely solely on domestic sources of financing to build long-term economic resilience and would need a diversified funding strategy.
“Every country needs to have a good ability to access funds both in domestic markets, as it already has, as well as international markets for eurobonds and other modes,” he said.
He said a return to international capital markets would have significant implications for Sri Lanka’s external debt composition, while strengthening foreign exchange reserves would remain essential as the country prepares to meet future debt-servicing obligations.
The IMF’s assessment comes amid improving international investor sentiment towards Sri Lanka and positive developments in the country’s sovereign credit ratings.
Papageorgiou cited Fitch’s recent upgrade of Sri Lanka’s credit rating as a positive development, saying global investors were increasingly viewing the country from a more constructive perspective.
Sri Lanka remains under the IMF’s Extended Fund Facility (EFF) programme, which is scheduled to continue until March 20, 2027. Regaining access to international capital markets remains a key milestone under the country’s broader economic recovery.
The IMF has stressed the importance of rebuilding Sri Lanka’s foreign exchange buffers and maintaining stability in domestic financial markets as the country approaches substantial external debt repayments.
A sustained improvement in these areas would help strengthen the country’s capacity to return to international markets while safeguarding macroeconomic stability, the IMF has indicated.
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President appoints three new judges to High Court
President Anura Kumara Dissanayake yesterday (23) handed over appointment letters to three Special Grade officers of the Judicial Service as High Court Judges, at a ceremony held at the Presidential Secretariat, according to the President’s Media Division (PMD).
The new appointees are Perumal Sivakumar, District Judge of Jaffna; Anandi Kanagaratnam, Senior Assistant Secretary of the Judicial Service Commission; and Gnanesha Lalith Kannangara, District Judge of Colombo.

The three senior Judicial Service officers will take up duties as High Court Judges following their appointments.
The appointments were made from among Special Grade officers of the Judicial Service, the PMD said.

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