News
Keerthi: IMF conditions painful but necessary
Country paying heavy price for delaying decision
By Shamindra Ferdinando
Former Governor of Uva, Southern and Central Provinces Rajith Keerthi Tennakoon yesterday (16) said that those who objected to the government seeking IMF’s assistance had ruined the economy.
President Gotabaya Rajapaksa had, in his address to the nation on Wednesday, expressed his willingness to seek IMF assistance, Tennakoon said.
Tennakoon, one-time Executive Director of polls monitoring body CaFFE told The Island that in fact Sri Lanka had been engaged in discussions with the IMF since February 2019 in the run-up to the presidential election.
But the talks had suffered a setback following the change of government following the 2019 presidential election, Tennakoon said, adding that one of conditions was the enactment of Monetary Law Act to bring about discipline the financial sector and stability, Tennakoon said.
According to him, one of the key conditions had been to remove Secretary to the Finance Ministry from the five-member Monetary Board. The IMF believed far reaching changes were necessary to restore financial discipline, particularly uncontrolled printing of notes that had caused inflation.
Tennakoon said that Finance Minister Basil Rajapaksa favoured IMF’s intervention. As soon as he succeeded Mahinda Rajapaksa as the Finance Minister in July last year, Sri Lanka sought the IMF intervention. Much respected former Governor of the Central Bank and head of a Sri Lanka overseas mission arranged the IMF’s intervention, Tennakoon said.
Responding to queries, Tennakoon said that the government would be asked by the IMF to implement the late Mangala Samamaweera’s formula that helped Treasury to collect well over Rs 1,900 bn in 2019 and the current dispensation lost well over Rs. 500 bn due to a controversial decision to do away with a range of taxes, including PAYE (Pay As You Earn), NBT (Nation Building Tax), Withholding tax, Capital Gain tax imposed on the Colombo Stock Exchange, Bank Debit tax and unprecedented reduction of VAT (Value Added Tax).
Tennakoon said that the 15% VAT and the 2% NBT which amounted to 17% imposed on all goods and services were unified and reduced to 8%, effective from the first of December 2019.
He said that the decision was taken at the first cabinet meeting of the incumbent government held on Nov 27, 2019.
Sri Lanka would be also asked to introduce pricing mechanisms for electricity and fuel if the government wanted IMF’s assistance, Tennakoon said. Interest rates, too, shouldn’t be subjected to political whims and fancies, Tennakoon said, adding that the IMF conditions would cause tremendous pressure on the government though it was in such a desperate situation it couldn’t take a tough stand.
As many as 40 loss-making state enterprises including national carrier SriLankan were likely to be identified for privatization or re-structuring, Tennakoon said, urging political parties not to sabotage current efforts at reaching consensus on national economy.
The one-time favourite of former President Sirisena emphasised that the government should without delay inquire into the circumstances leading to the Central Bank suddenly floating rupee over a week ago. It would be pertinent to ask whether the Central Bank has sought Cabinet approval before the announcement was made, Tennakoon said, alleging the country suffered due to the Finance Ministry and the Central Bank pulling in different directions.
The civil society activist alleged that for want of a cohesive action plan, the government inadvertently caused serious mistakes though nothing could be as bad as handling of the national economy.
Tennakoon said that the IMF’s role undermined Pohottuwa policies but the ruling party couldn’t do anything about it. Commenting on social media reports of CBSL Governor Cabraal being asked to step down immediately, Tennakoon said that no one could force him to do so. Cabraal could continue till July 4, 2022 as he was in the process of completing the period allocated for his predecessor, Tennkoon said, adding that though the President could replace Cabraal after July 4 it wouldn’t help to address the crisis.
Religious and civil society leaders have called on President Anura Kumara Dissanayake to begin implementing the recommendations outlined in the Special Presidential Commission that investigated the Easter Sunday terror attacks without further delay.
Addressing a press conference held at the Centre for Society and Religion in Colombo, Lawyer Manoj Nanayakkara stated that 71 months have passed since the Easter Sunday attacks, yet justice has not been served for the victims.
“We are approaching the sixth anniversary of this heinous crime, which claimed nearly 300 lives and wounded twice as many others. President Anura Kumara Dissanayake had promised to conduct a fresh investigation into this crime. In the meantime, he could implement the recommendations of the Special Presidential Commission that probed the Easter Sunday terror attacks. This would demonstrate that the current government is keeping its word to deliver justice to the victims,” Nanayakkara said.
He also commented on Ven. Galagodatte Gnanasara Thero, who has been holding press conferences, claiming to have information related to the terror attacks and to know the masterminds behind them. “Our question is why he does not go to the law enforcement agencies and share the information he claims to possess. There is no purpose in making such statements at press conferences. As a citizen, his duty is to share this information with the investigating authorities.
Therefore, we believe that Gnanasara Thero is engaging in a political ploy at the behest of someone else. He should be aware that intentionally withholding information about a brutal massacre and failing to share it with the investigating authorities is an offence punishable under the Penal Code,” Nanayakkara said.Rev. Fr. Julian Patrick Perera, Rector of St. Joseph Vaz Deva Dharma Niketanaya, also addressed the press conference.
By Norman Palihawadana
The Colombo foreign ministry Friday formally announced Indian Prime Minister Narendra Modi’s visit to Sri Lanka when he will have bilateral talks with President Anura Kumara Disanayaka and Prime Minister Dr. Harini Amarasuriya.
While in Sri Lanka,Modi is scheduled to visit Anuradhapura to pay homage to the sacred Sri Maha Bodhi and will inaugurate several projects implemented in Sri Lanka with the assistance of the Government of India, a ministry release.
A number of Memoranda of Understanding inked between the two countries are also expected to be exchanged during this visit, it added.
The Indian PM will be accompanied by the Minister of External Affairs, the National Security Advisor, Foreign Secretary and other senior officials of the Government of India.
It was revealed in the Committee on Public Enterprises (COPE) that a private company named ‘Savorite’ was issued Waiver of Registration (WoR) certificates to import 38 types of medicines in 2022 without the evaluation of the National Medicines Regulatory Authority (NMRA).
The former Secretary to the Ministry of Health also informed the Committee that the former Minister of Health had given instructions to select this private company to import medicines in this way, parliament sources said on Friday.
This was disclosed when the COPE met in Parliament recently under the chairmanship of MP Dr Nishantha Samaraweera, to examine the Auditor General’s reports for the years 2022, 2023 and 2024 and the current performance of the NMRA.
The Committee Chair informed the committee that on December 30, 2022, the NMRA had issued Waiver of Registration (WoR) certificates to a private company named ‘Savorite’ for the import of 38 types of medicines submitted through unsolicited proposals without the evaluation of the NMRA.
The Committee Chair said that the NMRA has abdicated its responsibility, stating that the purpose of establishing the NMRA is to ensure the quality, safety and efficacy of those medicines and that it cannot be handed over to the Medical Supplies Sector.
Former members of the Board of Directors of the NMRA said that since the import of medicines through a special pathway with prior approval was carried out, the Board of Directors could not grant permission for it without conducting a proper evaluation. Therefore, they said that they did not accept responsibility in this regard.
Accordingly, this matter was discussed at length in the committee, and it was revealed that the former Minister of Health had instructed to select a private company called ‘Savorite’ to import the medicines in short supply for three months.
Meanwhile, the Committee also discussed at length the Cabinet Memorandum submitted by the former Minister of Health on September 26,2022. The Committee Chair inquired from the Ministry of Health officials about the fact that a large number of medicines would reach zero levels within the next three weeks from the date of submission of the relevant Cabinet Memorandum.
The officials who responded said that the information had been added to the Cabinet Memorandum based on the information obtained from the existing database regarding medicines. However, the committee Chair said that it was unacceptable for a large number of medicines to reach zero levels at the same time and that the relevant responsible officials had acted irresponsibly until such a level was reached.
The Auditor General, who spoke at the time, stated that the medicines that were ordered and to be received in advance have also been imported, citing that the medicines have reached zero levels.
Accordingly, the committee chair instructed the officials to submit a full report to the Committee on who were the officials involved in preparing this Cabinet Memorandum. The Chair further stated that a full report regarding the import of these medicines will be prepared by the Committee and submitted to Parliament, and that necessary action will be taken expeditiously.
MPs Mano Ganeshan, Nalin Bandara Jayamaha, S. M. Marikkar, Chaminda Wijesiri, Attorney-at-Law Nilanthi Kottahachchi, Chandima Hettiarachchi, Asitha Niroshana Egoda Vithana, Kosala Nuwan Jayaweera, Sudath Balagalla, Dr S. Sri Bavanandarajah, Lt Com (Retd.) Prageeth Madhuranga and Samanmali Gunasinghe were present in this committee meeting.
Myanmar quake toll passes 1,600 as people dig for survivors with bare hands
Showers or thundershowers will occur at several places in Western, Sabaragamuwa, Southern, and Uva provinces and in Nuwara-Eliya and Ampara districts after 2.00 p.m.
Chapman, Abbas and Smith see off Pakistan challenge to give New Zealand 1-0 series lead
-
Foreign News6 days agoBuddhism’s holiest site erupts in protests over Hindu ‘control’ of shrine
-
Features4 days agoCelebrating 25 Years of Excellence: The Silver Jubilee of SLIIT – PART I
-
Editorial6 days agoWhen tractors become cars!
-
Business2 days agoAIA Higher Education Scholarships Programme celebrating 30-year journey
-
Business4 days agoCEB calls for proposals to develop two 50MW wind farm facilities in Mullikulam
-
Features4 days agoNotes from AKD’s Textbook
-
Features6 days agoPolitics of Enforced Disappearances in Sri Lanka
-
News1 day agoGnanasara Thera urged to reveal masterminds behind Easter Sunday terror attacks