News

Lanka eyes December bailout, IMF says timing hard to predict

Published

3 years ago

2022/10/2

(Nikkei Asia) Sri Lanka’s government appears increasingly upbeat about its chances of receiving International Monetary Fund (IMF) board approval for a USD 2.9 billion bailout by December, but the multilateral lender has cautioned that the time frame remains uncertain, and much depends on discussions with the heavily indebted country’s creditors.

Peter Breuer, senior mission chief for Sri Lanka, and Masahiro Nozaki, mission chief for Sri Lanka, in written comments to Nikkei Asia, said, “It is difficult to predict the timeline, as the process of debt relief discussions takes time. All parties who are involved in the process should move expeditiously, so that Sri Lanka can emerge from the crisis as quickly as possible.”

On Sept. 1, Sri Lanka reached a staff-level agreement with the IMF to obtain the $2.9 billion, a crucial lifeline for a country wrestling with the worst economic crisis in its history. The country’s year-on-year inflation topped 70% in August, and the public continues to face severe shortages of essentials.

Earlier this year, Sri Lanka defaulted on a foreign bond for the first time, after its foreign reserves dwindled to next to nothing. “We announced that we are not in a position to pay,” central bank Gov. Nandalal Weerasinghe said in May, confirming the “pre-emptive default.”

“Our position is very clear. Until [the lenders] come and restructure, we can’t pay,” Weerasinghe said.

Last Friday, Sri Lanka’s Finance Ministry held an online presentation for external creditors to explain the situation and discuss the next steps toward restructuring. A handout cited “some past policy mistakes” along with the COVID-19 pandemic and the resulting crisis as key factors that crippled the economy, depleted reserves and forced the country to stop debt repayments.

The day before, President Ranil Wickremesinghe chaired a meeting with ambassadors from 23 Paris Club and non-Paris Club countries, including Japan, France and India, to discuss related matters.Wickremesinghe appealed to all creditor countries to offer the “financing assurances” on debt sustainability the IMF has said are essential for the board to give the final green light.

The Indian High Commission in Sri Lanka, for its part, expressed support even before the creditor briefings. On Sept. 20 it said that it had started discussions on restructuring Sri Lanka’s official debt to India. A spokesman told Nikkei Asia that the “cordial atmosphere” of the talks reflected New Delhi’s support for an “early conclusion and approval of a suitable IMF program.”

Noting the need for other creditors to work on ensuring Sri Lanka’s debt is manageable, he added that India would remain “closely engaged” with relevant stakeholders.

During last Friday’s presentation, Weerasinghe and Mahinda Siriwardana, secretary to the Treasury and Ministry of Finance, noted that as of the end of June, Sri Lanka’s public debt stood at 122% of gross domestic product. A figure equivalent to 70% of GDP was denominated in foreign currency.According to the presentation by the Ministry of Finance and the central bank, China, Japan and India were the country’s top three bilateral creditors, with China accounting for 52% in total, followed by Japan at 19.5% and India at 12%.

The Sri Lankan officials also pushed for the formation of an ad-hoc coordination group to expedite the process of obtaining financing assurances from multiple creditors. They explained that such a group would allow official bilateral creditors to give such assurances to the IMF collectively, after discussing the matter among themselves.

The Japanese Embassy in Colombo agreed that it is essential for all creditors to come to the table for debt restructuring discussions to ensure that the process is transparent and fair. “If all the creditor countries will participate in a coordination platform proposed by President Wickremesinghe, the government of Japan is ready to contribute to the discussion in a constructive way,” the embassy told Nikkei Asia.

But all eyes are on top creditor China, known for its preference for refinancing loans or deferring repayments rather than restructuring and settling for loss-making “haircuts.”

On the sidelines of the United Nations General Assembly last week, Sri Lankan Foreign Minister Ali Sabry met his Chinese counterpart, Wang Yi, who pledged China’s support for a Sri Lankan economic recovery.A Chinese Foreign Ministry readout of the meeting said that Wang promised China “is ready to work with Sri Lanka to carry forward the traditional friendship, consolidate strategic mutual trust and deepen and expand pragmatic cooperation.” He also said that China would “continue to offer assistance within our capacity to help Sri Lanka overcome temporary difficulties.”

Still, a highly placed Sri Lankan diplomatic source said that although debt discussions have started with some countries, it is “impossible” to say how long they will take and when a final decision will be made.

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Financial contributions received for ‘Rebuilding Sri Lanka’ Fund

Published

1 hour ago

2025/12/22

Priyan

The Government’s ‘Rebuilding Sri Lanka’ Fund, established to provide relief and support to communities affected by Cyclone Ditwah, continues to receive financial contributions on a daily basis.

Accordingly, the Containers Transport Owners Association made a financial contribution of Rs. 1.5 million, while the Association of SriLankan Airlines Licensed Aircraft Engineers contributed Rs. 1.35 million to the Fund.

The respective cheques were formally presented to the Secretary to the President, Dr. Nandika Sanath Kumanayake, at the Presidential Secretariat on Friday (19).

The occasion was attended by W. M. S. K. Manjula, Chairman of the Containers Transport Owners Association, together with Dilip Nihal Anslem Perera and Jayantha Karunadhipathi.

Representing the Association of SriLankan Airlines Licensed Aircraft Engineers were Deshan Rajapaksa, Samudika Perera and Devshan Rodrigo handed over the cheque.

News

UNICEF representatives and PM discuss rebuilding schools affected by the Disaster

Published

1 hour ago

2025/12/22

Priyan

A meeting between Prime Minister Dr. Harini Amarasuriya and a delegation of UNICEF representatives was held on Saturday, (December 20) at the Prime Minister’s Office.

During the meeting, the Prime Minister explained the measures taken by the Government to ensure the protection of the affected student community and to restore the damaged school system, as well as the challenges encountered in this process.

The Prime Minister stated that reopening schools located in landslide-prone areas would be extremely dangerous. Accordingly, the Government is focusing on identifying such schools and relocating them to suitable locations based on scientific assessments.

The Prime Minister further noted that financial assistance has been provided to students affected by the disaster, enabling parents to send their children back to school without an additional financial burden. Emphasizing that school is the safest place for children after their homes, the Prime Minister expressed confidence that the school environment would help restore and improve students’ mental well-being

The Prime Minister also highlighted that attention has been given to several key areas, including the relocation of disaster-affected schools, restoration of school infrastructure, merging and operating certain schools jointly, facilitating teaching and learning through digital and technological strategies, and providing special transportation facilities. She emphasized that the Government is examining these issues and is committed to finding long-term solutions.

The UNICEF representatives commended the Government’s commitment and the initiatives undertaken to restore the education sector and assured their support to the Government. Both parties also discussed working together collaboratively on future initiatives.

The meeting was attended by the UNICEF representatives to Sri Lanka Emma Brigham, Lakshmi Sureshkumar, Nishantha Subash, and Yashinka Jayasinghe, along with Secretary to the Ministry of Education Nalaka Kaluwewa, Director of Education Dakshina Kasturiarachchi, Deputy Directors Kasun Gunarathne and Udara Dikkumbura.

(Prime Minister’s Media Division)

News

NMRA laboratory lacks SLAB accreditation

Published

3 hours ago

2025/12/22

Thilina Walpola

Dr. Sanjeewa

Drug controversy:

“Setting up state-of-the-art drug testing facility will cost Rs 5 billion”

Activists call for legal action against politicians, bureaucrats

Serious questions have been raised over Sri Lanka’s drug regulatory system following revelations that the National Medicines Regulatory Authority’s (NMRA) quality control laboratory is not accredited by the Sri Lanka Accreditation Board (SLAB), casting doubt on both the reliability of local test results and the adequacy of oversight of imported medicines.

Medical and civil rights groups warn that the issue points to a systemic regulatory failure rather than an isolated lapse, with potential political and financial consequences for the State.

Chairman of the Federation of Medical and Civil Rights Professional Associations, Specialist Dr. Chamal Sanjeewa, said the controversy surrounding the Ondansetron injection, which was later found to be contaminated, had exposed deep weaknesses in drug regulation and quality assurance.

Dr. Sanjeewa said that the manufacturer had confirmed that the drug had been imported into Sri Lanka on four occasions this year, despite later being temporarily withdrawn from use. The drug was manufactured in India in November 2024 and in May and August 2025, and imported to Sri Lanka in February, July and September. On each occasion, 67,600 phials were procured.

Dr. Sanjeewa said the company had informed the NMRA that the drug was tested in Indian laboratories, prior to shipment, and passed all required quality checks. The manufacturer reportedly tested the injections against 10 parameters, including basic quality standards,

pH value, visual appearance, component composition, quantity per phial, sterility levels, presence of other substances, bacterial toxin levels and spectral variations.

According to documents submitted to the NMRA, no bacterial toxins were detected in the original samples, and the reported toxin levels were within European safety limits of less than 9.9 international units per milligram.

Dr. Sanjeewa said the credibility of local regulatory oversight had come under scrutiny, noting that the NMRA’s quality control laboratory was not SLAB-accredited. He said establishing a fully equipped, internationally accredited laboratory would cost nearly Rs. 5 billion.

He warned that the failure to invest in such a facility could have grave consequences, including continued loss of life due to substandard medicines and the inability of the State to recover large sums of public funds paid to pharmaceutical companies for defective drugs.

“If urgent steps are not taken, public money will continue to be lost and accountability will remain elusive,” Dr. Sanjeewa said.

He added that if it was ultimately confirmed that the drug did not contain bacterial toxins at the time it entered Sri Lanka, the fallout would be even more damaging, severely undermining the credibility of the country’s health system and exposing weaknesses in health administration.

Dr. Sanjeewa said public trust in the health sector had already been eroded and called for legal action against all politicians and public officials responsible for regulatory failures linked to the incident.

by Chaminda Silva ✍️