News
Prof. Dunusinghe debunks govt.’s claims about stabilising economy
By Rathindra Kuruwita
Until Sri Lanka has access to international money markets, which will allow it to ensure there are no short-term dollar shortages, relaxing the restrictions on vehicle imports is out of the question, Professor in Economics at the Department of Economics at Colombo University, Dr. Priyanga Dunusinghe, said.
Even then, relaxing vehicle imports should be done in a slow and methodical manner, he said.
“A lot of people ask me whether I can give a date when this could be. However, giving a timeline is difficult because we have not yet managed to restructure our international debt. The government says this can be done in the middle of the year. Once the government manages that, we will have access to bilateral credit. After a while, we might be able to slowly relax restrictions on imports.”
Prof. Dunusinghe said people must not expect our economy to return to 2018 levels, soon after foreign debt is restructured.
He added that even if the government succeeds in foreign debt restructuring, it is improbable that the rupee will strengthen. It is likely that the rupee will hover around the current rates or be in a slightly depreciated state.
“We see increased economic activity, and with this, the demand for imports will rise. However, given that market mechanisms govern the exchange rate, I don’t see large fluctuations.”
Even with recent hikes, the tax revenue of the government is not adequate to cover the expenses. When the daily revenue is about 11 billion rupees, the daily expenditure is around 19 billion rupees, he said.
“The government needs to reduce its expenditure. It should also take steps to collect the taxes it can. The government says it has stabilised the economy, but many fear that it’s not a ‘stabilisation’ that can lead to growth in the medium term.”
Prof. Dunusinghe said Sri Lankans see Ministers still enjoying perks. They have not reduced their expenditure. There are also many issues with the procurement process.
Recently, Verite Research issued a report, and they said Sri Lanka’s procurement guidelines don’t allow for blacklisting contractors/suppliers involved in fraud and corruption, and the compliance gap is shown by the failure to maintan a blacklist for defaulting contractors.
“We are the only South Asian country that doesn’t blacklist contractors/suppliers involved in fraud and corruption. There are so many instances where companies provide low-quality goods to government agencies. We see so many substandard constructions. Things are increasingly getting worse. Companies make profit by selling a 100-rupee item at 250 to the government and make profit. How can the government reduce expenditures like this? If we make the procurement process transparent, a lot of waste can be reduced.”
Prof. Dunusinghe said corruption and bribery have to be stopped for the country to go forward. Government, as well as senior bureaucrats, have a significant role to play.
He added that Sri Lanka has a great potential for tourism. However, the country should be mindful that the industry seems to face extremely challenging situations once every three to four years.
“This is like a bubble that can burst. We should focus on tourism, but we must also focus on boosting exports. Remittances are also important, but overdependence on them becomes a curse. In recent years, we have become increasingly dependent on remittances and tourism, and we don’t focus on anything else. We don’t think about boosting exports. We send our youth and professionals abroad, hoping they will send a lot of money. This is how we plan on running our economy. Let me be clear: no country has developed from remittances.”
Prof. Dunusinghe said a strong export sector, based on correct Foreign Direct investment (FDI), is the path for development for Sri Lanka.
“Depending on tourism alone is also very risky. We need to diversify,” he said.
News
War-linked power crunch pushes Lanka to four-day week
(AFP ) Millions of Sri Lankans enjoyed a government-ordered extra day off on Wednesday as the island nation battles an energy crisis triggered by the Middle East war.
Rail and bus stations were largely deserted as most state institutions, schools and universities shifted to a four-day working week.
“I am really enjoying the mid-week break because it is a fully paid holiday,” said housing ministry official Prarthana Perera, 40.
Her office, like many government departments in Battaramulla — the capital’s main administrative hub — was closed.
Banks operated on shorter hours, while many private firms introduced work-from-home arrangements, industry bodies said, urging members to help curb energy use.
Sri Lanka has already raised fuel prices by a third since the United States and Israel began bombing Iran, triggering retaliatory attacks that have disrupted global energy supplies.
About half of Sri Lanka’s electricity is generated by coal and diesel.
The cabinet has set a target of cutting electricity consumption by 25 percent, ordering street lamps switched off and asking civil servants to use table fans instead of power-hungry air conditioners.
Shipping executive Varuna Perera welcomed the day off but was uncertain of its impact.
“It will not be effective in the long term,” Perera said. “But the government will have a breather for a couple of weeks, to save some energy.”
Environmental lawyer Ravindranath Dabare was more sceptical, arguing the move would have limited impact as those needing government services would have to travel on other days.
“We can’t close hospitals… the doctors and health officials can’t work from home,” Dabare said.
The influential Chamber of Commerce said it had urged members to follow government guidelines or adopt remote work where possible, if
“business continuity can be effectively maintained”.
And Sri Lanka’s leading technology firm WSO2 made working from home mandatory for its 500 employees on Tuesdays and Thursdays.
“This is our way of contributing to the national cause,” WSO2 spokeswoman Zaithoon Bin-Ahamed told AFP.
Media Minister Nalinda Jayatissa said the government had yet to assess the impact of the energy-saving measures, but expected broad compliance.
Sri Lanka has been running coal and diesel power plants at full capacity to meet electricity demand.
President Anura Kumara Dissanayake urged electric vehicle owners not to charge their cars overnight, as they would add a surge to an already strained grid.
He asked motorists instead to plug in during the day, when excess solar power is available.
Officials said the country’s diesel stocks are sufficient to last until mid-May, while petrol could last a week longer.
The government is seeking oil supplies from Russia and hopes to tap Iran for crude oil, Jayatissa said.
Political commentator Kusal Perera said the crisis also presented scope to boost productivity across the state sector.
“They must use this opportunity to have a national dialogue on improving productivity,” he told AFP. “We have to address the inefficiency in the public sector.”
By Amal JAYASINGHE
News
Lanka to swelter through April and May, Met Dept warns
Sri Lanka is set to experience continued hot weather conditions until May, the Department of Meteorology has warned.
Additional Director General of Meteorology Ajith Wijemanna said the current heatwave is expected to ease only slightly once the southwest monsoon sets in toward the latter part of May.
Wijemanna explained that the island is currently in the first inter-monsoon period, characterised by low wind speeds and shifting wind directions, which contribute to rising temperatures. Reduced cloud cover and the sun’s direct position over the country are causing increased heating of land and sea, generating heat waves and warmer atmospheric conditions.
He cautioned that the hottest period of the day will be between 11:00 a.m. and 4:00 p.m., urging the public to limit outdoor activities during these hours.
Authorities also advised drinking plenty of water, wearing light-colored clothing, and avoiding prolonged exposure to direct sunlight, particularly for children and the elderly.The Meteorology Department further noted that rainfall may remain limited in the coming months, with drier conditions possible due to climate variability.
News
Pathfinder Foundation launches Proposal for a National Security Strategy for Sri Lanka
The Pathfinder Foundation launched a proposal for a National Security Strategy for Sri Lanka—2026, emphasising the urgent need for a comprehensive and state-led national security framework.
The proposed strategy contends that an effective National Security Strategy (NSS) must be based on a robust National Security Policy, which provides the long-term framework for protecting the country’s sovereignty, stability, and development in an increasingly uncertain global environment. The Pathfinder Foundation’s initiative, developed through consultations with academics, retired military officers, legal experts, and policy specialists, seeks to stimulate national discussion and support the formulation of an official state policy. The launch event was attended by those involved in preparing this proposal, heads of local think tanks, and media representatives.
Chairman of the Pathfinder Foundation, Amb. (Retd.) Bernard Goonetilleke, in his presentation of the report, emphasised that many major and middle powers, including the United States, China, the Russian Federation, the United Kingdom, Germany, Sweden, and Japan, have developed formal national security strategies. He pointed out that several South Asian and Southeast Asian countries, including India, Pakistan, Bangladesh, Nepal, Malaysia, Thailand, and Singapore, also rely on NSS, whereas Sri Lanka still lacks a single, officially adopted National Security Policy (NSP) or a National Security Strategy to guide long-term strategic planning.
The report highlights key strategic priorities across several sectors, including good governance, internal security, cybersecurity, energy and food security, health security, human capital development, and environmental protection. It also employs the internationally recognised DIME framework (Diplomacy, Information, Military, and Economy) to guide the coordinated use of national power in advancing Sri Lanka’s interests. Among its main institutional recommendations are establishing a fully legislated National Security Council, creating a National Security Secretariat, and officially appointing a National Security Advisor to coordinate policy and implementation across the government.
The full text of the report is available https://pathfinderfoundation.org/publications, and your comments a/ welcome via pm@pathfinderfoundation.org
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