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SJB demands transparency in debt restructuring process

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Dr. Harsha de Silva

The Samagi Jana Balawegaya (SJB) has urged the government to maintain transparency in the ongoing debt restructuring process as national elections are around the corner and that the next government will have to honour the conditions agreed upon by the incumbent administration.

The SJB said so soon after the government of Sri Lanka rejected international bondholders’ proposal in respect of restructuring more than $12 billion in debt.

Some of the proposal’s “baseline” assessments and a lack of a contingency option in the case of continued economic weakness were the two main reasons the deal was not agreed, the government said in a statement.

The following is the text of statement issued by Dr. Harsha de Silva, MP, on behalf of the SJB: “These initial comments are based on the first reading of the press release by the Finance Ministry moments ago.

“We reserve the right to make additional comments upon in depth study of the proposals in the attachments.

“At the outset, we note with disappointment that there has been absolutely no transparency in the government’s debt restructuring process even though we had requested for the same. In fact I personally requested a meeting with the relevant stakeholders, both as the economics spokesperson for the main Opposition SJB, and as the Chairman of the COPF. That opportunity was not provided, instead a meeting with government officials was arranged to discuss the IMF programme which we had no reason to attend as we anyway meet the delegation during their visits and exchange views on the same.

“From the media statement it is obvious that the government has failed to strike a deal favourable to the people of

Sri Lanka. We acknowledge however, that it is better to withdraw from the discussions than to agree to a bad deal.

“Having said that, the statement by the President’s Chief of Staff Sagala Ratnayaka that the two sides agreed on two of the four issues is not accurate when the note categorically states that no agreement had been reached, only that they ‘came closer to meeting of minds’ if a significant additional payment was made and even then, contingent upon the government side agreeing to the bondholders remaining conditions.

It is clear that the participating bond holders do not want to move away from the original macro linked bond (MLB) structure they proposed based on the performance of the Sri Lanka economy to be measured on their much higher ‘alternative baseline’ as opposed to that of the IMF. The main problem with this approach from the point of view of Sri Lanka is with their proposed structure of sharing the upside. It is not acceptable given the pain already incurred and will be incurred for decades to come by domestic creditors forced upon by the domestic debt restructure. It is now clear the alternative restructuring proposal by the government consisting of a mix of plain vanilla and MLB has been rejected by the bond holders.

“We do understand the need for some type of value recovery instrument (VRI) that could be a component of the final restructured series, but we are of the opinion that to link the same to every bond takes away the freedom of a future government to manage the nation’s liabilities in the most beneficial way for Sri Lanka. It is possible to discuss the VRI structure that is detachable from the main instrument.

“We are happy to note the inclusion of a discussion on a possible governance linked bond (GLB) structure and would be interested in discussing how that can be worked into a possible instrument to be agreed upon.

“We urge the government to be much more transparent in this restructuring process given that elections are around the corner and that the next government and those to come will be held responsible to honor the conditions agreed upon by this government in its final months. We are fully aware that any unilateral suspension of meeting any of the agreed payments would mean a second default which would be an absolute disaster.”



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Tobacco and alcohol claim 22,000 lives annually

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Health and Mass Media Secretary Dr Anil Jasinghe speaking to NPP MP Samanmali Gunasinghe during the sectoral oversight committee meeting

NATA to be given more powers

The Parliamentary Sectoral Oversight Committee on Health, Mass Media and Women’s Empowerment has agreed in principle to ban single-stick sales of cigarettes and increase taxes on tobacco products, according to parliamentary sources.

The decision was reached during an institutional review of the National Authority on Tobacco and Alcohol (NATA) held recently in Parliament. The meeting was chaired by MP Dr. Nihal Abeysinghe.

During the review, NATA officials informed the committee that approximately 22,000 deaths occurred annually in Sri Lanka due to tobacco and alcohol consumption. They said the country suffered an economic loss of between Rs. 225 billion and Rs. 240 billion each year due to the consumption of tobacco products and alcohol.

Officials told the committee that steps were underway to amend the National Authority on Tobacco and Alcohol Act to grant it more powers.

Noting that 104 countries had already banned the sale of loose cigarettes, the underscored the need for Sri Lanka to adopt a similar policy. When loose cigarettes were sold, mandatory health warnings on cigarette packets were not visible to consumers, the NATA officials said.

The committee was also briefed on the importance of imposing taxes on cigarettes after determining their retail prices, as part of broader measures aimed at reducing tobacco consumption.

Commenting on the matter, Dr. Abeysinghe said the committee was prepared to extend its full support for the proposed amendments to the Act, as well as for other programmes and initiatives undertaken by the National Authority on Tobacco and Alcohol.

Deputy Chair of the Committees Hemali Weerasekara, committee members MPs Dayasiri Jayasekara, Muneer Mulaffer, Samanmali Gunasinghe, Prof Sena Nanayakkara, Dr S. Sri Bhavanandarajah, Dr Ramanathan Archchuna and with the permission of the Chair, MPs Dr. Janaka Senarathna and Dr Pathmanathan Sathiyalingam were present at the committee meeting.

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Development Officers hunger strike drags on for fourth day

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Development officers on hunger strike demanding absorption into the teacher service, outside the Presidential Secretariat at Colombo.

The hunger strike launched by a group of Development Officers demanding their absorption into the teacher service entered its fourth day yesterday (29) outside the Presidential Secretariat Colombo.The protesters, members of the Ceylon School Development Officers’ Union (CSDOU), began their satyagraha on January 26.

One of the four officers participating in the fast-unto-death fell seriously ill on the fourth day and was rushed to hospital for treatment, while the remaining three continued the hunger strike. Earlier, Dr. Chamal Sanjeewa, President of the Doctors’ Trade Union Alliance for Medical and Civil Rights, visited the protest site to examine the health of the protesters and oversaw the administration of saline to those suffering from dehydration.

CSDOU Secretary Viraj Manaranga criticised authorities for refusing to listen to the protestors.

“Not a single official from the relevant authorities has come forward to hear our grievances, which is a matter of serious concern,” he said, accusing the government of negligence and “stepmotherly treatment” of the issue.

The Ceylon Teachers’ Union (CTU) echoed the need for legal and procedural adherence, noting that there are currently 40,000 teacher vacancies nationwide. The union stressed that a significant number of development officers and graduates remain outside the teaching service, despite provisions in the teacher service constitution allowing for their appointments, which fall under the powers of Provincial Councils.

National People’s Power (NPP) MP Chandana Sooriyarachchi said graduate development officers are required to sit a compulsory competitive examination. Former Education Minister Akila Viraj Kariyawasam, who oversaw appointments under the Good Governance administration, also stated that direct appointments are legally not feasible. He added that school development officers were absorbed into the teacher service in 2018 through competitive exams and stressed that appointments must follow established procedures, warning that strikes would not alter this process.

The hunger strike continues to draw attention to the demands of the Development Officers as they urge the government to take immediate steps to address their grievances.

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IMF urges Lanka to diversify trade amidst global tariff risks

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Srinivasan

Sri Lanka and other small Asian economies must accelerate trade diversification or face heightened vulnerability to global tariff disputes and shifting supply chains, warned Krishna Srinivasan, Director of the Asia and Pacific Department at the International Monetary Fund (IMF).

Speaking in Colombo on the evolving global trade landscape, Srinivasan highlighted Asia’s growing exposure, particularly in the wake of tariff tensions between the United States and China. “Asia benefited a lot from trade integration, benefited a lot from openness to trade,” he said. “So much so that when tariffs were imposed by the US, Asia was subject to the highest level of tariffs.”

He cautioned that the region that gained most from open markets is now at risk of bearing the brunt of protectionist measures. For countries like Sri Lanka, he said, the message is clear: diversify or be exposed.

Srinivasan also noted that South Asia remains the least integrated sub-region in the continent. “Having greater integration with your partners within the sub-region will take you a long way,” he said. For small economies, he added, building deeper trade ties with neighbours and broadening export and production bases is essential for resilience.

Meanwhile, Sri Lanka has received a strong vote of confidence from the IMF following a high-level meeting between President Anura Kumara Dissanayake and the delegation at the Presidential Secretariat.

The visiting IMF representatives, who arrived on January 22 to assess the damage caused by Cyclone Ditwah, spent a week touring the island, engaging with affected communities and observing the impact firsthand. In a briefing, the delegation praised the government’s swift relief efforts, infrastructure restoration, and commitment to rebuilding lives, noting widespread appreciation among citizens for the administration’s handling of the crisis.

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