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Midweek Review

Some thoughts on green financing options for Sri Lanka

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By Prof. Nimal Gunatilleke

This is a sequel to my earlier article, titled ‘The Sri Lankan Debt Crisis: A Layman’s Review’, which appeared in two parts on the 01st and 02nd June in The Island Midweek Review and also in the Daily Financial Times on the 06th and 07th June 2022. In the second part of that article, I highlighted some of the emerging global investment opportunities, such as Green Bonds that are being made available for restructuring sovereign debts in this green economic era.

In this article, I would like to draw attention to the additional green financing options that are currently available for prospective investors, based on recent successful examples from other countries. These green financing opportunities will only be available once the debts have been brought to a sustainable level, as dictated by the IMF. However, Sri Lanka is currently wrestling desperately with the task of securing bridging finance, either as donations or loans to meet her day-to-day needs spilled over to the streets, day in, day out.

Among the loans received in the form of fuel, food, and medical supplies, the USD 500 million loan through the Indian Credit line (more credit under negotiation) and more recently pledged loan of USD 120 million (and perhaps, additional grants) from the US stand out prominently. It is a relief to learn that several other countries and international agencies too have come forward to help Sri Lanka in her critical stage of the balance of payment crisis. All these loans being given in the name of bridge financing during this interim period will also be added on to the existing debt burden during the restructuring process. In the meantime, Sri Lanka needs to restructure its foreign debt or make substantial progress towards that goal before the IMF agrees to lend money.

Still being categorized as a Middle-Income Country, Sri Lanka is not entitled to interventions focused on providing debt relief to the Low-Income Countries, usually given on greater concessionary terms. The IMF intervention in this instance, as it happened 16 occasions earlier, since our independence, may once again recommend, among other solutions, outright sale, lease, or pawn of our family silver – the valuable real estate assets – as a stopgap fix to the debt problem. Consequently, IMF intervention alone is least likely to be a sustainable solution for our chronic trade deficit problem because Sri Lanka has been consistently spending more forex than it earns over the past decades. In all probability, this trend may continue further since the economically sound options for bridging the trade deficit are socially more painful and therefore politically inauspicious. The current mayhem that the country is going through and led by deceitful political forces would only lead to worsening the situation, further.

As we all are now well aware, we had been borrowing forex from the international capital markets to meet the deficit to balance the national budget each year over the past several decades, which obviously cannot keep going forever. If we continue to have this ‘business as usual’ attitude, the country will simply pile up bigger and bigger debts to pay back in the future despite IMF interventions. This is where the selling of family silver stealthily sneaks in.

Fortunately, however, there are new green financing opportunities emerging as a unified global response to the climate change mitigation and adaptation in transforming International Sovereign Bonds into more climate-friendly investments such as green bonds, climate bonds, sustainability bonds, payment for ecosystem services, debt for climate swaps, etc., under Paris agreement on climate change.

Green bonds

Although Sri Lanka has been quite late to enter the globally booming green bond market, our nearest neighbour, India has been expanding its green bond market vigorously over the recent years. This includes several projects they have supported in Sri Lanka as well, under the green bond label since 2015. Amongst them, the EXIM Bank of India, the closest proxy to the Sovereign in International Debt Markets in India, had supported three projects in Sri Lanka for the purpose of laying railway tracks from i) Omanthai to Pallai, ii) Pallai to Kankasanturai, and iii) Madhu church -Talaimannar sectors under eligibility in the mass transportation sector, since 2015 ().

The recently inked Sampur Solar Energy project by the National Thermal Power Corporation of India, and even the proposed Mannar and Pooneryn wind and solar energy projects to be funded by the Indian investors may be coming under similar green or other such bond schemes. On the other hand, the only Sri Lankan green finance venture that I came across so far in literature is the one in which the Seylan Bank PLC has arranged a Green Bond for financing several renewable energy projects in Sri Lanka. The global and regional appetite for green bond issuance is on the increase and it is high time that Sri Lankan investors too, evoke greater attention towards it.

Sri Lanka Road Map for Green Financing

The Sri Lankan Road Map for sustainable/green financing has been prepared by the Central Bank of Sri Lanka with technical assistance from the International Finance Corporation through a consultative process for the purpose of promoting sustainable/green finance options in Sri Lanka. In addition, the Central Bank of Sri Lanka has already prepared a Biodiversity Finance Plan (BIOFIN 2018 – 2024) to move towards sustainable financing solutions with an aggregate resource mobilization target ranging from LKR 20 billion – 46.7 billion.

The BIOFIN Plan has prioritized 13 finance solutions and issuing Green Bonds is one amongst them. The generic description of Green Bonds in this plan states that issuing green bonds is a new source of financing that can mobilize a large amount of financial resources by the public sector as per the financial regulatory mechanism, subject to the country’s debt servicing capacity. Sri Lankan investors too, now have an enviable opportunity to join this lobby as partners during the restructuring process especially, in transforming the Sri Lankan Sovereign Bond debts.

Payment for Ecosystem Services (PES)

Payment for Ecosystem Services is yet another financial solution that the BIOFIN 2018-2022 Plan has put forward which it claims to be another new financing source for paying directly or indirectly for ecosystem services and negative externalities either with private or public involvement in Sri Lanka. The BIOFIN plan considers that an introduction of PES in the energy sector is important because the current modes of power generation have significant negative implications on the country’s biodiversity and ecosystem services whilst the condition of watersheds also influences power generation efficiencies, especially in hydropower. The BIOFIN plan details out the information needed for developing three different business models under the PES system (pages 28-37). They are (i) Payment for watershed management in lands above mini-hydro power plants, (ii) Payment for watershed management for hydropower generation at Moragahakanda, and, (iii) Payment for negative externalities of coal power generation.

PES for Watershed management in the Central Highlands

Management of watersheds has been recognized as a national priority for sustainable development in Sri Lanka in the most recent National Physical Planning Policy and the Plan for Sri Lanka 2017-2050 and its immediate predecessor – NPP – 2030. Both these plans have recognized the Central Highlands and the Coast Conservation Zone as fragile regions (see the figures) that need urgent conservation interventions for the sustainable development of practically the entire country.

The ‘Central Fragile Area’ is the geographic entity that consists of lands with sensitive natural ecosystems, highly vulnerable to landslides, and plays a crucial role in sustaining water resources. A major portion of these areas are located above 300 meters from mean sea level and cover the upper catchments of all major rivers on the island. Almost all major economic enterprises in Sri Lanka, including downstream irrigated agriculture and associated livelihood sustenance, hydro-power generation, and inland and coastal tourism are very much dependent upon the ecological health of this fragile region.

Therefore, the prioritization of watershed management in at least a few selected areas as a priority area under the Payment for Ecosystem Services by the BIOFIN project of the Central Bank of Sri Lanka as a start is praiseworthy. The National REDD+ Investment Framework and Action Plan (NRIFAP) 2017 and its subsequent updates including that of the Forestry Sector Master Plan for Sri Lanka 2021-2030 (still in draft) would be able to provide a strong foundation for developing investment models in this vital sphere of sustainable development.

Conversion of exotic monoculture plantations in critical watersheds into native and naturalized species mixes in these central highlands according to proven scientific guidelines would be yet another green financial proposition for both public and private sector engagement for which intriguing business models can be developed under PES schemes. We have developed two ecologically sustainable Pinus conversion models, one in the NW buffer zone of the Sinharaja World Heritage Site and the other in Peradeniya University Lower Hantana campus land. These can be scaled up into other Pinus plantations in critical watersheds of the island with public-private collaboration as Corporate Social Responsibility projects, especially in the plantation sector.

Similarly, the World Bank-funded Landscape Management Plan for Sinharaja Forest Range prepared recently is yet another superlative green financing option for such investors. (See maps)

PES for Coastal Zone Management

On the other hand, the ‘Coast Conservation Zone’, the second fragile region identified by the NPP includes the area for which boundaries have been delineated by the Coast Conservation Department under the provisions of the Coast Conservation Act No. 57 of 1981. Even though a large quantum of physical developments in Sri Lanka has been taking place in this zone, conservation of the lagoons, estuaries, swamps, riverine, and other sensitive environments, is important because of the eco-services that they provide, the attractions they have, and the ever-expanding economic activities associated with them.

The ‘Sri Lanka Coastal Zone and Coastal Resource Management Plan – 2018’ prepared by the Coast Conservation and Coastal Resource Management Department would be an ideal foundation document for developing investment and business models in this critical coastal belt that covers a circum-island coastline of 1,620 km. Due to its abundant natural resources and consequent social and economic benefits supporting millions of livelihoods, the coastal zone has experienced immense development and urbanization over the decades. This calls for the sustainable management of the coastal zone to ensure that resources are not exploited beyond their regeneration capacity and that the remaining habitats are not further degraded or destroyed.

Similar projects with appropriate business models have been developed in other regions/countries that Sri Lanka could take a cue from. They are the following:

i.) Mangrove Restoration in Senegal – The mangrove restoration project in Senegal, coordinated by the Livelihoods Carbon Fund (LCF) since 2011, aims at restoring an ecosystem that protects arable land from salinization and produces fish resources (fish, shellfish, crustaceans) and wood. With the support of the Livelihoods Carbon Fund, the mangrove restoration project in Casamance and Sine Saloum estuaries of Senegal has helped 450 local villages replant 10,415 out of the existing 185,000 hectares of mangrove, between 2009 and 2012. It stands like a rampart against climate change impacts and at the same time a nourishing ecosystem for the inhabitants. Carbon finance has enabled vulnerable communities to restore their mangroves through the commitment of private companies that have committed to investing in sustainable projects. In return for their investment in the Livelihoods-Senegal project, the companies that are supporting the Livelihoods Carbon Fund receive carbon credits with high social and environmental value to offset their CO2 emissions.

Investors in the Carbon Livelihoods Fund have provided Océanium – the local NGO with the necessary funding for replanting (population awareness, validation of scientific models, intervention logistics, etc.) and are going to continue to finance its monitoring and evaluation until 2029, for a total duration of 20 years.

The project was validated by the United Nations Framework Convention on Climate Change (UNFCCC) Board. The Project Detailed Document made by Carbon Decisions in December 2010 was audited by Ernst & Young and the Dept. of Environment in May 2011. The approval of the Senegalese authorities was obtained in March 2011 and was subject to a tripartite Memorandum of Understanding of 10 years between Livelihoods, OCEANIUM, and the Senegalese government (Ministry of Environment). The long-term impacts of the project is being measured using the ‘Sustainable Livelihoods Approach’ since 2017. ().

Lessons learned from this project would be beneficial for Sri Lanka to design her own mangrove restoration and coastal and marine conservation initiatives with a public-private partnership. These projects are already being done in an uncoordinated ad hoc manner, especially after the Tsunami event in 2004

. The Sri Lanka Coastal Zone and Coastal Resource Management Plan – 2018 prepared by the Coast Conservation and Coastal Resource Management Department would provide the necessary underpinning for the development of investment and business models for our fragile coastal zone extending over a circum-island coastline of 1,620 km.

ii.) Blue Bond Initiative of Seychelles: Seychelles is a Small Island Developing State dependent on its marine natural resources to derive its economic prosperity. In recent years there have been a decline in the fish stocks and marine resources linked to i) overexploitation of fisheries resources and subjected to environmental pollution. The benefits expected from the blue bond initiative. A blue bond was issued in 2018 for US$ 15 million over a maturity period of 10 years. Among the benefits expected were the development of a Blue Economy through sustainable use of marine resources securing private sector participation, raising awareness of the critical role of the ocean and marine resources, and the overall global need for environmental protection. (). The early indications are claimed to be very positive and there are several lessons that Sri Lanka can learn from this in designing her own blue bond initiatives.

iii.) Grain for Green Programme of China: China initiated its “Grain for Green” programme in 1999 as an ambitious conservation programme designed to mitigate and prevent flooding and soil erosion. It is an example of Payment for Ecosystem Services (PES) which is helping to solve Environmental issues in China. The programme is designed to retire farmland that is susceptible to soil erosion, although some farmers may go back to farming the land after the program ends. China started the Grain for Green program in the western parts of the country for example Shanxi Province. These areas were known for their rather poorly performing economy that was affiliated with an endangered ecological environment. The environment was being further damaged by soil erosion which was a result of cultivation on sloping land as people were changing forests into farmland. By 2010, around 15 million hectares of farmland and 17 million hectares of barren mountainous wasteland were converted back to natural vegetation (From Wikipedia, the free encyclopedia).

This project has a strong appeal for the restoration of the Central Fragile Area of Sri Lanka as recommended in the NPP 2017 – 2050. The unproductive tea lands, areas under unsustainable vegetable cultivation susceptible to excessive soil erosion and degradation, and monoculture exotic tree plantations in critical watersheds are prime candidates to be sustainably developed under appropriate PES-type business models. It is hoped that the Chinese experience and expertise in the above example would be taken on board in restructuring some of our outstanding Chinese debts.

iv.) Great Green Wall Initiative – An ambitious project partnered by the European Union and the UNCCD and implemented across 22 African countries in 2007 to restore 100 million ha of currently degraded land; sequester 250 million tons of carbon and create 10 million green jobs by 2030. More than USD 8 billion has been raised and pledged to support this game-changing initiative in the Sahel region in Africa to provide fertile land, food security, and economic opportunities for the millions and climate resilience in a region where temperatures are rising faster than anywhere else on earth ().

If the world renowned ‘ellanga’ irrigated agricultural systems (small tank cascade systems) spread across the dry zone of Sri Lanka, can be further enriched through a similar program, not only the sustainability of the agricultural heritage system but the chronic health issues currently afflicted with the farming communities could be successfully addressed. Prototype business models well supported by socio-ecological research are already available for these regions for rebuilding agricultural resilience in the Dry Zone of Sri Lanka.

Debt-for-Climate Swaps

Debt-for Climate Swaps are also emerging as yet another viable option that can generate the much-needed fiscal space for Middle-Income Countries like Sri Lanka to focus on climate ambitions and economic recovery while reducing their overall debt burdens.

A debt for climate swap is an agreement between a sovereign debtor and one or more of its international creditors by which the latter forgives all or a portion of the debtor’s external debt in exchange for a commitment by the debtor to invest, in domestic currency, in specific climate projects during a commonly agreed period. The rationale of debt swaps is that debt can be acquired at a discount. When creditors do not expect to recover the full nominal value of debts, they may be willing to accept less. In exchange for (partial) cancellation of the debt, the debtor government is prepared to mobilize the equivalent of the reduced amount in local currency for agreed purposes on agreed terms. The Debt for Climate swaps help countries struggling to service their debts to reduce the debt and free up fiscal space (cash flow) for climate-friendly investments.

Debt swaps provide opportunities for raising capital especially in low-income countries to address environmental and other policy challenges and support green growth. For the debt for climate swaps, the debtor government commits to invest the accrued savings from debt forgiveness in climate adaptation or mitigation. Debt-for-climate swaps have the potential to transform daunting debt into opportunities to reduce climate vulnerability and implement much-needed adaptation. These swaps would thus contribute to the Paris Agreement, which stipulates that developed countries should mobilize climate finance from a wide variety of sources through a variety of actions.

The potential for using debt-for-climate swaps as an innovative financial solution to the twin crises of climate change and debt distress is very high. Such debt swaps provide opportunities for raising capital in debt-stridden low-income countries to address environmental and other policy challenges and support green growth. However, only when the debt has been made sustainable, the swaps can transfer resources for climate purposes.

A number of developing countries are engaging in debt-for-climate swaps since Seychelles secured the world’s first debt-for-climate swap deal for protecting the world’s oceans with the Paris Club group of developed country creditors in 2016, aimed at ocean conservation and climate resiliency. Since then, several Small Island Developing States (SIDS), especially those in the Caribbean region too have joined this program. These countries are facing situations similar to those that we in Sri Lanka, are currently undergoing. They too are heavily indebted countries with tourism-dependent economies more recently worsened by COVID -19 pandemic and subjected to serious climate vulnerabilities.

Activities that can be funded through this debt structuring, include management of marine reserves, coral and mangrove restoration, improving marine, fisheries, and coastal policies, economic diversification, and climate resiliency of coastal communities.

Debt for Climate Swaps provide excellent opportunities for promoting climate change mitigation projects such as the accelerated phasing-out of coal power projects. Quite fortuitously, 40 countries including Sri Lanka pledged at the COP 26 meeting of the UNFCCC held in Glasgow in 2021 and also agreed not to build/fund any new coal power plants. In the light of these recent developments in relation to the UN Convention on Climate Change and the internationally binding Paris Agreement, the Long-term Generation Expansion Plan (LTGEP) for Sri Lanka may need to be reworked. This plan envisages the retirement of several thermal power plants that are likely to be taken off from operation due to their age-related mal-functioning and more importantly, the construction of two more coal-fired power plants totaling 1500MW in the late 2020s. Debt for Climate Swaps are strong candidates for facilitating the early retirement of coal/thermal power plants and investing in energy-efficient clean energy projects in Sri Lanka.

Debts for Climate Swaps are also eligible for climate change adaptation which include Nature- based Solutions that include conservation and enhancing diversity by restoration of degraded lands including wetlands. The rationale for undertaking such projects, which are often not commercially viable business models, is that their benefits, such as enhanced biodiversity, higher water tables, carbon capture, improved well-being of citizens, green jobs created, etc. far outweigh the costs involved. Their socio-economic benefits being intangible are often not captured or are externalized in standard benefit/cost analyses. However, in this Decade of Forest Restoration declared by the United Nations, such ventures partnered with developed countries are being used to reduce the debt burden of developing countries.

Conclusions

In summary, Sri Lanka has in place most of her key development strategies and plans for the next several years in conformity with major global conventions on biodiversity, climate change, and combating land degradation. They are the following:

 National Biodiversity Action plan (NBSAP 2016-2022),

 National REDD+ Investment Framework and Action Plan (NRIFAP 2018-2022),

 National Action Program for Combating Land Degradation in Sri Lanka (NAP-CLD 2015 -2024),

 National Adaptation Plan for Climate Change Impacts in Sri Lanka (2016 – 2025).

Using the information provided by these strategic action plans, the Central Bank of Sri Lanka together with Ministry of Environment has prepared a Biodiversity Finance Plan (BFP) for Sri Lanka (2018 – 2024) with 13 prioritized finance solutions some of which I have highlighted in this article. The donor agencies are also very much interested in entering into green financing partnerships with countries in need of investment capital. Therefore, every effort should be made to make this current adversity an opportunity of a lifetime.

The Prime Minister informed the parliament on 06th July 2022 that Sri Lanka is participating in the bailout negotiations with the IMF as a bankrupt country and is going into a deep recession this year and have to face current difficulties extending into 2023, as well. As such, the country needs to submit a plan on Sri Lanka’s debt sustainability separately to the IMF for which a strong political leadership to take visionary decisions is the order of the day.

At this critical juncture of our nation, it may be well worth reminding ourselves of the historic words of John F. Kennedy at his inaugural address as the 35th president of the United States in 1961‘My fellow Americans, ask not what your country can do for you – ask what you can do for your country’ which challenged every American to contribute some way to the public good. Also, what a one-time prime minister of Sri Lanka SWRD Bandaranaika wrote in his son -Anura’s album which later became a more public proclamation ‘the main duty of man is to serve man’ are words that we need to convert to deeds at this moment of despair.

This is in stark contrast to protesting with the stereotypic slogans ‘Diyaw, diyaw, diyaw’ by the politically indoctrinated trade unions and the misguided young intelligentsia at every turn during this period of despondency with much inconvenience and annoyance, in particular, to the already suffering working class people. We are in need of a socially astute political leader with a vision who can stand tall and adapt the words of JFK as ‘My fellow Sri Lankans, ask not what your country can do for you – ask what you can do for your country’ in this hour of deep political and socio-economic crisis and turmoil to steady the ship and steer it safely to calmer waters. Finding a national figure with such qualities at this moment is the Quadrillion Rupee (inflation accounted for) problem!



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Midweek Review

22A: Competing Opposition parties in dilemma

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Ranil Wickremesinghe arrives at the Opposition Leader Sajith Premadasa's Office on 23 July, 2026. Talks centred on ways and means to oppose the 22nd Amendment

Silent petty backbiting among Opposition may result in it grabbing defeat from victory over NPP

There is no likelihood of the SJB and the UNP reaching consensus on a tangible arrangement in the near future though some asserted that they may agree on a united front against the ruling National People’s Power (NPP). Referring to

former President and UNP leader Ranil Wickremesinghe’s visit to Opposition Leader Sajith Premadasa’s Office on 23 July, a source familiar with the developments said that in spite of such gestures, underlying problems remain. Another source explained that a combined front may be useful in a campaign against a particular issue but the two parties needed a genuine arrangement ahead of the next countrywide election.

By Shamindra Ferdinando

United Republican Front (URF) leader Patali Champika Ranawaka recently thanked Health and Media Minister Dr. Nalinda Jayathissa for recognising the Janathawadi Joint Opposition as a real challenge to the National People’s Power (NPP) government. The NPP enjoys an unassailable 159 parliamentary seats.

The former Minister noted that Dr. Jayathissa, who is also the Cabinet spokesman, realised the political threat posed by them, though the main parliamentary Opposition party Samagi Jana Balawegaya consisted of 40 lawmakers.

Ranawaka refrained from naming the SJB as the main Opposition party he was referring to.

Addressing the media at the Flower Road Office of UNP leader Ranil Wickremesinghe, Ranawaka pointed out that the ruling party felt their challenge, though there were a plethora of Opposition parties in the Parliament.

Referring to Dr. Jayathissa’s recent accusation that they conspired at the Kirula Place, Colombo 5, residence of former External Affairs Minister Prof. G. L Peiris, Ranawaka appreciated the Minister’s declaration made at the expense of the SJB.

While the 40-member SJB group is the second largest group in Parliament, the Illankai Thamil Arasu Kadchi (ITAK) holds third position with eight seats whereas New Democratic Front (NDF) consists of five MPs. The NDF, that received the backing of Wickremesinghe at the 2024 parliamentary polls, is in fourth position, whereas the Sri Lanka Podujana Peramuna (SLPP) parliamentary group consists of just three members. The SLPP suffered a humiliating defeat at the hands of the NPP at the last parliamentary polls, held in November 2024. An angry electorate at the first parliamentary polls after the 2022 regime change project reduced the SLPP, from a commanding 145-seat group, to just three MPs. Defeated 2024 presidential election candidate Namal Rajapaksa was so fearful of the impending rout at the November 2024 polls, he took refuge in the SLPP National List.

The political grouping, based at the Flower Road office of Wickremesinghe, has gradually broadened its operation. The stepping up of the Flower Road operation must be examined taking into consideration the NPP targeting Wickremesinghe over his 2023 September visit to the UK. The NPP has alleged that Wickremesinghe squandered public funds at a time the country was undergoing extreme economic difficulties. The crux of the matter is whether Wickremesinghe, in his capacity as the President, spent Rs 16.2 man on a private visit.

In spite of the Flower Road project receiving the NPP’s attention, Wickremesinghe does not really command the NDF that contested under the ‘Gas Cylinder’ symbol. The NDF group in Parliament consists of former Badulla District SLPP lawmaker Chamara Sampath Dassanayake, former Kalutara District SLPP MP Rohitha Abeygunawardena, ex-SLPP Kandy District MP Andrada Jayaratne, ex-UNP Minister Ravi Karunanayake (National List) and former SLFP Minister Fizer Mustapha (National List).

It would be pertinent to mention that a major problem erupted within the NDF at the time of filling the two National List slots. Wickremesinghe is the undisputed leader of the NDF, though he lacked any formal recognition as such, fielded candidates for selected electoral districts outside the Northern and Eastern regions at the 2024 November polls. The NDL comprised the UNP, the SLFP and the SLPP breakaway faction ‘Podujana Eksath Nidahas Peramuna (PENP).’ All three elected members Dissanayake, Abeygunawardena and Jayaratne represented the PENP.

The SLFP received one National List slot whereas the General Secretary of the NDF, Sharmila Perera, regardless of strong objections by Wickremesinghe, accommodated Karunanayake as the other NDF National List nominee. Perera informed the Election Commission, in writing, while the coalition debated Karunanayake’s appointment. An influential section of the coalition favoured the appointment of Kanchana Wijesekera, of the PENP, as the other National List member.

Perera, in her capacity as the NDF’s General Secretary, chose Karunanayake whose involvement with the NDF is in the public domain. The Election Commission gazetted a notification on 18 November, 2024, naming Karunanayake to Parliament. Will discuss the NDF’s emergence as a significant political factor in the wake of the 2010 presidential election, the first national poll after the eradication of the separatist Tamil terrorist movement.

SJB strategy

Whether the SJB likes it or not, former Yahapalana Minister Ranawaka’s reaction to Dr. Jayathissa’s conspiracy claim highlighted the ongoing controversy surrounding the main Opposition party’s overall response to the NPP’s pet project, the enactment of the 22nd Amendment.

Some political commentators have harshly criticised SJB Chief, who is also the Opposition Leader, Sajith Premadasa, for failing to mount a large-scale counter offensive. Some of them have taken offence that Premadasa sort of played it safe in spite of the NPP seeking to bulldoze the Opposition, both in and outside Parliament. Various interested parties have asserted that Premadasa’s inaction has been influenced by his fear of the government hounding him with corruption investigations, targeting him and his wife Jalani.

In spite of much publicised gathering of recognised Opposition parties/groups at the Opposition Leader’s Office at No 30, Sir Marcus Fernando Mawatha, Colombo 07, on 23 July, 2026, also attended by Wickremesinghe, the SJB appeared to have failed to take the lead in the overall campaign against the 22nd Amendment. Had the government managed to neutralise the determined efforts of the Sri Lanka Bar Association (BASL) and the unexpected United Nations intervention, the Opposition campaign may have collapsed already.

The undeniable truth is the SJB never succeeded in taking command of the overall political strategy. Dr. Jayathissa’s claim and Ranawaka’s reaction clearly suggested the deterioration of the SJB’s status. But those who approve of the SJB’s handling of political developments seem confident the party is on the right track. They feel criticism directed at the SJB and Sajith Premadasa, in particular, unfair and utterly politically motivated. Social media criticism appeared to have troubled the SJB. Recently, the SJB contradicted and challenged the opinion expressed by Priyanjith Vitharana who posted political commentaries under the pseudonym ‘Rate Rala.’ The former General Secretary of the breakaway JVP group, the National Freedom Front (NFF), has emerged as one of the strongest critics of Premadasa’s style of Opposition politics. ‘Rate Rala’ relentlessly attacked the SJB leader and vigorously questioned what he called the Opposition Leader’s lukewarm reaction to the NPP’s challenge.

The SJB and the Wickremesinghe-led political grouping cannot turn a blind eye to President Anura Kumara Dissanayake’s impending high profile political campaign, countrywide. The NPP has declared that the campaign would be launched on 5 September. The NPP enjoys absolute political power to move large groups of people for their intended meetings as previous ruling parties did. But, in the absence of a cohesive political strategy, those in the Opposition are still unable to work out a strategy to counter the NPP campaign. The Cabinet spokesman has dared Wickremesinghe’s group to bring in people onto the streets instead of having clandestine meetings at the residence of Prof. Peiris, the convenor of the Janathawadi Joint Opposition.

Wickremesinghe’s five-member NDF group in Parliament is obviously divided over political strategy. It seems the members of the group are pulling in different directions. The SLFP’s Faizer Mustapha is somewhat silent on the 22nd Amendment and the remaining members haven’t been seen playing a role against the 22nd Amendment worth mentioning. Cobbling up alliances to overcome short-term political challenges is the bane of the Sri Lankan political setup. The NDF is no exception. Having suffered an expected defeat at the 2024 September presidential poll, Wickremesinghe utilised the NDF to bring together those at the mercy of the NPP. Wickremesinghe’s move dealt a devastating blow to the SLPP, struggling to cope up with the developing situation. The consequences of Wickremesinghe post-presidential actions caused irreparable damage. The fielding of SLPP candidates on the NDF ticket and also accommodating them on its National List, at the expense of the SLPP, undermined that party. Among those who betrayed the SLPP were former Prime Minister Dinesh Gunawardena and ex-Speaker Mahinda Yapa Abeywardena. But, Wickremesinghe didn’t care. By then, the SLPP had forgotten how in its capacity as the ruling party it elected Wickremesinghe as Gotabaya Rajapaksa’s successor at the expense of their own Dullas Alahapperuma who teamed up with the SJB to fight it out in Parliament.

The SLPP fell out with Wickremesinghe when the latter sought the ruling party’s backing at the 2024 presidential polls, the first post-Aragalaya (read regime change project) national election. At the end, Sajith Premadasa, Ranil Wickremesinghe and Namal Rajapaksa contested at the expense of a unified front. That enabled Anura Kumara Dissanayake to secure victory at the 2024 presidential race.

Unrealistic SJB-UNP partnership

In the run-up to the 2024 parliamentary polls, the writer, at a Flower Road Office briefing by UNP Deputy Leader Ruwan Wijewardena, raised the failure on the part of the UNP and the SJB to reach a consensus after Dissanayake won the presidency due to their dithering.

The former Deputy Defence Minister, struggled to explain the status on the SJB-UNP talks when the writer pointed out that Dissanayake polled 5,634,915 votes whereas Sajith Premadasa (4,363,035 votes) and Ranil Wickremesinghe (2,299,767) together polled 6,662,802- a staggering 1,027,887 votes more than the winner. Unfortunately, both camps remained adamant regarding the modalities of consensus/unification. Had the two parties realised the gravity of the situation and the extraordinary challenge the NPP posed, they could have shed whatever their differences to contest under one symbol. But the petty-minded SJB and UNP leaders squandered an opportunity that resulted in the NPP securing an unbeatable 159 seats at the presidential election.

The SJB and the UNP continue to move in different directions. Those who remain with the UNP appeared to be more comfortable having Dissanayake as the President than Premadasa. Wickremesinghe’s visit to the Opposition Leader’s Office seemed to have failed to achieve a genuine reconciliation between the two leaders. Soon after the 2019 presidential election that brought newcomer Gotabaya Rajapaksa to power, the internal crisis, within the UNP, intensified.

Defeated UNP contestant Deputy Leader Sajith Premadasa quit the party in early February 2020, to form the SJB. The SJB-led alliance was officially launched in March 2020 ahead of the parliamentary polls in August 2020. The UNP split in the aftermath of the 2019 presidential poll created an extremely unfavourable environment for Wickremesinghe who suffered a crushing defeat at the August parliamentary polls. The UNP was reduced to one National List slot whereas the SJB secured 54 seats, including seven National List slots. Wickremesinghe failed to retain his Colombo District parliamentary seat.

Wickremesinghe refrained from filling that solitary National List slot till June 2021. By then, the economic crisis had set in. Wickremesinghe entered Parliament on 23 June, 2021. Rapid economic deterioration led to sovereign default the following year. Political stability created an environment for Wickremnesinghe to exploit. Wickremesinghe didn’t hesitate to accept the premiership on 12 May, 2022, soon after SJB leader Sajith Premadasa turned down President Gotabaya Rajapaksa’s invitation. The beleaguered UNPer couldn’t have asked for more. The SLPP ended up electing Wickremesinghe as Gotabaya Rajapaksa’s successor 10 weeks later, a decision that the party now rued. In hindsight, the consensus between the Rajapaksas and Wickremesinghe, in the short term, benefited both parties but undermined efforts to iron out differences between the SJB and the UNP.

The UNP felt that it should have the final say in the issue at hand. However, the SJB quite rightly asserted that securing 54 seats at the 2020 parliamentary election should be taken into consideration. The UNP was down to one National List slot and in the wake of the SLPP accommodating Wickremesinghe in the Executive Office, Wajira Abeywardena filled that vacancy.

In fact, the UNP never relished consensus with the SJB. Instead, Wickremesinghe felt that it could extend his partnership with the SLPP, to his advantage, by securing its approval as the party’s 2024 presidential poll. Had that happened, the SLPP would have further deteriorated though Wickremesinghe could have polled a far larger share of votes at the presidential poll. Contesting as an independent, Wickremesinghe polled over 2.2 million votes at the presidential election. That defeat compelled Wickremesinghe, who turned 75 in the run-up to the presidential poll, not to join the parliamentary polls fray.

Wickremesinghe knew the signs. He knew the game was over and the UNP no longer appealed, even to die-hard supporters. The UNP leader quietly brought together the remnants of the UNP with the SLFP and SLPP and fielded them under the NDF’s symbol. As mentioned at the onset of this piece, the NDF, under Wickremesinghe’s leadership, obtained five seats. But, he never managed to retain control of the parliamentary group. Against the backdrop of an unprecedented deterioration of the UNP, the 22nd Amendment, in a way, has helped Wickremesinghe to work out a strategy to somewhat consolidate his position. The Flower Road operation has given Wickremesinghe some leverage as the NPP battled the high profile Bar Association of Sri Lanka (BASL)-led campaign against the 22nd Amendment.

NPP strategy

The NPP seems confident that the SJB and the UNP, under any circumstances, will not amalgamate or contest under one symbol. The NPP’s political strategy is based on the presumption that the two parties lacked the will to do so, though they realised their costly failure to reach consensus at the last presidential and parliamentary polls in 2024. Both parties suffered at the 2025 May Local Government polls as well. In a last-ditch attempt UNP leader Wickremesinghe proposed that the UNP and SJB contest the Colombo Municipal Council under one symbol. That proposal never materialised.

As a result, the UNP lost the CMC after more than 50 years. The UNP won the CMC in 2011 when the rival UPFA, led by the then President Mahinda Rajapaksa, won all other local government bodies outside the Northern and Eastern Provinces, two years after the eradication of the LTTE.

Opposition sources acknowledged that nothing short of an arrangement to contest the next election, under one symbol, wouldn’t help them. “We are unable to fully exploit the deterioration of public confidence in the NPP due to the appalling failure to bring talks between the two parties to a successful conclusion,” a source familiar with the developments said.

The 22nd Amendment gave an opportunity for the SJB, with 40 MPs in Parliament, and the UNP, sans any parliamentary representation, to finalise an arrangement. Unfortunately, they failed to do so, thereby allowed the government to proceed with the strategy. A major campaign, led by President Dissanayake himself, scheduled to be launched on 5 September, underscored their strategy, whereas the Opposition remained still unsure of its own counter-strategy. Had they at least managed to organise a few mega rallies with the participation of the entire Opposition, the NPP may have come under real pressure. Unfortunately, even after the Illankai Thamil Arasu Kadchi (ITAK) and Tamil Progressive Front (TPA) representing upcountry political parties declared strong opposition to 22nd Amendment, the SJB couldn’t take the lead in organising a large-scale counter campaign. Instead, the Janathawadi Joint Opposition, operating out of the Flower Road Office, has exploited the situation to its advantage.

Despite both the SJB and the UNP (Janathawadi Joint Opposition) moving the Supreme Court against the 22nd Amendment, they conveniently failed to appear together at regular media briefings, held at Wickremesinghe’s Flower Road Office, where Prof. Peiris, in his capacity as the convenor of the grouping, meticulously dealt with the developing story.

Regardless of the failure on the part of the SJB and the UNP to finalise an arrangement with eyes on the next election, the BASL-led campaign against the 22nd Amendment caused significant damage to the NPP’s reputation. The BASL’s shocking revelation that two deserving justices, namely senior justice of the Court of Appeal, Dhammika Ganepola, and senior-most justice of the Court of Appeal, justice R. Gurusinghe, were deprived of promotion to the Supreme Court by the incumbent administration, was received by the public with disappointment. The BASL released 17 August, 2026, dated, hitherto unpublished letter, addressed to President Dissanayake, that dealt with unfilled vacancies in the superior courts, while the government preached the public of its determination to deal with a mountain of case backlog.

Unfortunately, the Opposition campaign lacked direction though some former and present lawmakers targeted the 22nd Amendment. With almost all who moved the Supreme Court against the 22nd Amendment seeking all remaining judges of the Supreme Court to hear the petitions with the BASL suggesting that Chief Justice recuse himself of hearing the cases over conflict of interests and all agreeing on a referendum to approve of the controversial constitutional amendment, the apex court constitutionally is authorised to take three weeks to decide on the issue at hand.

The decision is expected to be communicated to Speaker Dr. Jagath Wickremaratne around the time President Dissanayake completed his second turbulent year in Office on 21 September.

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Midweek Review

The local and global dynamics of Sri Lanka’s 22nd Amendment

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Beyond noise and acrimony:

by Sasanka Perera
(The writer is on X as @sasmester)
Background

The Sri Lankan government has proposed to introduce the 22nd Amendment to the Constitution focused on increasing the retirement age for Supreme Court and Court of Appeal judges. Coupled with parallel legislative adjustments to the Judicature Act of 1978 governing the functioning of lower-tier courts, the initiative has drawn sharp criticism from domestic legal bodies, opposition political parties, human rights activists and scrutiny from international organisations, most notably the United Nations Special Rapporteur on the Independence of Judges and Lawyers.

Locally however, much of the debate is lost in the noise of acrimony, name-calling and what can only be called ‘social media violence’ rather than becoming a sensible discourse of rational and courteous debate. A week ago, a simple tweet from me on my wariness over getting the UN involved in this matter and the UN’s general bias towards countries like ours literally went viral, castigating me as a supporter of the government. My public writing in support and often in opposition to government positions — as demanded by different cases and situations — had no impact whatsoever. This virulent noise has no place in democratic practice, which all these noisemakers nevertheless claim to protect. This essay, however, finds its genesis in that noise as a means of making sense of the politics of the 22nd Amendment for myself and for any sensible people who might want to ponder over its implications.

As far as my understanding goes as a citizen without a legal background, the present controversy touches on the core tension amongst practical administrative necessity as seen by the government, constitutional integrity as argued by many in the legal profession, human rights advocates and opposition politicians and the geopolitics of international human rights oversight exercised by entities such as the UN.

Under Article 107 of Sri Lanka’s 1978 Constitution, the mandatory retirement age for Supreme Court judges is 65 years, while Court of Appeal judges must retire at 63 years. The proposed 22nd constitutional amendment seeks to raise these limits by two years. That is, extending Supreme Court tenure to 67 years and Court of Appeal tenure to 65 years. It also proposes that the number of judges in the Court of Appeal be increased from 19 to 24. Further, in the case of the Chief Justice, it is specified that the retirement date would be 67 years or after completing six years in office, subject to whichever comes first. In parallel, the government has also proposed to amend the Judicature Act of 1978 with the aim of raising the retirement age of High Court judges to 63 years and for District Court judges and Magistrates to 62 years. In other words, the overall proposal is to increase the retirement age of judges throughout the judicial hierarchy by two years.

Government’s Rationale

The government’s justifications for the proposed amendment rests on two general parameters. One is efficiency in judicial administration. The other is the retention of experienced judges for an additional period of two years. In this context, the government and its supporters in civil society do not perceive the proposal as a political maneouvre, but rather as an urgent administrative intervention that is essential to clear the backlog of cases throughout the judicial system. There is no doubt that the system is clearly overworked, understaffed and inefficient, and as a result, burdened with a serious backlog of cases.

Sri Lankan courts face an acute backlog exceeding 1.1 million pending cases according to some estimates. In this context, the government’s argument is that retaining seasoned judges is vital to maintain case disposal rates and prevent systemic paralysis. Extending judicial service is presented as a pragmatic mechanism to preserve institutional memory and combat capacity shortages.

Objections and Opposition

Despite official justifications, most of which seem legitimate based on actual experience and existing data, some legal analysts, opposition figures, and civil society groups suspect unstated political objectives behind the timing and structure of the reform. For them, a primary concern is that the amendment is structured to apply retroactively or immediately to sitting judges rather than prospective future appointees. Critics suggest this directly benefits specific high-ranking figures ranging from the incumbent Chief Justice to senior appellate judges, who are nearing the mandatory retirement age while overseeing politically sensitive cases. On the other hand, one can argue it is precisely because some of them are presiding over politically sensitive cases, that they need to complete the relevant cases for which experience, familiarity as well as institutional memory are essential.

However, there is no doubt that extending the tenure during an active term creates the impression of a government benefit granted to sitting judges. Whether this is the intention or whether it becomes reality, appearances do matter. The main point opponents bring out is, this specific intervention risks compromising the perception of judicial neutrality in a situation where sitting judges might be perceived as indebted to political authority for extending their service. While this is indeed a possibility, it is nevertheless not a necessary outcome.

Formal and vocal opposition at the moment is led by the Bar Association of Sri Lanka, local political parties, and some constitutional experts. But this has not become a bread-and-butter issue yet in the country. That is, there is no way this issue will capture the public imagination in the manner more pressing bread and butter issues did in the aragalaya of 2022. Also, Sri Lanka’s fractured and delegitimised opposition sharing the same argumentative plain with an entity like the Bar Association of Sri Lanka does not help the latter when it comes to generating public sympathy for its cause however legitimate it might be.

To my understanding and reading between the lines amidst the deafening noise in the vocal opposition, the above concerns are based on several core arguments.

One has to do with the perceived erosion of the separation of powers. That is, changing the retirement age of sitting judges mid-tenure can compromise constitutional predictability and impartiality. Theoretically, fixed retirement ages exist in judicial systems globally to specifically protect judges from executive interference or influence. The second concern I can see but not clearly articulated by sceptics has to do with the possibilities of career stagnation. In other words, delaying emergent vacancies at the Supreme Court and Court of Appeal will create a bottleneck across the entire judicial hierarchy for some time, potentially demoralising junior judges in the High Courts and District Courts awaiting elevation. Finally, there is a concern over the long-term government failure to effectively utilise cadre expansion that has already been made possible which precedes the present government’s access to office. Prior constitutional changes (such as the 20th Amendment) already had expanded the numerical capacity of the superior courts. In this context, the argument is that the government should focus on filling existing vacancies with new appointees rather than altering the tenure of current judges. Purely as matters of principle, theory and potential impact on democratic governance, none of these concerns are spurious.

The UN Special Rapporteur’s Intervention

The 22nd Amendment is no longer merely a local political issue. On 7 August 2026, Margaret Satterthwaite, the UN Special Rapporteur on the Independence of Judges and Lawyers, addressed a five-page official communication to the Sri Lankan government based on ‘information’ her office had received and issued 7 requests for further information. Internationalisation of the politics surrounding the 22nd Amendment is also an integral part of Sri Lanka’s oppositional politics. While acknowledging that raising retirement ages can preserve expertise, her mandate emphasised that alterations to judicial tenure must adhere strictly to international standards. The Special Rapporteur highlights a number of primary concerns, which include the following: 1) She is concerned with the application of the proposed changes to sitting judges. That is, extending terms for sitting judges without clear, objective, and transparent transitional safeguards creates the risk or perception of political favor. 2) Second, she has raised concerns over the lack of broad consultations in introducing the proposal. In other words, the rapid introduction of the amendment without inclusive public and professional stakeholder consultation can threaten public trust in the rule of law. 3) Finally, she has also referred to a potential conflict of interest. That is sitting judges benefiting from the extension could face a structural conflict of interest if called upon to adjudicate constitutional challenges against the very amendment that extended their careers.

In a sense, these concerns are very similar to the concerns raised by the local opposition. But in real terms, is the 22nd Amendment unusual or inherently anti-democratic that it warrants a UN body to be this concerned when in general it is often not concerned beyond rhetoric in far worse situations? Increasing judicial retirement ages is a common trend globally, driven by demographic shifts and longer life expectancy. However, the mechanisms and contexts of various cases differ considerably. Through the Public Service Pensions and Judicial Offices Act 2022, the United Kingdom raised the mandatory retirement age for judicial office holders from 70 to 75. This included judges, magistrates, and coroners. The rationale for this provided by the UK government at the time cited improvements in life expectancy, the need to address post-pandemic court backlogs, and recruitment gaps across courts. Crucially, the change followed a comprehensive public consultation involving over 1,000 responses from legal professionals, the magistracy, and civic bodies.

An Australian state and a self-governing territory, namely, New South Wales and Northern Territory offer other recent examples. Australia does not have a single uniform retirement age for all state and federal judges. Under Section 72 of the Australian Constitution, federal judges have a fixed retirement age of 70. However, individual states have raised state-level judicial retirement ages at different times. In 2018, New South Wales enacted the Justice Legislation Amendment Act (No. 2) 2018, raising the mandatory retirement age for state judges and magistrates from 72 to 75. Similarly, in 2019, the Northern Territory also raised the retirement age for Supreme Court judges from 70 to 72 years under the Justice Legislation Amendment Act 2019.

But the UN Special Rapporteur did not issue formal communications or allegations to either the United Kingdom or the Australian state and territory regarding these specific tenure increases — with reason. For one thing, both the UK and Australian state and territorial governments conducted long-term, transparent public consultations with legal professional bodies prior to enacting legislation. That is, there was an appearance of reasonability. On the other hand, in these cases, the reforms were introduced as broad, systemic statutory updates rather than ad-hoc constitutional amendments enacted amid heightened domestic political tension or ongoing sensitive litigation involving sitting judges as is the case in Sri Lanka. Finally, in these cases, the policy changes were implemented via general legislative consensus rather than executive-driven constitutional maneuvers that directly benefited individual judges in real-time in the short term.

Further, in these cases, as far as I can see, there were no formal complaints to the UN from any entity in these countries given that there were adequate consultations. On the other hand, unlike the UK or Australia, bodies like the UN generally assume countries like Sri Lanka are inherently anti-democratic and therefore need oversight. It is in such a context that the UN Special Rapporteurs have routinely issued communications to other countries that have altered judicial terms. For example, Poland, Hungary, and Bolivia have received such communications when changes to judicial retirement ages or tenure were perceived as attempts by the governments concerned to alter the composition of courts or erode judicial independence. The Sri Lankan case too must be understood in such a situation. The government, on its part, has submitted a six-page response accompanied by two annexures to the Special Rapporteur’s communication on 21 August 2026. It responds fully to the queries raised by the Special Rapporteur rationally. However, if it closes the matter remains to be seen.

The problem in this context is that Sri Lanka has the added complication of having a resolution on its human rights situation in the United Nations Human Rights Council since 2012. The next formal update on this resolution is scheduled for the 63rd session of the UN Human Rights Council taking place from 7 September to 9 October 2026. My concern in internationalising a domestic issue such as the opposition to the 22nd Amendment is that it could feed into the longstanding resolution giving further ammunition to Sri Lanka sceptics and detractors both in and outside the country. This is an unnecessary burden for a country like Sri Lanka lacking the power wielded by mass human rights violators such as Israel and its sponsor the United States. It is also a needless distraction for a country that is trying to reinvent itself. In such a situation, dealing with the sins of the predecessors does not help, more so, when UN impartiality is known to be selective.

The Future of the 22nd

Amendment

The controversy surrounding Sri Lanka’s proposed 22nd Amendment illustrates the delicate equilibrium required in constitutional governance and democratic practice. On a practical level, the government’s argument addresses an undeniable operational crisis. That is, as a means to deal with an overburdened legal system requiring the retention of experienced judicial personnel to deliver timely justice. Yet, on a principled level, constitutional safeguards exist precisely to ensure that procedural mechanisms are insulated from perceived political manipulation. In my mind, the government’s cardinal mistake was not to have wide-ranging consultations and information sharing programmes before the proposal became a contentious issue. This is simply good PR and common sense. Consultations and information sharing do not mean wholesale adherence to opposition positions. It simply means transparency, accepting what is reasonable, not accepting what makes no sense and offering at least a semblance of fair play. This would have also ensured that the government did not need to be overly defensive as it is now. In any case, given its overwhelming majority in parliament, the government does not need any support from the opposition to pass legislation. But it can certainly afford to be politically intelligent, sophisticated and mature in its public demeanor.

When a government alters the terms of service for sitting judges, the primary challenge is rarely the increased age limit. Rather, it is the need to preserve public trust in judicial neutrality. As comparative examples demonstrate, nations can adjust judicial tenure legally and successfully when changes are accompanied by broad professional consensus, prospective application, and transparent legislative processes.

Sri Lanka’s challenge lies in balancing the immediate demands of judicial efficiency against the enduring requirement that constitutional reforms must satisfy both domestic legitimacy and established international standards of judicial independence, particularly in a situation the latter is inherently oppositional to nations who do not have a veto or global political wherewithal to withstand pressure.

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Midweek Review

The ‘Ice’ Avalanche

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By Lynn Ockersz

‘Sunshine Isle’ saw it coming right along,

Yet did not heed well the warning rumbles,

Of this ‘Ice’ avalanche that’s flattening lives,

Particularly those of the land’s young,

That are verily the nation’s life blood,

But there’s more at issue in this grave crime,

Than seizing kingpins and locking them up;

It’s rather a question of making the young see,

That their lives ahead are full of possibilities.

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