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Chemical fertilizer loaded long beforeimport ban, says Agstar

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A consignment of nearly 10,000 MT of Prilled Urea costing USD 3.97 million that arrived in Colombo on board MV Emesa on July 12 when the ban of the import of chemical fertilizer was in force had been loaded (in Indonesia) under approval from the National Fertilizer Secretariat on Mar. 6 (when there was no ban), Agstar PLC, the consignee, said in a Stock Exchange filing on Friday.

Thereafter, in or around Mar. 11, the vessel got stuck in the Malacca Strait due to sudden problems in her main engine plus various other technical issues and was unable to arrive in Sri Lanka on or around Mar. 15 as originally envisaged, it said. Eventually the vessel arrived in Colombo on July 12 when the import ban was in force.

The filing said that Agstar had informed “all authorities” about the situation by their letter of May 10.

It also said that it had taken immediate action to arrest the vessel and claimed losses due to substantial delay in its arrival. It is at present under arrest in the Port of Colombo. Agstar said it had paid all Customs and Ports Authority dues and the vessel berthed for discharge.

“Subsequently Customs detained the vessel and requested the Ministry of Agriculture for confirmation of the gazette notification of May 6 (relating to the ban on the import of chemical fertilizer),” Agstar said.

Its filing further said: “Please note that Import and Export (Control) Regulation No. 7 of 2021 issued on or after May 6 only applies to shipments that have a date in the Bill of Lading after May 6, 2021, (that is loaded on or after May 6). Consequently this Regulation has no bearing whatsoever to the above consignment as it was loaded on the vessel way back on Mar. 6, 2021, which is approximately two months prior to the date in the Regulation,” the Agstar filing said.

It further said it was in discussion with the relevant authorities to get the cargo cleared as Agstar had not violated any regulation.

“Further, the above cargo has been ordered with prior approval of the NFS and (is intended) mainly to meet Nitrogen fertilizer requirement in the tea sector,” the filing said. “The company has already obtained approval of NFS to supply the bulk of this cargo to meet the requirements of plantation companies and tea smallholders.”

Agstar said that in the event permission is not granted (“even with the above clear facts”) to clear the cargo, “the company will be compelled to make necessary arrangements to move the cargo to another destination in order to mitigate colossal losses.

It further said that at the moment it does not envisage any substantial financial impact.



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‘Economic Transformation Bill ‘ and ‘Public Financial Management Bill’ to Parliament on May 22 – Acting Finance Minister Shehan Semasinghe

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Acting Finance Minister Shehan Semasinghe announced plans to introduce two significant bills to Parliament on May 22, aimed at bolstering the country’s economy.

These bills, the “Economic Transformation Bill” and the “Public Financial Management Bill,” are designed to enhance the management of public finances, thereby safeguarding against future economic downturns.

Minister Semasinghe made this announcement during a press conference at the Presidential Media Centre today (20), themed ‘Collective path to a stable country’.

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Macroeconomic policies in Sri Lanka are starting to bear fruit: IMF

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Julie Kozack, Director of IMF Communications

However, the global lender still requires two things from Sri Lanka

By Sanath Nanayakkare

Julie Kozack, Director of IMF Communications, last week highlighted Sri Lanka’s macroeconomic policies, rapid inflation decline, and steady economic growth as commendable.

“Sri Lanka now anticipates finalizing debt restructuring with private and official creditors. Domestic debt operations are largely completed, paving the way for faster-than-expected economic recovery following the crisis”, she said.

“So, just stepping back and giving the lay of the land. On March 21st of this year, the IMF staff and the Sri Lankan authorities reached a staff-level agreement for the second review of the program and also concluded the and also finished the Article IV mission. Completion of the review by the Executive Board of the IMF requires two things. The first is implementation by the authorities of the agreed prior actions, and the second is the completion of the financing assurances review, and that would confirm multilateral partners’ financing contributions. And the financing review will also assess adequate progress with debt restructuring.”

“With respect to Sri Lanka’s economic performance, macroeconomic policies in Sri Lanka are starting to bear fruit. Commendable outcomes include a rapid decline in inflation, robust reserve accumulation, and initial signs of economic growth, while also preserving stability in the financial system. Overall, program performance has been strong. The next steps with respect to the debt restructuring are to conclude negotiations with external private creditors and to implement the agreements in principle with Sri Lanka’s official creditors. The domestic debt operations are largely completed. The initial debt restructuring negotiations with external bondholders ended in mid-April without an agreement, and discussions are continuing with a view to reaching agreement in principle. And on the official creditor side, these agreements in principle still need to be finalized,” she said.

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CMTA hosts forum to explore Sri Lanka’s economic growth and mobility

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On Left - Katsuki Kotaro, Deputy Head of Mission - Embassy of Japan delivers the keynote address. On Right - Thilaka Jayasundara (Secretary, Ministry of Education), Eng. Ranjith Rubasinghe (Secretary, Ministry of Transport and Highways), Bingumal Thewarathanthri (Chairman, Sri Lanka Bankers Association), Katsuki Kotaro and CMTA officials

The recent event organized by the Ceylon Motor Traders Association (CMTA), themed “Mobility and Economic Growth,” brought together key stakeholders and thought leaders to delve into crucial discussions shaping Sri Lanka’s economic landscape. The event, highlighted by a keynote speech from Katsuki Kotaro, Minister and Deputy Head of Mission at the Embassy of Japan, and a dynamic panel discussion, provided invaluable insights and strategies for sustainable growth and enhanced mobility.

Kotaro emphasized Sri Lanka’s significant strides in economic recovery since the challenges of 2022. He explained that Sri Lanka’s economy has rebounded since 2022, with steady growth rates approaching the 3% target for 2024. Inflation, previously at 70%, has dropped to 2.5%, though prices remain high. Government efforts and IMF support have stabilized the economy. He went on to explain, that Sri Lanka’s practical strategy should involve starting with hybrid vehicles until about 2030, then transitioning gradually to EVs and fuel cell vehicles by 2035, mirroring Japan’s carbon neutrality goals. This phased approach acknowledges Sri Lanka’s current infrastructure and fiscal limitations. It’s crucial to develop industrial policies that support automobile production and enhance mobility while balancing economic growth with environmental sustainability.

During the course of the discussion, Bingumal Thewarathanthri, Chairman of Sri Lanka Bankers Association, spoke about Sri Lanka’s current economic trajectory, and possible risks the country might face. He explained, “We don’t see a risk of not crossing this review. As a country, we’ve made significant progress in several areas, including fiscal policy and the external sector, which has performed exceptionally well. Although there are still areas that need improvement, particularly in debt restructuring, the requirement is to show meaningful progress rather than completion for the second review. Given our advancements, I’m confident that Sri Lanka will secure the $300 million needed to move forward.”

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