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Economic crisis: MR, ministers, CBSL Governor, Dr.PBJ ignored IMF warnings

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Dr. Jayamaha says Monetary Board acted regardless of strong opposition

By Shamindra Ferdinando

It was disclosed before the Committee on Public Enterprises (COPE) yesterday (25), the then Prime Minister Mahinda Rajapaksa, who served as the Finance Minister, had been briefed, in March-April 2020, on the impending financial crisis of unprecedented magnitude, but he had chosen to ignore the dire warning.

The parliamentary watchdog was told how the International Monetary Fund (IMF) had warned the then Governor of the Central Bank, Prof. W. D. Lakshman, and Treasury Secretary S. R. Attygalle, of Sri Lanka’s inability to procure loans unless the country undertook debt restructuring immediately.

COPE members received a briefing on the circumstances leading to the crisis when senior officials of the Central Bank appeared before the all-party body yesterday. CBSL Governor Dr. Nandalal has stated that the IMF warning hadn’t been heeded at all.

The COPE received confirmation of what has been widely speculated hours after UNP Leader Prime Minister Ranil Wickremesinghe, was sworn in as the new Finance Minister.

Janakantha Silva, Director Legislative Services / Director Communication, Parliament quoted Dr. Weerasinghe as having told COPE that following technical talks held in terms of the Finance Act pertaining to the IMF’s stand, recommendations were made to the then Premier and other senior officials. Dr. Weerasinghe has stated that the relevant decisions should have been made by the Premier, in his capacity as the Finance Minister and the entire Cabinet of Ministers.

The IMF has made its position clear after having asserted Sri Lanka lacked debt sustainability.

Asserting the failure on the part of those who managed the economy for causing a massive crisis, COPE Chairman Prof. Charitha Herath called it a crime. The first time entrant to Parliament recommended the setting up of a Special Parliamentary Select Committee to probe those who neglected their responsibilities thereby caused the current debilitating crisis. Prof. Herath blamed those few who managed the economy during that period.

SLPP National List MP Basil Rajapaksa succeeded Mahinda Rajapaksa in July 2021 as the Finance Minister whereas President Gotabaya Rajapaksa brought in SLPP National List MP Ajith Nivard Cabraal as the Governor of the Central Bank in Sept 2021. Cabraal quit in March to pave the way for Dr. Weerasinghe, the former Bank Deputy Governor to return from retirement in Australia, as its new Governor.

Dr. Harsha de Silva pointed out that the then Finance Minister Mahinda Rajapaksa delegated his responsibilities to the then State Finance Minister Cabraal who refrained from briefing the Parliament as regards the actual situation. Dr. de Silva said that the IMF’s declaration of debt sustainability should be examined against the backdrop of the revenue cut imposed on the recommendation of the then Secretary to the President and one time Central Banker and Treasury Secretary Dr. P.B. Jayasundera that deprived the Treasury of Rs 600 mn in taxes.

Dr. de Silva asked who decided on the tax cut in spite of the IMF specifically advising the government not to do so. The top SJB spokesperson and COPE member asked who decided on such reckless course of action.

COPE member and SLPP lawmaker Rear Admiral (retd) Sarath Weeraselera has said that tax cut was declared to encourage business and trade.

When COPE raised contentious issue of the Central Bank wasting precious funds to prevent depreciation of Sri Lanka Rupee, Dr. Weerasinghe has said this was the responsibility of the Monetary Board comprising five persons. The then Monetary Board member Dr. Ranee Jayamaha has revealed that the then Governor Prof. W.D. Lakshman, Treasury Secretary S.R. Attygalle and nominated member Samantha Kumarasinghe decided on that course of action in spite of her and Sanjiva Jayawardena, PC, opposing them. They had registered their protest in writing.

Dr. Weerasinghe assured the COPE that in spite of the difficulties likely to be experienced within the next three to four months he would try to achieve objectives.



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Lankan aircrew fly daring UN Medevac in hostile conditions in Africa

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Lankan Air Force personnel rescuing a UN personnel at Zemio in Central African Republic

The Sri Lanka Aviation Unit operating under the United Nations (UN) mandate in the Central African Republic (CAR) has successfully carried out a critical Casualty Evacuation (CASEVAC) mission, under extremely hostile and volatile conditions.

The mission had been launched in response to an urgent request to evacuate two United Nations personnel who had sustained combat-related injuries in the Zemio area, the Sri Lanka Air Force (SLAF) said.

Accordingly, the evacuation has been conducted using a Mi-17 helicopter (UNO 325P).

The aircraft was captained by Wing Commander Nelson De Silva, with Flight

Lieutenant Arunoda Ekanayake serving as co-pilot.

The aircrew comprised Squadron Leader Sandeepa Wijayathunga, Sergeant WCN Senevirathne, and Corporal DVPM Rodrigo. The Aeromedical Evacuation Team included Group Captain Sujith Perera, Flight Sergeant KW Sumedha, and Flight Sergeant RDH Karunadasa, who provided critical in-flight medical care to the casualties, the SLAF stated.

The extraction site was located approximately 20 kilometres northeast of the Zemio Permanent Operating Base (POB) and posed significant operational challenges.

They included extremely dusty landing conditions, an unstable and rapidly evolving tactical environment, and the requirement for a precision landing under constant threat, the SLAF said.

Despite these constraints, the aircrew demonstrated remarkable courage, sound judgement, and outstanding airmanship throughout the operation.

A comprehensive threat assessment conducted by the aircraft commander, taking into account the critical condition of the casualties, reflected exceptional adaptability and operational decision-making, the statement added.

According to the SLAF, the total flight duration of the mission was one hour and 45 minutes. The injured personnel were safely evacuated from the hostile location and successfully transported to Bangui for advanced medical treatment.

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Lanka to observe National Safety Day today

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Sri Lanka will mark National Safety Day today (26) with countrywide religious observances, a national moment of silence and the main state commemoration at the Peraliya Tsunami Memorial in Galle, officials said yesterday.

The annual observance, declared in the aftermath of the 2004 Indian Ocean tsunami that claimed over 35,000 lives and left more than 5,000 people missing, is held each year to honour victims of the tsunami and other disasters, while reinforcing public awareness on disaster preparedness.

Disaster Management Centre (DMC) Director General Retired Major General Sudantha Ranasinghe said the 2025 programme would be conducted with due consideration to prevailing weather conditions caused by the Ditwah cyclone, with district-level multi-religious observances planned across the country.

“National Safety Day is a moment of remembrance and reflection. It also reminds us of the importance of preparedness, early warning and community resilience,” he said.

The main national commemoration will take place at the Peraliya Tsunami Memorial from 8.30 a.m. to 11.00 a.m., with the participation of government representatives, religious leaders, disaster survivors and families of victims.

Secretary to the Ministry of Defence Air Vice Marshal (Retd) Sampath Thuyacontha said a two-minute silence will be observed nationwide from 9.25 am to 9.27 am today, in memory of all those who lost their lives to the tsunami and other disasters.

“All institutions and members of the public are requested to observe this moment of silence as a mark of respect and national solidarity,” he said.

DMC Additional Director General Pradeep Kodippili urged the media to provide wide coverage to the main commemoration in Galle as well as district-level programmes organised through District Secretariats.

“Media support and public participation are essential to ensure that the lessons of past disasters remain alive and that a culture of safety is strengthened across the country,” Kodippili said.

National Safety Day has been observed annually on December 26 since 2005.

By Ifham Nizam ✍️

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Street vendors banned from Kandy City

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Mayor Chandrasiri Wijenayake

All forms of street vending within the Kandy Municipal Council area will be banned from January 1, Mayor Chandrasiri Wijenayake has said.The Kandy Mayor said the decision had been taken as part of efforts to preserve it as a clean and aesthetically pleasing city and to allow the public to move freely while enjoying its surroundings.

He said the ban would apply not only to streets in the city centre but across the entire municipal council area. The move, he added, follows long-standing public requests for a more systematic regulatory framework within the Kandy urban area and is aimed at ensuring public convenience and welfare.

Wijenayake stressed that the decision would be implemented without reversal.

The Kandy Municipal Council has already issued formal notices to pavement vendors directing them to cease operations. Street vendors had requested a three-month grace period to relocate, which will expire on December 31.

By S. K. Samaranayake ✍️

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