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Finance Minister rules out defaulting on debt repayment

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… the bloated public service can no longer be sustained

By Shyam Nuwan Ganewatte

Finance Minister Basil Rajapaksa said on Saturday that the government would not be defaulting on the country’s debt repayment.

Addressing the media at the Ministry of Finance, the Minister said that various solutions including the halt of vehicle imports had been resorted to, but those had failed to yield a clear solution with regard to the country’s foreign reserves crisis and debt servicing. “We think that this issue will persist next year as well, but we expect to resolve it without obtaining loans,” the minister said.

Sri Lanka has to pay 500 million US dollars in debt repayment in January and one billion US dollars in July next year, said the minister, adding that the country would definitely make both payments.

“The country expects to have foreign reserves of 10 billion US dollars of its own money by 2027. From next year, we expect to contribute one billion US dollars of our own money annually towards forex reserves. So, for the first time by 2024, we will be able to take the external budget into positive territory after many years.”

Minister Rajapaksa said the state sector had become bloated to the point that the country could no longer sustain it anymore.

“I think we don’t need to appease them (public servants) with sweets any further,” the finance minister said, adding that the government was not in a position to allocate more public funds for the state service for another year.

Responding to a query on an allegation by the opposition parties that there was a lack of price reduction of goods via Budget 2022, the minister said: “There are no short-term solutions. This government and its counterparts in other countries have got into difficulty by attempting to do so. The only solution is to increase production. Amid the existing COVID pandemic, I don’t think the price of imported goods will come down within the next year.”

When asked of the relief measures for the tourism sector, the Finance Minister said: “More than enough relief measures have been given to the people in this sector. The biggest relief the tourism sector can be given is making the country safe by vaccination so that tourists can visit without fear.”

Minister Rajapaksa said that the government was doing everything in its power to ensure the revival of the tourism sector. “As the finance minister, I say that the tax from the tourism sector goes to the tourist board and not to the government. The government gets income tax from all other sectors, but they independently collect the revenue and spend it.”



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Countrywide power outage act of sabotage, claim TU, officials

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Unions suspect sinister attempt to call in military

Engineers say technical fault caused power failure

CEBEU suspends work-to-rule protest

By Ifham Nizam

The government was trying to pin the blame for yesterday’s countrywide power outage on the Ceylon Electricity Board (CEB) trade unions in a bid to call in the military, Joint Trade Union Alliance Convener Ranjan Jayalal said yesterday.

Jayalal told The Island the government’s attempt would tarnish the image of the military and that of the country, but such intimidatory tactics would not deter the CEB unions from continuing with their action against the questionable agreement between the government and the US energy firm, New Fortress, which has been allowed to acquire a 40% stake in the Yugadanavi power plant. “The government is trying to derail our trade union action, scheduled for December 08. Definitely the power outage was an act of sabotage. Two units of the Norochcholai coal-fired power plant and the one at Sapugaskanda had failed,” he added, insisting that the trade unions had nothing do with the power outage. He said union activists had sprung into action to restore power despite their work-to-rule, for the sake of the country and its people.

A senior independent electrical engineer said the power failure was an act of sabotage or attempt at sabotage. “It could have been a rehearsal that misfired,” he added.

Electricity supply in several areas in Colombo and its suburbs were restored around 2.00 p.m. Subsequently, the power supply on Anuradhapura-Habarana, Laxapana-Athurugiriya and Kotmale-Biyagama transmission lines was restored. However, even at 5.30 p.m. most parts of the Gamapaha District experiencing power failures.

CEB General Manager, Eng. M R Ranatunga sand disruptions to the power supply could be considered sabotage. He said CEBEU activists had been dragging their feet on power restoration.

State Minister of National Security & Disaster Management Chamal Rajapaksa said necessary action would be taken against the CEB engineers if it was revealed that the power outage was an act of sabotage.

Major disruptions to the electricity supply were reported across the country around 11.30 a.m. yesterday owing to a breakdown in transmission lines.

The National Water Supply and Drainage Board (NWS&DB) said the water supply in several areas of Colombo and suburbs had been disrupted due to the breakdown in the power supply as the NWS&D is dependent on the national grid for pumping purposes.

The Ceylon Electricity Board Engineers Union (CEBEU) last night said it had received a favourable response from the government to its demands and therefore decided to suspend its work-to-rule campaign.

The Island learns that President’s Secretary Dr. P. B. Jayasundara will meet a CEBEU delegation, next week.

A senior electrical engineer expressed concern about CEB General Manager’s statement that the power outage was an act of sabotage by the engineers’ union. He denied as baseless the official’s claim.

CEBEU Secretary Dhammike Wimalarathne confirmed that his union had decided to suspend trade union action following an undertaking given by the government to have talks with them.

Meanwhile, CEBEU President Saumya Kumarawadu, addressing the media, yesterday, insisted that the power outage had been due to a technical problem.

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Chamal tells Parliament if power failure is due to sabotage, culprits will be dealt with severely

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By Saman Indrajith

Minister of Irrigation and State Minister of Internal Security, Home Affairs and Disaster Management, Chamal Rajapaksa told Parliament yesterday that the government was investigating the causes of yesterday’s countrywide power outage and if it was due to sabotage those responsible would be severely dealt with.

Responding to a question by Anuradhapura District SJB MP Rohana Bandara Dissanayake during the third reading stage debate on Budget 2022 under the expenditure heads of the Ministry of Defence, the Minister said that the government would not tolerate sabotage.

MP Rohana Bandara Dissanayake said that while the national security was being debated in Parliament the entire country was experiencing a power outage which could be considered a serious threat to national security.

He said all reservoirs were brimful and there was sufficient water to generate hydro power.

Colombo District SJB MP Dr. Harsha de Silva said that the entire country was in dark and Parliament was sitting thanks to power supplied by generators.

Minister Rajapaksa said that the government had already called for an investigation and it would not hesitate to take necessary action on the findings of the probe.

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Committee on Public Finance meeting: one-third drop in next Yala harvest predicted

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Members of the Committee on Public Finance recently recommended that if the import ban on rice, which was imposed last April, is to be lifted, it should be done only after a proper forecast of the coming Yala harvest.

The Chairman of the Committee on Finance Anura Priyadharshana Yapa pointed out that under the prevailing circumstances, the interest of the paddy farmers and consumers had to be taken into consideration.

In response to MP Yapa’s comment, the Imports and Exports Controller General revealed that, according to the available data, the expected Yala harvest is likely to be only 2/3 as compared to last year.

MP Nalin Fernando pointed out that if businessmen were allowed to import rice freely, the business community would be tempted to import more rice than necessary, driving the paddy prices down and affecting the farming community badly. Hence, the Ministry of Finance should intervene to prevent the local farmer from facing difficulties. MP Fernando also pointed out to the officials of the Ministry of Finance that it was important to make rice freely available at reasonable prices. Sri Lankans did not like rice imported from neighbouring countries, he said.

The Committee on Public Finance was urged to obtain approval for an Extraordinary Gazette Notification permitting the importation of Kekulu, Nadu, Samba and other types of rice as per the order of the Minister of Finance. MP Dr. Harsha de Silva said officials had to investigate the macro economic impact of such orders given without a proper procedural or logical assessment.

The committee members inquired from the officials of the Ministry of Finance who were present at the Committee meeting whether the 2021 Budget forecasts could be fulfilled. According to the statistics and data submitted by the officials of the Ministry of Finance, the committee observed that if only local funds were used to repay all debts, there would be an increase in interest rates in the near future and that would adversely affect the local private sector, (Dr.) Harsha de Silva said.

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