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Hand over economic management to independent technocrats: SJB MP



By Sanath Nanayakkare

Samagi Jana Balavegaya MP Patali Champika Ranawaka said in Colombo recently that managing the economy of the country should be handed over to a group of independent technocrats.

“The general public and the business people are growing increasingly less confident about the capacity of the political leadership to pull the country out of the current economic crisis. So, the situation calls for the government to turn over the management of the economy to a group chosen through a process that emphasises their relevant skills and proven performance to put the economy back in shape,” Ranawaka said.

The MP said that such technocrats needed to be truly independent and need not just serve the interests of popular politics because if a sovereign default happens, all Sri Lankans, those who voted for the government and those who didn’t, would have to face grave repercussions.

Ranawaka made these comments at an Advocata forum themed, “A National Consensus for Economic Reforms.

Ranawaka said that Sri Lanka has got into a precarious financial situation today where it can’t raise enough capital either in the domestic market or in the international capital market.

“In the next eight months, we have to honour commitments on International Sovereign Bonds and Sri Lanka Development Bonds worth nearly USD $ 3 billion with only USD $ 1.5 billion cash in hand. In this backdrop, Sri Lanka runs the risk of a default and potential bankruptcy at some point. Even if the authorities begin talks on renegotiating and rescheduling of our foreign loans, that would technically mean declaring bankruptcy. When Prime Minister Mahinda Rajapaksa asked the government of India to postpone Sri Lanka’s debt by three years, that also tantamount to acknowledging bankruptcy. If the country hits bankruptcy, it will have a negative impact across the board. It won’t be easy recovering after a default and bankruptcy. It could lead to multiple defaults. Defaults by Argentina on its foreign debt as well as the debt crisis in Greece led to a loss of confidence in their economies. They haven’t recovered fully. They may recover for some time and they falter again. Elections were held in Greece from time to time to resolve the economic issue. Masses elected leaders from the left, centre and right in the political spectrum, but nothing has worked meaningfully. The economic malaise has dragged on for 10 years in Greece. Argentina is no different. If a sovereign debt default occurs in Sri Lanka, we may face a similar situation. It would be unwise to think that when the situation aggravates, it would help the Opposition to come to power. Whoever comes to power, would have to bear the same pain and pressure, so a sovereign default must be averted,” he said.

He said that the government is still not serious about this serious situation.

“Our concern is whether political leaders and responsible authorities are paying the issue the attention it deserves. This crisis can’t be solved by providing each Grama Niladhari division with Rs. 3 million to spend on building rural infrastructure. If a default happens, its negative spillover could see the loss of thousands of jobs triggering a social explosion. The racial and religious tensions which are under wraps could flare up again and foreign investors would try to capitalise on the situation. A fine example for this is; about six months ago the Urban Development Authority put up more than 50 strategic national properties for sale under what was called ‘Selendiva’. It was said that USD 5 billion would be raised from its proceeds. Nevertheless no buyer has made any bids to date. We are often told that USD 3.6 billion is coming from Oman, USD 2.5 billion is coming from some other country and so on. But these have not materialised yet. Why? Everyone has realis-ed that Sri Lanka is on its way towards bankruptcy. And investors know that they can buy these assets for five million dollars once that happens. It is very clear that nobody is coming to buy these assets right now. There are no friends left here for us. In 2019, during our administration, we arranged four investments for the much hyped Port City and the foundation stones were laid. I can tell you that those investments or anything else won’t come to Port City next year. All countries in the world are experiencing varying degrees of volatility and instability as the virus has again plunged the world back into uncertain territory. No friends have been left for us in the midst of it.

“So coming to a national consensus on structural reforms needed to get out of the economic crisis is critical right now. It’s up to the government to show the right signals that it is ready to move along the correct political and fiscal path to get the support of everyone to do it,” he said.

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Overtime gravy train for public sector back



Govt. MPs make contradictory statements on state of economy

By Shamindra Ferdinando

UNP National List MP Wajira Abeywardena on Sunday (26) disclosed the issuance of a circular by the Finance Ministry to restore overtime and other payments in the public sector.

The declaration was made in Galle soon after Transport and Media Minister Bandula Gunawardane lamented that the government was short of billions of rupees to pay public sector salaries, pensions, Samurdhi payments and meet recurrent expenditure.

Minister Gunawardena and UNP National List MP Abeywardena addressed the local media after the handing over of several buses to the Galle SLTB depot.

Cabinet Spokesman Gunawardena said that the government needed as much as Rs 196 bn before the Sinhala and Tamil New Year and its projected revenue was Rs 173 bn. In addition to that Rs 500 mn was required to settle what Minister Gunawardena called bilateral debt.

Minister Gunawardane said that a part of the first tranche of USD 333 mn from the International Monetary Fund (IMF) would be utilised to pay public sector salaries.

Of the USD 333 mn received so far, USD 121 had been used to pay the first installment of USD 1 bn credit line secured from India early last year, according to State Finance Minister Ranjith Siyambalapitiya.

Power and Energy Minister Kanchana Wijesekera in the second week of August last year revealed as much as Rs 3 bn had been paid as overtime to Ceylon Petroleum Corporation (CPC) workers for several months. This disclosure was made in response to a query raised by Chief Opposition Whip Lakshman Kiriella.

One of the major demands of the public sector trade unions on the warpath over the Wickremesinghe-Rajapaksa government’s new tax formula is the restoration of overtime.

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Now, Opposition wants Finance Secy. hauled up before Privileges Committee



Prof G L Peris

Prof. G. L. Peiris yesterday (27) urged Speaker Mahinda Yapa Abeywardena to act speedily on the main Opposition Samagi Jana Balawegaya (SJB) request to summon Finance Secretary Mahinda Siriwardena before the parliamentary Committee on Ethics and Privileges.

Addressing the media on behalf of the Freedom People’s Alliance, the former External Affairs Minister said that the Treasury Secretary had challenged the parliament by withholding funds allocated in the budget 2023 to the Election Commission thereby sabotaging the election.

Prof. Peiris said that there couldn’t be a far worse violation of parliamentary privileges than a government official undermining Parliament.

Instead of appreciating the intervention made by the Supreme Court to facilitate the delayed Local Government polls, the ruling party had sought to challenge the apex court, Prof. Peiris said, urging Speaker Mahinda Yapa Abeywardena to fulfill his obligations.

Prof. Pieris said that if the government lacked funds, just one percent of USS 333 mn received from the International Monetary Fund (IMF) was sufficient to conduct the election.

The ex-minister said that the IMF wouldn’t oppose the utilisation of a fraction of the first tranche of USD 2.9 bn loan facility provided over a period of four years to guarantee the constitutional rights of the Sri Lankan electorate. (SF)

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Cabinet nod for fuel distribution by three foreign companies



By Rathindra Kuruwita

Minister of Power and Energy Kanchana Wijesekera announced yesterday that the Cabinet of Ministers has granted approval for allowing China’s Sinopec, Australia’s United Petroleum and RM Parks of the USA, in collaboration with multinational Oil and Gas Company – Shell plc, to enter the fuel retail market in Sri Lanka.

The minister said that each of the three companies would be given 150 dealer operated fuel stations, which are currently operated by Ceylon Petroleum Corporation (CPC). A further 50 fuel stations at new locations will be established by each selected company, he said.

They will be granted licences to operate for 20 years to import, store, distribute and sell petroleum products in Sri Lanka, the minister tweeted.

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