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IFC reaffirms commitment to Sri Lanka amid plans to increase investments



IFC’s Vice President for Risk Mohamed Gouled, Country Officer for IFC Sri Lanka and Maldives Victor Antonypillai, World Bank Country Director for Sri Lanka, Maldives and Nepal Faris Hadad-Zervos, Regional Director for South Asia Hector Gomez Ang, Country Manager for Sri Lanka and the Maldives Lisa Kaestner, IFC Regional Vice President for Asia and the Pacific Alfonso Garcia Mora, President Gotabaya Rajapaksa; Secretary to President Gamini Senarath, Principal  Advisor to the President Lalith Weeratunga, Secretary/Ministry of Finance S.R. Attygalle and Director General/External Resources Department Ajith Abeysekera at the meeting 

International Finance Corporation Regional Vice President for Asia and the Pacific Alfonso Garcia Mora has said that IFC aims to boost its investments in Sri Lanka, with a focus on supporting private sector job creation, paving the way for robust investments to help spur the country’s recovery and future growth, it said.

The comments by IFC Regional Vice President for Asia and the Pacific Alfonso Garcia Mora, came at the end of a three-day visit to Sri Lanka, which included a meeting with the President Gotabaya Rajapaksa, Finance Minister Basil Rajapaksa, government officials, including Central Bank Governor Ajith Nivard Cabraal, private sector representatives, entrepreneurs, and development partners.

Garcia Mora was accompanied by IFC’s Vice President for Risk Mohamed Gouled, Regional Director for South Asia Hector Gomez Ang and the new Country Manager for Sri Lanka and the Maldives Lisa Kaestner, as well as the World Bank Country Director for Sri Lanka, Maldives and Nepal Faris Hadad-Zervos.

“In my meeting with the President, we discussed the need to have a sound macro fiscal stability to attract foreign capital and provide medium- and long-term certainty,” Garcia Mora said. “The talks also focused on ways to maximise the potential of the country’s private sector to help address Sri Lanka’s challenges and achieve the inclusive growth the country needs.”

“We are committed to Sri Lanka,” Garcia Mora said. “This is demonstrated by our investment commitments in the past six months which have targeted export-oriented industries. Since the onset of the pandemic, IFC has also played a strong counter cyclical role in its financing and will continue to build on that program going forward.”

During his meetings, Garcia Mora highlighted IFC’s investment of $ 450 million during the first 18 months of the pandemic in Sri Lanka as a sign of IFC’s steadfast commitment to the country.

“We are working with the private sector in the country to create a robust investment pipeline and this can be accelerated with additional reforms in the infrastructure sector, allowing the private sector to play a bigger role,” Garcia Mora said. “IFC intends to invest a further $ 150 million during the current fiscal year ending in June 2022. Over the next five years, IFC is looking at an investment pipeline of more than $ 800 million, specifically in supporting growth-enabling sustainable infrastructure.”

IFC’s efforts will focus around three strategic pillars in Sri Lanka: supporting innovation for growth, including export diversification, start-ups, niche market agriculture and value additions for export, high tech manufacturing; growth-enabling sustainable infrastructure, including low-cost clean energy, sustainable transport and logistics systems; and deepening social and financial inclusion, including digitisation, economic participation of underserved people, especially women.

While in Colombo, Garcia Mora also signed a cooperation agreement with John Keells Holdings (JKH) to develop a commercially viable and sustainable street market in Colombo 2, which will also promote women’s participation in hospitality and tourism. The officials also had the opportunity to meet clients and partners of the Women in Work program – IFC’s largest, standalone country-based gender program designed to close gender gaps in Sri Lanka’s private sector.

Since the beginning of the pandemic, IFC has invested $ 450 million in Sri Lanka, including $ 175 million in JKH to boost retail and tourism – IFC’s largest investment in Sri Lanka over its 50-year operations. As part of the overall pandemic response, IFC injected $ 50 million in Commercial Bank of Ceylon and $ 25 million in Nations Trust Bank to help small businesses stay afloat during the height of the pandemic.

IFC’s strategy also focused on expanding export diversification, promoting sustainability and inclusive growth. Last year, IFC piloted a new digital health program – DigiHealth – to boost access to affordable and quality health-care services in Sri Lanka and beyond.

In October, IFC also issued its first-ever rupee-denominated bond in the country – the ‘Serendib Bond’ – to ensure that the private-sector has access to long-term offshore financing in local currency.

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More than 6 bn worth of substandard drugs dispensed to patients



The Committee of Public Accounts (COPA) has disclosed that Rs. 6,259 million worth of drugs faced a quality failure from 2011 to 2020 due to improper storage. The COPA report has further revealed that 99% of such drugs had already been dispensed to patients when the condition was brought to attention. In that situation, it was not possible to recover the cost of substandard drugs from the suppliers, the Parliament said.

The Committee on Public Accounts has directed the Ministry of Health, Nutrition and Indigenous Medicine to expedite the process of facilitating better storage of drugs to ensure their safety.

It has also been observed that the temperature in the warehouses, owned by the Medical Supplies Division, is maintained properly and that the medical supplies are stored in the corridors of the central drug warehouses and hospitals.

Furthermore, the Secretary to the Ministry has pointed out that if there is a system to detect the failure of drugs as soon as they are received, the loss can be recovered from the suppliers and if the quality testing of 60 drugs can be done by the State Pharmaceutical Corporation, this situation can be avoided to some extent.

These concerns and observations were contained in the first report of the Second Session of the Ninth Parliament on COPA, which was tabled in Parliament recently (20) by Prof. Tissa Vitarana, the Chairman of the Committee on Public Accounts.

The report contains information about the investigations of seven state institutions summoned before the Committee on Public Accounts and one Special Audit Report during the period from 04.08.2021 to 19.11.2021.

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CBSL Chief: Economy could be stabilised in year or so if …



By Hiran H. Senewiratne

The prevailing Balance of Payments (BoP) crisis could lead to a major social crisis as the available foreign reserves were only sufficient for a few weeks’ imports, Governor of the Central Bank Dr. Nandalal Weerasinghe warned on Monday.

“The economy can be stabilised in the next 12 month if the IMF negotiations and debt restructuring are finalised within the next seven to eight months. Until then we have to support the poor people,” Dr. Weerasinghe said, addressing a seminar on the “State of the Economy and Talks with the IMF”. It was organised by the Press Club, together with the Press Institute, at Colombo Hilton.

The CB Governor said the current BoP crisis would worsen and, therefore the economic pain could only be minimised if essential policies and measures were implemented in an expeditious manner. But “IMF technical level virtual meetings are likely to conclude this week, and thereafter further discussion will take place to finalise everything,” Dr. Weerasinghe said.

Dr. Weerasinghe suggested that the monetary and fiscal authorities tighten the monetary policy by higher margins and fiscal policy by restoring tax rates to pre-2020 levels.

The Governor said, “We have three categories of creditors namely International Sovereign Bonds, which raise short term funds from global markets, which account for 35 percent of the government debt, while other two creditors are Paris Club and non-Paris Club (India and China).

Dr. Weerasinghe said that the country’s debt needed to be brought to a sustainable level. “For that purpose a debt sustainability analysis needs to be drafted with a fiscal policy for the IMF bailout”, he said.

Speaking about the country’s worsening economic fundamentals, Dr. Weerasinghe said: “The nation is currently experiencing a historically low economic growth and falling trend of per capita GDP since 2017 with rising levels of poverty. It is also running the highest fiscal deficits since 1988 with the lowest ever government revenue as a percent of GDP.

“Amid those developments Sri Lanka’ poverty level will increase, unemployment level soar and local industries will have to shut down due to restriction of importation of raw material. Therefore, we have to seek humanitarian assistance from the World Bank, Asian Development Bank and other bilateral and multilateral agencies”, the Governor said.

“We are seeking short-term bridging facilities from official creditors until an agreement is reached with creditors on restructuring,” he said.

In his presentation, Dr. Weerasinghe analysed the links between banking and the currency crises. He pointed out that the problems in the banking sector typically precede a currency crisis with the currency crisis deepening the banking crisis, thus activating a vicious spiral.

Sri Lanka also had the highest-ever government debt which was unsustainable at the moment. Debt dynamics might be worsening in the next few years unless the debt was restructured, he said.

Sri Lanka also recorded the highest rate of inflation in 12 years which was increasing sharply and was experiencing the highest-ever levels of money printing by the CBSL, he added

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Dragonfly thought to be extinct found again



By Ifham Nizam

Scientists have rediscovered Sri Lankan Clubtail (Anisogomphus ceylonicus), one of the rarest species of dragonflies in the country. The team that made the discovery comprised Amila Sumanapala of the Department of Zoology and Environment Sciences, University of Colombo, T. Ranasinghe of the Butterfly Conservation Society of Sri Lanka, and D. Sumanapala of the Faculty of Graduate Studies, University of Sri Jayewardenepura. According to lead scientist Amila Sumanapala Sri Lankan Clubtail is one of the rarest species of dragonflies.

First collected in 1859, it was only known from the original collection and another collection record made a century after in 1962. This species had not been found anywhere in Sri Lanka for close to 60 years until the team encountered a larva during a survey conducted in 2021.

Anisogomphus ceylonicus is one of the few Odonates of Sri Lanka with no photographic records of a living specimen available hitherto.

The present observation provides the first photographs of a live A. ceylonicus larva and the most recent documentation of the species. These observations, coupled with previous work (Lieftinck 1971, Bedjanič & van der Poorten 2013), provide an improved understanding of the species, which might enable further targeted surveys to be made

It was first discovered from Ramboda over 140 years ago based on a female specimen, which was originally described as Gomphus ceylonicus and later assigned to the genus Heliogomphus by F.C. Fraser (Bedjanič & van der Poorten 2013). Almost a century later, Lieftinck (1971) collected an immature male and its exuvia of a clubtail dragonfly from Rambukpath Oya, 10 miles northwest of Hatton in 1962 and described it as Anisogomphus solitaris. However, Bedjanič & van der Poorten (2013) recognized that H. ceylonicus is conspecific with A. solitaris, and thus reassigned it to the genus Anisogomphus. Since the discovery of the species, only these two records have ever been documented (Bedjanič et al. 2014), despite odonatological surveys and numerous biodiversity explorations conducted countrywide.

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