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JVP inspires calls for protests against rising cost of living

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By Saman Indrajith

The JVP yesterday called on people to take to the streets against the government that cannot control market prices of essential items.

Addressing a press conference held at the party headquarters in Pelawatte, the party’s national organiser and former MP Bimal Ratnayake said that yesterday’s fuel price hike was unjust and it would result in further increases in prices of all goods and services in the coming days, sending the pandemic-hit economy from the frying pan into the fire.

“This is the highest ever price hike in fuel in the country’s history. As per an announcement by the Ceylon Petroleum Corporation Octane 92 petrol price has been increased by Rs 20, Octane 95 by Rs 23, diesel by Rs 10, Super diesel by Rs15 and kerosene by Rs 10. The reason for the price revision has been attributed to the world market price change of fuel. It cannot be accepted. There had been many previous occasions when the world market price of fuel increased more than this. In 2013 the price of a barrel of oil was at USD 97. For years the price was at USD 100 a barrel. There had been some increase in price in the world market but following the spread of the Omicron variant there were travel limitations in Europe and price of fuel decreased. There is a presumption that the price of an oil barrel would be around USD 60 owing to the Omicron effect.  Then the truth is that the government jacked up fuel prices at a time when the world market prices are going down.

“The CPC and Petroleum minister have become puppets of the ruling cabal. Discussion for fuel price increase started by the government on Dec 13 soon after the budget. Yet Finance Minister Basil Rajapaksa did not allow the prices to increase while he was still in the country. He wanted to show that the price increases took place in his absence. His intention was to apportion the blame on the petroleum minister and the acting finance minister. Yet the truth has come out and now it is a known fact that the CPC increased the prices last night on a directive from the Finance Ministry.  It is clear that the finance minister plotted to place the blame on others. This is a well-known tactic of Rajapaksa family. The rest of the ministers are used by them as puppets.

“Government spokesman Minister Dullas Alahapperuma says that the fuel prices were increased to save the foreign exchange reserves. We cannot understand how the government could save dollars by increasing the fuel prices in the local market. The government could have instead asked people to stay at home to save fuel.

“Bakery owners are planning to increase the prices of their products. Three wheel operators say that they would increase their starting price per km from Rs 30 to Rs 80. Bus owners demand to increase the minimum fee to Rs 25. Likewise, the prices of various services and goods would go up in the coming days. The government has lost control of prices and the market. There are shortages of various items. The standards of available consumables are questionable. Traders fleece consumers at will. While the government is fleecing people it has let several big-time companies fleece money from the people. People can identify those companies because it was they who recorded unprecedented profits in the third quarter of this year. Some banks recorded 312 percent profit in the said period. There are two main companies running supermarket chains. One says it received a Rs 3,500 million profit after tax and the other has raked in Rs 1,387 million profit in the third quarter. These profits came at a time when the economy was down. They have earned profits by increasing the prices at their will. Rice prices in the market are decided by the millers. The government has lost control of the prices in the market. We call on people to raise their voice and stand with us against this government”, Ratnayake said.



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Contentious Chinese research vessel docks in Maldives

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Xiang Yang Hong 03 has previously visited Indian Ocean on several other occasions

A contentious Chinese research ship reached the Maldives on Thursday in the latest sign of the archipelago’s diplomatic reorientation towards Beijing and away from its traditional benefactor India.

Local residents said they had spotted China’s Xiang Yang Hong 3 at the Thilafushi industrial port near the capital Male.The 100-metre-long (328-foot) vessel was at an anchorage near Male on Thursday evening, according to the website Marinetraffic.

The Maldives’ pro-Beijing government said earlier the vessel was docking for a port call to rotate crew and take on supplies, on the condition that it would not conduct “research” while in its territorial waters.

Media reports in India had suggested that the vessel was conducting surveillance for Beijing.

India is suspicious of China’s increasing presence in the Indian Ocean and its influence in Sri Lanka and the Maldives, which are strategically placed halfway along key east-west international shipping routes.Relations between Male and New Delhi have chilled since pro-China President Mohamed Muizzu won elections last year.

Muizzu has asked India to withdraw 89 security personnel based in the Maldives to operate reconnaissance aircraft by March 15.But the president has also insisted he does not want to upend ties with New Delhi by replacing Indian troops with Chinese forces.

Sri Lanka refused entry to Xiang Yang Hong 3 after two other port calls from Chinese vessels since 2022 raised objections from India.That included the ship Yuan Wang 5, which specializes in spacecraft tracking and which New Delhi described as a spy ship. (AFP)

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MP Harsha in Australia as “Special visitor”

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Harsha de Silva

Opposition MP and Chairman of the Committee on Public Finance (COPF) Harsha de Silva is currently in Australia as a special visitor.

Taking to ‘X’, the Samagi Jana Balawegaya (SJB) MP said he had embarked on a nine-day visit on an invitation extended by the Government of Australia.

“My engagements with policymakers, academics, scientists and investment managers began in Melbourne and will continue in Adelaide and then public officials and politicians in Canberra,” he added.

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ADB country chief hopes Lanka could sustain policy reforms despite elections

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Takafumi Kadono

ECONOMYNEXT –The Asian Development Bank (ADB) expects Sri Lanka not to reverse its International Monetary Fund-led policy reforms despite elections soon, the ADB Country Director for Sri Lanka Takafumi Kadono said.

The island nation has witnessed repeated reversals of policy reforms in the past due to greedy politicians who misled  the people to vote for them by sowing the seeds of subsidy mentality with unsustainable debts at expensive borrowing costs, economists say.

That led the country into an unprecedented economic crisis in 2022 with a sovereign debt default. Sri Lanka is still struggling to come out of the crisis.

The IMF has strictly placed some reforms including in state sector enterprises, fiscal and monetary sectors.

Sri Lanka has implemented the painful IMF reforms so far including higher personal income taxes, but economists have raised concerns over the sustainability of the current reforms due to possible changes in the policies in the event of a new president or government comes to power after democratic elections.

“If that kind of reversal happens, we also cannot justify our support,” ADB Country Director for Sri Lanka Takafumi Kadono told EconomyNext on late on Wednesday.

“We do expect these policy reforms to be sustained. So that is our expectation. That is the premise which we are providing our budget support. If they reverse, the whole premise will be collapsed. That kind of policy reversal cannot happen.”

The island nation had sought IMF bailout package for 17 times including the ongoing support. However, the authorities have failed to complete most of the past IMF loan disbursements due to politically motivated contradiction with the global lender’s tight fiscal policies.

Sri Lanka has shown some signs of recovery in the third quarter of 2023 with the economic growth turned to positive from contraction for the first time in seven quarters.

However, opposition political parties have promised to revisit the IMF deal if they come to power.

Higher taxes, soaring cost of living, and lack of salary hike have made President Ranil Wickremesinghe’s government unpopulour among the public, analysts say.

Wickremesinghe has said the country will hold both presidential and parliamentary election by 2025.

Some government politicians have told EconomyNext that the higher taxes would be eased from April and the authorities will try their best to meet the IMF conditions for the third disbursement in June this year.

The presidential polls should be held by October this year, but opposition parties have said President Wickremesinghe is in the process to delay the poll.

However, Wickremesinghe’s office last week said Presidential Election will be held “within the mandated period”, without giving an exact time.It also said the General Election will be held next year, “according to the current timeline”.

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