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SJB MP presses for IMF intervention



‘… restructuring debt, fiscal discipline urgently needed, we’ll implement it when we get to office’

By Shamindra Ferdinando

The Samagi Jana Balavegaya (SJB) MP Dr. Harsha de Silva insists Sri Lanka is left with no alternative but to seek immediate assistance of the IMF to tackle what he calls an unprecedented debt crisis. “The SJB is in general agreement with my view that outstanding external debt should be restructured, “Dr de Silva said.

The Island sought the SJB MP’s views against the backdrop of State Minister of Finance, Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal ruling out IMF’s intervention. The former Governor of the Central Bank (2006-2015) said so in response to Dr. de Silva’s original call for the IMF’s assistance.

Asked whether he still believed the government should ask for the IMF’s intervention, Dr. de Silva said that the IMF in itself was not the answer. Stressing the need for fiscal discipline, the former UNP minister said Sri Lanka needed the IMF assistance primarily for two reasons as Sri Lanka could not address the current financial crunch under its own steam.

MP de Silva said that IMF’s assistance was needed to facilitate restructuring of debt. Referring to President Gotabaya Rajapaksa’s recent admission that his government was faced with the challenge of settling loans amounting to USD 4 bn annually, Dr. de Silva said that the IMF could provide Sri Lanka the platform to negotiate with hundreds of International Sovereign Bond (ISB) investors to reach a consensus.

Asked to explain, the MP said that if the government initiated the process, an understanding could be reached on postponement of interest and capital payment by 36 to 48 months.  Delay on Sri Lanka’s part to take action to address the overwhelming threat though politically such measures seemed disadvantageous could be catastrophic, the SJB MP said.

Dr. de silva urged the SLPP MPs to peruse the statement issued by the President’s Office on June 13 in the wake of the SLPP General Secretary attorney-at-law Sagara Kariyawasam demanding Energy Minister Udaya Gammanpila’s resignation over the fuel price hike. The President’s Office admitted the unbearable burden on the banking sector by staggering borrowings run up by CPC and CEB amounting to Rs 737 bn.

Dr. de Silva said now that the government had revealed the true status of the economy, it should go the whole hog to address the issue. “These ISB agreements are mainly in New York jurisdiction and there are clauses that need 3/4 of investors (by value) having to agree. So it’s not easy. We need to arrive at an acceptable debt sustainability plan and to do that the IMF is needed. Once we do that, confidence in Sri Lanka’s ability to manage our debt will return and we can participate in the international financial markets again. When we have space without having to make large debt payments in the next few years we can undertake essential economic reforms without which we cannot move forward.”

Asked whether he had been able to convince the SJB to go with his views on restoring financial confidence, Dr. de Silva emphasised that the SJB was in agreement with his stance that Sri Lanka had to restructure its debt. “Look at what is happening today. Look at the indicators? How much is the USD? Now they want to restrict even more imports. We are going back to 1973—77 period. We have a plan to get Sri Lanka back on its feet by integrating with the world. That is how we will strengthen the domestic economy. Not by hoodwinking the people. We will implement it when we form a government.”

Responding to queries on the need for urgent action and consensus on the crisis, Dr. de Silva said that remedial measures should be undertaken immediately. The MP emphasised that the issue at hand should not be blamed on rampaging Covid-19 pandemic. Declaring that the trouble had been brewing for years, the MP said that the country had been consuming much more than it had been producing.

The MP said: “Our savings have been low. Our investments have been unproductive. Our subsidies have been wasted. Our exports have been falling as a percentage of global shares. The inward looking policies of this government that once failed in the 1970s have caused rapid deterioration. The unwise steps starting from the massive tax give away in December 2019 long before Corona only exacerbated the problem.”

National People’s Power MP Dr. Harini Amarasuriya said now that State Minister Cabraal on behalf of the government had ruled out IMF intervention, he should explain how the incumbent administration was going to tackle the problem.  MP Amarasuriya emphasised that the public had a right to know the conditions, modalities as well as those involved if the IMF was not. The MP alleged decades of waste, corruption, irregularities, negligence and mismanagement had weakened the national economy and the country was now in a perilous state.

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SJB MP slams police double standards



“Why one law for Ponnambalam and another for Gamage?”

The police have failed to display the same efficiency they displayed in arresting Jaffna District MP Gajendrakumar Ponnambalam with regard to arresting State Minister Diana Gamage, who should have been spending her time at the Mirihana Immigration Detention Centre, Kurunegala District SJB MP Nalin Bandara Jayamaha told Parliament on Friday.

“If the police had displayed the same efficacy, Diana Gamage should have been at the Mirihana Detention Centre at this time. Instead she comes to parliament and issues threats to other MPs. The courts have clearly stated that the CID could take her into custody because she had been using two passports.

“The Immigration Controller himself has reported to the courts that she had been a UK citizen since 2004 and using a UK passport since then. She has not revoked her UK citizenship. In addition she has obtained anther passport through the Secretary General of Parliament. The Speaker too should have a responsibility to prevent a foreign citizen sitting unlawfully in the House,” he said.

Jayamaha said that Gamage had no right to sit in parliament. “The case against her regarding her having forged passports is postponed again and again. The law is not implemented. My colleague Mujibur Rahuman tabled a document in this House that the Defence Secretary had been informed of the illegality of Gamage’s presence in Parliament. I tabled the same again today.

“She recently told a TV talk-show that she had applied for the revocation of her UK citizenship. We do not know whether she has two tongues,” the MP said.

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Sarath Weerasekera opposes SLT share sale on security grounds



Sri Lanka Telecom (SLT), which owns a fixed and mobile telecom group, which is partly foreign owned and listed should not be privatized, the head of a parliamentary committee on national security has said.

Government MP, Retd. Admiral Sarath Weerasekara who chairs the Sectoral Oversight Committee on National Security told parliament Friday that divestment of the 49.5 percent stake in SLT held by the government could “expose the country’s strategic communication infrastructure and sensitive information to private companies that are motivated by profit, which could pose a threat to national security”.

Weerasekara also said that any individual or organization proscribed or otherwise that “aided terrorists or extremists” must not be allowed to purchase shares or control Sri Lanka’s national assets.

The claim comes despite satellite links and international cables connecting the country being built and managed by foreign conglomerates in which many connected countries are also shareholders. SLT is also a shareholder in some global cable companies.

Weerasekara suggested that the government retain the right to repurchase shares held by the majority shareholder of SLT.SLT’s second biggest shareholder, behind the Sri Lanka government, is Malaysia-based Usaha Tegas Sdn Bhd with a 44.9 percents take in the company.

Most Sri Lanka’s mobile firms were also built and owned not just by private firm but foreign ones. SLT’s own mobile network, Mobitel was a build operate transfer project by Australia’s Telstra.

Sri Lanka’s cabinet of ministers in March 2023 listed Sri Lanka Telecom among several state companies to be re-structured.SLT currently enjoys market leadership in fixed-line services and is the second-largest operator in mobile. It also owns an extensive optical fibre network.The company was placed on watch for a possible rating upgrade by Fitch Ratings in March 2023 after the government announced the restructuring. (EconomyNext)

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Cardinal hits out at government demanding local elections



By Norman Palihawadane

Colombo Archbishop Malcolm Cardinal Ranjith has urged the government to hold local elections to secure the democratic rights of the people.

“Voting is a right of the people that we must all enjoy. It is a right that every person over 18 -years of age is entitled to to determine the future of the country,” he said on Thursday.

“Today justice as been turned into injustice, governance to dictatorship and law into lawlessness,” the 75-year-old cardinal told a gathering of hundreds of people at a function at St. Anthony’s College in Kochchikade.

Local polls to elect 340 councils were slated for April 25 but the election commission postponed it, citing a lack of funds.

“The government said earlier that it doesn’t have money to hold an election, now it’s saying that it has money. If the government has the money, please give an opportunity to the people to vote and let the people express their wishes. How much of what came from the IMF was used for agriculture? How much for the fishing industry? And what about education?” the cardinal queried.

Rather than improving the lives of people, “politicians import goods, and bring in what we need and what we don’t need, destroying our economic independence, leading us to depend on foreign countries,” he said.

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