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“Strong expectations” of SL soon striking deal with commercial creditors: IMF

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Julie Kozack

The International Monetary Fund (IMF) says there is a strong expectation that Sri Lanka will soon reach agreements with external commercial creditors consistent with program parameters.

“So overall we assess that there has been sufficiently strong progress on the debt restructuring front,” Julie Kozack, Director of the IMF Communications Department, said during a press briefing at Washington on Thursday (06).

On March 21, IMF staff and the Sri Lankan authorities reached staff-level agreement on economic policies to conclude the second review of the economic reform program and also the 2024 Article IV Consultation.

Kozack confirmed that on June 12, the IMF Executive Board will meet to discuss Sri Lanka’s second review and the Article IV Consultation.

“In Sri Lanka, we do see macroeconomic policy reform starting to bear fruit.” Commendable outcomes include rapid disinflation, robust reserve accumulation, and initial signs of economic growth, while preserving stability of the financial system, she said responding to questions on Sri Lanka.

The IMF spokesperson said that the program performance is strong with most quantitative and structural conditionality for the second review met or implemented with delay, and reforms are still ongoing in some areas.

“The next steps on the debt restructuring are indeed to conclude negotiations with external commercial creditors and to implement agreements in principle with the official creditors. The domestic debt operations are largely completed. Debt restructuring discussions are continuing.”

More specifically, she said the authorities have been holding extensive discussions with external official creditors regarding an MOU with the official creditor committee and the final agreements with the Export Import Bank of China.

Discussions with external bondholders continue with the aim of reaching agreements in principle soon, Kozack said, adding that negotiations with the China Development Bank are also at an advanced stage.

“There is a strong expectation that agreements with external commercial creditors consistent with program parameters will be reached soon. So overall we assess that there has been sufficiently strong progress on the debt restructuring front.”



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President inaugurates Auto Assembly Plant in Kuliyapitiya

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Marking a significant milestone in the country’s automotive industry, President Ranil Wickremesinghe today (17) inaugurated the Western Automobile Assembly Private Limited (WAA) vehicle assembly plant in Kuliyapitiya..

The first vehicle to be assembled at the $27 million facility, a 15-seater passenger van, is expected to enter the market by the end of the month. The factory, equipped with cutting-edge machinery designed by global automotive experts, will generate both direct and indirect employment opportunities for local youth. In line with international industry standards, the facility also houses a vocational training institute, offering young people the chance to gain skills that will qualify them for overseas job opportunities.

During the ceremony, President Wickremesinghe unveiled a commemorative plaque and toured the factory, engaging in friendly conversation with staff. In his speech, the President emphasized that no one will be allowed to obstruct projects vital to strengthening the national economy, despite protests. He also noted that although the Western Automobile Factory was initiated in 2015, it lacked the necessary support for timely completion.

President Ranil Wickremesinghe emphasized that his administration is committed to advancing development projects that will benefit the country, noting that significant job opportunities for youth were lost due to the 10-year delay in completing this project, which was initially expected to be finished in two years. He highlighted that the new factory will not only boost the local economy of Kuliyapitiya but also strengthen the national economy.

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Over 60,000 police personnel to be deployed on election day

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By Hemantha Randunu and Pradeep Prasanna Samarakoon

Over 60,000 police officers would be deployed to protect polling stations, other election-related locations, and maintain law and order on 21 September, Viyani Gunathilaka, Secretary of Public Security, told The Island on Tuesday (17).

Gunathilaka said the number of officers could be increased if necessary.

The assistance of the tri-forces would also be sought to provide security at strategic locations across the country on both election day and the day after, he added.

Two police officers will be stationed at each polling centre, while special police teams, including units from the Special Task Force (STF), will be deployed to protect counting centres and conduct patrols and carry out search operations, Gunathilaka confirmed.

He said the 2024 presidential election campaigns had been remarkably peaceful so far, with no reports of serious election-related violence to date.

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Russia rejects Latvian claims about shipment of potash fertiliser to Sri Lanka

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Asian Majesty (IMO: 9724996) is a Bulk Carrier and is sailing under the flag of Singapore.

The Russian Embassy in Colombo on Tuesday (17) refuted claims made by the Latvian Embassy in New Delhi regarding the delay of a crucial shipment of Russian potash fertilisers bound for Sri Lanka.

Last week, the Russian Embassy stated that the vessel Asian Majesty, carrying 55,000 tonnes of potash fertilisers, valued at approximately USD 34 million, had been held at the Port of Riga, Latvia, since mid-2023.

According to the Russian Embassy, Latvia is planning to nationalize the shipment under pressure from Western powers. On Monday, the Latvian Embassy rejected these accusations, asserting that it has been actively working to expedite the shipment without causing any delays.

In a statement issued yesterday, the Russian Embassy in Colombo criticized Latvia, claiming that the delay reflects the limited sovereignty of the Baltic state. The Embassy argued that key foreign policy decisions for Latvia, like other Baltic nations, are made in other capitals.

“Latvia continues to claim its significance, yet it has become a leader in implementing measures that jeopardize global food stability,” the Russian Embassy noted. It added that Riga has repeatedly (in October and December 2023, and January 2024) proposed blocking Russian agricultural products from the European market in line with the EU’s sanctions policy.

However, the Russian Embassy claimed such actions are harmful to global food security, as they contribute to the rising prices of European agricultural exports to third-party countries. This, combined with a reported 30% decline in fertiliser production in Europe since 2021, has left vulnerable nations in Africa, Asia, and other regions increasingly at risk.

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