Connect with us

Editorial

The galloping stock market

Published

on

The Colombo stock market has been galloping like nobody’s business these past several days with little or no rational explanation of why this is so in the context of a pandemic-hit business downturn. Among the reasons that have been proffered by brokers and analysts for this surge in confidence of market players, and they have increased substantially in recent months according to the CSE, is that interest rates are plunging. Investors who could earn as much as 12 or 13 percent or more on fixed deposits not so long ago, have to be now satisfied with marginal returns way below the prevailing rates of inflation. They are thus attracted to a stock market which is now performing better than most others in the region.

But the surge on the Colombo market is not supported by foreign or institutional buying which knowledgeable people say is necessary to sustain the current momentum. In fact there has been a steady outflow of foreign funds from Colombo in recent months and there has been no stemming of this flow. Although various authorities have more than hinted that institutions like the Employees Provident Fund and the Insurance Corporation will be back in the market in the short term, this does not appear to have come to pass.

Little wonder. There have been a plethora of allegations about pump and dump and market manipulation that institutional fund managers will be reluctant to open themselves to fresh accusations. This would mean a safe ‘do nothing’ philosophy unless they are ordered to enter the market. We do not know whether there is political or any other directions on what state-controlled entities should do with regard to stock market investment today. But we do know that this has happened in the past. It has been rightly urged that the EPF is only the guardian of the private sector retirement fund it manages, and not its owner. The fund belongs to its members who, together with their employers, make monthly contributions to it as a retirement saving. It must therefore refrain from speculative investments like stock trading is the conservative viewpoint.

The contra-argument has also been adduced. The EPF has long been a captive lender to the government. Government borrowing would naturally ease as the economy grows and there was official thinking within the Central Bank that it made sense to invest in private sector growth areas through the stock market as a long-term strategy. This was done to some degree that was admittedly small. Those who read the annual reports of listed companies, and even their quarterly financial reports listing their top twenty shareholders, will know that that the EPF has substantial stakes in many blue chip companies. There must be a lot of unrealized capital gains in the EPF portfolio where the pluses will outweigh the minuses although the fund cannot always back winners. If its members get an annual dividend ahead of inflation on their individual holdings in the fund, nobody can reasonably complain.

The benchmark All Share Price Index of the CSE has already topped its all time high and the upward momentum continued as this is being written on Friday. Where it will end, nobody can say. It is certainly a good thing for the country that many small investors are entering the stock market which is now retail driven. A completely new class of investors have today entered a field which not so long ago was the exclusive preserve of the rich. Massive turnovers in the billions are being recorded on the CSE every day and stockbrokers who had a lean time as the Easter bomb and the pandemic hit forcing market closure for a long period, would now be laughing all the way to the bank. While the market and its players can bask in the current sunshine, it is very necessary to attract foreign investors back to the CSE. This will undoubtedly be a formidable tasks but a bull run such as that which ongoing can be a factor that can prove persuasive.

 

Ranjan Ramanayake

 

The Chairman of the Elections Commission went on public record that Ranjan Ramanayake, the actor politician, who has now begun serving his term of four years rigorous imprisonment will not lose his parliamentary seat for six months. But the attorney general has said otherwise and the elections boss has subsequently stated that what he had expressed is a personal opinion. However that be, the Ramanayake issue remains very much alive in parliament where his Samagi Jana Balavegaya colleague, Harin Fernando sported a black shawl last week and said he will continue to wear it until Ranjan returns. Parliamentarian M.A. Sumanthiran, who defended Ramanayake in the Supreme Court also spoke up for the actor saying he was privileged to appear in court “for a clean, honest politician and I’m proud of that.”

The Speaker is yet to rule whether the convicted MP is entitled to attend parliament and promised to announce his decision in three weeks. Readers know that other prisoner-parliamentarians have previously attended sessions, but what will happen in this instance remains an open question in the short term. While most people believe that there is no appeal from a Supreme Court determination and a presidential pardon is the only way out, a contrary view relative to this matter has also been expressed in the context of the International Convention for Civil and Political Rights (ICCPR) to which Sri Lanka is a signatory.

In parliament last week Sumanthiran drew attention to the fact that Sri Lanka has failed to enact legislation for contempt of court although some work in that regard had been done. Expressing the view that the term imposed on Ramanayake was unprecedented and exceptionally severe, he drew attention to a serious lacuna in the law which has resulted “in an unprecedented injustice to an honest Member of Parliament.” Ramanayake has consistently refused to apologize for the offence over which he was charged; his parliamentary colleague, Lakshman Kiriella, also last week referred to the conduct of two former chief justices, although under the protection of parliamentary privilege. Such reference had obvious implications in the context of what Ramanayake said.



Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Editorial

School dropouts

Published

on

Saturday 13th June, 2026

Prime Minister and Education Minister Dr. Harini Amarasuriya has informed Parliament that as many as 267,138 students dropped out of school between 2018 and 2024. She said so in answer to a question from Opposition MP Hesha Withanage. Pointing out that figures for the period from 2018 to 2024 had been derived from annual school census reports, using an internationally recognised methodology that takes into account student enrolment figures and dropout rates from Grade One to Grade Ten, the PM added that definitive data on school dropout were not available for the period between 2010 and 2017. This is something serious. The education authorities must have such data. Otherwise, how can they formulate policies aimed at improving student participation in school education?

The Prime Minister told Parliament that the school dropout statistics were subject to the caveat that not all students who had left schools could be considered dropouts; some of them may have moved to schools in other areas, enrolled in international schools, or migrated overseas with their families while continuing their studies.

Such cases could not be separately identified under the methodology used to compile the statistics and were, therefore, included in the overall dropout figures. This points to the need for a holistic statistical analysis of the issue of students leaving school, and steps must be taken to ensure that all relevant factors are taken into account when statistics are prepared. The education authorities should be able to say how many children actually discontinued their education.

Thankfully, UNESCO has pointed out that Sri Lanka continues to perform better than most South Asian countries in keeping children in school though thousands still leave the education system annually. Using available data for 2024, some researchers have argued that Sri Lanka’s school dropout rate is about 0.7 per cent of the government-school student population. Regional comparisons show Nepal and Sri Lanka among the stronger performers on school retention, while Bangladesh has made substantial progress and Pakistan continues to struggle with high dropout rates. India, too, has worked hard to bring down the national school dropout rate. However, the bar must be set higher, and action should be taken to prevent school dropouts completely. It is hoped that the Prime Minister, as an academic and researcher, will address this issue, and ensure that the education authorities will fulfil the need for high-quality, policy-relevant statistics.

Prime Minister Dr. Amarasuriya has said a range of factors have contributed to students leaving the formal education system. According to media reports quoting her answer in Parliament, they include personal circumstances, school-related issues, family and economic difficulties, social influence, as well as students opting for alternative educational pathways and training opportunities. Researchers inform us that mong the main causes of school dropout in Sri Lanka are poverty, poor academic achievement, lack of perceived relevance of education, family difficulties, child labour, even early marriage or pregnancy in some cases, and inequalities in educational opportunities. From a policy perspective, as researchers have pointed out, addressing these issues requires not only financial support for vulnerable families but also improvements in school quality, vocational pathways, counselling services and community support systems.

The need for a multi-pronged strategy to address the root causes of the school dropout issue cannot be overemphasised. This should figure high on the incumbent government’s agenda.

Continue Reading

Editorial

Probes and politics

Published

on

Friday 12th June, 2026

Government politicians are giving a running commentary of the investigations into the Easter Sunday terror attacks. They usually do so in Parliament and at media briefings to generate headlines and distract attention from burning issues.

Minister of Public Security Ananda Wijepala has told Parliament that investigators have gathered sufficient evidence to establish the involvement of former State Intelligence Service Director Major General (Retd.) Suresh Sallay, in a conspiracy linked to the 2019 carnage. Other JVP/NPP politicians also come out with what can be described as teasers about the CID’s Easter Sunday terror probe, making one wonder if the outcome of investigations is known to the government in advance.

The claim that Sallay was involved in the Easter Sunday bombings is still an unsubstantiated allegation, but going by government politicians’ claims about the investigations into the terror attacks, it is obvious that they are privy to information that the police must keep confidential to ensure the integrity of the probe. It is unbecoming of crime investigators to share such information with politicians, who use it to gain propaganda mileage.

Minister Wijepala has also claimed that Sallay declined to disclose the passwords for his personal computer and mobile phone. He described Sallay’s alleged non-cooperation as an attempt to obstruct the investigative process. Isn’t it naïve to expect a former spy chief who was aware that he was living under the microscope to store in his mobile phone or personal computer any information that could be used against him? On the other hand, in this day and age, gaining access to password-protected computers and phones is child’s play.

When prominent ruling party members declare that proving a serious charge against someone is only a matter of time, and some high-profile arrests are imminent, how can investigators led by a person at their beck and call be expected to factor in contradictory evidence that can be used to challenge his political masters’ assertions and public statements? Won’t the investigators be compelled to suppress such evidence lest they should embarrass their political leaders, provide grist for their political rivals and, most of all, fall from grace as a result? Instances abound where the police fall victim to confirmation bias, cherry-pick evidence and build cases backward in outcome-driven investigations. Initial police investigation that fitted information to the theory that the death of popular rugby player Wassim Thajudeen was due to a car crash is a case in point.

In this country, police officers do not stand up to the powers that be in the name of truth, justice and fair play; instead, they stand to attention before politicians in power. One may recall that in 2016, the then IGP Pujith Jayasundera was caught on camera, at a public meeting, answering a telephone call from someone whom he reverentially called ‘sir’ and assuring that a certain person would not be arrested. Submissiveness can become institutionally contagious. A fish is said to rot from the head down. A Yahapalana era audio clip of a telephone conversation between CID Director SSP Shani Abeysekera and Deputy Minister Ranjan Ramanayake is available in the digital space. Abeysekera is heard offering to wash pots and pans in Ramanayake’s kitchen over some matter.

There is no gainsaying that the Easter Sunday terror attacks, which claimed more than 275 lives and left many others seriously injured, must be probed thoroughly. Justice must be done to the victims. But what’s the world coming to when a government brings its own party members out of retirement, elevates them to key positions in the police and the public security sector and assigns them to conduct high-profile criminal investigations and declares suspects guilty even before they are indicted. Most of all, its leader, President Anura Kumara Dissanayake, orders the detention of suspects under the Prevention of Terrorism Act and predicts judicial decisions accurately?

Political affiliations and prejudices of crime investigators have a corrosive effect on the integrity of the probes they conduct.

Continue Reading

Editorial

Way to go! More to be done

Published

on

Thursday 11th June, 2026

The law finally caught up with former Deputy Minister Sarana Gunawardena, who caused losses to the state through some questionable deals, two decades ago. He was found guilty on four counts of corruption charges and sentenced to 16 years of rigorous imprisonment by the Colombo High Court, on Tuesday. The Commission to Investigate Allegations of Bribery or Corruption (CIABOC) had filed four cases against him for causing losses to the state coffers during his tenure as Chairman of the Development Lotteries Board during the Mahinda Rajapaksa government, in 2006. The CIABOC stated that he had acted in a manner that provided an undue advantage to some individuals when obtaining vehicles on rent for the institution.

When Gunawardena committed those offences, he may not have thought he would have to face the consequences of his actions. He is not alone in having enriched himself at the expense of the public; many are those who have amassed colossal amounts of ill-gotten wealth through corrupt means while in power. It is hoped that all of them will be brought to justice.

The deterrent sentence handed down to Gunawardena must have gladdened the hearts of all those who dream of a country free from bribery and corruption. The economic cost of corruption in Sri Lanka has not been estimated. But corruption has obviously hindered economic progress. The IMF and the World Bank have pointed out that corruption discourages foreign direct investment, increases cost of public infrastructure, reduces efficiency of state-owned enterprises, and weakens competition and productivity. So, a strategy to develop the economy consists in a truly national effort to battle bribery and corruption with might and main.

The CIABOC went all out to bring Gunawardena to justice, and it deserves praise for its relentless efforts. Does this mean that the culture of impunity is over and the rule of law has finally been restored under the present dispensation? The answer is in the negative. Most corruption cases that have culminated in convictions were filed prior to the 2024 regime change.

It is imperative that the CIABOC act swiftly and decisively in the case against former Energy Minister Kumara Jayakody, whom it has indicted on two counts: facilitating a private company to make undue financial profits and causing a loss of over Rs 8.8 million to the state while serving as the procurement manager of the Lanka Fertiliser Company in 2016. The CIABOC has not been entirely free from allegations of selective efficiency in handling corruption cases. Jayakody was not arrested. He obtained bail after indictment.

Over the last year and a half or so, the CIABOC has successfully prosecuted several former ministers. In April 2025, the Colombo High Court sentenced former Chief Minister of the North Central Province S. M. Ranjith Samarakoon and his secretary to 16 years RI for obtaining fuel fraudulently and causing losses to the state. In May 2025, the Colombo High Court Trial-at-Bar sentenced former Minister Mahindananda Aluthgamage and former Sathosa Chairman and ex-Minister Nalin Fernando to 20 years RI and 25 years RI, respectively, for causing a loss of Rs. 53 million to the state by using public funds to purchase 14,000 carrom boards and 11,000 checkers boards purportedly for schools and sports clubs in the run-up to the 2015 presidential election.

Perhaps, the severity of the offences, committed by Aluthgamage, Fernando and Ranjith, pales into insignificance in comparison to that of the coal procurement scam, which is believed to have caused staggering losses amounting to Rs. 10 billion to the state coffers. We reported on Monday that the use of diesel to keep the oil-fired power plants running to compensate for the Norochcholai generation loss due to the use of substandard coal had cost Rs. 4.5 billion in April 2026 alone. As we reported on Monday (08), according to power sector data, coal-based electricity generation in April 2026 was 27 GWh lower than in April 2025, a development that has sparked concerns among energy experts and economists over the mounting financial burden of diesel replacement on the country’s already strained power sector.

President Anura Kumara Dissanayake has sought to obfuscate the issue of substandard coal imports by appointing a presidential commission of inquiry to probe all coal purchases since 2009. His modus operandi is like “using a loincloth to control dysentery”, as a popular local saying goes. There’ll be hell to pay when the JVP/NPP politicians responsible for the coal scam and other rackets lose power. It will then be their turn to be hauled up before courts and bussed to prison so that they will be in the exalted company of Aluthgamage, Fernado, Ranjith and others.

Continue Reading

Trending