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US cautions China-backed Port City could turn into money-laundering haven

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(ANI) US Ambassador to Sri Lanka and Maldives, Alaina Teplitz on Saturday warned Sri Lanka of unintended consequences of ‘nefarious actors’ who may try to misuse a China-backed Colombo Port City’s easy business rules as a permissive money laundering haven amid concerns of tax leaks.

Sri Lanka has unveiled draft legislation for a Colombo Port City Commission which allows for sweeping tax breaks, tax-free salaries and to be an offshore financial centre.

“Any legislation relating to the port city has to be considered very carefully for its economic impact,” Teplitz told reporters in Colombo in an online discussion.

“And of course among those un-intended consequences could be creating a haven for money launderers and other sorts of nefarious actors to take advantage of what was perceived as a permissive business environment for activities that would actually be illegal.”

The agency running the Port City would have extensive powers to exempt businesses from taxes of up to 40 years, though it is not a tax haven in the traditional sense.

Sri Lanka’s tax revenues have plunged in 2020, raising concerns over debt and the fiscal path, credit downgrades and the ability of the government to provide vital public services to the people, while managing loss-making state enterprises.

“I do recognize that the government of Sri Lanka wants to take advantage of the investment that has already been made in creating the Port City foundation, but the legislation really needs to be reflected to address these challenges and to be careful of what it might be to open doors to bad practice and unfair competition for the rest of the country,” said Teplitz.

Teplitz said an idea by US Treasury Secretary Janet Yellen to have a global single corporate tax was just a proposal with no immediate impact but Sri Lanka should think about tax concessions in its own interests.

Sri Lanka is under the worst import controls since the 1970s using the 1969 law, though exchange controls are less draconian.

Sri Lanka’s economy was progressively closed with an import control law being enacted in 1969 as money printing pressured the rupee, which worsened after the break-up of the Bretton Woods in 1971, as then-Federal Reserve Chief Arthur Burns printed money to target an output gap, forcing dollar to be floated.

Sri Lanka’s attempts at creating numbered accounts as part of creating Non-resident foreign currency accounts, after re-opening the economy in 1978 was also resisted by Western nations.

Citizens are also allowed to hold up to 15,000 US dollars as well as unlimited amounts in dollar accounts outside to protect their savings from monetary expropriation, in relaxation of legal tender laws.

 

 



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Easter Sunday Case: Ex-SIS Chief concealed intel, former Defence Secy tells court

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Former Defence Secretary Hemasiri Fernando told court on Thursday that then State Intelligence Service (SIS) Director Nilantha Jayawardena was also aware of intelligence information and had acted to conceal it, while also testifying that he believed former President Maithripala Sirisena had prior knowledge of the Easter Sunday terror attacks.

Fernando made the statement while giving evidence before a Trial-at-Bar in the case filed against him over alleged negligence in failing to prevent the 2019 Easter Sunday suicide bombings.

He said he believed that Sirisena, who at the time also held the posts of Defence Minister and Commander-in-Chief of the Armed Forces, had been aware of intelligence inputs relating to the impending attacks.

The former Defence Secretary further alleged that Jayawardena, then Director of the SIS, was also privy to the information and had acted to suppress it.

Fernando is indicted on charges of criminal dereliction of duty for allegedly failing to act on prior intelligence warnings ahead of the coordinated attacks.

Defending his position in court, he maintained that responsibility for the failure lay elsewhere.

“The President, who was the Defence Minister and head of the armed forces, had left the country. As the most senior official, I have been dragged into this case. If the information I presented had been properly examined, this case would not have been filed against me. Those responsible are still at large,” he told court.

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NCPA gets up to seven child violence complaints daily

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NCPA Chairperson Preethi Inoka Ranasinghe

The National Child Protection Authority has warned that corporal punishment continues to cause serious harm to children, revealing that it receives between 2,000 and 2,500 complaints of physical violence against children each year — averaging between five and seven complaints a day.

Issuing a statement to mark the International Day to End Corporal Punishment on April 30, the NCPA said both short-term and long-term physical and psychological punishment could severely affect a child’s personality development and emotional wellbeing.

NCPA Chairperson Preethi Inoka Ranasinghe said research had consistently demonstrated the damaging effects of corporal punishment used in disciplining children.

“For decades, parents, elders and teachers have used various forms of physical punishment to discipline children, making it a socially and culturally accepted practice both at home and in schools,” she said.

The Authority stressed that corporal punishment constitutes physical abuse and should not be used under any circumstances.

According to the NCPA, complaints relating to physical violence remain the second highest category of complaints received annually by the institution, with between 2,000 and 2,500 incidents reported each year.

Based on those figures, the Authority receives approximately 5.5 to 6.8 complaints of child physical violence every day.

The NCPA further noted that under Article 19 of the United Nations Convention on the Rights of the Child, children are entitled to protection from all forms of abuse and neglect, an obligation binding on Sri Lanka since 1990.

The Authority also pointed to Article 11 of the 1978 Constitution, which guarantees freedom from cruel, inhuman or degrading treatment, as well as provisions under Section 308(A) of the Penal Code and Education Ministry circulars prohibiting physical and psychological punishment in schools.

The NCPA urged parents, teachers and caregivers to adopt non-violent disciplinary methods and to prioritise the safety and mental wellbeing of children.

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AKD’s May Day vow: Crackdown looms as corrupt face day of reckoning

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President Anura Kumara Dissanayake said that all individuals accused of fraud, corruption and other offences will be brought before the law in the coming weeks, as investigations are being intensified under the NPP administration.

Addressing the Nuwara Eliya District May Day rally on Friday, the President said the government had already strengthened key investigative institutions, including the Criminal Investigation Department and the Bribery Commission, to expedite ongoing probes.

He said a large number of cases involving alleged wrongdoing were now progressing through the legal system, with ten cases scheduled to be taken up in court during May and one case already ordered for a verdict within the month following a directive issued on April 30.

President Dissanayake stressed that the government was acting on a public mandate to ensure accountability, warning that law enforcement action would continue in the months ahead.

He said the administration had taken steps to reverse what he described as a culture of privilege enjoyed by former rulers, while focusing instead on public welfare and governance reform.

“We are making decisions for the people and ensuring that privileges of the ruling class are reduced,” he said, adding that previous governments had worked to expand their own benefits while placing burdens on citizens.

The President claimed that the NPP government had secured the trust of people across all regions, describing it as a “people’s administration” committed to working-class interests.

He also outlined the government’s broader policy direction, including ensuring stable incomes, improved education, housing, the rule of law and national unity.

Warning of further legal action, he said a significant number of individuals accused of corruption would face imprisonment in 2026, adding that no one would be above the law regardless of position or family background.

“We do not distinguish between Presidents, Prime Ministers or their families. The law will apply equally to all offenders,” he said.

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