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Monday June 3rd, 2024

Sri Lanka economic conditions does not require IMF bailout: Minister Cabraal

ECONOMYNEXT – Current economic conditions in Sri Lanka does not require an International Monetary Fund bailout, State Minister for Money and Capital Markets Nivard Cabraal has said.

“The conditions that are available in Sri Lanka today would not necessarily need us to go to the IMF for any bailout,” Minister Cabraal told a business forum hosted by Asia Securities, a Colombo-based investment house.

“We are quite confident that we can manage what we have now, and with the expected revenues and the expected foreign inflows that we have targeted, particularly from exports which have been quite robust with fairly good order books

“We have seen remittances even stronger than prior to Covid.”

Cabraal said there were investment commitments to the Port City and about 2.5 billion dollars in foreign direct investments were expected in 2021.

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“All these factors give us the confidence to say that we can manage the resources that we have, which are not extraordinarily large but which are sufficient to take us through 2021,” he said.

“And thereafter we will have much more placid times and we are confident that we can make that work without too much difficulty.”

There have been rising unease among analysts over large scale monetizing of debt with unprecedented volumes of money being printed, despite operating a soft-pegged exchange rate regime.

Excess liquidity is now about around 25 percent of reserve money (without excess liquidity) or about 1.2 billion US dollars, with warning that it will pressure the currency as soon as there is a sustained recovery in credit, regardless of whether there are import controls or not.

“We have of course seen monetary accommodation in the last few months but that is true with every country,” Cabraal said.

“A lot of countries have gone through this process with a reasonable degree of monetary accommodation.

“But in Sri Lanka we have also seen stable exchange rates, which has been one of the hallmarks of our macro-management in the last few weeks or months.

“Which has made sure that Sri Lanka’s rupee stays stable, that our interest rates stay sable and we can have a reasonably good passage towards growth in the next few months and years.”

Cabraal said a strong recovery was seen with the third quarter of growing 1.5 percent after contracting 16 percent in the second quarter.

Businesses were adapting to working amid Coronavirus, he said.

In 2021, if tourism resumes and comes to around 50 to 60 percent of 2019 levels, it will help the economy, he said.

The government also had a public sector investment pipeline which will be directed to roads and water (Colombo/Dec17/2020-sb)

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Water levels rising in Sri Lanka Kalu, Nilwala river basins: Irrigation Department

Sri Lanka Navy assisting in rescue operations (Pic courtesy SL Navy)

ECONOMYNEXT – Sri Lanka’s Irrigation Department has issued warnings that water levels in the Kalu and Nilwala river basins are rising and major flooding is possible due to the continuous rain. People living in close proximity are advised to take precautions.

“There is a high possibility of slowly increasing prevailing flood lowline areas of Kiriella, Millaniya, Ingiriya, Horana, Dodangoda, Bulathsinhala, Palinda Nuwara and Madurawala D/S divisions of Ratnapura and Kalutara Districts, up to next 48 hours,” it said issuing a warning.

“In addition, flood situation prevailing at upstream lowline areas of Ratnapura district will further be prevailing with a slight decrease.

“The residents and vehicle drivers running through those area are requested to pay high attention in this regard.

“Disaster Management Authorities are requested to take adequate precautions in this regard.”

The island is in the midst of south western monsoon.

DMC reported that 11,864 people belonging to 3,727 families have been affected due to the weather in Rathnapura, Kegalle, Kilinochchi, Jaffna, Mullaitivu, Kalutara, Gampaha, Colombo, Galle, Matara, Hambantota, Puttalam, Kurunegala, Kandy, Nuwara Eliya, Anuradhapura, Polonnaruwa, Badulla, Moneragala, and Trincomalee districts.

Meanwhile, the Meteorology Department stated that showers are expected on most parts of the island today.(Colombo/June3/2024)

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UNP gen secy defends call for postponing Sri Lanka poll, claims opposition silent

The UNP party headquarters in Pitakotte/EconomyNext

ECONOMYNEXT — United National Party (UNP) General Secretary Palitha Range Bandara has defended his call for postponing Sri Lanka’s presidential election by two years, claiming that his proposal was not undemocratic nor unconstitutional.

Speaking to reporters at the UNP headquarters Monday June 03 morning, Bandara also claimed that neither opposition leader Sajith Premadasa nor National People’s Power (NPP) leader Anura Kumara Dissanayake have spoken against his proposal.

“I have made no statement that’s undemocratic. My statement was in line with provisions of the constitution,” the former UNP parliamentarian said.

He quoted Section 86 of Chapter XIII of the constitution which says: “The President may, subject to the provisions of Article 85, submit to the People by Referendum any matter which in the opinion of the President is of national importance.”

Sections 87.1, 87.2 also elaborates on the matter and describes the parliament’s role, said Bandara.

“I spoke of a referendum and parliament’s duty. Neither of this is antidemocratic or unconstitutional. As per the constitution, priority should be given to ensuring people’s right to life,” he said.

“Some parties may be against what I proposed. They may criticse me. But what I ask them is to come to one position as political parties and make a statement on whether they’re ready to continue the ongoing economic programme,” he added.

Bandara claimed that, though thee has been much criticism of his proposal for a postponement of the presidential election, President Wickremesinghe’s rivals Premadasa and Dissanayake have yet to remark on the matter.

“I suggested that [Premadasa] make this proposal in parliament and for [Dissanayake] to second it. But I don’t see that either Premadasa nor Dissanayake is opposed to it. To date, I have not seen nor heard either of them utter a word against this. I believe they have no objection to my proposal which was made for the betterment of the country,” he said. (Colombo/Jun03/2024)

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300 of 100,000 trees in Colombo considered high risk: state minister

ECONOMYNEXT – Trees in Sri Lanka’s capital Colombo are being monitored by the municipal council, Army and Civil Defense Force as the severe weather conditions continue, State Minister for Defense Premitha Bandara Tennakoon said.

“Within the Colombo Municipal Council city limits, there are 100,000 trees. Of these, around 300 are considered high risk,” Tennakoon told reporters at a media conference to raise awareness about the current disaster management situation.

Not all trees required to be cut down he said. “We can trim some of the branches and retain them.”

The problem was that buildings in the vicinity of the tree had cut branches on one side, causing it to become unbalanced, the minister said.

New laws would be brought in so provincial/municipal institutions could strengthen enforcement of building codes.

“We don’t have a single institution that can issue a warning about a tree. Not one to tell us what trees can or cannot be planted near a road.

“Trees should be suitable for the area. Some trees have roots that spread and damage roads, buildings. When the roots can’t go deep, they tend to topple over.

“Now Environment Day is coming up, and anyone can go plant a tree by the road. We have to take a decision about this. We have to enforce laws strongly in future.” (Colombo/June3/2024)

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