The Exports! Exports! Exports! Game

The Exports! Exports! Exports! Game

e-Con e-News 23-29 December 2018

• Our deadline for ee contributions is Friday. Emergency announcements are allowed until 6pm on Saturdays. 

• Each ee section sometimes has an introduction to explain how to perhaps read the news between the lines

• This ee offers an incisive critique on this whole ‘export-led development’ business and ‘export promotion’ by SBD De Silva (see below, it will require some re-reading over and over again. It is fully worthwhile.)

• This week saw the leading private national English weekend newspaper call for social democracy!  A bit too late now, one would think. (see Economics section). But will a Left populism, as some theorize, resolve our woes? Will it downplay pressing economic prognoses. We will deal with that in an upcoming ee.

• Please note the repeated use of the word “crisis” in the media. The truth is this ‘crisis’ is nothing new. It is a mere continuation of the colonial status of the economy and thus, the polity. We inherited the most impoverished peasantry in Asia in 1948…

• What did Santa give Ranil in December? If the main robbery in this country is by multinational corporations how does their macro system of undermining national political systems work? And how much did Santa (errr…the white and not-so white embassies) pay to maintain the parliamentary status ko? How many deposits were made in offshore accounts? How many ‘scholarships” were provided to relatives? How many contracts / commissions were granted by importers? How does the system of bribery work to enable the dominance of the multinational corporations in our economy? Recall the November 11 ee

“Trump’s first Secretary of State Tillerson was an Exxon CEO. Senate investigators found Exxon was using Washington’s Riggs Bank to funnel hundreds of millions of dollars to the head of Equatorial Guinea, with its enormous gas and oil reserves. Exxon also paid for the children of high-ranking government officials to study in the US. In 2010, Congress included new disclosure regulation, Rule 1504, in the Dodd-Frank legislative reforms on banks. Exxon CEO Tillerson argued against it, but it was approved. On February 1 2017, Exxon lobbyists got Congress and Senate to rescind Rule 1504. Almost exactly an hour later, Tillerson was confirmed as US Secretary of State.” –

• “In October…the country spent a record high amount on personal vehicle imports. (see ee Economy). Yet there is no end to sermons against profligacy but the Colombo orgy continues…

• See ee Sovereignty, for a devastating critique of a recent Friday Forum statement and of the mess an unelected Civil Society made with the 19th Amendment.

The Friday Forum, made up of superannuating academics, bureaucrats and NGO royalty, while posing as ‘democratic’, has even more outdated and tired political and economic theories, … It has issued a dire ‘warning’ about the economy, calling for ‘austerity’ for “everyone”… even as they point out that most people are suffering. So then who should practice austerity? They perhaps fear naming the ruling class of private merchants, usurers and multinational corporations, who are robbing the country wholesale, but  focus instead on misuse of state resources.  It decries the reappointment of “corrupt’ Ministers into the cabinet, saying that they have been accused of defalcation, and yet welcomes the “re-appointment” of the main culprit of the bond scam. To consider its convoluted rather illogical prose (see ee Sovereignty). 

• the ee  Workers section has many news items on the plantation strikes, with most media parroting Planters’ Association dictat. This section also recalls the 83rd annivesary of the LSSP. It is therefore important to ask if it was when the LSSP was banned by the English in 1939, and their plantation union suppressed, that the plantation workers unions were then reformed as ‘Indian’?…Is it true that Nehru, showing his true Oxford colors, also spoke of them as such, which then gave some of the LSSP leadership heart disease….? – ee]

• We have added an ee Media Section, especially after recent revelations of complicity between the media oligarchy. What else is new? Media forensics is a vital life skill.  For example, there is nothing more pitiful than the private media calling others corrupt. The corporate media may make you believe that corruption is strictly a Made-in-Hambantota commodity imported into Colombo. And yet their job is not to inform and enlighten but to divert and confuse.

• Here is a summary list of saturating oft-repeated tropes of the economists:  Pay Foreign Debts (even if odious?) ! Eliminate Samurdhi (except welfare for the rich?)! Privatize SOEs! EPF on stock market! FDI! More Exports! More Imports! Oppose tariffs! Free Trade! Balance of Payments! Growth Rate! GDP. Falling Rupee! GSP+! Travel Advisories! ICC! IMF! World Bank! Ratings Agencies! Crisis! Confidence! Privatize! Corruption! Deregulate! Rule of Law!(but don’t ask Singapore where Mahendran is?)  “What will the international (read: white) community think?”!!!!! Wewill fillet these shibboleths one by one in an upcoming ee. Jayaveva!


 ee Reader’s Comments

• “Thank you for another revealing collection.”

• “Thank you for keeping me abreast of things …”

• We wonder if the ruling oligarchy’s economists have been told to increase their attacks on the 1970-77 government. Is it because it may become inevitable for people will look to this period for solutions.  You see these attacks on Mrs. B’s government all over the media and with a rising intensity…. In fact as one ee readerquipped: Mentioning ‘Sirimavo’ and ‘ R’ is a shorthand litmus to suss out a Colombo denizen’s political bias…”

• Some ee readers complained about the thuppahi hambantota weblink. Try this again:

Or go to the thuppahi site and search ‘Hambantota’? The title of this website is so appropos. It is by an academic who has specialized in obscuring class and economic underpinnings – an authority on Burghers and Karava, etc. Thuppahi perhaps also relates to his own paternal origins in the Barbados – that redoubt of English chattel enslavement. Speaking of the Caribbean, why did we not produce such books in English as Capitalism and Slavery (banned by its own author, Eric Williams, when he became PM of Trinidad)?


Production for export or Production for us?

SBD De Silva once noted that the Central Bank has always been reactionary. It opposed the Ceylon-China Rubber Rice Pact, our most successful trade agreement. From the CB’s very birth under the white man’s aegis, it has offered no initiative to invest in local modern industrial production and develop a rural home market, and in fact undermined every attempt to advance the country. So it is no revelation that the CB enabled our greatest bank robbery since the looting of the wealth of Senkadagala, Sinhale.

Rather than demolish ‘former Central Banker Deputy Governor’ WA Wijewardena’s entire H.A. de S. Gunasekera lecture, which attempts an appraisal of the 1970-77 period, this ee focuses on a regular mantra in the media’s economic coverage. The need for “export development”. Like the need for “foreign investment” not a nanosecond goes by, without this saturation rosary-rubbing chant, “FDI”, “Exports!” etc. Yet, investment is largely into robbing us of our ‘natural’ resources: workers, rubber, coconut, graphite, etc. So before studying the economics, we should study the economists.

How do we explain these economists? The taming of ‘independent’ governments challenging colonial control of their economies has involved a war waged with not just deploying both bribery and coup but paid academics and think tanks  (see ee Industry – for what happened to Ghana’s Nkrumah). Corruption is not restricted to politicians.

The easiest example of ‘export-led’ economics is the ‘garment’ game. Neither pin, needle, thread or textile is produced here. We only provide the ill-paid underskilled workers. Then there is this constant media begging for the white overlords in Europe and the settler Americas to grant ‘our’ garments  “GSP+” etc, to gain access to the white man’s markets, when our own, largely rural, market is handed over to imports!  City-State Singapore (profiting from refuelling US bombers destroying Southeast Asia) had to soon resorted to promoting local markets (after the US was defeated in Vietnam!).

We recommend the last Chapters (16, 17) of SBD de Silva’s The Political Economy of Underdevelopment, 1982. Here is an excerpt from Chapter 17:

“The process of reincorporation of the periphery has involved an ‘orchestrated shift’ from import substitution to export-oriented industrialization. There were several reasons for the limited growth impact of the import substitution policy adopted after decolonization. First, the type of manufacturing production that was developed consisted mainly of non-essential goods. Second, the persistence of precapitalist agrarian relations limited the growth of the domestic market and the development of a symbiotic link between town and country. Merchant capital remained dominant and was powerful enough to negate the government’s efforts to foster industrial capital. In Sri Lanka the merchant interests resisted the protectionist policies with boundless ingenuity. There was, third, a subversion of the import substitution policy by exogenous forces mediating through agencies such as the IMF, the World Bank and the Asian Development Bank and consortia of commercial banks, which utilized the debt crisis in the periphery to impose the preconditions for the entry of multinational capital. Fundamentally, import substitution was pursued as a policy in itself instead of constituting one among a number of measures for transforming already established merchant capital into industrial capital. The reason for it was to bring into being a new class – the industrial bourgeoisie, whose ethos and interests are totally different from those of the merchant bourgeoisie which has been traditionally dominant; a class which not merely concentrates money wealth in its hands – like the landlord, the merchant and the usurer – but seeks to capitalize this wealth within the capital-labour relationship. This metamorphosis of capital is contingent upon a restructuring of both internal class relations and the relation of the bourgeoisie as a whole with foreign interests. Export oriented industrialization and the accompanying policy package which exposes the economy to foreign competition result in enervation and emasculation of indigenous industrial enterprises. Indigenous and foreign capital become involved in an unequal relation; when they are in partnership, the foreign interests control capital flows, technology and production proceeds, and marketing outlets, subserving a profit centre abroad. 

In fact, what is involved in this outward-looking policy is not export orientation as such. The expression ‘outward-looking’ as a euphemism for an economy that is incorporated in the world capitalist network is doubly misleading. It emphasizes production for export as against the domestic market, whereas the converse, an inward-looking economy, does not exclude the development of export production. 

Moreover, the openness or extrovert nature of the outward-looking economies is only in respect of the centre. In relation to each other they are inward-looking and closed. While competing with each other, they enter into a division of labour with the centre, producing what the centre wants to buy and buying what the centre wants to sell. The strategy of export promotion reflects the incapacity of the bourgeoisie and the state to mediate the land question, so as to realize the potentialities of the domestic market and develop a new base for surplus accumulation. 

The productive process thus develops essentially on the lines of the classical export economy, bypassing the need to revamp agrarian relations and to develop a symbiotic link between town and countryside. The politico-economic significance of the land reform that was imposed on Japan by the US military soon after the Second World War was that it provided Japanese capitalism with an internal base of this kind, making the pursuit of expansionary interests abroad unnecessary, at least for a while. 

Export oriented industrialization is like a quick fix, sending a jaded economy high by turning it into an ‘export platform’ for selected manufacturing industries of the centre. In the smaller territorial and demographic units, such industrialization makes bigger ripples, and the effect can be dramatic. Though lacking a rural hinterland and with a very small domestic market, these units could generate a certain dynamism, even encouraging them to secede from larger national entities. In Singapore, industrial production grew astonishingly after its political separation from Malaysia; from 1968 to 1973 employment increased nearly five times. Delighted by the prospect, Singapore’s Foreign Minister explained: ‘We have plugged’ ourselves into the world economy.’ The euphoria of these years created an anti-regional bias. The case against economic regionalism was argued in 1971 by Dr Augustine Tan – Senior Lecturer at the University of Singapore, a Member of Parliament and of the Economic Development Board, and earlier the Prime Minister’s Political Secretary. 

The recession of 1974-5 and the communist victory in Vietnam caused a turn-around in foreign economic policy. The precarious buoyancy of Singapore was at this time soberly reflected on by Mr Lee Kuan Yew: ‘We hitched a ride on the expanding world economy in these years. ‘ He then sponsored a revival of ASEAN as a framework for regionalism. …”



• Many ee readers ask us how we can spread these ee issues to a wider audience. Some ee  readers challenge us about our analyses. When we say “Singapore (or Chennai) are industrial powerhouses attempting to turn us into supine markets for their goods” – They ask us for proof. When we give them proof, they move on to some other anti-industrial canard, like us not having Economy of Scale. Well, they (not knowing we have a larger population than many industrialized European countries) cannot be fully blamed, they are repeating what is broadcast widely in the nanosecond-by-nanosecond media. (see ee Industry)

• Of course there also needs to be a mutual urge to find out and investigate an issue rather than just blurt out on each and every matter. We also lack important statistics to inform our assertions. But in the end, these issues need to be worked out by discussion and debate across the country, and not just by experts!

• “The conversation that is the nation” – a conversation that matters is absent. And yet a conversation is what is needed. A conversation about “What is to be done?” A conversation about analyzing the roots of our discontent, about transforming the economy of the country, so we can learn from our past mistakes. 

• Of course this does not mean that conversations are not taking place across the country.  They sure are. Maybe at least 400 million a day, at the conservative rate of 20 gabs per person. But how much of these conversations are ‘national’ is another issue. Connecting the important dots, “seeing number in the chaos of digits”. The dots buried in the soil (and how deep? To 1505?) and the dots pouring off as sweat (evaporating into the winds, or flowing uselessly into the sea, not to mention the gulfs and the Atlantic). 

Instead we are fed sheer nonsense about ourselves and the world of which we are a part, especially in the English media, which likes to claim a cosmopolitan sophistication, even as it occasionally dons a fake nationalist mask.

To go beyond the plus and minus, division and multiplication, to the algebra (Arabic for the reunion of broken parts), and latest mathematics of not just numbers. The media needs to be more than a mirror, a searchlight, a smoke signal, an xray, a siren, a call to action….


So it seems inevitable: ee needs a Media section. 

Whenever one has a personal relationship to a story, it becomes evident how newspaper owners and editors simply cannot report even descriptive facts, let alone any analysis or prognosis. The only loyalty seems to be to reproduce the status ko, to maintain their relatives and friends, of their class. This does not apply to state employees (as a recent forum of ’academics’ and retired bureaucrats seems to claim. Hitting politicians and politics  

And even when one does not have the personal relationship to a story, it is possible to xray this paralysis by other forensics, like reading other sources, and when even those are unavailable, by logic or historical deduction. See the reportage on the plantation workers  Take the recent contradictory reportage on Chinese workers in Colombo (see the ee Workers section, or the Kenya port and China story (from Delhi?) where Kenya Ombudsman denies ever saying such, see the ee Sovereignty section). 


• The Maharajah Corporation’s MTV News First propagation outlet  has taken to promoting the US State Department’s (or perhaps the US Treasury’s) well-funded NGO – the Advocata Institute’s incessant bulletins, using a young man, who clearly knows no economics, as their spokesbot (note the non-gender-specific nature of this assignation):

Here is one classic Advocata ass-kissing idiocy, by one Dhananath Fernando, with the hallowed title of COO:

“Sadly…Most employees tend to think that their employers get them to slave away so that the employer alone can walk up the ladder. This inhibits most people from being supportive to their employers and the workplace’s bigger vision….”

As one ee regular commentator notes:

“This %$#$%^& idiot doesn’t realise that the “employer” doesn’t move up the ladder but owns the ladder.  He is confusing managerial staff with owners.  Very appropriate for a confused bunch like Advocata.”

Indeed, the link between Advocata and the present ruling party’s corporate-sponsored hijacking of government think-tanks (like Singapore Razeen Salley and the IPS) has been exposed by the Avocado Collective:

The rest of the recent bulletin by this US NGO Advocata is to complain about the taxes on imports. Such complaints warm the hearts of the white (and almost-white) embassies and related Chambers of Commerce who represent the importing merchants who are the main opponents of a modern industrial economy for Sri Lanka.


Media Amnesia

Our ee Diyavannaa corrrespondent

We need to criticize the “mainstream” media for its bias.

1) In the white media treatment of the current political crisis in Sri Lanka, Mahinda Rajapaksa is consistently referred to as “former strongman” and alleged human rights abuses are always mentioned in conjunction with his name. The fact that he held free and fair elections regularly, even entertaining a thoroughly hostile Northern PC, is ignored. On what do they base this “strongman” stuff?

They never mention war crimes when George W Bush and Tony Blair are reported on. They invaded Iraq and caused a million casualties, all the while lying to their own people. Obama and Clinton turned Libya into a modern slave market.

Ranil Wickremasinghe is always represented in a benign manner. He no strongman, but liberal gentleman. No mention of the fact that the Batalanda Commission recommended he be charged in connection with the torture centre. No mention of the Bond Scam. Ever. 

The doings of the rump parliament, led by a thoroughly biased Speaker, has never been reported even-handedly. No mention that the Speaker’s actions might be unconstitutional/illegal. No mention that his “bloodbath” speech was based on fantasy.

The president’s actions are invariably treated as somehow illegal.

No mention is made that the UNP is trying its best to avoid a general election

No mention is made that the Western diplomatic missions have been interfering actively in the internal affairs of this country, to the extent of threatening sanctions.

(2) Hambantota/China

The Chinese lease of Hambantota is always represented as some kind of infernal plot. The operative spell is “hubble bubble palm oil and debt trap”

Hambantota is always represented as a Chinese MILITARY base. It is generally mentioned in conjunction with Djibouti, where the Chinese have a naval logistics facility. 

No mention of the fact that the US has a naval/military logistics agreement with Sri Lanka, or that some thousands of US naval/military personnel are deployed in this island.



[Why no investigation into white bribes? – ee ]

CIABOC launches probes on crossover bribes

The Commission to Investigate Allegations of Bribery or Corruption (CIABOC) has begun investigations into two complaints lodged by the Transparency International Sri Lanka (TISL) concerning crossover bribes…[on allegations by] United National Party Parliamentarian Palitha Range-Bandara …and… President Maithripala Sirisena…


Viyangoda responds to accusations, seeks legal redress – Secret payments

December 26, 2018, 

Shamindra Ferdinando

In the wake of recent revelations that several dozens of persons, including civil society activist Ven Dambara Amila, who appeared on Purawesi Balaya stage, received Rs. 95,000 a month from Litro Gas since April 2016 on the instructions of the Finance Ministry, Co convenor of Purawesi Balaya Gamini Viyangoda…was recently accused of receiving cash and other perks and privileges from Litro and Selacine Television Institute, also coming under the purview of the Finance Ministry….


UK claims to have met all sides to dispute during recent crisis in Sri Lanka

December 26, 2018, 11:39 pm

UK Minister of State for Asia and the Pacific, Mark Field has informed the UK Parliament on Dec 20 of action taken by BHC in Colombo in the wake of President Maithripala Sirisena sacking Prime Minister Ranil Wickremesinghe.

Field briefed the parliament in response to a question raised by MP Liz McInnes as regards political developments in Sri Lanka.

Field said: “The British High Commissioner to Sri Lanka met regularly with all political parties and expressed our concern at the behaviour of some MPs in disrupting parliamentary proceedings.”…


UK expresses concern at disruptive behaviour of Lankan MPs


UK Minister of State for Asia and the Pacific, Mark Field has informed the UK Parliament last week that they expressed concern over the behaviour of some Sri Lankan MPs disrupting parliamentary proceedings…


Commonwealth commends Lanka’s commitment to democratic process

December 27, 2018

Commonwealth Secretary-General Patricia Scotland has commended Prime Minister and other political stakeholders for their steadfastness in defense and support of the rule of law and the constitutional framework…”very much look forward to building on the longstanding and fruitful partnership between your country and the Commonwealth Secretariat.”


Former Lanka Peace Co Chairs’ agenda back on track

December 25, 2018, 9:11 pm

Shamindra Ferdinando

…The US, EU and Japan and Norway functioned as Co-Chairs to Sri Lanka peace process in the aftermath of the Dec 05 2001 parliamentary polls, won by Ranil Wickremesinghe. The Co-Chairs guaranteed the Norway-led peace initiative, finalized on Feb 21, 2002. Japan, in addition to being a member of Co-Chairs, played a significant role in the peace process, with its own Special Envoy Yasushi Akashi pursuing an agenda of his own. 

….Co-Chairs, though irrelevant in the wake of the annihilation of the LTTE, nearly a decade ago, are still pursuing their original agenda, in spite of setbacks. Before further comment on their strategy, it would be pertinent to mention the growing US-Japan-India military cooperation, to counter China, constantly named as Mahinda Rajapaksa’s political ally.

 One-time Indian High Commissioner in Colombo (1997-2000) Shivshankar Menon, in his memoirs, Choices…indicated that New Delhi had reason to desire a change of government, in Sri Lanka, due to the then President Mahinda Rajapaksa going back on his pledge in respect of Sri Lanka-China relations. Menon alleged that Rajapaksa received Chinese political funding – an extremely serious accusation coming from, former top official who once functioned as India’s National Security Advisor.

…In the first week of April 2009, the LTTE suffered irreparable losses in Puthukudirippu east which destroyed its conventional fighting capacity.

….A section of the international community caused mayhem in Sri Lanka. Sri Lanka never really examined how foreign powers contributed to Sri Lanka’s misery.

 Let me reproduce what former Ambassador and one-time head of Peace Secretariat, Jayantha Dhanapala, told the Lessons Learnt and Reconciliation Commission (LLRC) in late 2010: “Now I think it is important for us to expand that concept to bring in the culpability of those members of the international community who have subscribed to the situation that has caused injury to the civilians of a nation. I talk about the way in which terrorist groups are given sanctuary; are harboured; are supplied with arms and training by some countries with regard to their neighbours or with regard to other countries. We know that in our case this happened, and I don’t want to name countries, but even countries who have allowed their financial procedures and systems to be abused in such a way that money can flow from their countries in order to buy the arms and ammunition that cause the deaths, the maiming and the destruction of property in Sri Lanka are to blame and there is therefore a responsibility to protect our civilians and the civilians of other nation States from that kind of behavior on the part of members of the international community, and I think this is something that will echo with many countries in the Non-Aligned Movement where Sri Lanka has a very respected position and where I hope we will be able to raise this issue.”


Govt. to go ahead with FTA with S’pore

December 24, 2018

Chaminda Silva

The government is planning to go ahead with the controversial Sri Lanka-Singapore Free Trade Agreement (SLSFTA) with some amendments to the original draft.

Development Strategies and International Trade Deputy Minister Nalin Bandara, yesterday, said that the government was ready to amend some sections of the proposed SLSFTA and it had been decided to take on board recommendations made by a committee appointed by President Maithripala Sirisena to review the proposed pact.

“…Many a lie has been propagated about the pact; a rumour was spread that Singaporean doctors will come here to work and local doctors will lose their share in the job market. A doctor in Singapore earns around three million rupees a month. Will a doctor earning that much come here for a pittance? Then there was another story that Sri Lanka would be used for dumping Singapore garbage. Such things will not take place.

“There has been a delay in the development process of this country during the past two months. We are trying catch up and develop the country in order to provide more relief to the people. We will certainly cut down the prices of essential items…

Among those present were Minister of Development Strategies and International Trade Malik Samarawickrama and a group of MPs and secretary to the Ministry S. B. Kodikara.


Here is Friday Forum in the last Sunday Island. Especially note demand (d) concerning the dire state of the economy – demanding more ‘austerity’, to be borne by ‘everyone’! Also check out the response by Jolly Somasundaram below this…. – ee]

The crisis and after

December 22, 2018, 6:11 pm

“.. the status quo ante has been restored and the legitimate Prime Minister re-appointed. 

….We wish to record our protest that persons who were earlier compelled to resign from the Cabinet due to public loss of confidence over their alleged implication in financial frauds and issues of conflict of interest, have now been re-appointed and given Ministerial posts.  This undermines the democratic values that civil society constantly fought for, and especially in the past few weeks. We ask that these persons not be permitted to hold public office until these issues are sorted out. The availability of other competent MPs who can serve as ministers makes such appointments all the more unacceptable.

…(d) Take immediate measures to address the dire state of the economy which will soon plunge the country into desperate crisis. This requires immediate austerity measures which will need to be borne by everyone. Those in positions of power and privilege must abandon their profligate lifestyles at state expense, including international travel for themselves, their family and friends, huge costs for security, unjustifiable remunerations for privileged posts, and the use of state resources for travel and other purposes. Those in privileged positions cannot overlook the poverty that prevails among a high proportion of our people, whose situation will become more critical in the coming months.

Mr. Faiz-ur Rahman, Mr Prashan de Visser, For and on behalf of:

Mr. Priyantha Gamage, Dr. GeedreckUsvatte-aratchi, Mr. Chandra Jayaratne, Dr. A.C.Visvalingam, Bishop Duleep de Chickera, Prof. ArjunaAluwihare, Dr. Devanesan Nesiah, Prof. Camena Guneratne, Prof. Ranjini Obeyesekere, Prof. Gananath Obeyesekere, Mr. Daneshan Casie Chetty, Ms. Manouri Muttetuwegama, Dr. Upatissa Pethiyagoda, Ms. Shanthi Dias, Prof. Savitri Goonesekere, Mr. Tissa Jayatilaka and Rev. Dr. Jayasiri Peiris.

The Friday Forum is an informal group of concerned citizens in Sri Lanka pledged to uphold norms of democracy, good governance, the rule of law, human rights, media freedom and tolerance in our pluralist society.


An Alternate View About Friday Forum’s Op-Ed “The Crisis and After”

December 28, 2018

Jolly Somasundram

…the Friday Forum (Forum), [consists] of the brightest and best of a highly educated informal segment of concerned upper class citizens in Sri Lanka….

…One of the provisions of the 19th was that no general election could be held before 4 ½ years had lapsed after the preceding one. As a Lady Macbeth of today may well have put it, an election, “if ‘tis to be held, then, it were well, if it were done 4 1/2 years after the need arises”. For the 19th, procrastination is the resource of time. While it sealed a safety valve to express resentment for 4 ½ years, the 19th was also Sri Lanka’s Brexit moment, where a stable, long term evolution of adaptive institutions was abruptly muted by populist forces. The 19th could only cause repeated omni-shambles. The frenzied events which took place in the last two months were a precursor. Chaos, thy name is the 19th! The great problem a polity faces, is of authoritarian governments trying to postpone elections. In Sri Lanka, the government was trying to do the opposite, advance them. The law is legal, though not necessarily legitimate, but the vote is immanent though always secular. The sacred exercise of permitting the vote cannot or should never be prevented. By the 19th, democracy – where the vote is its pivot- was sent spinning to the ropes. Civil society, by colluding with this rape, may have thought that it burnished its image: it only tarnished it.

… This crisis was caused by the entire political leadership being anaethetised much to the Forum’s happiness. More harm has been done in these two months by this cabal of self-appointed, unrepresentative civil society interventionists than could be computed. Having disrupted the process of established government- elected through elections-, civil society willed a disruptive unchangeable government, abjuring elections. The result is that a large flock of drone sightings in the Diyawanna, have an assured extended existence on THE taxpayer’s generously funded life-support. Having supported debauched governance, the Forum preens itself. It, claiming representational entitlement, says, “largely due to the vehement responses of the public and civil society to political manoeuvring, the status quo ante has been restored”. Nuremburg rallies were also made of the same stuff. Neville Chamberlain, after appeasing Hitler in Munich, on returning to London, crowed, “I have got peace with honour”. Similarly, the Forum, crowed Democracy has won. History repeats, one as tragedy the other as farce said Marx.

…The Forum was partisan in this debate. It said, “While the situation was instigated, carried forward and exacerbated by various political interests, it (ie the Forum) noted the irony in the claim of all these individuals and entities that they were acting in the best interests of the country”. The Forum was very skeptical of the bona fides of its opponents. Any opposing viewpoint was castigated and abused, almost suggesting that those expressing dissent were traitors. The Forum’s sub-text was that it was, “acting in the best interests of the country to uphold the sovereignty of the people”, a claim akin to it manifesting Rousseau’s The General Will. The Forum carried out a coup all its own, perhaps following Karl Marx’s advice, ‘so far civil society has bemused the world in various ways. The point is to change it’. The Forum followed the Machiavelli route, suppressio veri, suggestio falsi, to change.

The Forum has claimed that it upholds the rule of law, saying, “we wish to record our protest that persons who were earlier compelled to resign from the cabinet due to public loss of confidence over their alleged implication in financial frauds and issues of conflict of interest, have now been appointed and given ministerial posts. This undermines the democratic values that civil society constantly fought for. We ask that these persons not be permitted to hold public office”. These lowlights of the Forum were not inspiring reading. It is disenchanting that a group, which includes men of the cloth, Ph Ds, Professors, lead private sector performers, senior public servants, signed this Op-ed. The Op-ed makes cowardly, Kele pathra like tangential references to unnamed individuals, whose identity could easily be surmised, and condemned them on gossip about alleged financial frauds. The Forum refers to these tangential references as civil society values. I, an extinguished public servant, was taught different values. If an individual were to be punished there should be a charge sheet, an inquiry and after being given a fair hearing where he could defend himself, a verdict is issued. In this case, there was no charge, the relevant person was not given a chance of a hearing, but the kangaroo court of the Friday Forum has delivered its verdict and imposed its suggested punishment. The only charitable explanation for this response could be, that the Friday Forum had undergone a brief moment of absence of mind.


That man Patali Champika Ranawaka!

Patali Champika Ranawaka is the General Secretary of the United National Front for Good Governance (UNFGG). That’s a coalition led by the United National Party (UNP). The UNP is Ranil Wickremesinghe; I recommend a perusal of the party constitution to anyone who doubts this. Ranawaka was also the President’s nominee to the Constitutional Council under the 19th Amendment. The President is Maithripala Sirisena, who, after defeating Mahinda Rajapaksa became the leader of the Sri Lanka Freedom Party. In other words he was at the time the proverbial ‘right hand man’ of the leaders of both major political parties in Sri Lanka. A unique kind of creature, one has to acknowledge.

….What’s his history? He was a student leader at Moratuwa University. His political associations in terms of organizations, in many of which he was a key member and decision-maker, say as much about ideological orientation as about political ambition, untrammeled drive and an uncanny ability to read the political moment: the Janatha Vimukthi Peramuna, Jathika Chinthanaya, Ratawesi Peramuna (RP), Janatha Mithuro (JM), National Movement Against Terrorism (NMAT), SU, JHU, United People’s Freedom Alliance and the UNFGG. The RP, JM, NMAT and SU no longer exist. The JVP and JHU are more or less adjuncts of the UNP. The UPFA has been abandoned by non-SLFP parties including, officially, the Sri Lanka Podujana Peramuna (SLPP). The UNP lost considerable ground at the last local government election and what’s seen by some as a ‘resurgence’ is essentially a closing of ranks by the diehards. If Gallage is correct, then even in this exercise Champika played a significant role and one unusual for the leader of a small party which might not win a single parliamentary seat if it contested on its own.  

Is he then an opportunist who is absolutely focused on reaching somehow the top of the political ladder? Yes. Success in politics as far as an individual is concerned necessitates an eye for opportunity. As for changing political platforms, well, he’s no worse than most of his contemporaries.  

…Not long after the launch, Champika said ta-ta to Rajapaksa. He almost led Sirisena’s campaign in terms of formulating manifesto and strategy. Today, he seems to be Ranil’s sole non-UNP lieutenant and perhaps even his key advisor overall.  

Does ideology matter to him? He has the language, intellect and oratorical skills to justify anything he does. Time was when he argued against the abolition of the executive presidency given the its importance is ensuring that the 13th will not lead to a breakup of the nation. He voted for the 19th. He would have known that it was a terribly flawed and nonsensical piece of legislation. He can plead ‘collective responsibility’ but that vote may add to the scars he’s inscribed on his political persona on account of loyalty-switching.  On the other hand, it could also be that he knew the 19th did precious little pruning of executive powers. Was he looking to the future?

Well, now it appears he wants the executive presidency abolished. Has he abandoned all notions of territorial integrity and threats to the same which he eloquently pointed out when talking of the 13th Amendment? Has his ‘vision’ diminished to that of any random politician, i.e. a power-seek? Political experience suggests the answer is, ‘yes’. The onus is on him to prove otherwise.

For now, it is clear that he’s a political asset that far outweighs the perceivable strength of his party. Wickremesinghe would be loathe to drop him. There’s bargaining power there, obviously, and it is good to recognize that Champika knows this…


 The 19A as the UNP’s plaything


It is reported that the Government has decided to seek the opinion of the Attorney General on the possibility of increasing the size of the Cabinet of Ministers to 32. The argument is that the President and Prime Minister should not be included in the 30 member cabinet, as limited by the 19th Amendment. The Government is therefore seeking a green light considering the legal ambiguity.   

Interestingly, one of the main figures in the making of the 19th Amendment, Jayampathy Wickramaratne, claimed recently that ‘The National Government’ which allows Parliament to decide the size of the cabinet, continued to exist despite the United People’s Freedom Alliance (UPFA) withdrawing from the government, because, in his words, ‘the Sri Lanka Muslim Congress (SLMC) continues to be in it.’   

If this constitutional expert of the United National Party (UNP), who also helped author the 19th Amendment, believes that we still have a national government, why is Ranil Wickremesinghe’s government sweating over numbers, one must ask….   

…We have to conclude that the 19A was a piece of legislation that was written and voted for by sophomoric lawmakers. Wait, there’s another explanation: it was a deliberate exercise in constitutional tinkering for partisan reasons; in other words for the benefit of the UNP!   

Some basic questions would put the matter to rest. First of all, why couldn’t the likes of Wickramaratne and Sumanthiran come up with a draft that was ambiguity-free with regard to dissolution? Secondly, why did they offer a vague definition of ‘national government’ that made it possible for people like Wickramaratne to come up with the absurd claim that a UNP+SLMC arrangement would fulfil ‘national government’ criteria? Thirdly, why did they make a mockery of ‘independence’ when legislating the composition of the politician-heavy Constitutional Council?…

what we see is the UNP and Ranil Wickremesinghe stretching or contracting the 19A in accordance with their political needs

Yes, the 19th Amendment is a remarkable piece of legislation and one that should be studied carefully by students of politics, law and constitutional reform. In terms of process and product, it stands out as an excellent example of how not to write laws.


SL UK Mission has unpaid charges worth £ 371,003


The Sri Lankan High Commission in the UK has unpaid congestion charges and outstanding National Non-Domestic Rates (NNDR) worth pound sterling (£) 371,003, Secretary of State for Foreign and Commonwealth Affairs Jeremy Hunt said. 

In a written statement to the UK Parliament last Tuesday, Mr. Hunt said they have held meetings with diplomatic missions and international organisations about outstanding parking fine debts, outstanding NNDR payments and unpaid congestion charge debt. 

He said Foreign and Cmmonwealth Affairs (FCO) officials also press diplomatic missions and international organisations to pay outstanding fines and debts. “The majority of diplomatic missions in the UK pay the NNDR due from them. 

Diplomatic missions and international organisations are obliged to pay only 6% of the total NNDR value of their offices. This represents payment for specific services received such as street cleaning and street lighting. 

As at September 20, 2018, the total amount of outstanding NNDR payments owed by foreign diplomatic missions and international organisations due before 31 December 2017 is £ 1,507,576,” the statement said. 

Accordingly, the Sri Lankan High Commission has an outstanding NNDR payment of £ 26,278 and £ 344,725 as unpaid congestion charges. 

It was reported that the value of unpaid congestion charge debt incurred by diplomatic missions and international organisations in London was £ 110,069,300. According to the statement, the US Embassy has an outstanding payment of £ 11,925,920 as congestion charges, Embassy of Japan £ 8,021,190, Nigerian High Commission £ 6,724,405, Russian Embassy £ 5,653,955, Indian High Commission £ 5,394,580, German Embassy £ 4,288,680 and the Chinese Embassy £ 4,337,295.–160239.html


Geopolitics of Western interest in Sri Lanka’s political impasse


The inordinate interest shown by Western states and their Colombo-based diplomats in Sri Lanka’s political imbroglio, sparked off by the President Maithripala Sirisena’s sacking of Prime Minister Ranil Wickremesinghe on Oct. 26, formed an interesting side-show to the actual political developments as they played out in the country. The actions and statements of these emissaries, even as events continue to unfold, offer much food for thought about the motivation behind this unnatural focus on an internal Sri Lankan conundrum….

It is not without reason that the ‘human rights-accountability-reconciliation-constitutional reform’ refrain has surfaced again, and at this moment in time. In order to see the full picture, it is useful to take note that these statements come from countries lying outside the geographical area where claims are nowadays being voiced, to being stakeholders in the Indian Ocean. It may be noticed that countries that do assert themselves in this maritime region, in their comments all mention ‘Indian Ocean’ or ‘Indo-Pacific.’ Sri Lanka is described as a ‘valued partner in the Indo-Pacific’(US); a ‘longstanding friend and partner in the Indian Ocean’ (Australia); and commitment is expressed towards achieving ‘peace, stability and prosperity in Sri Lanka and the Indo Pacific’ (Japan). Both categories of countries – those making claims in the Indian Ocean and those who have less maritime presence, have the same strategic focus – a geographic location at the cross-roads of vital sea lanes, the control of which may determine who rules the world in years ahead…

Western countries that cannot make direct hegemonic claims in the Indian Ocean, but need to make common cause with those that do, have a Sword of Damocles in the form of the Geneva resolutions to rein in Sri Lanka and make it an obedient client. It may be recalled that the Canadian High Commissioner in his initial reaction to the events of Oct 26, made reference to the Geneva commitments when he said (to the puzzlement of many): “The Government of Sri Lanka needs to take concrete steps to meet its commitments to its own people – and the international community – with respect to accountability, transitional justice and ending impunity.‎”

The desire to assert dominance in the geopolitical ‘great game’ in the Indian Ocean goes a long way to explain the over-the-top reactions of Western states to Sri Lanka’s political in-fighting. The most candid admission of the real reasons for the Western need to protect Wickremesinghe, and be rid of Rajapaksa, was made by former US ambassador to Sri Lanka Robert Blake. 

….It is the Sri Lankan people who must decide whether a Wickremesinghe or a Rajapaksa (or someone else) will be Prime Minister.


UK responds to petition calling to refer SL to ICC

December 24, 2018, 12:04 pm

Responding to a petition calling for Sri Lanka to be referred to the International Criminal Court (ICC), the United Kingdom (UK) said it supports Sri Lanka’s commitments to the UNHRC as the best way to achieve reconciliation, said a statement released by the Foreign and Commonwealth Office.

The petition for the UK to refer Sri Lanka to International Criminal Court, if it continues to fail to implement its commitment made to the UNHRC Res. [A/HRC/RES/30/1] by March 2019; by agreeing to provide accountability and transitional justice, has received over 11,000 signatures.

Issuing a response, the UK government said support for international criminal justice and accountability is a fundamental element of its foreign policy.

…The UK is committed to supporting the Sri Lankan Government’s efforts to improve the human rights situation in the country. The UK is providing Sri Lanka with £8.3 million of Conflict, Stability and Security Fund funding over three years, including support for police reform and training, reconciliation and peace building, and resettlement and demining in the north of the country.


UK supports SL to advance reconciliation programme


The UK Government would continue its work with the Sri Lankan Government at the national level and with local and international organisations to help them advance the country’s wide reconciliation agenda, British High Commissioner James Dauris said.

….Meanwhile, he said a number of Sri Lankan students had travelled to the UK this year to further their education.

“An increase number of them went through British Government’s scholarships. Through the year, I have met hundreds of students taking British qualifications here in Sri Lanka. This enabled them to show they have the skills the employers are looking for here and internationally,” he said.


EU funds for ‘human rights’ in Sri Lanka:

The European Union (EU) is seeking proposals from eligible organisations for a program entitled “European Instrument for Democracy and Human Rights Country Based Support Scheme (CBSS) for Sri Lanka – 2018-2019”.

The global objective of this call for proposals is the enhancement of democracy and human rights in Sri Lanka.

The specific objective of this call for proposals is to contribute to the promotion and protection of human rights, fundamental freedoms and to contribute to the strengthening of the international framework for the promotion and protection of human rights, justice and the rule of law in Sri Lanka.

Priorities – The priority of this call for proposals is: Promoting and defending freedoms of expression and information, assembly and association and thought, conscience and religion


Canada updates travel advisory on Lanka with caveat

December 28, 2018, 11:17 pm

Canada has updated its travel advice on Sri Lanka as the political crisis has come to and end.

The Canadian Foreign Ministry said that the information about political instability in Sri Lanka has been removed from its updated travel advice.

The update however notes that even peaceful demonstrations can turn violent at any time and they can also lead to disruptions to traffic and public transportation.

“Avoid areas where demonstrations and large gatherings are taking place. Follow the instructions of local authorities. Monitor local media for information on ongoing demonstrations,” the updated travel advice said.


Tourism Minister to get adverse travel advisories on Sri Lanka rescinded

December 24, 2018, 12:02 pm

Zacki Jabbar

The new Minister of Tourism and Christian Affairs John Ameratunga said yesterday that he would act speedily to ensure that adverse travel advisories on Sri Lanka, imposed by many countries since October 26, were  rescinded.


Deshamanya RKW Goonesekere Memorial Programme on Law and Justice – Oration

December 28, 2018, 11:17 pm

…The second programme in 2018 will be presented by the Department of Legal Studies, Open University of Sri Lanka. It will commence with an oration by Professor Erik Jensen, Professor of the Practice of Law and Director, Rule of Law Program, Stanford Law School, USA. Professor Jensen was a Fulbright scholar in Sri Lanka in the nineteen eighties and contributed to the LLB programmes of the Open University and the University of Colombo at that time. He later served as the Representative of the Asia Foundation in Colombo.

The oration will take place at the Auditorium of the Open University of Sri Lanka, Nawala, Nugegoda on Friday, 4th January 2019 at 5.30pm. Professor Jensen’s lecture will be on “The Elusive Quest for Rule of Law: Building It and Backsliding from It.” Those interested in attending can email for further information to, or


Geetha’s fate should befall dual citizens in parliament’

Deshapriya says it’s a matter for courts…

December 27, 2018, 10:57 pm

Shamindra Ferdinando

National Election Commission (NEC) Assistant Commissioner (Parliamentary Elections) Shreen Yapa Boralessa yesterday said that the lawmakers having dual citizenship could be verified with the Department of Immigration and Emigration.

Asked whether the NEC would do so in the wake of the revelation three Tamil National Alliance (TNA) lawmakers would relinquish their foreign citizenship ahead of parliamentary polls in 2020, Boralessa explained the NEC would act if it received a complaint.

The official ruled out the possibility of NEC initiating action on its own.

…At the time of going to press, the TNA had not responded to the query as to whether the party initiated inquiry into three lawmakers having dual citizenship.

The TNA voted for the 19th Amendment….


“Now let’s take the arrest of Meng Wanzhou, Huawei’s chief financial officer and daughter of the firm’s founder, in Vancouver. She is accused of breaking US sanctions on Iran, and faces extradition to the US, where she could be jailed for up to 30 years if found guilty….

What is true here? In all probability, one way or another, all big corporations discreetly break the laws. But it’s more than evident that this is just a “secondary contradiction” and that another battle is being fought here. It’s not about trade with Iran, it’s about the big struggle for domination in the production of digital hardware and software.

What Huawei symbolizes is a China which is no longer the Foxconn China, the place of half-slave labor assembling machines developed elsewhere, but a place where software and hardware is also conceived. China has the potential to become a much stronger agent in the digital market than Japan with Sony or South Korea with Samsung, through economic heft and numbers.


[We are not fans of sea-sick Zizek, nor do we like his comments below about “half-slave labor”…after all, China ’enslaved’ for 5,000 years perhaps with the white man only wishing to enslave them further..not only that, China has worked hard to build their own society, not London!…But we take his point, that the white man (and their brown slaves) main concern is that China will slip out of their grasp..and build the most important machines: the ones that make machines… – ee]

“What Huawei symbolizes is a China which is no longer the Foxconn China, the place of half-slave labor assembling machines developed elsewhere, but a place where software and hardware is also conceived. China has the potential to become a much stronger agent in the digital market than Japan with Sony or South Korea with Samsung, through economic heft and numbers.


70 years of Canada-Israel diplomatic relations:

“The only Middle East expert at External Affairs at the time of the UN discussion of the British Mandate of Palestine, Elizabeth MacCallum opposed the UN Partition Plan that gave the Zionist movement 55% of the territory despite Jews making up a third of the population and owning less than 7% of the land. She claimed privately that Ottawa supported partitioning Palestine into ethnically homogenous states “because we didn’t give two hoots for democracy.”

The opinion of the first woman to become a senior foreign policy advisor wasn’t popular with Undersecretary of External Affairs, Lester Pearson, who organized late-night meetings allegedly to make it difficult for her to participate. Despite failing to convince her boss at External Affairs, MacCallum displayed sharp foresight. At the time of the 1947 partition vote, notes Arthur Andrew in The Rise and Fall of a Middle Power, “MacCallum scribbled a note and passed it to Mike [Pearson] saying the Middle East was now in for ‘forty years’ of war, due to the lack of consultation with the Arab countries.” She was prescient, even if she did underestimate the duration of the conflict. – Yves Engler


Dissolution of Parliament: What the SC said

December 22, 2018, 12:00 pm

C. A. Chandraprema

The list of Petitioners against the dissolution of Parliament and the holding of a fresh general election read like a who’s who of the yahapalana election campaign of 2015. It included R. Sampanthan on behalf of the Tamil National Alliance, Kabir Hashim and Akila Viraj Kariyawasam on behalf of the United National Party, the Centre for Policy Alternatives in its institutional capacity and Dr. Paikiasothy Saravanamuttu in his private capacity, Lal Wijenayake of the United Left Front, Anura Kumara Dissayanake, Bimal Ratnayake, Vijitha Herath, Dr. Nalinda Jayatissa, Sunil Hadunetti, Nihal Galapaththi all of the JVP, Manoharan Ganesan of the Tamil Progressive Alliance, Rishad Bathiudeen, Ameer Ali, Abdullah Mahroof and Ishak Rahuman all of the All Ceylon Makkal Congress, and Rauff Hakeem, Seyed Ali Zahir Moulana, Faizal Casim, H. M. M. Harees, M. I. M. Mansoor, M. S. Thowfeek and A. L. M. Nazeer all of the Sri Lanka Muslim Congress.

 Professor S. Ratnajeevan H.Hoole of the Elections Commission was also one of the Petitioners. The multiple Petitions were all heard together by a seven member bench comprising of Chief Justice H.N.J Perera, and Justices Buwaneka Aluwihare, Sisira J. De Abrew, Priyantha Jayawardene, Prasanna Jayawardena,  Vijith. K. Malalgoda, Murdu N. B. Fernando….


Appointment of Vijayakala as State Minister raises fresh questions

December 23, 2018

President’s Counsel Manohara de Silva yesterday told The Island that President Maithripala Sirisena and the government owed an explanation as to how the UNPer Vijayakala Maheswaran had been appointed the State Education Minister in the new government.

De Silva asked whether the government had forgotten the circumstances under which she had resigned as a minister several months back.

Vijayakala called for the LTTE’s revival in Jaffna in the presence of foreign minister and former Attorney General Tilak Marapana and Public Administration Minister Vajira Abeywardena….


What to do and what not to do next

Only down to earth real-politick can stop a Rajapaksa reflux

December 22, 2018, 12:00 pm

…The GMOA has threatened strike action if Rajitha is appointed Health Minister. This kind of political interference by the doctor’s trade union is intolerable. Rajitha must be appointed and if the GMOA attempts to hold the people and their health services hostage it must be smashed; I can’t think up an English equivalent to convey the same flavour as andu kadanna ooney.

A full range of emergency steps, including the hiring of retired overseas Sri Lankan doctors on one- and two-year contract are necessary stop gap measures. The fight against proto-fascism is a fight to the death; make no mistake.

…Paski, Charitha, Eran and Harsha should be granted 18 months furlough and tickets for a nice long trip. I know the latter two and can vouch that they are nice chaps and went to good schools and all that but in these times, they are best suited to a salubrious vacation in Alaska or Botswana. Their economic thinking if allowed to dictate the next period is a sure-fire election loser. This is not the time for long-term liberal or conservative bourgeois free market, capitalist investor oriented economic daydreaming. Nothing of such an approach (even if it were wise which I reject, but that’s another matter) will produce tangible results within months or ameliorate anger at government’s economic failure of the last three years. This policy framework has been a failure both as a growth and export strategy and as a way of winning mass support….


Constitution-making process to resume


The government has decided to resume the Constitution-making process which had been at a standstill for a while as a result of the recent political crisis and prorogation of parliament.

The Parliament Steering Committee appointed to draft the new Constitution is scheduled to meet during the first parliamentary week in January. It will take up for discussion a report compiled by the experts’ committee appointed to advise the Steering Committee on preparing the draft Constitution.

The Steering Committee consists of members of all the political parties in Parliament.


CC meets on Jan.8 to fill SC vacancy



The Constitutional Council will meet on January 8 to consider another nominee by President Maithripala Sirisena as a Supreme Court judge.

There will be another vacancy in the Supreme Court after the retirement of Justice Eva Wanasundara on January 5 bringing the number of vacancies to three.

The Constitutional Council has to endorse the nominees by the President before being appointed and it is already at loggerheads over the filling of two previous vacancies after the President refused to appoint the nominees endorsed by the Constitutional Council. (Kelum Bandara)


Parliament Dissolution : SC verdict saved country from international trap: Bimal


JVP MP Bimal Ratnayake said yesterday the verdict of the Supreme Court on the dissolution of parliament should be made available to MPs and the people in all three languages and said the SC verdict had rescued the country from an impending international trap.

He told Parliament that the SC verdict had sent a clear signal to the international community that our judicial system was independent.

“Our judicial system had been vilified at international level in the past and the government had been urged to call in international judges to hear cases of war crimes against our security forces. But this verdict has proved that we have an independent judiciary which is impartial,” he said.

Speaking during the debate on the Vote on Account, MP Ratnayake said the JVP could not support the Vote on Account as it was a mini budget to carry forward the UNP’s programmes rather than allocating money only to pay salaries of government servants, pensioners and Samurdhi relief.

“We have voted against the budgets of the government so far, and we will vote against this as well. If it was only to pay salaries, we have no reason to object,” he said. (Ajith Siriwardana and Yohan Perera)


High profile US delegation visits Sri Lanka’s Port of Colombo

December 22, 2018, 8:14 pm

A high profile delegation of the United States headed by Deputy Assistant Secretary at the United States Bureau of South and Central Asian Affairs David Ranz has made a special visit at the Colombo Port.

Sri Lanka Ports Authority said the delegation was welcomed by the Chairman of the authority Dr. Parakrama Dissanayake and briefed the recent developments of the port that aimed at becoming the maritime gateway in the region.

The delegation included US Ambassador Alaina Teplitz, Political Officers at the US Embassy of Colombo Joanna Pichette & Marcus Carpenter, Economic Chief Partha Mazumdar, Economic Attaché Eduardo Garcia, Desk Officer Jason Evans, and Bureau Planner Jason Briggs.

Managing Director of Sri Lanka Ports Authority Athula Hewavitharana, Additional Managing Director Upali De Zoysa, Harbour Master Nirmal Silva also attended the occasion. (LBO)


Chinese envoy to Russia and Ambassador Jayatilleka hold extensive discussions

During their meeting in Moscow

December 22, 2018, 8:47 pm

Dr. Dayan Jayatilleka met with Li Hui, the Ambassador of China to the Russian Federation, at the Chinese embassy in Moscow…

Jayatilleka stressed the emotions the Sri Lankan people always had toward China as a most trustworthy and well-proven friend, and thanked Ambassador Li for the continuous support China gave to Sri Lanka during the complex period of the war waged on terrorism, and for supporting the country in international organizations, while some of the world powers tried to put pressure on it.

Ambassador Li confirmed China’s firm adherence to the principles of mutual respect, territorial integrity, and equality, which should not be discarded as obsolete. 

According to him, the process of the world economic globalization should be regarded as an opportunity for common benefit, and not as a threat, or an attempt to seize more power; all problems must be solved in the way of a dialogue between equal partners, and not by the exercise of force or political influence.

Ambassador Li explained that some countries are of the unfounded opinion that economic globalization has only benefited China. Noting that some scientific researchers have concluded that certain powers attempt to monopolize the world both economically and politically, and are trying to turn the clock back fifty years….


Indian survey ship on hydrographic mission in SL

December 22, 2018, 8:16 pm

The hydrographic survey ship ‘Jamuna’ of the Indian Navy sailed into the Colombo harbour to undertake hydrographic surveys in Sri Lankan waters.

The vessel is expected to undertake a joint hydrographic survey covering the sea area from Colombo to Galle….

Assistant Defense Attaché to the Indian High Commission in Sri Lanka, Lieutenant Colonel Ravi Mishra was present at a ceremony to welcome the ship.

Lieutenant Colonel Mishra and Commanding Officer INS Jamuna, Captain HA Hardas met with Commander Western Naval Area, Rear Admiral Nishantha Ulugetenne at the Western Naval Command Headquarters and held a cordial discussion, focusing on matters pertinent to the visit, the Navy said.


Japan welcomes restoration of political stability in SL

December 22, 2018, 7:53 pm

“Japan, in cooperation with the Government of Sri Lanka, commits to further strengthening our ‘Comprehensive Partnership’ in order to achieve peace, stability and prosperity in Sri Lanka and the Indo-Pacific region. We commend all the parties for their efforts”, the Japanese Embassy in Colombo said in a statement.


Trump hits the wall

Monday 24th December, 2018

….Perhaps, the well-meaning members of the international community…Having fought quite a diplomatic war, as it were, to frustrate an attempt by President Maithripala Sirisena and former President Mahinda Rajapaksa to establish a minority rule here, they should heed the views that eminent political analysts of international repute such as Laurence Tribe, who is Professor of Constitutional Law at the Harvard University, have expressed about the ‘minority rule’ in the US.

Laurence has been quoted by the media as saying, “The rise of minority rule in America is now unmistakable.” One can’t but agree with him. He has cited, in support of his argument, the fact that Trump secured a majority in the Electoral College, in 2016, though Democratic candidate Hillary Clinton polled about three million votes more than he. The Electoral College mechanism left even Albert Einstein puzzled, according to an apocryphal story about the process of his naturalisation as an American citizen.

More importantly, Laurence has pointed out that the five of the nine judges of the US Supreme Court were ‘nominated by Republican presidents who collectively received fewer popular votes than their Democratic opponents and were confirmed by Senates similarly skewed’…


North Korean state media say Pyongyang will never unilaterally give up its nuclear weapons program unless the United States removes its nuclear threat first, amid a protracted deadlock in nuclear negotiations between the two countries over the sequencing of the denuclearization process in the Korean Peninsula and the removal of international sanctions.

The official Korean Central News Agency (KCNA) said in a statement released on Thursday that the denuclearization of the Korean Peninsula had to mean “completely eliminating the US nuclear threat to Korea,” as well as all neighboring areas.

When we refer to the Korean Peninsula, the term encompasses the area of DPRK plus South Korean territory, where US nuclear weapons and other forms of aggression forces are deployed,” the statement said, using the initials of North Korea’s official name — the Democratic People’s Republic of Korea.

“When we refer to the ‘denuclearization of the Korean Peninsula’ as well, it should be correctly understood as removing all nuclear threat factors from not only the North and the South but from all neighboring areas,” it added.

It said Pyongyang rejected US calls for it to unilaterally denuclearize, and added that Washington had to abandon the “delusion” of forcing the country into giving up its nuclear weapons “via pressure and oppression.”

“It is obvious that denuclearization of the Korean Peninsula is a joint business that cannot be achieved unless both Korea and the United States strive together,” the KCNA statement said. “In this sense, the denuclearization of the Korean Peninsula should be defined as ‘completely eliminating the US nuclear threat to Korea’ before it can eliminate our nuclear deterrent.”

The statement by the North Korean state media also suggested that Pyongyang would demand that Washington withdraw or significantly reduce the 28,500 US troops stationed in South Korea, which has been a major sticking point hindering a potential disarmament deal.

A summit between US President Donald Trump and North Korean leader Kim Jong-un in Singapore last June opened up dialog on denuclearization of the Korean Peninsula between the two countries after months of exchanging military threats.

In this file photo, taken on June 11, 2018, US President Donald Trump (R) is seen gesturing as he meets with North Korean leader Kim Jong-un in Singapore. (By AFP)

There has been talk by the US of a second summit early next year, but it is unclear whether North Korea would agree to the holding of the summit.

US-North Korea talks for a denuclearization deal appear to have stalled, in part due to disagreements over the timing of sanctions relief.

Washington seeks the complete and irreversible dismantling of North Korea’s nuclear program first, while Pyongyang is demanding a solid guarantee of its security and the removal of Washington’s nuclear umbrella protecting allies South Korea and Japan.


The Economic and Social Plan of the Bolsonaro Government

Latin America  •  December 28, 2018  •  Joao Marcio and João Pedro Stédile

“Reformed” captain Jair Bolsonaro already committed to the “market” the handover of all decisions in the economic area to large capital, under the hegemony of financial capital and foreign corporations (as personified in Paulo Guedes and his Chicago Boys, including Levy in the Brazilian Development Bank-BNDES). As per the President’s statements, his will be a government directly headed by businessmen committed to the reduction of the “Brazil cost,” that is, to the increase of private profit. A government with such profile would not only give continuity but also radicalize Michel Temer’s agenda with the aim of implementing the following measures:

1. A brutal reduction in compensation costs for the workforce (that is, a reduction of the minimum wage and the end of various labour rights, combined with a deterioration of working conditions, through the generalization of intermittent work, subcontracting, and the dismantling of labour justice);

2. The private appropriation of all possible natural resources (oil, mined minerals, land, water, and biodiversity), eliminating any bureaucratic or legal obstacles, trampling over traditional populations and environmental concerns…

3. The privatization of 149 State enterprises of which only part of Petrobras would remain…

4. The privatization of Social Security where the problem is neither the deficit nor the privileges, especially those of judges and the military, which will not be modified. What banks want is the right to implement a private social security plan, dreaming of large pension funds, with a no-cost access to national savings, as is already taking place with the social security of the BB, Caixa, and Petrobras, which turned into large operators in the speculative investment markets;

5. The dismantling and privatizing public education through the chronic resources and investments in schools and universities; the mass implementation of long-distance training via private corporations; the substitution of public hiring process for technicians and professors by subcontracting; the drastic reduction of academic scholarships, research and support for remaining in the university; the imposition of university presidents by the Education Ministry to the detriment of democratic elections by the academic community; and ideological persecution against the freedom of teaching and research;

6. The scrapping and privatization of public health through defunding of the SUS, the weak regulation of private healthcare providers, the generalization of public-private partnerships as a management model, and the substitution of public contests by temporary subcontracting);

7. The privatization of the public financial system – Banco do Brasil, BNB and Caixa – and a subcontracting and privatization process of public services in general. Anything that can provide profit will be transferred to capitalist corporations to benefit;

8. The favoring of the arms industry (both national and foreign), through the liberation of permits and the budget priorities demanded by police and military forces, including agreements with Israel for the provision of equipment;

9. A public security model that is even more bellicose, less responsible to society and legally less accountable, with the liberation of arms sales, the lowering of the legal age to be tried as a criminal to 16, and a punitive process that is going to fill our prisons even more that they already are;

10. Brazil’s foreign alignment and subordination to the economic interests of the USA and also the political alignment with right-wing governments such as Italy, Israel, and Taiwan, creating a militarist agenda that counters its diplomatic tradition and places peace at risk…

Joao Marcio is a professor at the Universidade Federal Rural do Rio de Janeiro (UFRRJ). João Pedro Stedile is an economist and a member of the national coordination of the MST and Via Campesina.


Cyprus – Deadly UK Military Bases, Refugee Camps… and Tourists

…The city of Nicosia is still divided, with the Greek Cypriot and the Turkish immigration check-points located right in the middle of an old town. Graffiti painted in ‘no man’s land’ demand an immediate end to the conflict: 

…Otherwise, it is one island, one history and one sad and unnecessary partition.

The division of the nation is not the only madness here. Before you get used to the idea, you may go mental, finding out that there are two British administered territories still engraved into the island.

If you drive around, you will never notice that you are actually leaving Cyprus, and entering the U.K. Some car license plates are different to those regular Cypriot ones, but that’s about it.

You cross an invisible line, and you are in the UK; historically the most aggressive (militarily and ideologically) nation on the face of the earth.

…Further south…is a small village of Akrotiri; a typical picturesque Cypriot charming settlement….But you are, actually, inside the U.K. From here, you can see the blue sea, a salt lake and the city of Limassol; but you are on British turf. How come? Simple: after Cyprus achieved independence from the British Empire, in 1960, the Brits ‘were concerned’ that they could lose control over their military bases in Cyprus, and at least partially, influence over the Middle East. As this being unimaginable to the British imperialist mind, the U.K. arm-twisted the Cypriots into this bizarre arrangement which holds to this day.

One more kilometer further south, and you hit the wall and a gate, decorated with threatening warnings. You are at the perimeter of the RAF Akrotiri base. From here, since December 2015, the RAF is carrying out illegal (according to international law) airstrikes against the sovereign Syrian Arab Republic.

….As early as in 2008, former left-wing President Demetris Christofias (who was also the General Secretary of AKEL, the Communist Party of Cyprus) tried to remove all British forces from the island, calling them a “colonial bloodstain”. However, he did not succeed, and in 2013 he decided to step down and not to seek re-election.

…One could easily conclude: this former British colony is still allowing, for a fee, the tremendous presence of the British/NATO military forces, as well as various spy facilities and propaganda outlets. RAF Tornado jetfighters are presently flying their ‘missions’ against Syria. Missiles are being fired from Akrotiri. People fleeing from the destroyed countries of the Middle East, are then detained in Cyprus, like criminals, behind barbed wire…..


Kenya too falls into Chinese Debt Trap!

December 25, 2018, 9:14 pm


NEW DELHI, December 24: After Sri Lanka and Zambia, Kenya too has fallen into the Chinese Debt Trap, an Indian newspaper reported today.

Kenya could lose its Mombasa port to China along the lines of Hambantota port in Sri Lanka, and and the international airport in Zambia—raising apprehensions about the Chinese debt trap.

Kenya could lose the port to the Chinese government if Kenya Railways Corporation defaults in the payment of $2.2 billion owed to Exim Bank of China, The Economic Times reported today….

Last September, Zambia surrendered its international airport to China after it failed to pay back money it had borrowed.


Kenya too falls into Chinese debt trap?

December 27, 2018, 9:22 pm

This alarming news item reported from Delhi, India…

What does this point out to? It is the lack of preliminary investigations, feasibility reports by professionals for its viability and then seek foreign funding, calling for worldwide tenders to get the best deal both financially and quality wise. I remember, when international lending bodies, like Asian Development Bank [ADB] and World Bank [WB] are approached for loans, they carry out a feasibility report on their own, along with ours and place certain conditions to make the project viable. Sadly, in recent times politicians without consulting professionals or only those ‘Yes men’ enter into agreements with countries such as India and China who have other motives. The Hambantota port, Mattala Airport, Cricket Stadium at Sooriyawewa, and the disastrous Uma Oya project are a few of the Quixotic projects undertaken. It is therefore no wonder we are a debt ridden country, facing a financial crisis. To overcome this crisis, we have to sell or lease our national assets – One such, is the sale of that precious, important, priceless land at Galle Face where the former Army Headquarters stood, to Shangri-La Hotels…

To conclude, it is my personal view that China is more interested in making countries poor to have control over them, both economically and politically to have world dominance.”

G. A. D. Sirimal


The Office of the Auditor General has denied reports indicating that it released an audit report warning that Kenya risks losing the port of Mombasa over the multi-billion shilling loan borrowed from China for the construction of the Standard Gauge Railway (SGR).


Sheikha Latifa: Mary Robinson ‘backed Dubai version of events’


Former UN rights chief Mary Robinson has been accused of supporting the emirate of Dubai’s version of events over a princess who was feared missing.

Mrs Robinson, who recently met Sheikha Latifa, daughter of Dubai’s ruler, said she was a “troubled young woman”. She told the BBC the princess regretted making a video in which she alleged confinement and torture.

Radha Stirling, head of the rights group Detained in Dubai, said questions remained about the princess’s welfare.

“Anyone familiar with Princess Latifa’s story who listened to the BBC Radio interview today with Mary Robinson will be astonished at the extent to which Mrs Robinson appeared to be reciting almost verbatim from Dubai’s script,” she said.

….On Monday, the UAE foreign ministry said it had sent a communiqué regarding Sheikha Latifa to the UN human rights office.

UN High Commissioner for Human Rights and former president of Ireland, and were purportedly taken on 15 December in Dubai…–160382.html

__________________________________________________________ Security__________________________________________________________ 

Govt. using underworld for its survival


The government is using the underworld for its survival, the Sri Lanka Podujana Peramuna (SLPP) said today.

MP Shehan Semasinghe said it was the duty of the government to ensure the safety of all citizens.

“Instead, the government is using the underworld for its own survival. Firearms are being used in broad daylight illegally. This year alone, 54 people have been shot dead. Six unidentified bodies had been found in five districts on Thursday. How can one say the security of the country has been ensured,” he said.

He said at a time when President Maithripala Sirisena had highlighted the importance of expediting investigations into the VIP assassination plot, Ministers Ranjith Madduma Bandara and Thalatha Atukorale had said there was no such plot.

The MP said the next year would be politically crucial.

“MP Range Bandara says he will make a decisive decision while Lakshman Wijemanna says he will even sacrifice his life. For what? These people are here not to serve the people but to get hold of portfolios. This government has to change,” he said. (Lahiru Pothmulla)


“President Sirisena declared that investigations into the alleged attempt to assassinate him were progressing well now. “I have always held that such investigations should be carried out correctly and in accordance with the law,” he said.  Ranjit Madduma Bandara intervened to say “Sir baya wenda epaa. Mama hariyata veday karranam or Sir don’t be frightened. I will do the job correctly.” Snapped back Sirisena, “Even earlier, you ran the Law and Order Ministry. Did you do your job or was it done for you by the Chief of Staff (CoS) of the Prime Minister’s Office.” He was referring to a onetime Law and Order Minister who serves as CoS, Sagala Ratnayake.  Sirisena then turned angry and remarked “You didn’t have anything to do. Isn’t it?” He said that he would appoint a suitable person as Law and Order Minister when it was necessary and it would remain with the Defence Ministry until then….

….Just hours before the swearing-in of ministers, Sirisena telephoned Lake House Chairman Wasantha Ramanayake. He directed that he hand over all his functions and duties to Krishantha Cooray immediately. A member of the UNP Working Committee, Cooray is widely regarded as a close confidant of Sirisena. Until the ouster of Wickremesinghe as Prime Minister, he served as Chairman of Lake House. He is also Chairman of Hotel Developers, the owning company of Colombo Hilton. On Friday, President Sirisena telephoned Samaraweera and asked him not to make appointments to any positions in the Media Ministry until the gazette notification listing the subjects allocated to ministers was published. He is learnt to have pointed out that Cooray had already taken over at Lake House only to be told by the President that it was he who had made that appointment. Whether the gazette notification in question will be issued before or after he returns from a four-day private visit, overseas is not immediately clear. It is, however, clear that President Sirisena wants to retain under his purview some of the state run media institutions.


ID photos to conform to ICAO standards from Jan. 01

December 28, 2018, 11:18 pm

Sirmantha Ratnasekera

The Registration of Persons Department (DRP) said yesterday that it would be compulsory for all studios countrywide, from January 1, to use the special software provided by the International Civil Aviation Organisation (ICAO) to take photos for the National Identity Cards.

The Government Information Department said, quoting DRP Commissioner General Viyani Gunatilleke, that the pilot project launched in the Sabaragamuwa and the Western Provinces was successful and the programme would be expanded to cover the entire country from January 1.

“Some 2,100 studios have been registered with the DRP and all of them have been provided with the ICAO software. …The applicant should be present at the studio to certify the printed copy before issuing it. The printed copy has to be handed over to the respective Grama Niladharis at the selected Grama Niladhari Divisions to be attached to the NIC application,” he said.

“The photo taken according to the parameters of the software will be transmitted to the DRP database for processing,” the Commissioner said.


WP Councillor arrested over alleged financial fraud


Western Provincial Councillor S. Kuhawardhan was arrested by the Criminal Investigation Department (CID) today for allegedly defrauding cheques amounting to Rs. 70 million, CID sources said.

….A businessman had lodged a complaint with the CID’s Commercial Crime Investigation Unit saying that the councillor had defrauded Rs. 70 million by giving dud cheques for the purchase of three housing complexes.

S. Kuhawardhan, who is a member of the Democratic Peoples’ Front (DPF), was engaged in a business involving building construction….


India to lay new Rameshwaram-Dhanushkodi railway line that will restore rail-cum-sea link to Sri Lanka

December 27, 2018,


NEW DELHI, December 25: The Government of India has approved laying a new 17-km  broad gauge railway line connecting Rameshwaram with Dhanushkodi in Tamil Nadu. The Dhanushkodi railway station was destroyed and abandoned after the 1964 Rameshwaram cyclone and it remains unattended till this day.

The railway line may also push the plan for restoration of a rail-cum-sea route to Sri Lanka, sources said. Dhanushkodi is believed to be the starting point of Ram Sethu and a major pilgrim destination.

….The railways has also approved building a new bridge on Pamban channel, which will replace the 104-year-old structure over the sea. The vertical-lift bridge, to be built alongside the existing bridge at INR 2.49 billion, will have the first vertical lift span in India…


Northern floods: Wiggy defends Tamil politicians

… alleges media in the South promoting military

December 27, 2018, 10:47 pm

By Dinasena Ratugamage

Former Northern Province Chief Minister C.V. Wigneswaran has denied accusations that Tamil politicians failed to respond swiftly in the wake of recent flood disaster in the north.

….Wigneswaran blamed what he called the media in the South for promoting the armed forces for coming to the assistance of the affected at the expense of Tamil politicians. Wigneswaran said politicians couldn’t be expected to play the role of security forces. (see, ee Workers for more on floods)


Civilians protest against move to remove army camp

December 26, 2018, 11:06 pm

 R.Sri Velraja, Kalmunai Correspondent

The residents of Tirukkovil yesterday held a protest opposite the Kovil against moves to remove the army camp in the area.

The protesters said by removing the camp there was a possibility of drug menace spreading further. They said the presence of the army had deterred the drug addicts.

The residents have handed over a memorandum to the Brigadier H.G.D.Ranasinghe requesting the army to maintain their presence in the area. Digamadulla District TNA MP K.Kodeeswaran has requested President Maithripala Sirsena to dismantle the army camp for the construction of a playground.


Drug peddler gives his accomplice away

December 25, 2018, 9:15 pm

Confessions made by a drug peddler arrested by the Kelaniya Division Crime Unit on Monday at Peliyagoda, led to the arrest of his accomplice who had seven grammes of heroin in his possession. The suspect, who was arrested first, near the Nawaloka grounds. is known as ‘Malu Samantha” (30), a resident of Peliyagoda…


Police blame Makandure Madush’s gang

December 27, 2018, 12:04 pm

Initial investigations into the Christmas Day killing of four persons at the Kudawella fisheries harbour in Tangalle have revealed that members of Makandure Madush gang were responsible for the attack. Police said that the gunmen had targeted Latheesh Udaya Kumara alias Rana, who died on the spot, on a contract given by a business rival… Police attributed the killing to a long standing dispute between two groups engaged in the fish trade…Rana’s family owned 21 trawlers operating from the Kudawella fisheries harbour.


Police open fire on fleeing vehicle

December 26, 2018

Hemantha Randunu

The Tangalle police in the wee hours of yesterday gave chase to a van and opened fire on it when it defied an order to stop.

Later the police identified the owner of the van as a businessman from Tissamaharama.


Another underworld shooting in Grandpass

December 27, 2018, 12:01 pm

Hemantha Randunu

A gang allegedly led by notorious gangster identified as Bloemendhal Sanka, yesterday, shot dead a member of a rival gang at Henamulla in the Grandpass police area. The police identified the victim as 35-year-old Wijeratnage Dinesh Eranga alias Kalubole, a father of two…Sources said that the victims and several of their associates had assaulted a close relative of Bloemendhal Sanka a few days back…


“The aid from US military circles which assisted the sinking of LTTE warehouse ships was only during the last operation in September -October 2007. The key strikes which opened up the ‘can of worms were in February and March (info conveyed personally by Commodore Travis Sinniah who commanded the sea operation). Much earlier, USA via Robert Blake did aid the SL Navy by providing “Bushmaster” cannons ( info conveyed personally b y Admiral Karannagoda).”


Namal accuses CID of attempting to cover up assassination plot against President et al

December 24, 2018, 10:47 pm

Saman Gamage

The CID had attempted to cover up the truth about the attempt to assassination President Maithripala Sirisena and former defence secretary, Gotabhaya Rajapaksa, Director of Anti Corruption Front, Namal Kumara told media yesterday.

Kumara said that he would reveal further information on it soon. The CID investigators had conducted the investigation into the assassination plot in a lukewarm and lethargic manner, he said.

Kumara said that some CID officials had leaked distorted information about the investigation to the media in a bid to make light of his allegations. “Officials took my phone to Hong Kong to recover some deleted voice recordings. After they returned a website carried a story saying that the experts had recovered a recording in which I planned to kill a senior security officer. The said officer is STF Commander DIG M. R. Latheef. Former head of the Terrorism Investigations Division (TID) Nalaka Silva wanted to get rid of Latheef and wanted my help. The STF head’s name is mentioned in several of the recordings and I had given those to the police already. So this was a plant.”…


Namal Kumara tells of attempts to sweep VIP assassination plot under rug

December 25, 2018

Charunya Rajakaruna

Namal Kumara, the Director Operations of the Anti Corruption Force, says that the investigations regarding the information he revealed on the VIP assassination plot are at a weak status…


Police nets navy spies at court, assassination plot feared

December 22, 2018, 8:45 pm

Sri Lanka’s police detained two navy intelligence officers at the Fort magistrate’s court Wednesday amid fears of a threat to the life of a key detective investigating the abduction and killing of several people allegedly by navy officers.

Police spotted two navy men identified as N. M. W. Janaka (38190) and A.S.N. Tony (103183) sitting among litigants and were reported to the magistrate who ordered their questioning.

….Police are investigating what the two intel officers were doing in court while supposedly being on duty at their Welisara camp.

Police have told court that some of the key suspects who are currently on bail have been reinstated and even given promotions. It is feared that they could have access to resources that will help them intimidate suspects…


Villagers catch person who damaged Buddha statue

December 26, 2018, 11:06 pm

People have apprehended a person who allegedly damaged a Buddha statue in the Mawanella police area. Later the police took him into custody. Police said that the arrest was made at Hingula, Mawanella…Police said investigations were underway to ascertain whether there was any move to provoke religious tension between the Sinhalese and Muslim communities.


Suspect arrested for damaging Buddha statue


…The suspect, Mohammad Ashfar (30), will be produced in court and police investigations are underway to ascertain whether there was any move to provoke religious tension among the Sinhalese and Muslim communities.

Meanwhile, Minister Kabir Hashim said he condemned the recent acts of violence involving places of worship in Mawanella. “As soon as I heard the recent attacks, I instructed the police to investigate and arrest those responsible…”


STF called in following unrest in Mawanella

December 27, 2018, 10:59 pm

Police commandos have been deployed in Kegalle to assist police in case of an emergency following some incidents where several Buddha statues were damaged.

Colombo Municipal Councillor Azath Sally yesterday said that he had discussed the situation with IGP Pujith Jayasundera. According to Sally, there had been some incidents at Udunuwara and Yatinuwara as well.


Muslims should reconstruct damaged Buddha statues: Marikkar


Muslims should reconstruct the Buddha statues which were vandalized in Mawanella recently to prove their sincerity and innocence, parliamentarian S. M. Marikkar said today…


Six persons burnt seriously as petrol can explodes

December 24, 2018, 10:20 pm

By Percy Kuruneru

Six persons were seriously burnt Sunday afternoon at Wattewewa, Kebithigollewa when a can of petrol that was to be used on a funeral pyre exploded…


STF goes after Uru Juwa’s gang

December 23, 2018

Norman Palihawadana

A criminal known as Bawa, an associate of underworld leader Uru Juwa, who is currently in remand prison, was arrested, on Saturday, by the Police Special Task Force (STF).

At the time of arrest the suspect had heroin and a grenade in his possession. During the last few days, the STF has arrested four members of the Juwa gang, engaged in drug dealing, extortion and illegal sand mining, in Hanwella….


Maldives seizes Lankan boat carrying shark carcasses


A Sri Lankan vessel carrying mostly shark carcasses had been seized by the Maldives for fishing illegally in its waters, the Maldivian media reported today.

According to Avas and Raajje News, the boat named ‘Oshadi 1’ which is registered in Sri Lanka was caught operating in Maldives’ special economic zone outside of Gaafu Dhaal atoll last Wednesday.

Members of the crew were apprehended 42 nautical miles off of Gadhdhoo island and were handed over to the Maldives Police Service.

“We found fishing equipment and around a tonne of fish on board the vessel. So we have no reason to believe that the boat had entered Maldivian waters for any purpose other than fishing,” Zuhair said.


Bond scams: Bring all culprits to justice

December 23, 2018

…We have already wasted nearly 20 months since the Central Bank alone incurred a loss running into billions of rupees due to the bond scams. It is indeed a shame that the then Central Bank Governor Arjuna Mahendran, wanted in connection with the bond scams, is still a free man in Singapore….


Sri Lanka coup hastens prosecution of Rajapaksa envoy to Washington

By Our Political Correspondent

Dec 24, 2018 21:03 PM

Sri Lanka’s October coup that brought former president Mahinda Rajapaksa briefly back to power may have backfired on a close relative, ex-ambassador to Washington and fugitive from justice, Jaliya Wickramasuriya.

The prospect of a Rajapaksa government in Colombo prompted justice authorities in Washington to publicly disclose money laundering and visa fraud charges against Wickramasuriya, a first cousin of the former president, and ensure he is swiftly prosecuted.

The man who served as Sri Lanka’s ambassador to Washington for six years till 2014 will now become the first Rajapaksa relative to be prosecuted abroad and face a possible lengthy jail term following five counts of charges ranging from wire fraud to immigration offences.

Official sources said the test case could leave the door open to several other very high profile prosecutions shortly. Foreign ministry sources said that it was the first time that a Sri Lankan ambassador was being prosecuted in the country he was posted to.

….As the coup drama unfolded in Colombo, the US government lodged a request on November 8 with a Washington court to partly “unseal” the indictment in order to impress Sri Lanka authorities of the gravity of the case. They followed it up with another request to fully unseal the charges. It was granted on December 20, according to public records…


Three Russian naval ships led by guided missile cruiser Varyag arrive

The Sri Lanka Navy, in accordance with naval traditions, welcomed three Russian naval ships at the Port of Colombo yesterday.

A group of the Russian Navy’s Pacific Fleet ships, including the guided missile cruiser Varyag, large antisubmarine ship Admiral Panteleyev and the large sea tanker Boris Butoma, entered the Port of Colombo in Sri Lanka on a goodwill visit, the Sri Lanka Navy’s media unit said.

Subsequently, the Commander of the Squadron, Rear Admiral Eduard Mihailov, along with the commanding officers of the three ships – Captain Yurievich Ulyanenko, Captain Vitalievich Antsiferov and Captain Alexandrovich Bondar – called on the Commander of the Western Naval Area, Rear Admiral Nishantha Ulugetenne, at the Western Naval Command Headquarters and held cordial discussions.


Antonov flight at MRIA delays takeoff as engine catches fire


An Antonov An-12 flight (CVK 7042) which arrived at the Mattala Rajapaksa International Airport (MRIA) from Bangkok last night, had delayed its takeoff due to a fault in the engine….


 An Indian viewpoint Emerging South Asian scenario


India is circumventing this problem by building other networks

The first BIMSTEC military exercise was held in Pune in September 2018

Despite striking similarities in culture and a shared history going back to ancient times, South Asia is one of the least integrated regions in the world. But there are visible signs of change both within South Asia and in the way the world looks at the region, avers Dr. Swaran Singh, Professor at the Center for International Politics, Organization and Disarmament, Jawaharlal Nehru University, New Delhi. 

Currently a Senior Fellow at the Institute of National Security Studies Sri Lanka (NSSSL), Dr. Singh says that there is an increasing realisation, both among the constituent countries of the region and the world powers, that South Asia has to be seen as a whole in strategic, economic and developmental terms.

…The  demand for trade necessitates inter-connectivity. Therefore, inter-connectivity is the buzzword now with many international structures being set up to work on it, such as the Bay of Bengal Initiative for Multi-Sectoral Economic and Technical Cooperation (BIMSTEC). 

….But there is one nightmarish problem facing South Asia, and that is the scourge of terrorism, both domestic and cross-border. Therefore, in contrast to the past, the focus now is on terrorism and cross-border terrorism. 

“Afghanistan and Pakistan are seen as breeding grounds of terrorism,” Dr.Singh noted. 

….Asked if the conflict with Pakistan on the issue of cross border terrorism is not hampering cooperation through an established institution like SAARC, Dr. Singh said that India is circumventing this problem by building other networks where Pakistan is not involved, such as BIMSTEC. 

“After the BRICS (Brazil, Russia, India, China, South Africa) summit in Goa in 2016, Prime Minister Modi organized a BRICS-BIMSTEC outreach summit there. At that summit attended by Bangladesh, India, Myanmar, Thailand, Bhutan, Nepal and Sri Lanka, combating terrorism was given high importance, though BIMSTC had nothing to do with terrorism per se. 

The first BIMSTEC military exercise was held in Pune in September 2018. All member countries barring Nepal and Thailand, sent their teams. Apparently, China had dissuaded Nepal from participating, Dr. Singh said.

…In his view, China’s  engagement with the region is “continuous, enormous and influential.”  

He pointed out that out of the six major projects in China’s Belt and Road Initiative (BRI), four are in South Asia. China is also present in the Bangladesh, China, India, Myanmar Forum (BCIM). However, to date, China’s flagship project in the region is the China Pakistan Economic Corridor (CPEC). China has ports in Sri Lanka and Pakistan and is planning one in Myanmar. A China-India-Nepal-Corridor on the anvil. “Through these corridors, Chin

“Extraction and usurpation are the twin aims of the BRI,” he added. 

….India’s opposition to the China-funded CPEC in Pakistan is based on the ground that a part of the corridor passes through a part of Kashmir which India considers its legal entitlement.

The Indian scholar said that China has no right to point an accusing finger at India in this regard as China had successfully prevented the Asian Development Bank from investing in the Indian State of Arunachal Pradesh arguing that this State is part its Tibet Autonomous Region. 

“I tell the Chinese: Apply your own principle to India’s objection to CPEC, then you will appreciate New Delhi’s stand,” Dr. Singh said. 

Explaining India’s objection to China’s ring of ports around it  Dr. Singh said that India feels vulnerable because these ports have a dual purpose. However, China’s main aim is not to intimidate India as such but to checkmate the United States.

…However, India’s objection to BRI is restricted to CPEC, Dr. Singh said. India’s attitude towards BRI softened when Chinese President Xi Jinping proposed that India is welcome to take up joint projects with China in third countries. There is already a proposal for India and China to jointly engage in development projects in war torn Afghanistan. 

Therefore, in the midst of conflicts, India and China are exploring spaces for cooperation. There is already cooperation between the Indian and Chinese navies in anti-piracy operations in the Gulf of Aden and off the Somalian coast, Dr.Singh pointed out.


US Empire on the Ropes

Black Agenda Radio with Nellie Bailey and Glen Ford

24 Dec 2018

We are witnessing “the beginning of the end of a world order that was hatched after World War Two,” said Duboisian scholar Dr Anthony Monteiro. “What I see is a retreat from empire, based on a popular uprising of the people who have to pay the cost of empire” through austerity and war.


India issues blanket order for 10 agencies to monitor, decrypt any information

To tighten internal security

December 22


NEW DELHI, December 22: In an apparent bid to tighten internal security, India on Friday issued a blanket order, enabling 10 authorised agencies to monitor and decrypt any information on any computer.

This move has brought the spotlight back on privacy laws, and stalled parliament today. Opposition Congress Party President Rahul Gandhi promptly used the controversial move to brand Prime Minister Narendra Modi an “insecure dictator.”

With Section 69 of the Information Technology (IT) Act paving the way for the “monitoring,” government agencies will now be able to keep an eye on exchange of information and material between individuals and banned or militant groups….


Indian troops return after joint urban counter-terrorism exercises with Chinese army

by Editor

December 24, 2018

New Delhi, December 24 (Daily Hunt): Troops from Indian Army that were engaged in the Hand-In-Hand joint military training between India and China returned home on Sunday. Indian and Chinese troops concluded the seventh round of counter-terrorism military exercises in China’s Chengdu city on Saturday. Over 100-strong contingents from both nations conducted the drills while living and dining together to build up a sense of camaraderie during the exercise.


War With Russia?

The New Cold War is more dangerous than the one the world survived.

The Time We Live In…And Why Moscow Is The Most Exciting Place To Be A Diplomat Now!

“Prof Stephen F. Cohen of Princeton visited Camp David at the request of President George H.W. Bush, squaring off against Harvard’s Richard Pipes in a scholarly battle to influence U.S. foreign policy and determine the course of the Cold War.” And this December 2018 he wrote that:

“The new US-Russian Cold War is more dangerous than was its 40-year predecessor that the world survived. The chances are even greater that this one could result, inadvertently or intentionally, in actual war between the two nuclear superpowers.”


“The new Cold War is not a mere replica of its 40-year predecessor, which the world survived. In vital ways, it is more dangerous, more fraught with actual war, as illustrated by events in 2018, among them.”


Does the Sri Lankan intelligentsia, such as it is, know any of this? Has it figured out that Sri Lanka is in this vortex? And has it figured out how we should position ourselves; which stand we should take in the national interest?

War With Russia?, like the biography of a living person, is a book without an end. The title is a warning—akin to what the late Gore Vidal termed “a journalistic alert-system”—not a prediction. Hence the question mark. I cannot foresee the future. The book’s overarching theme is informed by past and current facts, not by any political agenda, ideological commitment, or magical prescience. 


Russian Pacific Fleet ships conclude visit to Sri Lanka

December 24, 2018, 10:19 pm

A fleet of ships from Russia’s Pacific Fleet has concluded its visit to Sri Lanka, the Fleet’s press service said in a statement yesterday.

The Pacific Fleet ships embarked on a three-month journey from Russia’s Far Eastern port of Vladivostok on October 1.

The group has already visited ports in Japan, South Korea, Brunei, Singapore, China and India, and also took part in the Indra Navy 2018 Russian-Indian maritime exercise.


December 24, 2018

Banishing Truth

Chris Hedges

The investigative reporter Seymour Hersh, in his memoir “Reporter,”describes a moment when as a young reporter he overheard a Chicago cop admit to murdering an African-American man. The murdered man had been falsely described by police as a robbery suspect who had been shot while trying to avoid arrest. Hersh frantically called his editor to ask what to do.

“The editor urged me to do nothing,” he writes. “It would be my word versus that of all the cops involved, and all would accuse me of lying. The message was clear: I did not have a story. But of course I did.” He describes himself as “full of despair at my weakness and the weakness of a profession that dealt so easily with compromise and self-censorship.”

….The US government’s wholesale surveillance, however, has crippled the ability of those with a conscience, such as Chelsea Manning or Edward Snowden, to expose the crimes of state and remain undetected. The Obama administration charged eight people under the Espionage Act of leaking to the media—Thomas Drake, Shamai Leibowitz, Stephen Kim, Chelsea Manning, Donald Sachtleben, Jeffrey Sterling, John Kiriakou and Edward Snowden—effectively ending the vital connection between investigative reporters and sources inside the government.

…Hersh left the [NYT] after a massive expose he and Jeff Gerth wrote about the corporation Gulf and Western, which carried out fraud, abuse, tax avoidance and had connections with the mob, was rewritten by cautious and timid editors. Charles Bluhdorn, the CEO of Gulf and Western, socialized with the publisher Arthur “Punch” Sulzberger. 

….He was writing for The New Yorker when Barack Obama was elected president. David Remnick, the magazine’s editor, socialized with Obama and was apparently wary of offending the president. When Hersh exposed the fictitious narrative spun out by the Obama administration about the killing of Bin Laden, the magazine killed the story, running instead a report about the raid, provided by the administration, from the point of view of one of the SEALs who was on the mission. Hersh resigned. He published the account of the raid in the London Review of Books, the beginning of his current exile to foreign publications. When we most urgently need Hersh and good investigative reporters like him, they have largely disappeared. A democracy, at best, tolerates them. A failed democracy, like ours, banishes them, and when it does, it kills its press.


Huawei : Security concerns ‘disingenuously’ raised as excuses to block market competition

December 26, 2018, 9:02 pm

Huawei Rotating Chairman Ken Hu held a press conference with leading global media at the company’s new campus in Dongguan recently. The journalists visited R&D labs showcasing materials and thermal management technologies developed for 5G equipment, as well as an independent cybersecurity lab.

“Rare cases” have arisen where some countries are using 5G issues as an excuse for groundless speculation based on “ideological or geopolitical considerations”. Security concerns disingenuously raised as excuses to block market competition would slow adoption of new technology, increase costs for network deployment, and raise prices for consumers. If Huawei were allowed to compete in the US for 5G deployment from 2017 to 2020, around US$20 billion of capital expenditure in wireless infrastructure would be saved, according to some economists.


“Canadians are rightly concerned about security state surveillance, especially from the institutions which have a proven record of carrying out operations directed against the labour and peoples’ movements in Canada and the US:  CSIS, the RCMP, CSE, NSA, FBI and CIA. Police forces in major Canadian cities are now using IMSI catchers that have the ability to eavesdrop on any cell phone within range. The Trudeau Liberals have passed Bill C-59 (essentially Harper’s Bill C-51) which greatly expanded the powers of the surveillance state in Canada. Unaccountable social media monopolies now collect information on billions of people for profit.

The Trudeau government’s clear decision to side with Trump in the US trade war with China, alongside the deepening anti-China propaganda, and the federal government’s stated intention to raise the military budget by 70% and to beef up NATO funding, raises serious alarms about the accelerating drive towards imperialist aggression and war.

The Communist Party of Canada demands that the Canadian government order the immediate release of Ms Meng Wanzhou, and reject US demands that Canada participate in illegal acts of aggression in its escalating trade and political war against China.”


India opens office in Chabahar Port in Iran, critical for connectivity to Eurasia

December 27, 2018, 10:30 pm


NEW DELHI, December 27: The India Ports Global Limited Company on Monday opened its office in Chabahar in Iran and took over the operations at the Shaheed Behesti port, a crucial step that will take India closer to effective connectivity link to Afghanistan, Central Asia and parts of Russia.

Monday’s developments come in the backdrop of the US waiver to import Iranian oil and use of Chabahar Port and construction of railway line from Chabahar to the Afghan border. Work on Chabahar Port was delayed under first round of US sanctions on Iran. But this picked up when sanctions were lifted in 2015 following the nuclear deal. Thereafter, India’s plan gathered momentum.

Iran is critical for India’s connectivity to Eurasia and this is among key reasons that Delhi has been far from enthusiastic to follow US diktat on Tehran. While it remained engaged with USA to secure waiver for Iranian oil imports and use of Chabahar Port, New Delhi was in no mood to compromise with its Iran strategy.

Iran is key link to INSTC that connects Russia to India in shortest possible time. Kazakhstan plans to connect Gujarat via Iran, and Russia is looking to put in place a connectivity corridor involving India and Oman through Iran.

Chabahar will be a key element in India’s Indo-Pacific strategy that also includes Eurasia’s connect with Indian Ocean Region. Chabahar is a key element in Delhi’s SCO (Shanghai Cooperation Agreement) membership and a pillar of India’s connectivity projects amid China’s BRI (Belt and Road Initiative).

European countries and Japan are poised to complement India’s efforts in the Chabahar port. The US, which has allowed India to continue importing oil from Iran, has granted a waiver from sanctions for New Delhi’s role in the Chabahar port and the construction of a railway line from the Iranian port city to the Afghan border.

This became possible after the Modi government dug its heels in and decided to continue with its engagement in Chabahar even in the absence of a waiver by the Trump Administration for the project. The waiver will make funding India’s role in the port less tricky.

While the Modi government held hard negotiations with the Trump administration during the past six months, including some tough talk to continue importing oil from Iran, it had also simultaneously explored mechanisms to safeguard its interests in the Chabahar port in the event the sanctions covered that project.

Indian officials had been holding discussions with the US on the one hand and Iran-Afghanistan on the other to continue and expand its presence at Chabahar, which is located not so far away from the China-funded Gwadar port in Pakistan, a key element in the China Pakistan Economic Corridor (CPEC).

This explains why Chabahar is critical to India’s geo-politics. Foreign Secretary Vijay Gokhale said at a conference here in early November: “We are also seeking to develop the Chabahar Port as a gateway for onward connectivity to and from Afghanistan and Central Asia.

“Since its inauguration last year, we have shipped about 1,10,000 metric tons of much-needed wheat and 2,000 metric tons of pulses from India to Afghanistan through this Port. To tap its full potential for benefit of Afghanistan, we might also need to pursue the development of a rail line from Chabahar to Zahedan at some future stage.”


German foreign minister doesn’t want US nukes in his country

26 Dec, 2018

…German Foreign Minister Heiko Maas says US nuclear missiles must not be stationed in Germany, or anywhere in Europe, in Washington’s arms control debate with Moscow.

“The deployment of new medium-range missiles would meet with widespread resistance in Germany,” Maas [told] German news agency dpa.

The US is set to quit the 30-year-old INF treaty with Russia, which has been preventing Washington from stationing such missiles in Europe. Both countries accuse each other of violating the treaty, and both deny any wrongdoing on their own part.

…The US is accusing Russia of building missiles prohibited by the INF treaty, while Moscow says American missile defense systems already stationed in Eastern Europe can easily be converted into offensive ballistic missile launchers.

In October, the US announced it would withdraw from the treaty unless Russia halts the alleged violations, and in December it gave Russia a 60-day deadline to comply. According to Russian Deputy Foreign Minister Sergey Ryabkov, Moscow was informed right away that the decision was final, and not an attempt to start a dialogue.

Russia has warned it would have to respond if American missiles are stationed in Europe, making any such sites potential targets.


Revisionism American Style

Calls by Canada’s National Defence Committee for increased “sanctions” that is, economic warfare, against Russia, and for an increased NATO presence in the Black Sea, directly threatening Russia’s southern flank and its Crimea territory, used the term “revisionist power” to describe Russia. This term has also been used by American and NATO diplomats and generals concerning China. It is a term that is never defined. To Marxists it rings of not being true to the cause of revolution, and that is, until recently, its most common usage. Lately it has been used to label anyone who questions official or standard narratives of history with the sense of condemnation for “revisiting” the facts and constructing an alternative narrative that more closely fits the facts. If you claim the attacks on Yugoslavia, or Afghanistan, Iraq, Libya or Syria were acts of aggression instead of” humanitarian interventions”, you are now labelled a “revisionist.”


India to spend INR 100 billion to send three astronauts to space by 2022

December 28, 2018, 11:14 pm


Our Special Correspondent

NEW DELHI, December 28: India will spend INR 100 billion, or US$1,388 million, on Gaganyaan, the human spaceflight mission, to send three of its astronauts to space by 2022.

… And the Indian Space Research Organisation (ISRO) has since upped the ante for its implementation.

ISRO has kick-started the process of selecting experiments that could be performed in the Low Earth Orbit (LEO), where it will send Indian astronauts (Gaganauts).

…The process for astronaut selection is yet to kick off. And, for this ISRO will work with the Indian Air Force (IAF), whose agency— Institute of Aerospace Medicine—will be responsible for selecting the astronauts.


Over half a billion Indians access internet via their mobile phones!

December 28, 2018, 11:18 pm


NEW DELHI, December 28: The number of internet connections in India has grown by 65% from March 2016 to cross the 500-million mark in 2018, in line with the target set by the Narendra Modi government three years ago.

As per the latest information from the Telecom Regulatory Authority of India (TRAI), by the end of September 2018, there were 560 million narrowband and broadband connections in India.

Only China is ahead of India with 746 million internet connections. The figures for the next three countries with most internet connections are: USA (245 million), Brazil (123 million), and Japan (117 million).

…Of the 560 million connections, 64%, or 360 million, are in urban areas and 36%, or 194 million, in rural areas. While more service providers are focusing on rural areas, experts credit the increase in the hinterland to the infrastructure created by the government. The massive growth in urban centres on the other hand is attributed to the entry of Reliance Jio.

Professor Debabrata Das from the International Institute of Information Technology-Bangalore (IIIT-B), who was an integral part of the Centre’s National Information Infrastructure version 2.0 (NII 2.0), says: “The infrastructure created by state-run BSNL and the Centre’s BharatNet project that envisages connecting all gram panchayats with internet through an optical fibre network.”

Just five states — Karnataka, Tamil Nadu, Andhra Pradesh (including Telangana), Gujarat and Maharashtra — account for 20 crore or 36% of all internet connections in India.


Viber CEO: apps you use should allow you to access data they’ve collected

‘End-to-end encryption, by default, is the only way to make sure privacy is a reality’

December 28, 2018, 9:19 pm

By Djamel Agaoua, CEO, Rakuten Viber

Like most people, I am concerned about my online privacy, and that of the people who use our app on a daily basis. During 2018, digital privacy became a hot button issue due to the multiple Facebook privacy breach stories and GDPR, the new privacy regulations issued by the EU. 

If you sit down at a coffee place with a friend for an intimate chat, you don’t expect the coffee house owner to listen in on your conversation. That should be same for your private chats and calls over messaging apps.

…Beyond simply encrypting chats, it is also important that chats are not stored anywhere. They must not be accessed and read by others at some point in the future without my permission. So, I want to know that the chat app I use doesn’t save my content on their servers for ever.

…And I want to be able to check access, get historical data or delete it in less than 15 seconds, not after an intensive search of 20 minutes at the bottom of the settings section.

… I want to be able to decide what services can use my information. ..

…sometimes I want to delete an entire message because it went to the wrong person or it’s not necessary anymore or I regret my words from last night! So allowing me to delete a message after it has been sent, on my device and all the devices who received it, is a great feature, as long as it is clear for everyone that a message has been deleted.

…But we also demonstrated there is an alternative to the “zero privacy to personalize ads policy” that another company claims to be the only way to monetize their service.



Dissecting Sri Lanka’s Post Conflict Growth: Is Sustainability Attainable?

 IPS Research Team     12 Oct, 2018

Sri Lanka’s post-conflict development trajectory has been a story of mixed results. In the aftermath of the conflict, Sri Lanka adopted many strategies to improve livelihood opportunities and reduce poverty and inequality, hoping to ensure harmony through better connectivity. Over the years, Sri Lanka has performed commendably in terms of reducing overall poverty; the poverty headcount rate has reduced from 8.9% in 2009/10 to 4.1% in 2016. However, there are significant regional disparities, especially in the case of previously conflict-affected districts. Kilinochchi, Mullaitivu, Batticaloa, and Trincomalee record the highest poverty rates in the country.

As such, the Session on ‘Smarter Development for Sustaining Peace’, at the Saman Kelegama Memorial Conference, dissected the strategies post-conflict Sri Lanka adopted to ensure inclusive and sustainable growth

two major sectors that have fallen behind in the country: a) the estate sector, and b) districts in the Northern and Eastern Provinces. These sectors are lagging behind in terms of access to services, with relatively high rates of poverty. Citing the map on the spatial distribution of poverty, published by the Department of Census and Statistics (DCS), Professor of Economics at the University of Peradeniya, Dileni Gunawardena opined that it is remoteness that causes inequality: there is regional polarisation, where the regions with higher poverty levels lack connections to regions that are more economically dynamic. 

…Executive Director of Centre for Poverty Analysis (CEPA), Dr. Udan Fernando, touted the Local Empowerment through Economic Development (LEEDS) Project, implemented by the International Labour Organisation (ILO), as a success story in reviving livelihoods in the conflict affected regions. Among the key success factors of the project identified by Dr. Fernando were, the selection of viable economic activities, the focus on value chain development, the scale of the project (medium to large, as opposed to the small scale projects introduced by many implementers), and the time taken to learn from mistakes and adjust the project as necessary.

Professor of Economics at the Griffith University, Jayatilaka Bandaralage, in the aftermath of the conflict, the government recognised tourism as a leading industry that could play a big role in the national reconciliation and re-integration process, while improving livelihood opportunities in the North and the East…..

– Written by Chinthani Sooriyamudali


A delicate balancing act: Can Sri Lanka overcome regional income inequalities?

December 27, 2018, 8:32 pm

Wimal Nanayakkara

….The figure below gives the shares of Household Incomes and Percentages of Households falling into richest 20 percent and poorest 40 percent in each district, based on this common national scale. As observed, in the Colombo district the ’richest group’ enjoy 72.9 per cent of the district’s total household income. More than 41 per cent of the households in this district are in the ’richest group’, with a monthly income of Rs. 81,372 or more. The other districts with a high share of household income enjoyed by the ’richest group’ are Gampaha (53.3 per cent), Kalutara (54.5 per cent), Polonnaruwa (51.6 per cent) and Puttalam (50.2 per cent).

The highest percentage of households falling into the ‘poorest group’, with a monthly household income of less than Rs. 36,500, is in the Mullaitivu district (71.6 per cent) followed by Killinochchi (66.6 per cent) and Batticaloa (65.2 per cent). On the other hand, only 16 per cent of households in the Colombo district fall into the ‘poorest group’. But in absolute terms, Colombo has more than five times the number of households in the ‘poorest group’ compared to the corresponding number in Mullaitivu. It should also be noted that in districts such as Mullaitivu, Killinochchi, Mannar, and Vavuniya, the shares of the households in the ‘poorest group’ out of the total in Sri Lanka, are extremely small (less than 1.0 percent), although the percentages within each of these districts are high.

…Another important factor is the inadequate attention given to the agricultural sector; 27 per cent of the employed population are engaged in agricultural activities and nearly 30 per cent of the moderately poor (based on global poverty line of $3.20 a day) are living in households headed by those engaged in agricultural activities. In rural areas, the majority depend on agriculture. Many of them are also affected by frequent natural disasters, especially floods and droughts. As such, if adequate attention is not given to these issues, it would be difficult to reduce the prevalent spatial income inequality in Sri Lanka.

Another reason for the persistent income inequality is the low female labour force participation in Sri Lanka (only around 36 per cent), especially in rural areas. 

The agriculture sector needs special attention to reduce the spatial inequality, as most of the people in less developed regions in Sri Lanka depend mainly on agriculture and produce food for 21 million people in the country. This should not be disregarded when developing strategies to reduce spatial income inequalities.

(Wimal Nanayakkara is a Senior Visiting Fellow at the Institute of Policy Studies of Sri Lanka (IPS). To talk to the author, email To view this article online and to share your comments, visit the IPS Blog ‘Talking Economics’ –


Universal health coverage 

• An ee reader sent us this: “‘Preventative’ Health Care … not by promoting good food to eat but by tracking people’s health history and giving them medicine to “prevent” them from getting ill. The shift is always away from people taking control over their health and towards surveillance, medicalization and disempowerment – all of which lead to ready economic exploitation. Everybody’s medical records, vulnerabilities and life expectancy will be available to holders of access to this database


Paucity of human resources underpins fragility of primary health care across SA

December 28, 2018, 12:00 pm

Primary healthcare crisis is prevailing across South Asia owing to poor investment and shortages in the health workforce, finds a recent study published by British Medical Journal last week.

The study argues that increased public financing for primary care and medical education as well as regulation of private services are vital to tackle the primary care crisis in South Asia.

The study titled, ‘Tackling the primary care access challenge in South Asia,’ has three main conclusions that poor investment and shortages in the health workforce underpin the fragility of primary healthcare in South Asia, private providers are heavily relied on for primary care, albeit with little regulation of costs and quality of care and tackling the primary care crisis requires substantial increases in public provision and financing of primary care, medical education, and health worker training, and regulation of privately provided primary care services.

…Total government expenditure on healthcare in the region in 2015 was in the range of 0.4-2% of gross domestic product, which is among the lowest globally. With low investment in healthcare, the infrastructure of primary health centres is often poor, with inadequate supply of drugs and equipment and shortages of health staff.

“Paucity of human resources underpins the fragility of primary care services in South Asia. The World Health Organization recommends a minimum of 2.28 healthcare professionals (doctors, nurses, and midwives) for every 1000 people. There is a shortage of health workers across the region with the exception of Sri Lanka (table 1). These are crude estimates as precise data, especially for physicians who are active, are not available.In India, more than 8% of 25 300 primary health centres have no doctor, 38% are without a laboratory technician, and 22% have no pharmacist. Over three quarters of first referral units (called community health centres) do not have surgeons, obstetricians and gynaecologists, physicians, or paediatricians. A similar situation exists in other countries, with the exception of Sri Lanka. The problem of inadequate numbers is compounded by doctor and health worker absenteeism,” says the study.

The study has observed that there is heavy reliance on the private sector for primary care in the South Asian countries during the recent times. In India about 80% of outpatient services are provided by the private sector while in Nepal over half of all patients access private facilities for acute and chronic illnesses. In Bangladesh about 13% of patients use government health services, 27% see qualified practitioners in the private or non-governmental organisation sector, and 60% rely on unqualified private practitioners. In Pakistan only a third of curative primary health services are delivered by the public sector, says the study adding that in Sri Lanka, 35% to 50% of patients rely on the private sector for primary care.

The study has been conducted by Amit Sengupta, Associate Global Coordinator of People’s Health Movement, New Delhi, Shehla Zaidi, associate professor and head of School of Health Policy and Management Unit, Aga Khan University, Karachi, T Sundararaman, professor of School of Health Systems Studies, Tata Institute of Social Sciences, Mumbai, Sharad Onta, professor of Department of Community Medicine and Public Health, Institute of Medicine, Tribhuvan University, Kathmandu and Manuj C Weerasinghe, senior lecturer of the Department of Community Medicine, University of Colombo.


JVP unions upbeat after talks with Ravi

December 28, 2018, 11:16 pm

Udara Karunadasa

Pro-JVP trade unions at the Ceylon Electricity Board (CEB), yesterday, said that discussions with newly appointed Power and Energy Minister Ravi Karunanayake had been fruitful.

General Secretary of Lanka Viduli Sewaka Sangamaya Ranjan Jayalal told The Island that minister Karunayake had agreed to meet their demands.

On a request of the minister, 58 trade unions in the CEB led by pro – JVP Lanka Viduli Sewaka Sangamaya met him at the ministry yesterday morning.

Jayalal said that during the last two months a large number of political appointments had been made and that problem had to be sorted out.

He said that there were rumours that the privatisation of the CEB would be accelerated on Minister Karunanayake’s watch.

Minister Karunanayake had promised not to privatise any section or service in the CEB Jayalal said.

“We also demanded action against those who obtain money to provide jobs in the CEB as we have proof of CEB officials taking such bribes,” he said.

Jayalal said that the minister had promised to hold a discussion with CEB trade unions once a month to discuss issues regarding its employees as well as the service.

State Minister of Power and Energy Champika Premadasa, Secretary to the Ministry Dr. B. M. S. Batagoda and ministry officials also participated in the meeting. 


[What new skills and tech have been introduced? The making of machines?  – ee]

BOI zone in Seethawaka tops US$ 290 million in export earnings for 2018

More than 23,000 people benefit from jobs in the zone

December 26, 2018, 8:55 pm

The BOI’s Seethawaka Export Processing Zone, contributed US$294 Mn (Rs.52,842 Mn) in export revenue as at end of October 2018. It was Rs. 65,791 Mn. in the year of 2017.

Seethawaka Export Processing Zone is the only zone located in the Colombo District. It is 47 Km from Colombo via low –level road and 57 Km via High level road. It was built with Japanese technical co-operation and is a well-planned Export Processing Zone.

….There are currently 27 enterprises in commercial operation at the Seethawaka zone that are involved in the manufacture of apparel and accessories, glove products and rubber products, fabric, chemical and mineral, printing and food processing. There are 112 enterprises outside the zone area that are also serviced by the Seethawaka Zone.

The enterprises include both Sri Lankan and foreign enterprises. The enterprises in the zone are from Sri Lanka (13) and India (5 Factories), followed by Belgium (2), Hong Kong, Japan, USA, UK, Canada, China and Thailand (1 each).

Since these are mainly from non-traditional economic sectors, the enterprises of the Export Processing Zone have created new skills and introduced new technologies to Sri Lanka’s economy.


LSSP celebrate 83 years of struggle for the people

At Eheliyagoda today

December 22, 2018, 8:06 pm

The Lanka Sama Samaja Party (LSSP) celebrates its 83rd anniversary at 3.00 pm at Eheliyagoda today (23).

“It is with a sense of pride at our past achievements and a sense of confidence to meet and overcome future challenges that we celebrate the anniversary”, the party’s leader, Prof. Tissa Vitarana said.

The LSSP was born on December 18, 1935, out of the struggle for complete independence from the British imperialist rulers begun by the Suriyamal Movement. , Dr. Colvin R. de Silva, Philip Gunewardena, Leslie Goonawardena, Dr. S. A. Wickremasinghe and Handy Perimbanayagam were among the founding leaders…

….The LSSP, which was committed to developing the country to eliminate poverty and ensure social justice, stood up for building a powerful national economy, combining modern science with our rich past scientific heritage. The goal has always been to establish a maximum value addition hi-tech industry, making best use of our own resources, rather than to be a mere source of raw materials for foreign industry.

….”When the LSSP was formed in 1935, it drew up a list of 22 objectives to be achieved. Among them were free education, a free health service, workers’ rights like an eight-hour working day, overtime payments, pension, EPF, workers compensation schemes etc. The LSSP made full use of the universal adult franchise given in 1931 to fight for these rights through its representatives in the State Council, NM and Philip in particular.

“A powerful Trade Union movement was established island-wide by the LSSP, beginning with the plantation sector. Among the many heroes who sacrificed their lives in the course of the struggle for better wages were Govindan of Muloya Estate and Kandasamy during the General Strike of 1947.

“When the UNP Government tripled the price of rice, sugar and other essentials and stopped the free mid-day bun for school children in 1953, the LSSP led the Great Hartal day of protest in which nine of our comrades died including Edwin.

“It was the Hartal that led to Dudley Senanayake, the UNP PM resigning at a Cabinet meeting held in a British warship in Colombo harbour. It was this event that led to the subsequent defeat of the UNP at the 1956 General Elections, with the formation of the first Centre/Left Government, with Philip from the LSSP joining the SLFP-led by S. W. R. D. Bandaranaike.

“Thereafter, it was the Centre/Left governments that progressively replaced the colonial economy controlled and largely owned by the British rulers into a national economy owned and run by Sri Lankans. By having a powerful state sector run by Sri Lankans, it was possible to build a national economy that served the interests of our people and retained the income in our country. A social welfare state was established. But all this is under threat today.

….”The LSSP has developed an economic program to become a developed nation. This stresses the need to actively support science, technology and innovation, with priority to hi-tech and artificial intelligence, to become an industrial country. The de-humanizing effect of Neo-liberalism must be eliminated by developing the solidarity concept, which will also greatly increase productivity. Your support will help us to get this implemented, and unite the nation”.


Tensions rise in Kotagala as estate workers block main road

…police attempted to clear a group of estate workers who staged a protest opposite the Kotagala Pradeshiya Sabha yesterday.

Carrying black flags and banners, around 200 workers from the Drayton and Yuthernside estates in Kotagala staged a protest urging the return of their children who were staging a hunger strike in Colombo in support of the estate workers’ demand for a Rs. 1,000 daily wage.

The situation became tense when police attempted to disperse the protesters who were blocking the road. 

….The protestors added that their children were continuing a hunger strike over the past 10 days but to no avail. “We do not want a pay hike while holding the lives of our children to ransom,” the protestors said…

Subsequently, negotiations with the police led to protesters clearing a path for vehicles to pass.


[Another badly written or purposefully convoluted article…It is not true that nationalization hurt the plantations…The privately held estates made no attempt at innovation, let alone replanting…more interested in playing the kalu suddha sahib with the imported house slave in tow? And now Hayley’s wants a “revenue sharing’ system – ee]

Though the turning of tea estates into tourist sites is indeed a scary development (with its …His other claims and figures should be challenged… Why is there no popular media to challenge this fake saturated repetitions of anti-state economic/industrial myths – ee]

Lanka’s tea industry reaches boiling point

By Sunimalee Dias

Tea traders are up in arms against what they call a bad decision on the part of the President that has led to a drop in exports and a total ban on Ceylon Tea to Japan since last year.

Ceylon Tea Traders Association (CTTA) President Anslem Perera addressing the Ceylon Planters’ Society as Chief Guest at its 82nd AGM held on Wednesday at the Hotel Galadari said that the one bad decision of the President had caused huge costs to the industry and a drop in exports and yields this year.

“Personally, as an exporter I have suffered as Japan is a big market,” he said. He explained that since Ceylon Tea was banned from October 2017 to October 2018 there has been a serious issue since his company that sells Mlesna Tea has had to spend nearly Rs.2 million monthly on laboratory tests to ensure the tea is safe for consumption in Japan prior to entry there.

Mr. Perera noted that though glyphosate had just arrived in the country it was yet to reach the estates and pointed out that the absence of its use on the plantations would mean that it would take up to six months to return to normalcy after its application…

Mr. Perera pointed out that the plucking of two leaves and bud has been replaced by a whole branch and a bud and recalled how tea factories in their heyday would give out the aroma of tea that is hardly existent today.

After nationalization we have ruined the industry,” Mr. Perera asserted and insisted that planters of today should attempt to turn the industry to what it was some time ago.

Commenting on the state of the labour on the estates, he pointed out that the government continues to interfere and that, “we should not let the unions run this place” adding that there were no unions operating on estates in Sabaragamuwa and Ruhuna.

On the other hand, he called on the employers to look after their workers stating that they should not just be blinded by the profits. “You don’t need unions if you look after workers,” he said adding that discipline was an essential aspect of running the plantations as well.

CPS Chairman Rushantha Perera addressing the planters said they would fully support them in their resistance against unruly trade unions.

….He commended Plantation Minister Navin Dissanayake for the re-introduction of glyphosate on the plantations and insisted that hereafter there should be scientific evidence provided prior to the banning of such weedicides.

In addition, Mr. Perera said that the government is currently on a drive to close down nearly 38 estates with about 30,000 hectares allocated for the tourism industry.

Further fragmentation of the estates would mean that workers living on the plantations would lose their livelihoods but save their homes.

….Hayleys Plantations MD and the AGM Chairman Protem Roshan Rajadurai related the arrival of the Indian labour force on the Sri Lankan estates and explained the importance of the planters on the estates and their role in providing the necessary leadership at all times.

He called for a change in the wage system insisting that the 150 year-old model needs to convert to a motivational system to ensure workers were able to earn based on the productivity levels.

Through this revenue-sharing structure workers would be encouraged to work hard and be motivated to earn more, he said.

“Time has come particularly for planters to take charge against intrusive politics,” he said adding that they were not willing to engage with trade unions that use their political muscle nor would they bow down to such pressure. He explained that this was the reason they had called on the Employers Federation of Ceylon (EFC) to carry out wage negotiations on behalf of the RPCs.


Glyphosate back: Plantations would take 10 yrs to recover

By Sunimalee Dias

….Weedicide, Glyphosate that was banned in the country for the past three years, has been brought back following the lifting of the ban in May this year but plantation companies believe it would take about 10 years to return the estates to normalcy.

Hayleys Plantations MD Roshan Rajadurai told the Business Times that the plantations would take about 10 years to return to its earlier state as the reduction in the weeds that are overgrown would take a gradual process to take effect.

Since the previous week Glyphosate has been imported and each Regional Plantation Company (RPC) provided with 2000 litres of the weedicide.

Mr. Rajadurai explained that about 1.5 litres of Glyphosate is required for each hectare of plantations land to wipe out the weeds.

His company alone manages 35,000 hectares of plantation land and they believe that returning the estates to normalcy would take them quite some time since weeds cannot be wiped out overnight.

Glyphosate today is imported by the Ceylon Petroleum Corporation (CPC) which was previously carried out by a number of private companies and which was then freely available in the open market. However, today due to the ongoing ban on the use of the pesticide which would be permitted only for rubber and tea sectors, authorities believe that they need to regulate the import of the product.

In this respect, regulating its import could be convenient if delivered through the CPC and stocks would be issued only twice a year as per the requirements of the plantations.

One of the severe impacts of the ban on Glyphosate was the loss of the Japanese market which maintains strict conditions in the import of Ceylon Tea. Due to the use of the alternative pesticides by the industry in the absence of Glyphosate it caused high residue levels of these weedicides being found in Ceylon Tea exported to Japan. As a result Japan banned the product and it’s now exported after careful laboratory tests to ensure that they do not contain residue levels above the norm stated by the importing country.


Govt. take-over of plantation sector in the 1970’s triggered the collapse of the industry

Estates now in tatters

December 22, 2018, 7:56 pm

Steve A. Morrell

At the head-table: Sec.-Gen. CPS, Malcolm Dias, Romesh de Silva, Saliya Munaweera, Chaminda Bandara, Lalindra Abeywardena, Anuruddha Dissanayake, Tharanga Dias and Hiran Rajapakse.(Pics by Gamini Munasinghe)

“The government take-over of the plantation sector in the 1970’s triggered the gradual downfall of Sri Lanka’s estate sector, which has now slid into a state of economic impasse. The rot that set in at the time continued to erode a well appointed system of management and has left the industry in tatters.

These observations were made by Anslem Perera, Chairman, Mlesna (Ceylon) Ltd., and Colombo Tea Traders’ Association, as the chief guest at the 82nd AGM of the Ceylon Planters’ Society in Colombo last week.

…the origins of the industry, which evolved over many years of hard work, were literally dismantled to give way to some lean views of misinformed politicians to ensure their selfish agendas were in place…

…the President of the country banned glyphosate merely on the unqualified assumptions of a Buddhist monk…

He complained that alternate uncertified substitutes in use by some plantations led to Japan withdrawing their buying of Western high grown teas, pushing the industry into an unenviable position and further aggravating the price decline experienced at present.

….President, CPS, Rushantha Perera, in his annual report, reverted to some misgivings of planters and explained that it was of current interest that the planters’ retirement age be reviewed and placed at 60 years. At present, it stands at 55 years.

Guest-of-honor, Director-General, Plantation Human Development Trust, Lal Perera also spoke. Secretary General, CPS, Malcolm Dias conducted the meeting, while the vote of thanks was delivered by Deputy President, CPS, Dayal Kumarage.


Tea production, exports dip in November


    Tea export volumes decline by 8.6%

    Cumulative tea production down by 1.8%

By Nishel Fernando 

Tea exports fell by 8.6 percent in November while tea production recorded a marginal decline overshadowed by unfavourable weather conditions and production disruptions due to trade union actions in the estates managed by Regional Plantation Companies (RPCs). 

According to the Sri Lanka Tea Board (SLTB), tea export volumes dropped by two million kilogrammes (M/kg) to 21 M/kg in November, while tea production fell by a marginal 0.2 M/Kg or 0.8 percent year-on-year (YoY) to 24.7 M/Kg in November.  

The tea export income in rupee terms also dropped by Rs.1 billion to Rs.18 billion, despite this year’s sharp devaluation of the rupee against the US dollar.  On a cumulative basis, tea production contracted by 1.8 percent YoY to 277.7 M/Kg during the January-November period. 

Accordingly, during the period, tea export volumes fell by 3.01 percent YoY to 257.M/Kg and the export income fell by 1.04 percent to Rs.210 billion. 

The SLTB noted that the marginal tea production decline in November was mainly due to a notable decrease in the production of high-grown tea.

Speaking to Mirror Business, Employers’ Federation of Ceylon Plantations Group Chairman Roshan Rajadurai said that excessive rain in the hill country and the disruption to production due to trade union action, led to a decline in the RPCs’ tea output. 

He further noted that the RPC tea output in December is likely to record a sharp decline as a result of the strike carried out by plantation workers over a two-week period in early December, demanding to double their basic wage.

However, Rajadurai said that now that the strike has come to an end, the workers have returned to work. He was optimistic that the new collective worker agreement would be signed soon. 

Forbes & Walker Tea Brokers earlier this week stated that Sri Lanka’s tea production is likely to be around 300 M/Kg in 2018. 

The SLTB also said that the tea output may reach 300 M/Kg by end of this year, as some of the tea stocks not recorded in the current statistics would be included in the revised tea statistics for 2018; they are to be released next year. 

Speaking of forecasts for next year, Rajadurai emphasised that normalisation of the Colombo tea auction prices is crucial for planters to meet tea production and exports, as the RPCs in particular are already making losses due to high production costs. 

For most varieties of orthodox teas, Forbes & Walker Tea Brokers predicted an upward movement in prices, particularly in the first half of 2019.

Meanwhile, following a three-year ban, the planters have recently received the long-awaited shipments of the popular weedicide, glyphosate. 

However, Rajadurai pointed out that many of the planters were forced to abandon a considerable share in their plantations as a result of the rapid growth of weeds, in the absence of a recognised and an effective weedicide in the market, during last three years.

He noted that it might take 10 years to restore the soil back to original condition, at a considerable financial expense.


Air Taxis and Fisherfolk

“Asked by the AG’s Department representative whether the airline expected any resistance from fishermen, especially with regards to the proposed activities at the Negombo Lagoon, Wanasundara said that a Deputy Director of the Fisheries Ministry, Ranjith Bandara had approved the commencement of the air taxi activities in the Lagoon. 

“However, we were not able to continue work at the Negombo Lagoon because of the protests of the fishermen. Then we shifted operations to Koggala and Peliyagoda. No environmental approvals were obtained for these projects.”

It was also revealed that a feasibility study had been carried out by National Aquatic Resources Research and Development Agency (NARA) mid-2011, almost six months after the air taxi service started. The NARA report stated that such a project must only commence after detailed dialogue with the local communities. 

….The AG’s Department representative assisting the PCoI stated that the Airline had spent a massive amount of funds on the construction of water-dromes. It also spent a colossal amount of money on an 18-month project on straightening Dandugan Oya, which was the alternative site for air taxi landings on Negombo Lagoon. “However, all the money wasted. But a private company is now using the facilities created by UL to run their own air taxi operation.”


Saffron Air succeeds where UL fails

December 27, 2018,

Rathindra Kuruwita 

Saffron Air, a subsidiary of John Keells Holdings, now uses the infrastructure created to operate an air taxi service by SriLankan Airlines, Pulasthi Wanasundara, Flights Operations Manager of the airline told the Presidential Commission of Inquiry (PCoI) on irregularities at SriLankan Airlines, SriLankan Catering and Mihin Lanka yesterday. 

The decision to start a code share agreement with Saffron Air was taken in 2014, when Susantha Rathnayake, the head of JKH, was also on the Board of Directors of SriLankan.

 “However, Rathnayake declared a conflict of interest and excused himself when the discussion on the project took place. Rathnayake however did not quit the SriLankan board,” Wanasundara said. 

Although the air taxi service of SriLankan failed within nine months, Saffron Air still operates. Wanasundara said that Saffron Air can use all the water-dromes and other facilities created by UL. “I don’t know if they pay UL money for the facilities used,” he said. 


Floods wreak havoc in North

December 23, 2018, 11:51 pm

President Maithripala Sirisena, yesterday instructed, relevant authorities to provide relief to those affected by heavy rain and floods in Mullaitivu, Kilinochchi, Jaffna, Vavuniya and Mannar.

….The relief operations should be conducted with the assistance of the Governor of the Northern Province, District Secretaries, Army commander and Disaster Management Centres, the President has said.

The Disaster Management Centre now operates 40 camps in Mullaitivu, Kilinochchi, Jaffna, Vavuniya and Mannar districts to help the flood victims. More than 55,000 people from about 14,000 families were affected by yesterday evening. They include residents of Mullaitivu, Kilinochchi, Mannar, Vavuniya and Jaffna. (RK)


Over 45,000 affected in North due to rains, floods


More than 45,000 people from nearly 14,000 families have been affected due to heavy rains and floods in all the five districts of the Northern Province, the Disaster Management Center (DMC) said.

The affected districts are Mullaithivu, Kilinochchi, Mannar, Vavuniya and Jaffna. The DMC said that 8,539 people have been sheltered in 52 welfare camps. Meanwhile, President Maithripala Sirisena directed relevant officials to provide immediate relief to the affected people.


Troops rescue flood-affected in North


… in the districts of Mullaitivu and Killnochchi which were worst affected…More than 230 army troops, belonging to the Sri Lanka Light Infantry Regiment, Vijayabahu Infantry Regiment and Sri Lanka Sinha Regiment have been engaged in these relief operations…

They had assisted District Secretariat’s relief work to nearly 2,968 flood-affected people at Raththinapuram, Anandapuram, Kanakambikulam, Maradanagar, Pannankandy, Dharmapuram, Puliyanpokkanei, Paranthan, Kudyirippu, Uriyan, Kandawalai, Mankulam areas in Kilinochchi and Mannakandal, Kawwalakandal, Kodadikallu, KJanagaratnapuram, Vidyapuram, Udayarkattu, Kuruvilkulam in Mullaittivu.

….Naval personnel attached to the North Central Naval Command…reached displaced people residing in Iranamadu, Shamikulam, Oddusudan and Wasanthampuram areas…

…The Sri Lanka Air Force said a Bell-212 helicopter and Y12 aircrafts had been deployed on flights over Iranaimadhu and Mullaithivu areas to assess flood situation.(Darshana Sanjeewa)


Floods in North: GMOA asks Health Ministry to get cracking

December 24, 2018

Rathindra Kuruwita

The Government Medical Officers Association (GMOA) had written to the Director General of Health Services, calling for dispatching doctors and support staff in adequate numbers to the flood ravaged Northern Province, GMOA General Secretary, Haritha Aluthge told The Island.

…The Disaster Management Centre now operates 35 camps in Mullaitivu, Kilinochchi, Jaffna, Vavuniya and Mannar districts to help the flood victims. 10,342 persons are currently in those camps. More than 73,000 people from about 22,800 families were affected by yesterday evening. They include residents of Mullaitivu, Kilinochchi, Mannar, Vavuniya and Jaffna.


More than 72,000 persons affected by floods

December 24, 2018, 10:41 pm

Rathindra Kuruwita and Dinasena Ratugamage

Over 72,000 persons have been affected by the floods ravaging the Northern Province, the Disaster Management Centre (DMC) said yesterday.

The DMC said that most of those affected by floods were from the Mullaitivu, Kilinochchi and Jaffna districts. About 20,737 persons from 6,520 families had been affected in Mullaitivu, 38,534 persons from 11,688 families had been affected in Kilinochchi and 12,642 persons from 4257 families have been affected in Jaffna. Meanwhile 85 persons from Mannar and 455 from Vavuniya were also affected.

In total 72,453 persons from 22,624 families have been affected by floods in the North. 890 from Kandy district had also been affected by flash floods. The DMC maintains 35 relief centres that are sheltering 10,342 persons by yesterday afternoon….


Can EPF save the homeless?

Devuni Goonewardene     18 Oct, 2018

Colombo (News 1st) – The Employees Provident Fund has been mired in controversy with revelations been made about it’s bad investments.

We could take a few pointers from Singapore who managed to use their employees provident fund, to build one of world’s largest public housing schemes.

The Housing Development Board (HDB) of Singapore has designed over 1 million apartments throughout Singapore. Today more than 80% of Singapore’s population lives in public housing built by the HDB, which started off from only 9% in 1960. The home ownership rate has also increased rapidly because of Singapore’s rising economy.

For the HDB to work the government required certain types of taxes from the people of Singapore. The people are required to save part of their salaries in a state managed Fund called the Central Provident Fund. This fund can be used for two things: helping Singaporeans with retirement and providing incentives for Singaporeans to become homeowners.

….The public housing the government creates is not free, even for the poor, but is on average 30% lower than the private housing market in Singapore. P

….What should also be noted is that people should have the right to easily access information on how EPF funds are invested and what returns they have received…


Champika claims to have built more houses than all past national leaders combined

December 28, 2018, 11:26 pm

Megapolis and Western Province Development Minister Patali Champika Ranawaka says his ministry has built ten times more houses in Colombo than those built for the past 35 years by all governments taken together.

“In short, we have built ten times more houses in Colombo than the number of houses built by Dudley Senanayake, Sirimavo Bandaranaike, Ranasinghe Premadasa, JR Jayewardene, Chandrika Bandaranaike and Mahinda Rajapaksa combined,” the Minister said, addressing a meeting at the Sri Lanka Foundation in Colombo, says a press release issued from his ministry.

The media report quotes the minister as having said: “We carried out a project to give houses to the shanty dwellers in the Colombo city in recent years. We did so without any publicity and media hypes. While we shift those people from shanties to houses we carried out projects to uplift their living conditions too. We reformed their lifestyle. As a result of that transformation, many have been able to get rid of drug addiction and various nefarious activities and become citizens who contribute for the betterment of society.

“We provided for people without considering their party colours. We have not limited development only to our party members. Development is a process that should not be hindered by such petty selections.

“In all major cities we have communities comprising of present day generations of the Indians brought here by the British to clean their toilets. Those people live in shanties. Their children do not care about going to schools. We have to include those minor communities in the development process. We have to empower them. That is one of the first steps towards changing society,” the Minister said.


Suspect commits suicide in prison cell in Kuruwita


A 22-year-old suspect who was in remand custody at the Kuruwita Prisons is alleged to have committed suicide in his cell yesterday evening, Prisons Spokesman T.N. Upuldeniya said. A resident of Ruwanwella, he was remanded on December 21, over a drug-related offence.


Possible food scam at Prisons leave inmates starving

25 Dec, 2018

COLOMBO (News 1st): Allegations have been made that a food scam is taking place across several prisons including the Colombo Remand Prison. These allegations have been leveled by ‘The Organization to Protect the Rights of Prisoners’.

According to the Secretary to the organization Sudesh Nandimal, information at hand claims “over 5000 kilograms of rice is being held at the Colombo Remand Prison”. He also charged that the stock is being sold off illegally.

He also added that more than half of the inmates “get their meals from home”, and said that the prison authorities “procure food stocks for the entire number of inmates and then sell off the excess or take them to their own homes.”

“As a result of this situation, inmates are not being provided with proper meals,” he said. However, the Prisons Department has refuted the allegations.

According to Prisons Spokesperson Thushara Upuldeniya, there cannot be any shortage of food “as it is provided as-per the Prisons Ordinance and regulations of the Department of Prisons”. He stated that the process is monitored by a local and international organization and that if there is any report of corruption, it will be investigated. He added that such a complaint has not been made so far.

However, a Spokesperson for the Ministry of Prisons said it had received a number of similar complaints and the incident have been taking place over a period of time. Prisons Intelligence has been tipped to inquire and report on such incidents.


Doctor, pharmacist who smuggled narcotics to Prison arrested


A medical doctor and a pharmacist attached to the Welikada Prison were arrested by prison officials today while attempting to smuggle in narcotics and alcoholic drinks.

In a statement, the Justice and Prison Reforms Ministry said a prison officer had noticed the doctor handing over two bottles of alcohol to a prisoner to be handed over to another inmate…


Eatery raid: Bush meat, suspects taken into custody

December 27, 2018, 12:04 pm

By H.S. Abeyratne, Uda Walawe Corr.

The Uda Walawe Wildlife Department officers and the police Special Task Force raided a restaurant in the Embilipitiya town and took into custody a stock of venison, wild boar and buffalo meat…


Wasting food is a crime

December 24, 2018, 9:34 pm

Once I attended a wedding at a five-star hotel in Colombo….

I asked the waiter …why such unused food was not given away to people who were starving in this country. He replied that the five-star hotel would soon become an ‘ambalama’. There would be queues of beggars that would undermine the dignity of the hotel.

….It is a paradox that the gap between the rich and the poor is so wide in many Asian countries. Sri Lanka is no exception…

There are poor children who wait for a balloon to burst to pick up the pieces to make a miniature balloon…


Two-day train strike launched tomorrow

25 December 2018

Railway trade unions have decided to launch a two-day railway strike from midnight Wednesday They have decided to launch a strike over several railway grade anomalies. Railway Engine Drivers’ Union Secretary Indika Dodamgoda said that engine drivers, guards, station masters and administration and supervisory management services would participate in the strike


Train strike suspended temporarily: Railway TUs


The Railway Trade Union Alliance (RTUA) Co-Convener Lal Ariyaratne said they had decided to temporarily suspend the scheduled two-day strike action following an assurance given by the Transport Minister. [after] discussion with the Transport Minister Arjuna Ranatunga this morning.

….The Minister had agreed to grant solutions for their demands relating to salary anomalies before January 30 next year.

The collective TUs then decided to suspend their strike action temporarily, Mr.Ariyaratne said. They will resort to a trade union action if the Minister fails to provide solutions, he added. (Chaturanga Samarawickrama)


Railway strike suspended following talks with Arjuna

December 27, 2018, 12:04 pm

Following discussions with Transport Minister Arjuna Ranatunga yesterday morning, the Railway Trade Union Alliance (RTUA) suspend a two-day strike which was scheduled to commence at midnight Yesterday.

Ministry and RTUA sources said that the strike had been called off as Minister Ranatunga assured them tangible action would be taken in respect of salary anomalies before January 30, 2019….


Politicians manipulating teacher transfers in WP

December 24, 2018, 10:42 pm

Rathindra Kuruwita

The Western Provincial Ministry of Education and zonal education offices had transferred a large number of new teachers with political connections to popular schools, General Secretary of the Ceylon Teachers Union (CTU) Joseph Stalin told The Island yesterday.

“Some schools have an excess of teachers while others have a shortage in the Western Province. The teacher-student ratio in the province was 1:17, he said.

Stalin said politicians in Gampaha and Homagama areas were exerting pressure on the WP Ministry of education and zonal education offices to keep teachers known to them in urban schools.

“Because of this teachers from Negombo, Matugama, Colombo North, Moratuwa, Kolonnawa and Wattala are unable to get transfers to schools close to their homes after completing the so-called difficult area service.”

Stalin said over 600 new graduate teachers would be posted to western provincial schools on Jan. 02, 2019.


Japan’s new immigration policy, development game changer for South Asia ?

December 24, 2018, 10:20 pm

Japan has embarked on a major migration policy shift with a new law that passed the Upper House of the Diet in December 2018, the World Bank said yesterday. Starting in April 2019, the new law will allow inflows of two types of foreign workers: (i) low-skilled foreign workers who would reside in Japan for up to five years and work in 14 specific sectors, including farming, construction, hospitality and shipbuilding sectors, but shall not be allowed to bring their family members, and (ii) foreign workers with a higher level of skills who would be allowed to bring their family members and could be allowed to live in Japan indefinitely (see Migration and Development Brief 30). According to news reports, Japan plans to induct 340,000 migrant workers over the next five years, though this may not be sufficient to compensate for a declining population which fell by 373,000 in 2017.

Japan has around 2.4 million foreign residents of whom 1.6 million come from Low- and Middle-Income countries (LMICs). If bulk of the new migrants come from LMICs, the new policy would represent a great development opportunity. LMIC migrants sent an estimated $7 billion in remittances from Japan in 2017. Around 98 percent of this accrues to the top 10 LMIC migrant source countries: China, Philippines, Brazil, Vietnam, Peru, Thailand, Indonesia, India, Bangladesh and Pakistan.

Outward remittances from Japan will increase with new migration. Remittance propensities could be even higher if Japan’s high remittance costs of around 10 percent were reduced. Due to geographical distance, cultural/linguistic proximity, trade/investment linkages and historical connections (including presence of Japanese diaspora), China, Philippines, Brazil, Vietnam, Peru, Thailand and Indonesia are arguably better positioned to harness this opportunity. But South Asian countries such as India, Bangladesh, Pakistan can also reap benefits if they play their policy cards well. Japan’s GDP per capita is nearly 25 times that of India, 40 times that of Pakistan and 45 times that of Bangladesh, but their share of migrants in Japan and proportion of remittance outflows from there is quite low. At a time when migration of low-skilled workers to Gulf Cooperation Council (GCC) countries is slowing down due to the impact of labor market nationalization policies and lower oil prices, Japan provides a viable alternative destination. Over-and-above remittances, greater migration to Japan could open new channels for innovation, skill upgradation, entrepreneurial exchange and diaspora investments.

To successfully harness the opportunity, LMICs, especially those in South Asia, need to:

1. Assess the needs of the Japanese labor market and provide appropriate training to potential migrant workers, perhaps in consultation with Japanese agencies.

2. Provide cultural and language skills to make adapting to Japan’s unique cultural norms easier.

3. Work towards bilateral recognition of educational and vocational qualifications.

4. Adopt formal guidelines for recruitment and deployment of various categories of workers, and adequate measures to lower employee-borne recruitment costs to avoid exploitation by unscrupulous recruitment agencies.

5. Negotiate bilateral labor migration agreements to ensure proper working conditions and welfare of migrant workers.

6. Address the issue of high remittance costs in coordination with Japanese agencies.

Bangladesh, for example, has already embarked on promoting skills training for caregivers, a class of workers Japan urgently requires (see Migration and Development Brief 29). To prevent activities of unscrupulous operators, the Philippines stopped recruitment agencies from hiring caregivers for Japan till formal guidelines were issued by the Philippine Overseas Employment Administration (POEA) on their recruitment and deployment together with a list of authorized recruitment agencies


The Yellow Vest Movement 

Prabhat Patnaik

“Nothing shows the crisis of neo-liberal capitalism more clearly than the popular uprising in France that is occurring under the banner of the “Yellow Vest” movement. Thousands are congregating in Paris over week-ends to protest against the intolerable burdens being imposed upon them in the name of “austerity” and to demand that resources be raised instead through taxing the rich. This movement had begun initially as a protest against the diesel price-hikes, but has now taken on a more general character and is drawing huge support from the people.”


Democracy Can’t Survive Without the Welfare State 

An Interview with Claus Offe

Wherever we see rising tides of authoritarianism, we can link it to the systematic destruction of the welfare state.


[Rolling ‘astro-turf’ groups over grass roots is an old anti-worker strategy – ee]

‘We have no political aspirations on our agenda’ – GMOF President

‘Prepared to work with the Minister through mutual understanding’

December 22, 2018, 8:47 pm

Government Medical Officers’ Forum (GMOF) President, Dr. Rukshan Bellana…pledging support to Dr. Rajitha Senaratne, who was reappointed Health Minister, said that its core objective is to work towards the greater good of doctors and win over their rights and privileges through the close support and 

… Bellana, said: “Politics are totally irrelevant to us. We don’t seek political positions. As doctors in government service, we are prepared to work with the Health Minister appointed to office through mutual cooperation”.

Describing the GMOF as an “apolitical organization” dedicated to serve the interests of doctors, he said: “we are not interested in political favors or parliamentary seats. 


PM’s new role in Northern Development a boost to the region – Minister Rishad Bathiudeen

December 22, 2018, 8:15 pm

Minister of Industry and Commerce, Rishad Bathiudeen, who was given a bigger ministerial portfolio last week, welcomed Prime Minister Ranil Wickremesinghe’s entry into Northern development work.

“As an MP representing the Northern Vanni District, I commend Prime Minister Ranil Wickemesinghe’s appointment as Minister of National Policies, Economic Affairs, Resettlement, Rehabilitation, Northern Province Development, Vocational Training, Skills development, and Youth Affairs. Particularly his role as a Minister of Resettlement, Rehabilitation, Northern Province Development shall, no doubt, boost Northern region and its provincial GDP”, he said after assuming duties in his Ministry.

“Also in my expanded role as a Minister of Resettlement of Protracted Displaced Persons I look forward to recover the funds and allocations earmarked to support protracted IDPs in the North, which were wrongfully slashed by the recent government. This has placed IDPs in great difficulties”, he said.

Having learnt about the reduction of funds for IDPs, Bathiudeen protested on November 30, and said: “These long- term IDPs, most of them Muslims in Northern Province, are still suffering since the war. Their resettlement and welfare support by the government is vital as there is no one else to spend for them.

“Before our then Cabinet was replaced by the government of October 26 with its new Cabinet, we had approved funds for resettlement of these old IDPs. The approval was a thorough process, and it was also cleared by the policy Planning Ministry of previous Cabinet. Using these approved allocations, resettlement work already started from August 2018. It is unfortunate that the disputed PM slashed Rs. 250 million from the allocations, leaving the IDPs in great difficulty.

“Despite leading an illegitimate government, he had even instructed to divert this Rs. 250 million for other work, away from IDP resettlement. This harms the ongoing resettlement process of IDPs and therefore I, as an MP from Vanni District complained to Speaker Karu Jayasuriya to mediate and resolve this. We want IDP resettlement process to resume as soon as possible.”

After his re-appointment, Minister Bathiudeen now heads the Ministry of Industry and Commerce, the only Cabinet Minister to hold the portfolio for the fourth term.


The newspapers have published a Namini Wijedasa article claiming “The Chinese-built” Norocholai Kalpitiya coal power plant was poisoning people, based on a study by a US government-related ‘environmental’ NGO, who are not merely defined as “non-profit” in the articles.

One ee Corrrespondent responds: “At the outset, I should state that I am not a great supporter of coal-fired power plant. There are a number of technological “fixes” which could be applied, and I think that solar-thermal power plant are the ideal solution, combined with very high voltage DC transmission.

However, any criticism should be accompanied by fair and accurate reporting.

Regarding the report itself, several points have to be raised.

(1)  It was reported as a “global” survey. What were the other areas examined, and how did Kalpitiya fare against them?

(2) Were other areas of Sri Lanka surveyed to provide a control, always important in empirical data?

(3) Were areas adjacent to other power plant, eg diesel power plant, examined?

(4) Since high levels of Hg are associated with diesel exhausts, were other lagoons, with high use of diesel-engined vessels, or where the exhaust from diesel vehicles on roads gains egress into sea water, examined?

(5) How did the Kalpitiya area compare with areas which had non-Chinese (and non-Russian) coal or other power plant?

(6) Was any provision made for taking into account genetic propensity for Hg in hair?

(7) Was any provision made for taking into account mercury in hair dye/coconut oil-mercury hair sheen formula?


Coal plant: Kalpitiya women have dangerously high mercury level

By Namini Wijedasa

A global study has found high mercury levels in a majority of participants from the Kalpitiya Peninsula, where the Chinese-built coal-fired power station Lakvijaya is located on a sand bar between the sea and a fishing lagoon. Nearly 80 percent of those examined from the area–all women between the child-bearing ages of 18 and 44–exceeded the 1ppm (parts per million) total mercury reference. An alarming 97 percent had beyond the 0.58ppm proposed reference level. Pollutants in air and water are frequently measured in parts per million.

….The report was published last month by the non-profit Biodiversity Research Institute (BRI) and IPEN, a global coalition of health and environmental groups….“A significant industrial source of mercury emissions at the location is the Norochcholai coal-fired power plant,” says the study, titled ‘Mercury Threat to Women & Children across 3 Oceans: Elevated Mercury in Women in Small Island States & Countries’.

…Currently the estimated number of coal-fired power stations globally is around 3,700; however, there are proposals or construction underway for an additional 1600 facilities, increasing global coal power capacity by 43%.


Sri Lankans on transit through Hong Kong – Beware !

December 22, 2018, 6:12 pm

Sri Lankan travelers arriving on direct flights from Colombo for transit through Hong Kong are indeed given special treatment. As they leave the plane, passengers are racially profiled by airline staff who closely examine passports of dark skinned passengers while white and Chinese looking passengers are allowed to move freely into the airport….


Chinese workers clash, five hospitalised

December 24, 2018, 12:04 pm

Five persons were admitted to Colombo National Hospital after two groups of Chinese construction workers clashed with each other on Saturday night, Police media unit says.

The Chinese construction workers were deployed at a site in Chatham Street, Colombo. The police have arrested 11 Chinese construction workers over the incident.

Out of the five hospitalised, three are Sri Lankans who attempted to break up the fight.


Clash at a construction site in Colombo: 11 Chinese workers arrested

2018-12-23 14:52:42



Eleven Chinese nationals, working at a construction site at Chatham Street, Colombo, were arrested following a clash with a group of Sri Lankan Security Personnel at the site on Saturday.

The police said two Chinese workers and three security personnel were injured following the clash that had taken place on Saturday afternoon following an argument.

They said the Chinese workers were arrested after a complaint was lodged with the Fort Police by a Sri Lankan security officer. Two of the Chinese workers were admitted to a private hospital in Colombo and are undergoing treatment under police custody.

The police said the injured Sri Lankans were admitted to the Colombo National Hospital. The police also advised that the arrested Chinese workers had been remanded till December 28 after they were produced in the Fort Magistrate’s Court. (Darshana Sanjeewa)


“There were, however, reports of a clash between Chinese and Sri Lankan workers at a separate construction site in Colombo Fort.”


Political turmoil hits cancer hospital supplies

In the wake of the recent political turmoil which disrupted medicinal supplies, the cancer hospital has been given the green light to carry out urgent medicine purchases from the private sector to prevent interruption of treatment to new patients. The hospital’s Acting Director Dr Buddhika Kurukulasuriya said they were forced to take a difficult decision last week to delay the treatment of newly admitted patients as the hospital was facing a shortage of medicine. He said cancer patients must undergo treatment courses for a certain period and they should not miss this.

…The Acting Director said that with the approval of the interim budget and the restoration of the administration in the ministry they were also receiving medicine and the situation was slowly getting back to normal. State Pharmacetuical Corporation Managing Director Mohamed Rumy said that due to the disruption of the ministry functions, the SPC was unable to call for tenders for the past one and half months.


Sri Lankan staffer accuses senior UN official of sexual harassment


UNITED NATIONS – A Sri Lankan staffer has accused one of the highest ranking UN officials of sexual harassment in a case currently playing out at the United Nations. Shihana Mohamed, a Human Resources Policies Officer with the International Civil Service Commission (ICSC), has charged the New York-based Commission’s chairman of retaliating against her by denying promotions and excluding her from duty-travel overseas because she refused to accede to his demands.

After a long drawn-out investigation, the Office of Internal Oversight Service (OIOS), the UN’s investigative arm, produced a report last week.

But the contents of the report are under wraps since neither the OIOS nor ICSC has announced plans to go public with the results of the investigation in an institution which has long preached “transparency and accountability” to the outside world.

The official against whom the charges were made, UN Under-Secretary-General Kingston Rhodes of Sierra Leone, abruptly announced his resignation last Friday, two weeks before his retirement — circumventing the sexual harassment charges. The ICSC is described as an independent expert body established by the 193-member UN General Assembly, and its mandate is to regulate and coordinate the conditions of service of staff in the United Nations common system, while promoting and maintaining high standards in the international civil service.

The New York-based Equality Now, a non-governmental organisation (NGO) which promotes women’s rights, is advocating Ms. Mohamed’s cause….


[A typical ‘liberal’ article: it begins promising ‘multiculturalism’ and ‘equality’ but is soon bashing workers and unions…–ee]

Multicultural education: Finding educational explanations for the present crisis in Sri Lanka

December 25, 2018, 8:52 pm

Based on a research paper given at the International Research Symposium on Social Sciences and Humanities (IRSSSH) 2018 : Towards a Sustainable Future (13, December 2018)

By Dileep Chandralal, Professor Emeritus, Okinawa University (

…One of the basic assumptions I make is that the education in post-Independence Sri Lanka has reinforced existing community inequalities by applying unhealthy competition to the education sector while imposing a strictly academically oriented/examination-oriented school ethos.

For this paper, I have used the Methodological Guidelines provided by UNICEF for Education Sector Analysis….

Let me first consider the issue of equity. We can see how enrolment patterns and school results vary according to key sociodemographic factors and how policy choices regarding public resource distribution affect equity. It is so obvious that the extent of disparities according to the place of residence (urban/rural), geographic location and household income is so large in Sri Lanka. There are inequalities in access to schools. There is no equity in enrollment and learning achievements.

… There are large gaps between urban and rural schools, and between ‘popular’ (‘Janapriya’) schools and unpopular schools. Disparities in learning achievements are clearly affected by the area of residence and household income. The distribution of public resources including finances, facilities and equipment and teachers is not fair. 

…Another problem is the employability of school leavers and graduates, especially, of Humanities and Social sciences graduates, seems highly questionable. Have we developed our curriculums in anticipation of future labor market needs, considering what skills and qualifications are required for the country? Look at the tourism, leisure and hotel industry, for example. According to a recent news report, thousands of vacancies remain unfilled because our youngsters are reluctant to work in hotels sector or there is no proper career orientation aimed at the requirements of this sector.

….Look at the problem of medical doctors who were educated through government funds. As reported, “Last August, GMOA leaders launched their strike on several insistent demands regarding their income tax payments being raised from 12% to 24% and the privilege of admission of their children to prestigious national schools, their opposition to the free trade agreement between Sri Lanka and Singapore, without any consideration for poor patients depending on government/public hospitals.” (The Island, 6.8.2018)

Yet another example is provided by the following news item. “Railway trade unions today said that the train services on the northern railway line would be disrupted from this Sunday night if the Police failed to arrest those who were involved with Pothuhera blockade incident last evening, within 48 hrs. Union Alliance (RTUA) Co-Convener said, “We will start our strike after another 24 hours.”  (Daily Mirror 2018-11-01)

Looking at these incidents… it is not unfair to question our education output. It is obvious that there is no positive relation between the level of education and the level of social maturity and citizens’ responsibility in this country….

….According to the available sources, over 355,000 students sat for the Grade five scholarship examinations this year (2018). Only about 15, 000 students get chances to enter better schools. What happens to other 340,000 students needs not explaining…



ee reproduces here the reports of the various ‘Economists’ reproduced in the English media. Their craven fealty to the merchants and moneylenders – the rentiers – is blatantly apparent. Their opposition to modern industrial production is palpable and has a long lineage. In fact, it is the very basis of the economy they uphold. Their mantra is Imports (that undermine or do not inspire local production), Exports (where we are mere assemblers of MNC supplies), Investment (in buying more imports, not investment in local production, for the local market). 


[Who are the ‘talented ten’ economists the CB consults?ee]

CB seen keeping policy rates steady despite pressure on rupee


(Colombo) REUTERS: Sri Lanka’s Central Bank is expected to leave its key interest rates steady yesterday, a Reuters poll showed, despite heavy pressure on the rupee from a political crisis that triggered foreign outflows from stocks and government bonds.  

….All analysts expect the Central Bank of Sri Lanka (CBSL) to leave key rates steady as Wickremesinghe’s government aims to focus on economic growth, which has been sluggish due to tight policies, ahead of a presidential poll next year and general election in 2020. 

All 10 economists surveyed expected the Central Bank to keep both its standing deposit facility rate (SDFR) and standing lending facility rate (SLFR) to be left at 8.00 percent and 9.00 percent, respectively. 

The Central Bank raised SDFR by 75 bps and SLFR by 50 bps last month, while reduced the statutory reserve ratio (SRR) by 150 bps to 6.00 percent. All 10 analysts saw the SRR remaining steady. 

…The Sri Lankan rupee hit a fresh low of 181.85 per dollar yesterday while the island-nation’s dollar bonds have also plummeted as foreign investors sell their holdings. The rupee has fallen nearly 5 percent since the political crisis started on October 26. It has dropped 18.4 percent so far this year.

Political pressure would be against increasing the rates,” said Softlogic Capital Markets CEO Danushka Samarasinghe. 

“However, if rates are increased, it will be better for safeguarding foreign investments in the bond market and also might be favourable from a fiscal point of view.” 

Foreign investors have sold a net Rs.13.7 billion worth of stocks since the political crisis began and about Rs.56.7 billion worth of bonds between October 25 and December 19, bourse and the Central Bank data showed. 

Sri Lanka has seen net outflows of Rs.149 billion from government bonds so far this year, the Central Bank data showed.

[Also see ee Finance, for more on CB dealings…]


[Here is another ‘eminent’ economist repeating standard white nonsense about China’s rise..that it came after Chairman Mao…the truth is…as embodied in the current PM Xi Jinping, it was the sacrifices made by the people under Chairman Mao’s leadership to build an independent economy, that enabled its rise as a larger economic power. Abeyratne misses out on the fact that it is the communes that did not break up during Deng Xiao Peng that contributed to its power! Again, it is rather pitiful that such economists still equate ‘money’ with ‘power’…and not with ‘capital’…Further, China’s later FDI was invested not in importing other people’s luxury goods but invested in ‘production’ for its own market first! – ee]

Abeyratne: China after 40 years

“On Tuesday, China celebrated its 40 years of what was called to be the “reform and opening” of the economy. At that time, it was a poverty-stricken economy isolated from the rest of the world – in fact, from the capitalist world…..

…China began its reform programme, one year after Sri Lanka did it in November 1977. By that time, after 20 years of tightened regulated economic policies Sri Lanka was very poor, but China was poorer. GDP per capita of Sri Lanka was US$287 in 1977, compared to $185 in China.

….China’s economic transformation owed much to its foreign direct investment (FDI) flows. According to UNCTAD database, FDI flows to China began in 1980 with the first FDI amounting to $57 million. Then it exceeded $1 billion in 1984, $10 billion in 1992 and, $100 billion in 2010 and continued to remain well above that level over the past seven years.

Today, China is the first among developing countries to receive the largest FDI flows in the world and the second among all the countries in the world, after the US…

As a dominant feature of its Communist past, China has more than 150,000 state-owned enterprises (SOEs) which control a substantial part of enterprise assets in the country. There have also been significant discussions about the SOE reforms as well.

…In a study on SOEs, carried out by OECD in 2013, it was found that out of the world’s 2000 largest listed companies, 204 were SOEs originating from 37 countries: 70 from China, 30 from India, 9 from Russia, 9 from UAE, 8 from Malaysia, 7 from Brazil, 6 from Indonesia, 6 from Poland, 6 from Switzerland, and 5 from France.

When I spoke in favour of privatization of SOEs, some would question quoting countries like China where the government has developed its SOEs to become multinational corporations operating globally. I would say: “Why not? We can also ask our government to do it and show the result.”

Chinese economic transformation has contributed to the growth of Asia which has become the fastest growing region in the world. It has also challenged the economic supremacy of the developed world…

(The writer is a Professor of Economics at the University of Colombo –


[Here is another ‘eminent’ economist who thinks that ‘international’ (read: white) confidence in us is more important than confidence in ourselves – ee]

Sanderatne: Continuing squabbles are a severe constraint to economic stability

…The disagreement between the President and the Prime Minister is a severe constraint to the country’s economic stability and progress. 

….Effective implementation of political promises will be the key to the government’s success and the economy’s progress. In the last three and a half years, the Achilles heel was the weak implementation of economic policies and consequently the lack of visible benefits.

Restoring the eroded international confidence is vital for the sustainability of the external finances of the country. However, restoring international confidence and stabilising the economy cannot be achieved as fast as it was destroyed.

….Especially important for restoring international confidence and enhancing our external finances is the IMF’s first tranche of about US$ 500 million of a loan facility of US$ 1.5 billion that is pending release. This is vital to restore international confidence and provide balance of payments support. It will assist in improving the ratings of international agencies that would in turn improve the investment climate and reduce international borrowing rates.

…It is vital for the postponed budget for 2019 to have a clear one-year programme of economic recovery. It should focus on increasing near-term production and exports. It must ensure that there is no fiscal slippage.

Fiscal consolidation

No doubt, the budget that was prepared for presentation on November 5th would have to be modified. Combining the political compulsion of a populist budget with one that keeps to fiscal consolidation targets is an enormously challenging task. This is especially so as much damage has been done in the interim by reducing taxes and increasing expenditure…

Apart from these adverse economic consequences of a larger fiscal deficit on the stability of the economy, the deviation from fiscal target would not be in conformity with the agreed conditions for the IMF facility of US$ 1.5 billion.

The postponement or cancellation of this IMF loan would not only have direct adverse impact on the external reserves and debt repayment capacity, but also affect the country’s credibility in international financial markets and among investors. Therefore, measures to cut expenditure are vital to achieve fiscal consolidation.

…The economic programmer must be pragmatic, decisive and credible; its implementation must be swift and effective. Political rhetoric must be translated into institutional reality. Time is running out.


[Yet another professor repeats the merchant gospel about 1956, 1970, etc. – ee]

Agony of lower middle class and disintegration of liberal state in SL

December 23, 2018, 9:35 pm

Siri Hettige, Professor Emeritus of Sociology,

University of Colombo

With almost universal literacy and high levels of educational attainment among many of the adult citizens in the country, one would have expected by now overwhelming public support for a State based on secular, liberal values. Yet, the country continues to be highly divided on fundamental, secular democratic values

Sri Lankan political elites at the time of political independence had a broadly liberal political and economic outlook. Despite a large rural population dependent on an expanding small holder peasant economy, the country’s economy was widely identified as an export import economy dependent largely on the export of a few plantation products. Moreover, society was polarised between an urban, English educated elite and a mass of vernacular educated rural peasants. It is this state of affairs that came under severe criticism from both the left and the Sinhala Buddhist nationalists. I

…by the early 1970’s, a rapidly expanding population coupled with rising aspirations for upward mobility among youths belonging to all ethnic communities gave rise to unrest among educated segments of the population as was clearly evident from the 1971 JVP uprising followed by youth agitations in the north. Liberally oriented political opposition at the time saw the emerging crisis entirety as a failure of the state domination over a closed economy and sought to swing the pendulum to the other extreme by adopting an unregulated open economic policy.

….As already mentioned, the large state sector consisting of pervasive state services, import substitution industries, diverse specialised state institutions, extension services, etc. absorbed most of the vernacular educated, upwardly mobile youth in large numbers creating a massive rural lower middle class. Many of them over time reached very high positions in the state sector. But, with economic liberalisation , private corporate sector emerged as the dominant and lucrative sector of the economy.

….Moreover, post 1977 liberal economic reforms have also been widely perceived by the members of the rural lower and lower middle classes as a way of undermining the moral economy established in the 1950’s and the 60’s by disturbing the rural urban balance in terms of equitable life chances, creating huge income disparities and bringing back the English educated urban elites, marginalising the vernacular educated rural intelligentsia.

…it is not difficult to understand why the members of a vast rural lower middle class in the country feel that they have been dislodged from the post-Independence moral economy that flourished in the 1950’s and the 60’s, which was also largely shaped by ethno-nationalism. Given the fact that nationalist discourse has been an integral part of the post-Independence political discourses in the country, many ardent nationalists have interpreted social and economic inequalities in terms of the competition for scarce resources as one among ethno-religious groups, ignoring its obvious social class connotations. This is widely accepted by the members of the large lower middle class in Lanka, particularly in the rural hinterland where nationalist politicians and their ideologues have an almost captive audience.

__________________________________________________________ __________________________________________________________ 

Sri Lanka is not Greece, it is a Latin America style soft-peg: Bellwether

By The Price Signal by Bellwether

Dec 26, 2018

ECONOMYNEXT – There are pronouncements that Sri Lanka is like Greece from both sides of the political divide, but that is not correct. Sri Lanka has a Latin America style soft-peg which can put the country on a dangerous slippery slope unlike a strong floating rate like the Euro.

Greece had a debt rollover problem like Sri Lanka and went into sovereign default. There was no problem with the currency or private debt default or disappearing incomes.

The central bank has put Sri Lanka in a Latin America style strait-jacket. Sri Lanka escaped the worst LatAm effects up to now, because there was no large commercial debt. But from 2005, after Sri Lanka started tapping international bond markets everything changed.

….Sri Lanka’s central bank failed to mop up inflows in February 2018, losing its grip on the peg in the first major sin committed.

It will be interesting to find out how the monetary board gave approval for domestic operations to halt term repo mopping up, after a series of auctions failed.

And the central bank then printed money in April cutting rates to de-stabilize the peg further.

In August after the currency stabilized, liquidity was allowed to build up for a second time (including through Soros style swaps) pushing the currency down. This was the third great sin.

In September more liquidity was injected after a 2013 swap matured. The 2013 involved taking on a quasi-fiscal risk in the style of the once-bankrupted Philippines soft-pegged central bank.

….Sri Lanka’s central bank, not only injects money overnight, but also through longer-term reverse repo deals at overnight rates during currency pressure. This is not an official crime in Sri Lanka.

The central bank also injects overnight money below the ceiling rate despite currency pressure. This is not listed as a crime against the nation in the penal code.

The central bank also buys Treasury bills at auctions to inject money during currency pressure. Mercifully in the current episode it has been minimal. This is not listed as a crime either.

All these actions have to be re-examined in detail to prevent economic collapses in the future.

….As prices move up with currency depreciation the value of bank deposits evaporates. If the currency falls by 50 percent, local companies will now have to borrow more to repay foreign loans, making massive holes in their balance sheets even if forex was available to buy.

If exchange controls come, there will be no dollars to buy with the domestic money they have borrowed.

It is not possible to import goods freely when a soft-peg collapses because there will be forex shortages due to sterilized intervention. Import controls may also come.

As the cost of fuel or electricity goes up (oil prices are now falling and there is rain in Sri Lanka) if prices are not raised, more money will be printed to subsidize energy, pushing the currency down.

In Latin America, energy price controls have led to money printing and rationing. There can be power cuts and fuel shortages.

In Sri Lanka because of price controls of the National Medicines Regulatory Authority medicines, drugs can go off the shelves.

In Latin American soft-pegs many price controls were imposed. Instantly goods go off the shelves and black markets appear.

With import controls more businesses will fail. People will be laid off as revenues fall. Banks will make more losses. Rates will rise eventually. More businesses can fail.

If this situation continues for several months, there may be runs on banks. If money is printed to bail them out, the currency falls even more. This phenomenon was seen in many Latin American soft-pegs and also Indonesia during the East Asian crisis.

Debt to GDP will explode until inflation catches up. The share of foreign debt will also increase…

The Banker Magazine prophetically said this in an opinion piece on Ceylon’s planned central bank in July 1950.

“This law had been drawn up under American tutelage and along the lines that have been the subject of experiment in certain Latin American countries for some eight years past.

“The step from a n ‘automatic’ currency system (such as that which Ceylon inherited with its old Colonial Currency Board) to an ultra-modern “managed” currency system is necessarily fraught with great dangers and there may be some who will regret that Ceylon has decided to run such risks at this time.”

….Sri Lanka’s program with the International Monetary Fund advocated the same mistakes that led to the collapse of the Bretton Woods: cutting rates and printing money because inflation or growth seems low.

There were no public calls by the IMF to allow rates to go up in the first quarter 2018, despite having a program to collect forex reserves.

….This column is based on ‘The Price Signal by Bellwether’ published in the December 2018 issue of the Echelon Magazine….To contact the author,_it_is_a_Latin_America_style_soft_peg__Bellwether-3-12995-2.html


Sri Lanka and Ecuador; a cautionary tale of the Rupee and Sucre: Bellwether

By Bellwether, Nov 16, 2018

Sri Lanka’s rupee has fallen with amid two liquidity spikes in 2018 just as the economy started to recover, underlining the need to bring restrains to the central bank ability to generate monetary instability as the country moves into global and domestic uncertainty.

…An entire free trade strategy of the administration is in a shambles. Anti-free traders are baying at the heels of the Finance Minister.Tax revenues are being lost because vehicle and other imports have been hit.

The currency fall is making it difficult for Finance Minister Mangala Samaraweera to market price fuel as the rupee falls as the currency peg adds to the costs like in India, making him lose tax revenues.

A fragile recovery has been undermined with both currency depreciation and interest rates giving a double hit on consumer spending.

The National Medicinal Regulatory Authority through its price controls have also hurt pharmaceuticals sector. It is a threat to businesses and it is a threat to the banking sector and its depositors. The falling rupee has worsened pharma troubles. Drug prices may not be in the inflation index, but the cost rises are real.

Fiscal Policy

All this is happening despite Finance Minister Samaraweera running a budget as tight as possible. There is primary surplus in the budget also.

Governor Indrajit Coomaraswamy, honest to a fault, has publicly said this.

…..If Sri Lanka has to repay foreign debt on a net basis, interest rates have to be a little higher, economic activity has to be a little slower and therefore the external current account will end up being a little narrower.

This will generate the resources to repay debt. Curtailing imports such as cars, which bring massive tax revenues is not the answer. It hurts the ability of the country to repay debt by hitting the budget. Dollars will be diverted to imports with lower taxes. This is an own goal.

Neither will curtailing gold smuggling. If that was the case it should have put pressure on the currency in 2017.

Anyone who is smuggling gold to India has to get money back from India to make a profit. Any money he parks abroad will only be the profit. To get working capital for the next shipment he has to get the money back from India.

Gold imports are simply the same working capital being re-cycled with part of the profits accruing to Sri Lanka.

Whether this money appears officially in the trade account or not is irrelevant. To say that gold is imported legally and is not reflected in exports is not economics reasoning, it is Mercantilist unreason. As predicted now the imports of gold is also smuggled.

Sri Lanka should forget about gold smuggling, it is an un-necessary distraction.

Mercantilism is a danger to the stability of this country and the lives of her people.

….The Central Bank giving dollars to the Ceylon Petroleum Corporation under the counter will not help a float work. Buying dollars from the Treasury will not help any float.There is no need for this country to go into a meltdown.

….There is a National Medicinal Drugs Regulatory Authority. Big business groups involved in health care have been hit by the NMRA amid currency depreciation. It can have a cascading effect on other related businesses and their loan repayment abilities.

The health ministry is planning to bring price controls to hospitals, which will hit that sector as well, probably triggering bad loans and halting new hospitals and any growth. Sri Lanka has an ageing population and the country needs more hospitals.

When the currency is falling it is not a time to impose any price controls and kill another sector.

….The April liquidity injections, that came thick and fast from all directions makes this columnist shiver in his boots. What happened in August makes hair stand on end.

.China has already bailed out Sri Lanka with a billion dollar below market rate loan. It seems they are willing to give more. This means Sri Lanka probably does not have to go down the meltdown path.

But the big problem is China does not put conditions on loans to pull oneself out of the bootstraps like Western countries or the IMF does. Western countries have experience in giving loans and defaults that come from mis-management and corruption. China is learning now.

Sri Lanka will have to do the corrections on its own since China itself does not seem to know. Sri Lanka’s Finance Minister seems to be willing to do the right thing. But the soft-peg is his Achilles heel.;_a_cautionary_tale_of_the_Rupee_and_Sucre__Bellwether-3-12632-2.html


Sri Lanka risks instability, stagflation by being in PIIS soft-peg group: Bellwether

By Bellwether

Oct 15, 2018 

…This country is part of a group of countries with mis-managed soft pegs which include Philippines, Indonesia and India and Sri Lanka (PIIS) which are struggling with exchange regimes which are neither hard pegs nor true floats.

To move forward Sri Lanka has to end contradictory policy.

….Sri Lanka’s soft-peg is now under pressure with credit picking up, as this column has warned from the beginning of the year. In April, a period of excess liquidity and money printed to repay maturing bonds triggered a period of currency pressure.

In August the pressure was triggered by swaps with the Treasury and excess liquidity.

Subsequently conditions were further complicated by reversal of a legacy swap with National Savings Bank, which expired on September 18.

There is another 249 million dollar swap coming up in next year with NSB.

…Nomura, a Japanese bank has said Sri Lanka is at worst risk of a currency crisis than many other Asian countries, including Vietnam. Vietnam is the poster child in vogue among Sri Lankan policy makers at the moment, taking over from Malaysia and Singapore, which were touted in the 1980s.

Vietnam is spoiling for a crisis.Vietnam has seen un-ending credit growth for many years now. There is a raging property and apartment bubble. This bubble has already been pricked in Sri Lanka in 2017.

….Sri Lanka bolstered the state sector and expropriated private firms, starving the country of growth creating competitive foreign investment.

An exploitative oligarchy of protected industries were born, which was a cancer on the people. In the services sector such as IT where there was no protection, exports companies were coming up. But the people were protected by a relatively stable exchange rate until the first quarter of 2011.

Monetary and exchange rate policy deteriorated after that. After 2015 policy has worsened again, though the current Governor put the brakes.

….Sri Lanka is stuck in vicious mish-mash of contradictory policy, institutionalized by an IMF program which requires reserve collection.

Sri Lanka’s 1980s reforms failed to give East Asia-style growth due to bad monetary policy and not just the war.

….There is now widespread agreement that the Treasury secretary should be out of the monetary board and that Treasury bills should not be used to advance money to the finance ministry.,_stagflation_by_being_in_PIIS_soft_peg_group__Bellwether-3-12210-2.html



Santa’s early arrival

December 24, 2018, 9:43 pm

Santa arrived here about two months before Christmas. Maybe he was swayed by Sri Lanka’s Lonely Planet rankings and could not wait. He came, in October, donning a saataka and grinning like a Cheshire cat, and granting the people some economic relief. Fuel prices were reduced twice within a matter of a few weeks and import duty was slashed on some essentials. He also promised tax cuts and subsidies and then, suddenly, vanished like a foreign investor riled by a minister’s demand for a bribe.

Santa came back, clad in lounge suit, after a few days. We have got petrol and diesel at cheaper rates. Whoever would have thought the fuel pricing formula from hell would be shelved and relief given to the masses in this manner? Only Santa is capable of such a feat. Didn’t the Finance Ministry worthies tell us, before Oct. 26, that a downward revision of petroleum prices would be possible only in February next year? The way to bring Santa down is perhaps to give the rulers a scare. Nothing frightens politicians more than the prospect of losing power.

Santa is likely to stay with us for a few more months or even more and we do not have to worry about prices creeping up again at least in the near future. President Maithripala Sirisena has reportedly asked his party organisers to get ready for an election year. …

…A ruling party seldom wins an election that it puts off, as we saw last February, when the yahapalana partners suffered a crushing defeat at the mini polls which had been postponed for over two years. The government is aware of the people’s resentment, which it will seek to assuage as a matter of priority; the budget to be presented shortly will be a Santa sack full of goodies.

Meanwhile, a senior minister has, in his wisdom, demanded that the government allocate more funds for its propaganda. This is an indication that there will be elections next year.

…The public knows that a government is in serious trouble when its propaganda costs more than the projects it implements. As professional propagandists are aware, the best way to kill a bad product is to advertise it.

Everybody seems to have forgotten the state of the economy. The rupee is extremely weak and the inflow of foreign direct investment remains woefully low. There are staggering debts to be serviced. The future does not look bright, at all. An election budget is a euphemism for bribing the people with their own money…


“Although Sri Lanka has managed to reduce income poverty from 26.1 per cent in 1990/91 to 4.1 percent by 2016, income inequality has remained unchanged for more than four decades. The richest 20 per cent enjoy more than half the total household income of the country, while the poorest 20 per cent get only 5 per cent. The situation of the poorest 10 per cent of the households is worse, with the share of household income being just 1.8 per cent or less. Furthermore, income gaps between different regions is even wider than the income inequality at the national level.


“in this country all adults have come to believe in Santa since the 26 Oct., regardless of their religious faiths, given the price reductions, soft loans, grants, tax reductions, etc. they have received all these weeks

Santa, who arrived here unexpectedly in late October, stayed at Wijerama Road, for about six weeks, before shifting to Temple Trees, from where he is operating now. He has a busy schedule ahead of him owing to elections expected next year.”


Harsha promises relief

December 26, 2018, 11:39 pm

Economic Reform and Public Distribution Minister Dr. Harsha de Silva yesterday said that he would examine PAYE (Pay as You Earn) structure to help workers meet increasing non-food related expenses. The UNPer said so after assuming duties in his ministry.

….The following is the text of the Minister’s response to a query by The Island: “The requirement is to create jobs and wealth so that people whoever they may be wherever they may live are able to make their dreams come true. It may be to get a motorcycle, a car or save money to build a house or educate children. But the job of the government is to help create the environment for people to benefit from their hard work. Focus must be on the low income folks particularly in the agriculture sector to help them benefit from markets. I will also pay attention to the multiple issues of the middle class and relook at the PAYE tax structure in order to help them with increasing non-food related expenses they have to meet. In my role as the minister of public distribution, I will create a fully integrated network of climate controlled warehouses in several locations by the end of this year. They will be connected by IT and will be a huge boon to farmers who for last so many years had to throw away produce unable to store.”


Ravi promises relief to electricity consumers


Power and Energy Minister Ravi Karunanayake said yesterday that electricity consumers would be provided with relief after the Ceylon Electricity Board (CEB) becomes a profitable venture.

He said this during a discussion with representatives of 58 CEB trade unions held at the ministry yesterday morning.

The minister assured them that he would resolve many problems that had cropped up within the CEB shortly and requested the trade unions to cooperate by leaving their personnel objectives behind.

Power and Energy State Minister Champika Premadasa, Ministry Secretary Dr. B.M.S. Batagoda and several other officials took part in the discussion.


Central Bank holds policy rates steady


The Monetary Board of the Central Bank of Sri Lanka (CBSL) at the last policy review of the year decided to maintain policy interest rates at their current levels, as the private sector credit growth keeps accelerating and pressure on external reserves continues despite the economy performing below its potential. 

…Despite infusing around Rs. 90 billion liquidity to the banking system by reducing the Statutory Reserve Ratio (SRR) at the last Monetary Policy Review in November, the CBSL stated that the rupee liquidity deficit has further widened. 

…The CBSL expects that imports would moderate in coming months, in response to the measures adopted to curb imports of motor vehicles and non-essential goods as well as the impact of the depreciation of the rupee.

However, the trade deficit widened further in the first ten months of 2018 with the expansion in import expenditure,  outpacing the growth of export earnings.

..“Recent downward adjustments to fuel prices and selected administratively determined prices, as well as the reduction of special commodity and telecommunication levies, along with the ongoing recovery in the agriculture sector are expected to impact inflation favourably in the near term,” the Central Bank stated. 

However, the Central Bank noted that volatile global commodity prices, possible weather-related disruptions to domestic supply chains due to unpredictable weather patterns, and the possible pass-through effect of the rupee depreciation in recent months to domestic prices pose risks to the inflation outlook.


Treasury tightens government expenditure

By Bandula Sirimanna

Sri Lanka’s Treasury is tightening government spending while anticipating an increase in the final quarter revenue collection as the country is facing a cash flow problem following the 52-day political impasse triggered by President Maithripala Sirisena.

According to recent provisional assessment, the economic loss and financial slippage caused to the country during this period has exceeded Rs.102 billion.

The new Vote on Account presented in Parliament on Friday calculates the entire expenditure for four months at Rs. 1765 billion whereas the Vote on Account approved by the previous cabinet indicated Rs.1735 billion as the total expenditure.

It appears that the Budget Department may have considered a part of revenue slippage in preparing the new Vote on Account, economic analysts said.

The Central Bank has to sell Treasury bills in a bid to repair the damage caused to the credit and financial system by political instability, they disclosed.

But the Government only offered for auction Rs. 18 billion of Treasury bills and accepted bids for the same amount after receiving bids amounting to Rs. 62.86 billion this week, the Central Bank announced.

Stringent debt management is to be followed to meet the Government’s financing needs at the lowest possible cost consistent with a prudent degree of risk, a senior Treasury official told the Business Times.

The development and strengthening of the government securities market will be continued, while enhancing efficiency and maintaining stability, he said.

However printing money will help the government to tackle cash flow problem to a certain extent although printing money increases domestic credit and drives imports, pressuring the exchange rate.

Despite political uncertainty and policy confusion, the Central Bank is confident of managing the economy and massive US $4 billion debt servicing next year by raising funds through prudent financial instruments.

Some of the tax changes and revisions introduced by the previous Finance Minister Mahinda Rajapaksa appointed by the President should have to be approved by Parliament by next January, the senior Treasury official added.

Other changes such as the Telecommunications Levy, which has been implemented, would only have an impact of 0.03 per cent of GDP, he said adding that the Finance Ministry has introduced tax reductions while maintaining the 4.8 per cent budget deficit targeted for 2018.

The Central Bank has revealed that the country’s foreign debt repayment would double to a record $4 billion in 2019 from last year’s level.

The bank is anticipating foreign inflows to settle the $1.5 billion of sovereign bond repayments of two such international bonds within the first four months next year.


Sunday Times Editorial and Social Democracy?

“Many advanced democracies are moving towards ‘social democracy’ where the public is taxed, but the tax is used to provide services to the public equitably with a safety net for the vulnerable. If the President and the Prime Minister can make that combination work, they will make a winning team. Otherwise, the country can continue further down the slippery road to disaster.”


Growth slumps to 2.9% in 3rd quarter

19 Dec, 2018

Colombo (News1st): The country’s economic growth in the third quarter slumped to a historic low of 2.9% in the third quarter in comparison to 3.2% a year earlier reaffirming the continuous struggle. The growth rate in the 3rd quarter was lower in comparison to 3.7% achieved in the 2nd quarter.

The Gross Domestic Product at constant prices for the third quarter of 2018 was recorded as Rs. 2,431,627 million and GDP reported for the third quarter of 2017 was Rs. 2,362,698 million.

Agricultural activities expanded favourably by 3.3% compared to the contraction of 3.0% reported in the third quarter of 2017. Industrial activities recorded a positive growth rate of 1.9%, sharply down from 5.3% a year earlier and service activities expanded further by 3.9% up from 2.8% a year ago.

Speaking to News1st COO of the Advocata Institute, Dhananath Fernando stated:…..that our average growth rate after independence was about 4%, this year it was even below the average of this rate and if Sri Lanka is to become a rich country within one generation it should at least maintain an average growth rate of 8%….


Inflation increased in November 2018

December, 26, 2018

Headline inflation as measured by the year-on-year change in the National Consumer Price Index (NCPI, 2013=100) reversed its declining trend, recording 1.0 per cent in November 2018 from 0.1 per cent in October 2018. The increase observed in year-on-year inflation in November 2018 is mainly driven by the increase of the prices of Food items. Year-on-year Food inflation increased to -3.9 per cent in November 2018 from -6.6 per cent in October 2018. However, year-on-year Nonfood inflation decreased from 5.8 per cent in October 2018 to 5.2 per in November 2018.

The change in the NCPI measured on an annual average basis decreased to 2.7 per cent in November 2018 from 3.3 per cent in October 2018.

The month on month change of the NCPI increased by 2.2 per cent in November 2018 due to increase in the prices of the items in the Food category, particularly that of vegetables, green chillies, rice, limes and potatoes. Meanwhile, prices of the items in the Non-food category also increased during the month where Health sub-category reported the highest increase. However, prices of items in the Transport (Petrol and Diesel) sub-category reported a decrease during the month.

The core inflation, which reflects the underlying inflation in the economy, decreased to 3.1 per cent in November 2018 from 3.4 per cent in October 2018 on year-on-year basis. Meanwhile, annual average core inflation remained unchanged at 2.4 per cent in November 2018.


Sri Lankan rupee hits record low of 181 against dollar

December, 21, 2018

Reuters – The Sri Lankan rupee fell to a record low against the dollar on Thursday, amid pressure on the currency due to foreign outflows from bonds and stocks as uncertainty from a political crisis dented sentiment.

The rupee hit a record low of 181.00 against the U.S. dollar on Thursday, according to market sources, surpassing its previous low of 180.85 to the dollar on Nov. 28.

…The rupee has weakened about 4.4 percent since the political crisis began. The currency dropped 1.8 percent in November, and has lost 17.9 percent this year.


Sri Lankan rupee depreciates further


The Sri Lankan rupee depreciated further against the US Dollar today, hitting a record low of 183.17.

The exchange rates of the Central Bank indicated the selling price of the rupee as 183.17, the indicative price as 181.47….


Sri Lanka rupee opens wide, gilts flat, stocks down

Dec 26, 2018 11:27 AM GMT+0530 | 0 Comment(s)

… bond yields were flat and stocks were weaker the day after Christmas, dealers and brokers said.

In money markets, overnight money was quoted at 8.95/9.00 and in repo markets, bids were around 8.95 with no offers.

Yields on T-bills and bonds settled at the previous close after dipping slightly in thin trading.

A bond maturing on 15.03.2023 was quoted at 11.65/55, while a bond maturing on 01.09.28 was quoted at 12.00/90.

Twelve-month T-Bills were quoted 10.90/80.

The Colombo Stock Exchange was down 0.05 percent at 6,022.23 points an hour after market opening with thin trading.

The more liquid S&P SL20 index was up 0.12 percent to 3,128.60 points.

Renuka Agri Foods Plc, Orient Finance Plc and Ceylinco Insurance Plc drove the volume. (Colombo/Dec26/2018),_gilts_flat,_stocks_down-3-12993-3.html


SL rupee hits record low of 184.07


The Sri Lankan rupee hit a record low of 184.07 against the US Dollar today.

According to the exchange rates of the Central Bank, the selling price of Sri Lankan rupee was recorded as 184.0758, indicative price as 182.2783 and buying price as 180.1015.–160393.html


2019 Budget to be presented by the end of January 2019

24 Dec, 2018

COLOMBO (News 1st): Minister of Finance and Mass Media Mangala Samaraweera states that the budget for 2019 would be presented in Parliament before the end of January 2019 and approved by the end of February.

…“The first cabinet paper of the so-called Finance Minister of Mahinda Rajapaksa was to abolish the Gamperaliya program. But Prime Minister Ranil Wickremesinghe has already informed District Secretaries to continue their work at least until we convene the cabinet on the 2nd,” he added.

Min. Samaraweera also stated that Rs. 300 Million in funds will be provided to every electorate from January 1st 2019, for development activities.


Rupee depreciated 15.9% in 2018

28 Dec, 2018

Colombo (News1st): The Sri Lankan rupee has depreciated to an all-time low once again. The rupee was selling at 184.0758 against the dollar.

According to the Central Bank’s Monetary Policy Review: No. 8 of 2018, the Sri Lankan rupee depreciated by 15.9% against the US dollar thus far (up to 27 December) during 2018. The trade deficit widened further in the first ten months of 2018 with the expansion in import expenditure outpacing the growth of export earnings.

Both the government securities market and the Colombo Stock Exchange experienced net outflows of foreign investment. Sri Lanka’s gross official reserves, which stood at 8.4 billion US dollars by the end of July, have declined to the 7 billion US dollar.

As per the provisional estimates of the Department of Census and Statistics (DCS), the Sri Lankan economy recorded a modest real GDP growth of 2.9%, year-on-year, during the third quarter of 2018, compared to the revised growth of 3.6% in the second quarter of 2018. The report states that the real GDP growth is likely to be low in the fourth quarter of 2018 as well.

The Monetary Board of the Central Bank was of the view that it is appropriate to continue the current monetary policy stance to stabilize overall economic conditions. Accordingly, the Monetary Board decided to maintain the Standing Deposit Facility Rate (SDFR) and Standing Lending Facility Rate (SLFR) of the Central Bank at their current levels.


Price of gold on the rise

24 Dec, 2018

COLOMBO (News 1st): Market analysts have forecast the price of gold in the world market is set to increase in the coming years.

By the end of 2019, the price of gold in the world market is expected to rise up-to US$ 1300-per-ounce.

This value is expected to rise by another US$ 100 in 2020, bringing the price up to US$ 1400-per-ounce.


Inflation increased in November 2018

December, 26, 2018

Headline inflation as measured by the year-on-year change in the National Consumer Price Index (NCPI, 2013=100) reversed its declining trend, recording 1.0 per cent in November 2018 from 0.1 per cent in October 2018. The increase observed in year-on-year inflation in November 2018 is mainly driven by the increase of the prices of Food items. Year-on-year Food inflation increased to -3.9 per cent in November 2018 from -6.6 per cent in October 2018. However, year-on-year Nonfood inflation decreased from 5.8 per cent in October 2018 to 5.2 per in November 2018.

The change in the NCPI measured on an annual average basis decreased to 2.7 per cent in November 2018 from 3.3 per cent in October 2018.

The month on month change of the NCPI increased by 2.2 per cent in November 2018 due to increase in the prices of the items in the Food category, particularly that of vegetables, green chillies, rice, limes and potatoes. Meanwhile, prices of the items in the Non-food category also increased during the month where Health sub-category reported the highest increase. However, prices of items in the Transport (Petrol and Diesel) sub-category reported a decrease during the month.

The core inflation, which reflects the underlying inflation in the economy, decreased to 3.1 per cent in November 2018 from 3.4 per cent in October 2018 on year-on-year basis. Meanwhile, annual average core inflation remained unchanged at 2.4 per cent in November 2018.


[What algorithm determines the bus fare ticket – ee]

Bus fares to come down by 4%

Minimum fare remains unchanged

December 24, 2018, 10:18 pm

The minimum bus fare of Rs. 12 would remain unchanged and other fares would be reduced by 4% with effect from December 26, Minister of Transport and Civil Aviation, Arjuna Ranatunga told the media yesterday.

Earlier in the day he held discussions with private bus owners. “We looked at 12 factors when we revised bus fares. Fuel is only one of them. Price of diesel has been reduced by Rs. 15 but there hasn’t been any reduction in the prices of other components. So, there will be no change in the minimum bus fare though it was decided to reduce fares in general by 4%,” he said.

It was also decided to reduce the three wheeler fares. The charge for the first kilometre will be reduced by Rs. 10, from Rs. 60 to 50. The school transport vehicles will also reduce their fare by 3% from tomorrow midnight.

Minister Ranatunga said: “…We need to develop the transport sector as a public service and it should not only be profit motivated. We will continue to change bus fares in accordance with the fuel formula.


Bus, van and three-wheel fares to reduce from Wednesday

24 Dec, 2018 

Colombo (News1st) – Bus, three-wheel and school van associations have reached a decision to reduce their fares with effect from Wednesday (Dec 26).

The government took steps to reduce the price of Petrol by Rs. 10 and Diesel by Rs. 5. As a result, the IOC also took steps to reduce prices accordingly.

Representatives of various associations met this afternoon to discuss passing on the benefits of lower fuel prices to the consumers.


Bus fares down by 4% from Thursday night


The bus fares will be reduced by four per cent effective from Thursday (26) midnight, Transport Minister Arjuna Ranatunga said today. 

He made the announcement at a media briefing at the Ministry with several bus associations, three-wheeler associations and All-Island School Children Transport Association (AISCTA).

He also said there would be no change in the minimum bus fare of Rs.12. The Minister said the bus fare stages which are at Rs.15, Rs.20, Rs.24, Rs.29, Rs.38 and Rs.43 would drop by Rs.1. Rs.34, Rs.41, Rs.46, Rs.49 and Rs.52 would drop by Rs.2. The highest fare Rs.965 would drop down by Rs.41 and it would be Rs.924. 

…While issuing a special notice, National Transport Commission (NTC) Chairman M.A.P. Hemachandra said an interim bus fare revision has been granted by the NTC effective from December 27 in the terms of the National Bus Fares Policy, in order to compensate the decrease in fuel price. The full fare in respect of approved inter-provincial, normal, semi-luxury, luxury and super luxury services implemented by the Sri Lanka Transport Board (SLTB) and Private Passenger Transport Services will be displayed for the information of bus passengers, owners, crews, authorities, and the general public…


Finance Ministry calls for reduction in transport charges

December 24, 2018, 12:01 pm

Bus fares and other charges related to public transport must be reduced in keeping with the drastic reductions in fuel prices in the past few weeks, the Ministry of Finance said in a media statement.

“The price of petrol and diesel has been reduced by Rs. 30 and Rs. 20 respectively compared with the last price increase on October 10, 2018. Therefore the government stresses that the bus fares and the charges levied in the transport sector by three wheelers, taxies and school vehicles should be reduced proportionately in order to pass the benefits of the global fuel price reduction to the people,” the release states.

The ministry states that it expects the regulatory institutions which are responsible for the transport sector to take necessary action to ensure that the benefits of the fuel price reductions are passed on to the passengers.

“At the same time fisheries and other related sectors should also pass on the benefits of fuel price reduction to the people as the production and transport costs of such sectors have declined following the decrease of diesel price,” the Ministry said.

Currently the price of a litre of Octane 92 petrol is Rs. 125 while a litre of Octane 95 petrol is Rs 149. The prices of auto diesel and super diesel stand at Rs 101 and Rs. 121 respectively.


Services sector expansion hit its lowest in November

Due to record low expectations for activity

December 24, 2018


The Services sector expanded at a slower pace in November 2018, recording the lowest index value since the survey began in May 2015, a recent Central Bank report revealed.

The slowdown in the Services sector was mainly due to the record low index value reported for Expectations for Activity. Further, a notable slowdown had also been also observed in new businesses and employment. The political crisis at the time in the country and uncertainty on future policies had weighed on respondents’ expectations for activity and the growth in new businesses, the report said.

However, on a positive note, business activities of wholesale and retail trade and accommodation, food and beverage sub sectors had reported a growth due to the festive season and the peak season for tourism.

Further, according to the Purchasing Managers’ Index of the Statistics Department of the central Bank, manufacturing activities had slowed down in November

“The slowdown observed in manufacturing activities in November was mainly driven by the slowdown in new orders and production, especially in manufacturing of textiles, wearing apparels, leather and related activities. However, new orders and production in the manufacturing of food and beverages activities has improved with the Christmas season demand. Employment remained unchanged during the period due to the difficulties in recruiting additional employees, especially in manufacturing of furniture activities,” it said.

“Meanwhile, overall stock of purchases indicated a slowdown, mainly due to the subdued production of manufacturing of textiles, wearing apparels, leather and related products. Suppliers’ delivery time lengthened at a slower rate which is mainly driven by the reduction of lead time on demand, for supplies related to manufacturing of food and beverages activities to speed up their production”.

“All the sub-indices of PMI Manufacturing recorded values above the neutral 50.0 threshold signaling an overall expansion in November yet at a slower pace compared to October 2018”, the report said


[One economic observer suggests: “Bring back the housemaids [and the orgy of imports will] stop immediately... Interest cost on cash margin seems to be lower than cost of depreciation. They’ll need to bring at least quantitative controls…” – ee]

Trade deficit soars on higher vehicle, fuel imports


    October trade deficit up to US $ 903mn from US $ 752mn YoY

    Cumulative trade deficit in 10 months at US $. 8.8bn from US $ 7.6bn

    Oct. imports up 9%; exports up marginally by 4%

    Lankans spent US $ 161mn on vehicle imports in Oct.; US $ 1.39bn in first 10 months 

    Oct. oil bill at US $ 266mn; oil bill for 10 months at US $ 3.43bn, up 28YoY

 Sri Lanka’s trade deficit hit US $ 903 million in October expanding from US $ 752 million recorded in the same month in 2017, as the country’s import bill rose significantly compared to languishing exports

Sri Lanka imported US $ 1, 882 million worth of goods during October, up 9.0 percent from the same month in 2017, as the country spent a record high amount on personal vehicle imports.

Sri Lanka’s exports continued to languish as earnings for the month rose just 0.4 percent year-on-year (YoY) to US $ 979 million while the 11.5 percent decline in agricultural sector exports offset the 4.5 percent increase in industrial exports. 

This brought the cumulative trade deficit for the 10 months of this year to US $ 8,857 million, up from US $ 7,591 million recorded during the corresponding period last year. 

“Sri Lanka’s external sector continued to be under pressure in October 2018. The trade deficit widened significantly in October due to a higher growth in import expenditure alongside a marginal growth in exports. 

“However, it is expected that the trend of increasing imports will reduce in the coming months with the lagged impact of recently introduced restrictions on certain import categories,” Central Bank said.

An analysis of the country’s import basket shows food and beverage imports declining by 18.6 percent YoY to US $ 121.2 million in October, responding to the recent restrictions imposed on non-essential consumer good imports and the improvement in domestic production of some categories such as rice.  

For instance, rice imports were just US $ 1.0 million in October compared to US $ 37 million in the same month last year. 

However, what defies everything is the staggering amount of dollars going into the importation of personal vehicles. 

People have spent US $ 161 million on personal vehicle imports in October compared to just US $ 55 million a year ago, registering a massive 193 percent growth despite the restrictions imposed by the government on vehicle imports.

The Central Bank said these were motorcars less than 1,500 cylinder capacity and hybrid and electric motor vehicles. 

This is despite revising up the excise duties of those motor vehicle types in August and subsequently imposing financial restrictions on such in September.

During the 10 months, Sri Lankans spent a mind boggling US $ 1, 391 million on personal motorcar imports. Sri Lanka’s public transport system remains at a pathetic state and the capital city Colombo has one of the worse traffic jams in the whole of Asia. Meanwhile, Sri Lanka spent US $ 266 million on fuel imports—US $ 62 million on crude oil and US $ 201 million on refined petroleum in October, which together are up by 12.3 percent over the same month in 2017. 

For the 10 months, Sri Lanka spent US $ 3,431 million on fuel imports, up 28 percent YoY. 

However, the world fuel prices have declined close to 40 percent since the beginning of October due to oversupply fears on a slowdown in global growth and increase in supplies from the U.S. Meanwhile, the investment good imports, which include machinery and equipment and building material, rose by 8.5 percent YoY to US $ 426 million. 

In the export front, agricultural sector exports suffered the most during October led by all categories except seafood, vegetable and rubber. 

Earnings from tea exports dropped by 15.2 percent YoY to US $ 115.5 million with ten months earnings declining by 5.3 percent YoY to US $ 1.2 billion reflecting lower average export prices and volumes. Meanwhile textile exports, Sri Lanka’s largest industrial export category, rose by just 0.9 percent YoY to US $ 396 million due to lower demand from the U.S. 

However this is despite the increase in exports to the EU market and non-traditional markets such as India, Canada, Japan and Hong Kong.  For the ten months, textile and garment exports rose by 5.2 percent YoY to US $ 4, 354.5 million. 

Further the food, beverage and tobacco exports also rose by 21.7 percent YoY to US $ 42.7 million.


Nov. vehicle registrations slow as restrictions seen taking effect


Registration of motor vehicles across most categories has finally slowed down in November in response to the restrictions imposed on such imports and their financing in August and September.

The motorcars recorded 3,354 registrations in November, down from 5,826 units in October, but up from 2,400 units 12 months ago, the monthly vehicle registrations tracker by JB Securities, showed.

In August, the Finance Ministry increased the duty on small cars to a minimum of 1.25 million and subsequently the Central Bank increased the margin requirement on such motorcar imports to 200 percent in September, in a bid to curb the vehicle import frenzy of the Lankans, who have been long battered by a poor public transportation system.

Road accidents in Sri Lanka, mostly fatal ones have reached a record level due to reckless driving while almost all major cities have become almost impassable due to congestion, which kills the country’s productivity. 

Economists say money spent on purchasing a personal vehicle is one of the most ineffective capital allocation decisions in this part of the world, but free market fighters defy this logic and continue to fight to brake the barriers for owning a vehicle while maintaining deaf silence on its insurmountable economic and social cost. 

For instance, those so-called liberal advocates fight for the rights of the three-wheeler owners and prospective ones when they get the wind of measures to clamp down on them, claiming the three-wheeler gives these people the individual freedoms. 

But they have failed to say nothing when the same three-wheeler owners and drivers literally infringe the right to use roads by millions of others and their engaging in other vices under the guise of driving a three-wheeler. 

Meanwhile, three-wheeler registrations fell to 1,314 units in November, down from 1,932 units over the previous month and 2,270 units 12 months ago.

Two-wheeler registrations recorded 22,373 units in November down from 30,889 units in October and 28,334 units 12 months ago. 

Scooters accounted for 14,476 units with the balance 7,897 units being motorcycles. 

Bus registrations recorded 130 units in November down from 201 units in October and 381 units 12 months ago. 

Meanwhile, premium branded motorcar registrations recorded 158 units in November down from 207 units in October. Brand new accounted for a mere 28 units with Mercedes accounting for 11 units (C class 8 units) and BMW 9 units (5-series 4).

Notable premium cars in November were a Porsche Cayenne-S, three Jaguars XF/XE and a Mercedes Benz C Coupe. In October, there were three BMW i8s, 1 Jaguar XE, 1 Porsche 718 Boxter and one Ferrari 488 Spider.  

Across all categories, Sri Lanka registered 31, 358 motor vehicles in November, significantly down from 44,036 in October, the data showed.–160211.html


Growth slumps to 2.9% in 3rd quarter

19 Dec, 201

Colombo (News1st): The country’s economic growth in the third quarter slumped to a historic low of 2.9% in the third quarter in comparison to 3.2% a year earlier reaffirming the continuous struggle. The growth rate in the 3rd quarter was lower in comparison to 3.7% achieved in the 2nd quarter.

The Gross Domestic Product at constant prices for the third quarter of 2018 was recorded as Rs. 2,431,627 million and GDP reported for the third quarter of 2017 was Rs. 2,362,698 million.

Agricultural activities expanded favourably by 3.3% compared to the contraction of 3.0% reported in the third quarter of 2017. Industrial activities recorded a positive growth rate of 1.9%, sharply down from 5.3% a year earlier and service activities expanded further by 3.9% up from 2.8% a year ago.

Speaking to News1st COO of the Advocata Institute, Dhananath Fernando stated that this drop will continue to have a bad impact on the economy, which means that it will take a longer time for Sri Lanka to upscale its economy.

He noted that our average growth rate after independence was about 4%, this year it was even below the average of this rate and if Sri Lanka is to become a rich country within one generation it should at least maintain an average growth rate of 8%.

On the other hand, he said the agriculture had picked up, because of the favourable weather conditions, but it is saddening to see that the industry side is struggling as it is the future of the country. “This signal is not very good for the economy, which means it will affect the wallets of the people in a very negative way,” said Dhananath Fernando.


Net outflows surpass US $ 200mn in October

December 23, 2018, 9:04 pm

Sri Lanka’s Central Bank says the trend of foreign investment outflows from the financial account continued during October, with notable outflows from the Colombo Stock Exchange and the government securities market.

Government securities market recorded a net outflow of 172 million dollars in the month of October while foreign investments in the CSE, including both secondary and primary markets, recording a net outflow of 36 million dollars.

Securities market recorded a net outflow of 640 million by the end of the first ten months of 2018 while the CSE recorded a net inflow of 1 million in the first ten months which comprised an inflow of 77 million to the primary market and a net outflow of 76 million from the secondary market.

Central Bank said foreign currency outflows together with import expenditure exerted pressure on the domestic foreign exchange market in the month of October.

The major inflow to the financial account during October was a foreign currency term financing facility of 1 billion US dollars obtained by the government.

Meanwhile, Earnings from tourism in October are estimated at 284 million dollars with cumulative earnings at 3,496 million US dollars during the first ten months of 2018.

Workers’ remittances at 599 million US dollars recorded an increase of 9.7 percent year-on-year in October 2018, the Central Bank data showed.


External Sector continued to be under pressure in October 2018

December 23, 2018, 9:06 pm

Sri Lanka’s external sector continued to be under pressure in October 2018. The trade deficit widened significantly in October due to a higher growth in import expenditure alongside a marginal growth in exports. However, it is expected that the trend of increasing imports will reduce in the coming months with the lagged impact of recently introduced restrictions on certain import categories. Meanwhile, workers’ remittances recorded a healthy increase in October, while earnings from tourism registered a marginal growth.

The financial account witnessed outflows of foreign investments from the government securities market and the Colombo Stock Exchange (CSE). Foreign currency outflows together with import expenditure exerted pressure on the domestic foreign exchange market. Consequently, the Sri Lanka rupee depreciated by 12.3 per cent in the first ten months of the year. Gross official reserves rose to US dollars 7.9 billion as at end October from US dollars 7.2 billion at end September 2018, supported by the receipt of the foreign currency term financing facility of US dollars 1 billion.

The deficit in the trade account widened significantly in October 2018 in comparison to October 2017 due to higher growth in imports. On a cumulative basis, the deficit in the trade account expanded during the first ten months of 2018 in comparison to the corresponding period of 2017.

Performance of Merchandise Exports Earnings from merchandise exports increased by 0.4 per cent (year-on-year) to US dollars 979 million in October 2018. The marginal growth of exports in October reflects mainly the decline in agricultural exports by 11.5 per cent which offset the 4.5 per cent growth of industrial exports. Under industrial exports, export earnings from textiles and garments increased marginally in October 2018 due to higher earnings from textile exports despite the slight decline registered in garment exports. The reduced earnings from garment exports was mainly driven by the lower demand from the USA, despite an increase in exports to the EU market and non-traditional markets such as India, Canada, Japan and Hong Kong. Further, reflecting the combined impact of both volume and export prices, earnings from petroleum products increased significantly in October 2018. Export earnings from food, beverages and tobacco and base metals and articles increased substantially during October 2018 due to improved performance in most of their sub categories. In addition, export earnings from animal fodder, machinery and mechanical appliances and transport equipment rose in October 2018 contributing towards the increase in industrial exports. However, export earnings from rubber products, gems, diamonds and jewellery and leather, travel goods and footwear declined in October 2018. Meanwhile, earnings from agricultural exports were lower during the month owing to the poor performance in almost all sub categories except seafood, vegetables and rubber. Reflecting lower average export prices and exported volumes, export earnings from tea declined in October 2018. Export earnings from spices also reduced during the month due to the poor performance in most categories of spices. Further, despite an increase in earnings from coconut non-kernel products, earnings from coconut exports decreased due to the drop in earnings from coconut kernel products such as desiccated coconut and coconut oil. However, owing to higher exports to the EU market, earnings from seafood exports rose during the month. Leading markets for merchandise exports of Sri Lanka in October 2018 were the USA,India, the UK, Italy and Germany, which accounted for about 50 per cent of total exports.

Performance of Merchandise Imports Expenditure on merchandise imports increased by 9.0 per cent (year-on-year) to US dollars 1,882 million in October 2018. All three sub categories namely intermediate goods, consumer goods and investment goods contributed to the import growth. Expenditure on intermediate goods increased due to higher imports of textiles and textile articles, fuel and wheat and maize imports. Import expenditure on textiles and textile articles increased mainly due to higher imports of fabric and yarn. Expenditure on fuel imports increased with the higher import prices of both crude oil and refined petroleum products despite the reduction recorded in import volume of refined petroleum. In addition, import expenditure on wheat and maize, chemical products, fertiliser, rubber and articles thereof and plastic and articles thereof increased during the month. However, expenditure on gold imports declined significantly in October 2018 reflecting the impact of customs duty imposed on gold since April 2018. Further, import expenditure on consumer goods increased during the month owing to higher imports of personal motor cars less than 1,500 cylinder capacity (cc), hybrid and electric motor vehicles. However, it is expected that the importation of motor vehicles would decelerate in the coming months reflecting the lagged impact on such imports of the policy measures introduced in September 2018. Meanwhile, expenditure on rice imports decreased during the month indicating the availability of sufficient quantities of domestic supply. It is notable that import expenditure on certain categories such as clothing and accessories, telecommunication devices, household and furniture items and home appliances decreased in October 2018 partly reflecting the impact of restrictions on non-essential consumer goods imports while also responding to relatively larger depreciation. Import expenditure on investment goods increased in October 2018 mainly due to higher expenditure incurred on machinery and equipment and building material imports. However, import expenditure on transport equipment reduced due to lower imports of commercial vehicles such as tankers and bowsers, lorries, buses and commercial cabs. China, India, Singapore, Japan and UAE were the main import origins in October 2018 accounting for about 61 per cent of total imports.

Other Major Inflows to the Current Account

Earnings from tourism in October 2018 are estimated at US dollars 284 million, with cumulative earnings at US dollars 3,496 million during the first ten months of 2018. Tourist arrivals in October 2018 grew marginally by 0.5 per cent as a result of a decline in tourists arriving from China, Germany and France compared to October 2017. Tourist arrivals during the first ten months of 2018 totalled 2,080,627, resulting in a 11.2 per cent increase over the corresponding period of 2017. Meanwhile, workers’ remittances at US dollars 599 million recorded an increase of 9.7 per cent, year-on-year, in October 2018. Such increase is noteworthy after marginal decreases for five consecutive months on a year on year basis. Consequently, the decline in workers’ remittances for the first ten months of the year was 0.5 per cent in comparison to the corresponding period of 2017, while US dollars 5,876 million was received as remittances during the first ten months of 2018.

Financial Flows

The major inflow to the financial account during October was a foreign currency term financing facility of US dollars 1 billion obtained by the government. However, the trend of foreign investments outflows from the financial account continued during October 2018, with notable outflows from the Colombo Stock Exchange (CSE) and the government securities market. The government securities market recorded a net outflow of US dollars 172 million in the month of October, thus raising the net cumulative outflow to US dollars 640 million by the end of the first ten months of 2018.

Meanwhile, foreign investments in the CSE, including both secondary and primary markets, recorded a net outflow of US dollars 36 million during the month of October 2018. On a cumulative basis, the CSE recorded a net inflow of US dollars 1 million in the first ten months of 2018 which comprised an inflow of US dollars 77 million to the primary market and a net outflow of US dollars 76 million from the secondary market.

International Reserves

Gross official reserves were estimated at US dollars 7.9 billion, equivalent to 4.2 months of imports as at end October 2018. Total foreign assets, which consist of gross official reserves and foreign assets of the banking sector, amounted to US dollars 10.4 billion at end October 2018, equivalent to 5.5 months of imports.

Exchange Rate Movements

The Sri Lankan rupee depreciated by 15.5 per cent against the US dollar during the year up to 21 December 2018. Furthermore, reflecting cross currency movements, the rupee depreciated against other major currencies during this period. The weakening of the Sri Lankan rupee against the US dollar mostly reflects a broad based strengthening of the US dollar globally, outflows from the government securities market and demand for import related payments in the foreign exchange market.


Inflation increased in November 2018

December 23, 2018, 9:04 pm

Headline inflation as measured by the year-on- year change in the National Consumer Price Index (NCPI, 2013=100)1 reversed its declining trend, recording 1.0 per cent in November 2018 from 0.1 per cent in October 2018. The increase observed in year-on-year inflation in November 2018 is mainly driven by the increase of the prices of Food items.

Year-on-year Food inflation increased to -3.9 per cent in November 2018 from -6.6 per cent in October 2018. However, year-on-year Nonfood inflation decreased from 5.8 per cent in October 2018 to 5.2 per in November 2018.

The change in the NCPI measured on an annual average basis decreased to 2.7 per cent in November 2018 from 3.3 per cent in

October 2018.

The month on month change of the NCPI increased by 2.2 per cent in November 2018 due to increase in the prices of the items in the Food category, particularly that of vegetables, green chillies, rice, limes and potatoes.

Meanwhile, prices of the items in the Non-food category also increased during the month where Health sub-category reported the highest increase. However, prices of items in the Transport (Petrol and Diesel) sub-category reported a decrease during the month.

The core inflation, which reflects the underlying inflation in the economy, decreased to 3.1 per cent in November 2018 from 3.4 per cent in October 2018 on year-on-year basis. Meanwhile, annual average core inflation remained unchanged at 2.4 per cent in November 2018.


Ranil will be UNP presidential candidate

Kiriella promises unbelievable reliefs for everyone through budget

December 24, 2018, 12:01 pm

Cyril Wimalasurendre

KANDY – Kandyan Heritage and Kandy Development Minister Lakshman Kiriella, addressing the media in Kandy, on Sunday (23), said that the Budget 2019 would grant unbelievable relief to the public.

The ordinary public, state employees, pensioners, Samurdhi beneficiaries and all others sectors would benefit from the budget to be presented, Kiriella said, after calling on the prelates of Malwatta and Asgiriya.

Kiriella said that the government would proceed with renewed vigour after the recent crisis situation and that the Tamil National Alliance (TNA) was with the government.

The TNA was ready to work with the political groups supporting the government in amity, Kiriella noted….


Vote on Account passed in Parliament

With 102 votes in favour and 6 against

December 22, 2018, 8:02 pm

The interim budget for the first quarter of 2019 was passed on Friday with 102 votes in favour with six against on Friday.

The vote on account was submitted before Parliament by Minister of Finance, Mangala Samaraweera. The JVP voted against the interim budget, while the UPFA abstained from voting.

Rs. 1,765 billion has been allocated for government expenditure of which Rs. 970 billion would be utilized for debt repayment purposes during the first quarter of 2019. 

Parliament was adjourned until January 8, 2019.


With the country at risk of default of its international loan obligations and being reduced to the status of a Greece or Argentina, Rajapaksa was compelled to resign. Had not last week’s vote on account been passed in the nick of time, the entire process of government would have ground to a halt. Public servants could not have been legally paid and essential services crippled. Despite the hot air Sirisena expelled proclaiming that he will not appoint Ranil Wickremesinghe prime minister even if he commanded the support of all 225 members of parliament, the president was forced to eat his words and appoint a prime minister he says he cannot work with. Such assertions, of course, must be taken with much more than the proverbial pinch of salt. Here is a man who proclaimed from the house tops not so long ago that if Mahinda Rajapaksa won the 2015 election, he and his family would be sent “six feet under the ground.” This is the very man he made prime minister in place of an ally whose party played the major role in placing him on the presidential throne.


SL averts $1.5bn foreign debt default

December 22, 2018, 8:36 pm

(Colombo, AFP) –

Sri Lankan government Friday secured parliamentary approval to avert a debt default of $1.5 billion after the annual budget was blocked by a seven-week political crisis.

During the last day of the legislature for 2018, MPs voted 102 to six to approve an interim budget to pay for urgent government expenditure in the first four months of 2019.

Finance Minister Mangala Samaraweera said he was finalising an appropriation bill for next year when President Maithripala Sirisena sacked the government on October 26, plunging the country into a constitutional crisis.

“We don’t have time to present a new budget, but we need to meet our (debt and salary) obligations,” Samaraweera told parliament to introduce the vote on the interim budget.

Legislators approved four months of government spending pending a full-fledged budget around February.


Indian markets slide after central bank chief quits; state vote outcome in focus

Reuters     11 Dec, 2018

Indian markets plunged early on Tuesday (December 11) before recovering some ground as Reserve Bank of India Governor Urjit Patel’s unexpected resignation on Monday (December 10) shocked investors.

For further direction traders were cautiously awaiting results from crucial state elections due later on Tuesday.

…Patel’s resignation came after a month-long tussle over policy with the government that has raised concerns about the central bank’s independence as a national election nears.

Government officials had been pressuring the RBI to allow some public sector banks laden with bad debt to lend more easily and pushed for the central bank to hand over some of its surplus reserves to help fund the fiscal deficit.

The Indian rupee dropped 1.5 percent to a one-month low of 72.4650 per dollar in early trade but pared some losses to trade at 72.24 by 0453 GMT versus its previous close of 71.35.

Traders also cited some dollar-selling intervention by state-run banks on behalf of the RBI, which helped stabilize the rupee.

The benchmark 10-year bond yield was at 7.65% versus 7.59% at the previous close after initially rising as high as 7.71%. The broader NSE stock index was down 1%.

India’s ruling BJP was trailing on Tuesday in three big heartland states, two TV networks said, as counting began from local elections seen as a final trial of strength for Prime Minister Narendra Modi before general elections next year.


How China Is Positioning Itself Among India’s Top 10 Investors Despite Bilateral Differences

In 2017, China invested an estimated $2 billion, compared to $700 million in 2016,

Given the success of recent investments, China could very soon become one of India’s top 10 foreign investors

“India’s relationship with China has often swung back and forth between paranoia and deep suspicion to a calmer assessment of the situation. Last August, when the two countries clashed in their most serious border crisis in the last four decades over Doklam, the Chinese government publicly reminded India about the lessons of the 1962 war. But such is the nature of the India-China relationship—and its unpredictable ups-and-downs—that last week Prime Minister Narendra Modi had an unprecedented “informal” meeting with Chinese President Xi Jinping, without aides or an agenda, in the Chinese city of Wuhan.”

Published by ee ink.

This site was inspired by the dedicated scholarship and work of S.B.D. de Silva, author of "The Political Economy of Underdevelopment"

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