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Monday December 11th, 2023

Child or business? Sri Lanka flag vendor given choices by Rajapaksa backers before attack

ECONOMYNEXT – It was a hard choice to Shermila Mohamed, a national flag vendor at the protest site on May 09 near the presidential secretariat where hundreds of protesters had been demanding the resignation of President Gotabaya Rajapaksa and his government for one month.

A hoard of former Prime Minister Mahinda Rajapaksa’s supporters, hours before his resignation, stormed the Galle Face Green protest site where Shermila had been running a successful flag business selling national flags to protestors at the the Gota Go Gama, the makeshift “village” which the protests were centred around.

“They (Rajapaksa supporters) asked me what I value more, my child or my business,” Shermila told Economy Next on Tuesday (25) sharing her horrific experience on May 09 – which has since come to be known as Black Monday – when government supporters brutally attacked unarmed and peaceful protesters.

“I said my child and they said, ‘Then we will have to burn down your tent’.”

And burn it they did. Before setting the tent on fire, they trampled down Shermila’s flags, her bread and butter. Not one flag was spared.

Shermila holds a permit as a vendor at Galle Face. She left her job at a popular electronic store and days before the protests decided to start up a business selling flags with her brother and son. That ambition came to a halt on Black Monday.

“I had flags, needle and thread, wooden poles and masks – all worth 600,000 rupees, which I bought with a loan. How will I repay it with no sales?” she said.

The attacks, however, did not discourage her to leave the protest site.

Now she sells Buddhist flags which she had ordered after May 09 for the Vesak national Buddhist festival.

“The Buddhist flags I sell now are to remember the attack on May 09 by  government supporters who insist they follow Buddhism,” she said.

The attacks over protesters and people like Shermila later led to retaliatory mob violence across the country, with anti-government protestors attacking the then ruling Sri Lanka Podujana Peremuna (SLPP) supporters and torching the houses of SLPP legislators and local councilors. At least 10 people were killed and nearly 300 were injured in the clashes.

Despite the violence, people like Shermila cannot afford to close down her business because she may have to starve in what has become an unprecedented economic crisis.

The severity of the economic crisis has forced many to take to the streets demanding that the president and the government leave office. The protesters also want justice and are calling for the Rajapaksas to be held accountable for their actions on May 09.

The attack later forced Prime Minister Mahinda Rajapaksa to resign along with his cabinet of ministers, paving the way for a new government under prime minister Ranil Wickremesinghe.

The new prime minister has yet to address key economic issues, but many see another time bomb ticking to potentially massive public riots over food and medicine shortages in the next few months.

At Gota Go Gama, some vendors have now settled with different jobs, which partially explains Sri Lanka’s economic crisis, which was the root cause for the protest.

M K Lakshan from Kurunegela has resorted to selling masks, flags and protest accessories, after fuel price hikes took a toll on his main source of income of running a three-wheeler for hire.

Lakshan, a father of one, said he has been observing the protest and decided to do his bit as a citizen while also making a living.

Sri Lankan flag and mask vendors were seeing a boom in business at the protest site before Black Monday because there was high demand for those products at the protest site.

“Demand has also grown because protesting became an activity open to the public after the country was closed for more than two years,” said Danura Gunesekera, who sells mobile accessories and clothing.

He said the relaxation of COVID-19 restrictions after two years helped bring strong support to the protest.

“People are more interested in coming forward for the country,” Gunesekera told EconomyNext.

Gunesekera said the cost of running at Galle Face is significantly lower as they are mobile sellers and don’t have a rent to pay considering the prime location they trade at.

“I used to make 30,000 a day from selling flags here. My only expense as of now is paying for my cart which is 200 rupees a day. Other than that I get food, water and other facilities all from here,” said S Subramaniam also known as Suda at Gota Go Gama.

Suda’s business was also disrupted after the May 09 mayhem.

He was a wagon toy seller that was prominently seen in the areas of Dehiwala and Colombo.

Subramaniam first visited the protest site in the first week of the protest. Seeing the determination and the commitment of the people helped spark the business idea, he said.

Shantha Kumara, a hand band and sticker vendor at Galle Face, started selling headbands and face stickers to protestors.

“I get the head band made from Kandy and I sold about 60 pieces on weekdays and during the weekends I sold about 100 pieces,” Kumara said adding that before the protest he would sell items in accordance with the season.

This season, before May 09 it happened to be face tattoos and head bands that say “Gota Go Home” that became one of the fastest selling items for Kumara who was there from day one. (Colombo/May3/2022)

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Sri Lanka rupee opens at 327.00/50 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee opened at 327.00/50 to the US dollar on Monday, from 327.00/30 Friday, dealers said.

On the Colombo Stock Exchange, both indices opened up: The All Share Price Index 0.28 percent at 10,823, and the S&P SL20 0.35 percent at 3,113.85.

Bond yields were up.

A bond maturing on 01.08.2026 was quoted at 14.05/20 percent from 14.05/15 percent.

A bond maturing on 15.01.2027 was quoted at 14.05/20 percent from 14.10/25 percent.

A bond maturing on 01.07.2028 was quoted at 14.20/50 percent from 14.20/35 percent.

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Sri Lanka promoting Buddhist tourism from Vietnam, ASEAN

ECONOMYNEXT – Sri Lanka is planning to boost Buddhist tourism by linking temples in the country with those in East Asia, Foreign Minister Ali Sabry said after to welcoming a delegation of monks from Vietnam.

President Ranil Wickremesinghe, and Minister Sabry have initiated a temple-to-temple program where 100 Sri Lanka temples will be linked with counterparts in the Association of South East Asian Nations region.

“Tourism development will get a lot of growth with the temple-to-temple program,” Minister Ali Sabry said.

Along with the delegation of monks, five travel agents from Vietnam were also invited.

Under the first phase of the Temple-to-temple programs, several monks from Sri Lanka had received invitations from Indonesia, Malaysia, South Korea and Vietnam the Foreign Ministry said.

The Temple-to-Temple diplomacy program will be extended to Singapore, Japan, Thailand and Cambodia during the second phrase of the program.

Sri Lanka is targeting 2.3 million tourists in 2023, after getting about 1.5 million this year. (Colombo/Dec10/2023)

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ADB $200mn loan for Sri Lanka economic stabilization efforts

ECONOMYNEXT – The Asian Development Bank (ADB) has approved a US 200 million dollar concessional loan to Sri Lanka to help stabilize the country’s finance sector.

The Financial Sector Stability and Reforms Program comprises two subprograms of IS 200 million dollars each, according to a statement by the ADB.

“The program’s overarching development objective is fully aligned with the country’s strategy of maintaining finance sector stability, while ensuring that banks are well-positioned for eventual recovery,” ADB Country Director for Sri Lanka Takafumi Kadono was quoted as saying in the statement.

“The expected development outcome is a stable financial system providing access to affordable finance for businesses in various sectors of the economy.”

The ADB statement continues:

“Subprogram 1 targets short-term stabilization and crisis management measures that were implemented in 2023, while subprogram 2 is planned to be implemented in 2024 and focuses on structural reforms and long-term actions to restore growth in the banking sector.

The program will help strengthen the stability and governance of the country’s banking sector; improve the banking sector’s asset quality; and deepen sustainable and inclusive finance, particularly for women-led micro, small, and medium-sized enterprises.

According to the International Monetary Fund’s (IMF) latest review, Sri Lanka’s economy is showing tentative signs of stabilization, although a full economic recovery is not yet assured.

The program is a follow-on assistance from ADB’s crisis response under the special policy-based loan that was approved for Sri Lanka in May 2023.

It is aligned with the fourth pillar of the IMF’s Extended Fund Facility provided to Sri Lanka to help the country regain financial stability.

It is also in line with the government’s reform agenda, including strengthening the operational independence of the Central Bank of Sri Lanka (CBSL) and its designation as the country’s macroprudential authority.

In designing this subprogram 1 loan, ADB has maintained close coordination and collaboration with the IMF to design targeted regulatory reforms for the banking sector—including the asset quality review—and with the World Bank on strengthening the deposit insurance scheme.

“The loan is accompanied by a $1 million grant from ADB’s Technical Assistance Special Fund to provide advisory, knowledge, and institutional capacity building for Sri Lanka’s Ministry of Finance and CBSL.”

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