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Sunday February 25th, 2024

New twists to Sri Lanka ruling party’s factional theatrics as alliance partners cry foul

The Rajapaksa Brothers, President Gotabaya, Prime Minister Mahinda and Basil at a felicitation

ECONOMYNEXT  – Partner parties of the Sri Lanka Podujana Peramuna (SLPP)-led alliance have issued a joint-statement criticising attempts from within to heap blame for a staggeringly unpopular fuel price hike on Energy Minister Udaya Gammanpila.

In a statement signed by, among others, National Freedom Front (NFF) leader and Industries Minister Wimal Weerawansa and MPs Vasudewa Nanayakkara, Prof Tissa Vitharana and Athuraliye Rathana Thero June 14, eight out of 11 parties representing the government rejected the attempt to blame the decision on their colleague.

SLPP general secretary MP Sagara Kariyawasam on June 12 demanded the resignation of Energy Minister Udaya Gammanpila accusing him of conspiring to bring the party leadership to disrepute by increasing prices.

Related: Sri Lanka ruling party kindles resignation drama over fuel price hike

Criticising the move, the alliance partners said in their statement: “The decision to increase fuel prices was taken by a cabinet sub-committee on cost of living chaired by the president and participated by the prime minister, as recently confirmed by the President’s Media Division. By assigning blame for this “unpopular” decision to Mr Gammanpila, SLPP General Secretary MP Sagara Kariyawasam has thrown the party into an unnecessary crisis before the public.”

The general secretary of the party openly challenging a decision made by the president and the prime minister has led to the public wondering if there is factionalism in the government, the party representatives said.

“We would like to point out that such clannish and immature actions ultimately result in the people losing confidence in the government. It is the duty of the president and the prime minister to to defeat this trend,” they said.

Meanwhile, in a new twist to the saga, State Minister Nimal Lansa has said SLPP architect and national organiser Basil Rajapaksa would not have allowed a fuel price hike at this juncture.

Fielding questions from reporters June 14, State Minister Lansa said people are facing immense difficulties due to the COVID-19 epidemic and the increase in fuel prices couldn’t have had come at a more inconvenient time.

“For about a year and a half people have been facing job losses, pay cuts and inability to pay loans. A hike in fuel prices affects all goods and services. This is not the time for it,” said Lansa.

The government had raised prices in a bid to bolster the cash-strapped state energy firm, ending an election promise to fix oil prices. Gammanpila had said the previous day (11) that the price hike was decided by the cabinet subcommittee as the state-run Ceylon Petroleum Corporation (CPC) had 330 billion rupees of accumulated losses and over 3 billion US dollars in foreign exchange which was in short supply.

“People have gone out from the pan to the fire. They’re already suffering. Though I’m in the government, I must say we interact with people in our communities. Some in Colombo can say various things, but when we go to the village, people tell us they find it difficult to live,” Lansa said on June 14

Asked if Basil Rajapaksa was behind the move to blame Gammanpila for the price hike, the Gampaha district MP said: “Basil Rajapaksa is someone who speaks directly. If he were here, he would not have permitted an oil  price hike. What we ask the energy minister to do is to intervene and reduce prices.”

Lansa claimed Kariyawasam was under pressure to voice the frustrations coming from the party’s lower ranks.

“If Basil Rajapaksa wanted to, he would speak to the president or the prime minister,” he said.

Rajapaksa, younger brother of President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa, is currently on a visit to the US, where he is a citizen.

There had been simmering tensions between Kariyawasam and a faction represented by Gammanpila and Weerawansa.

Gammanipla has gone on record referring to a benign “internal struggle” to course correct the alliance and reverse some of its more problematic decisions.

In April 04, 2021, the minister said there was a conspiracy afoot to undermine President Gotabaya Rajapaksa’s administration and destroy the alliance from within.

“We know there are certain provisions in the 20th amendment to the constitution that go against the mandate. The 20th amendment wouldn’t have come out in the form that it did if the goal was to serve the mandate,” he said.

In his June 12 statement, Kariyawasam alluded to attempts to deliberately sabotage the government to make the party leadership unpopular in the eyes of the public.

Kariyawasam had previously levelled similar allegations at Industries Minister Wimal Weerawansa.

Tensions between Weerawansa and sections of the SLPP can be traced back to early February when he refused to retract a remark he had made to a Sinhala-language weekly on February 7 that President Rajapaksa must lead the SLPP.

His comment drew the ire of Kariyawasam who demanded an apology and a retraction from his colleague.

Previously, on February 2,the SLPP secretary criticised Weerawansa for going public with his party’s opposition to the now-scrapped East Container Terminal deal. His actions, Kariyawasam said, were detrimental to the unity within the ruling coalition. (Colombo/June14/2021)

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Sri Lanka could get US$500mn from ADB in 2024

ECONOMYNEXT – Sri Lanka could receive 500 million US dollars in support from the Asian Development Bank in 2024 based on the progress of policy reforms, Country Director of the Manila-based lender, Takafumi Kadono said.

The ADB expect to go to its Board around March or April with a 100 million US dollar power sector loan subject to the cabinet of ministers of approving a revised electricity reform bill.

A 100 million dollar loan to support SMEs could also be approved in the early part of the year. Sri Lanka is setting up a credit guarantee agency to support credit for small firms.

A 200 million dollar credit for financial sector was also slated for the year. The ADB gave the first tranche of the financial sector policy loan late last year.

A $100mn for the water sector could also be approved later in the year.

Sri Lanka could get around 200 to 300 million US dollars a year at the lowest rate, or concessional ordinary capital resources (COL) rate of 2 percent.

The balance of would come at the ordinary capital resource rate linked to SOFR.

The ADB has also started work on a ‘Country Partnership Strategy’ for Sri Lanka covering the 2024-2028 period, Kadodo said. (Colombo/Feb25/2024)

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Sri Lanka’s multi-aligned foreign policy based on friendship: Min

ECONOMYNEXT – Sri Lanka’s multi-aligned foreign policy is based on friendship to all and enmity to none, its Minister of Foreign Affairs has said.

“Non-alignment means not becoming a bystander. Non-alignment means you are not forced or coerced into a camp to take sovereign decisions… you make your own choices. Whether it is commercial, security, regional or otherwise,” M U M Ali Sabry said on X (twitter).

“I have repeatedly stressed that sovereignty is the right to have your own opinion on what’s right and wrong, and to stand by your principles. Our multi-aligned foreign policy is based on friendship to all and enmity to none,” Sabry was quoting from his speech at the Lakshman Kadirgamar Institute of International Relations and Strategic Studies (LKI) Foreign Policy Forum, on the theme ‘Reassessing Non-Alignment in a Polarised World’.

Sri Lanka is one of the founding members of the Non-Aligned Movement.

The strategically located island has been increasingly walking a fine line between opposing global factions as it seeks to come out of a financial crisis. (Colombo/Feb24/2024)

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Sri Lanka’s Commercial Bank Dec net down on tax provisions

ECONOMYNEXT – Sri Lanka’s Commercial Bank of Ceylon reported profits of 6.9 billion rupees from the December 2023 quarter down 21 percent, despite an improvement in net interest income and lower provisions, amid a change in tax provisions.

Pre-tax profits were 8.89 billion rupees up from 2.4 billion rupees. There was a 6.4 billion tax reversal last year compared to a 1.7 billion rupee tax charge this year.

Commercial Bank reported earnings of 5.26 rupees for the quarter. For the year to December 2023 earnings were 16.07 rupees per share on total profits of 21.1 billion rupees, down 11.3 percent.

Net fee and commission income was down 1.2 percent to 6.1 billion rupees.

Net interest income went up 16.8 percent to 25.5 billion rupees, with interest income rising marginally by 1.3 percent to 73.0 billion rupees and interest expense falling 5.45 percent to 47.5 billion rupees.

Loans and advances to customers grew 4.06 percent to 1.17 billion rupees in the year to December. Debt and other financial instruments fell 10.5 percent to 649 billion rupees.

Financial assets measured and fair value through other comprehensive income was at 287 billion rupees, up from 117 billion rupees.

Impairment charges were 13.1 billion rupees, down from 19.6 billion rupees last year.

Gross assets were up 6.45 percent to 2.36 billion rupees. Net assets were up 5.51 percent to 214 billion rupees. (Colombo/Feb24/2024)

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