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Tuesday February 27th, 2024

Sovereign debt defaulted Sri Lanka plans for $1 bln ambitious sports university

ECONOMYNEXT – Sovereign debt-defaulted Sri Lanka is eying to establish an ambitious sports university with an estimated cost of $1 billion by 2024, State Sports Minister Rohana Dissanayake said.

Sri Lanka’s economic crisis forced it to declare bankruptcy in April last year and the island nation has suspended its commercial and bilateral debt repayment since then.

The island nation is in discussions with its external debtors to restructure the past borrowings before starting repayment.

However, the State Sports Minister said some foreign firms have discussed the Sports University.

“Several foreign firms have discussed Sports University with us. The estimated cost is $1 billion (335 billion Sri Lanka rupees) to implement all the courses we have planned. We expect to provide a broader sports science course,” Dissanayake told reporters on Friday at a media briefing without elaborating on the names of foreign investors.

“We have informed the President about this proposal, and we believe that the President will allocate some funds in the budget for this from the treasury.”

Sri Lanka has witnessed higher performance only in select sports. It has won two Olympic medals in athletics, while secured 24 Commonwealth medals in weightlifting, boxing, athletics, shooting, and wrestling. In team games, it has won 50-over Cricket World Cup in 1996 and T20 in 2014.

Walking on a tightrope over finance, President Ranil Wickremesinghe, who is also the country’s finance minister has only allocated 125 million rupees for sports goods for 2024.

“If we don’t get, still we expect to establish this and sustain this as a private sports university,” Dissanayake said.

“There could be a lot of allegations and suggestions when we try to implement this. But the objective of mine and Sports Minister Roshan Ranasinghe is to establish this sports university by 2024 and provide opportunities not only for Sri Lankans, but also South Asian athletes. This could be a revenue generation project as well.”

“We expect both state funds and private sector funding to do this.”

Sri Lanka, during former president Mahinda Rajapaksa went ahead with massive infrastructure projects with borrowed money. Later, the island nation struggled to repay as most of those infrastructure projects failed to generate adequate return on investment.

Former Sports Minister Namal Rajapaksa mooted the idea of a globally accepted sports university idea when he was in power in 2020, but it was not materialize amid lack of funding and Covid outbreak. (Colombo/Nov 11/2023)

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Sri Lanka halts auction of bank loan collateral till Dec 15

ECONOMYNEXT – Sri Lanka’s Cabinet of Ministers had approved a proposal by President Ranil Wickremesinghe to amend the country’s loan recovery law and halt auctioning of defaulted loans till December 15, Minister Bandula Gunawardena said.

“Various parties have pointed out issues existing in paying off the loans obtained by small and medium scale businessmen from banks,” Gunawardena said Tuesday.

“Therefore, it is apparent that a sufficient grace period to pay off relevant debts without being a burden to the banking system should be allowed.”

“Accordingly, the Cabinet of Ministers granted approval … to suspend the procedure by the banks to acquire properties of loans not paid off, until 15 December 2024, and to amend Section 4 of the Recovery of Loans by Banks (Special Provisions) Act No, 4 of 1990 to impose legal provisions required for the above.” (Colombo/Feb27/2024)

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Sri Lanka parliamentary committee says electricity tariffs should be reduced by 20 pct

ECONOMYNEXT — A parliamentary Sectoral Oversight Committee on Alleviating the Impact of the Economic Crisis has recommended to the Public Utilities Commission of Sri Lanka (PUCSL) that electricity tariffs be reduced by at least 20 percent.

A statement from parliament said on Monday February 26 that, following an analytical review of the figures presented by the Electricity Board, Public Utilities Commission, etc. and taking into consideration all other factors affecting the price of electricity, including considering the opinion given by experts that the existing electricity price can be reduced by about 33%, price of electricity should be reduced by at least 20% in the year 2024 so that the state-run Ceylon Electricity Board (CEB) will not suffer any loss.

PUCSL officials have informed the Committee that by the end of this month, they can submit the necessary recommendations to reduce the electricity bill, according to the statement.

The matter was taken up for discussion when the committee, chaired by MP Gamini Waleboda, met in the Parliament on February 22.

Officials from the Ministry of Industry, Ministry of Finance, Central Bank of Sri Lanka, Public Utilities Commission, Industry Development Board, Enterprise Development Authority, Department of Population and Statistics, Department of Inland Revenue and from government institutions including the Micro, Small and Medium Scale Industries Board and a group of industrialists had also been called for the meeting.

“The Committee gave several directives to the relevant institutions and officials to identify the micro, small and medium scale industries that are directly affected by the economic crisis and to activate the local economy and increase the foreign exchange earnings by reviving the industry sector.

“The Committee pointed out that due to the increase in electricity bills, the number of electricity connection cuts reported across the island has exceeded one million. It was also emphasised that in order to alleviate the pressure on the industry and the society, it should be arranged to provide electricity connections again by charging only 50 percent of the outstanding charges at the initial stage with the concessional basis of payment of outstanding electricity charges on installment basis,” the statement said.

The committee was also of the view to allow the customer to pay the connection fee in installments so as to avoid discouraging new entrepreneurs to start micro, small and financial industries due to high charges for getting fixed electricity connection and instructed to review the new connection fee and work to reduce it as much as possible.

The committee chair has instructed the PUCSL to conduct an audit on the electricity consumption in the public sector as an approach to ensure energy security.

“The Committee recommended to the Ministry of Finance and the Central Bank to start a loan scheme at subsidised interest for the purchase of solar panel systems with a view to promoting solar energy as a source of energy supply to industries. The Ministry of Finance expressed its agreement to provide refinancing facilities subject to a maximum as per the proposal made by the Committee to implement a loan scheme targeting micro, small and medium scale industrialists under subsidized interest rates.

The committee has also recommended that raw materials that must be imported from abroad and impose tax concessions on such raw materials be identified to ensure the supply of raw materials required for the smooth running of micro, small and medium scale industries. Copper, lead, aluminum and other industrial scraps used as raw materials in various domestic industries currently being sold by the CEB to external buyers and other entities should also be issued to micro, small and medium scale industrialists recommended by the Ministry of Industry and the Industrial Development Board, the committee has recommended.

The definition used by the Department of Population and Statistics for micro, small and medium industries and the definition used by other institutions such as the Industrial Development Board and the Central Bank for those industries are different from each other, which is an obstacle in making policy decisions, the committee had noted, directing the Department of Population and Statistics to support to the policymakers by releasing statistical data based on a common definition.

“The committee also recommended that the Credit Information Bureau should take prompt action to remove their credit information from the blacklists so as to facilitate access to credit facilities for micro, small and medium scale industries facing financial crisis to activate their balance sheets and to review all existing laws and procedures for registration of micro, small and medium scale industries as well as to obtain licenses and introduce a simple system.

“The committee informed all the parties to establish a steering Committee headed by the Ministry of Industry to implement the recommendations given by the Committee and to report its progress within a week,” the statement said. (Colombo/Feb27/2024)

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Sri Lanka sets up fund to help children of Gaza

The United Nations Relief and Works Agency for Palestine Refugees in the Near East is mandated to provide education, health, relief and social services, and emergency assistance to refugees. (Pic courtesy UNWRA)

ECONOMYNEXT – Sri Lanka’s cabinet of ministers have approved a proposal by President Ranil Wickremesinghe to set up a fund to help children caught in the war in Gaza, a statement said.

The government will contribute a million US dollars and use funds allocated by state agencies for Ifthar celebrations.

Public contributions are also called.

The Presidential Secretariat is requesting public donations citizens for the “Children of Gaza Fund” to be contributed to account number 7040016 at Bank of Ceylon (7010), Taprobane Branch (747) by 11th April.

Deposit receipts should to be forwarded to 0779730396 via WhatsApp. (Colombo/Feb27/2024)

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