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Sunday December 3rd, 2023

Sri Lanka AG-headed delegation meets X-Press Pearl shipowner’s lawyers in Singapore

ECONOMYNEXT – A delegation led by Sri Lanka’s attorney general has met lawyers representing the ship-owner interests in the X-Press Pearl maritime disaster in a meeting that discussed, among other things, interim claims made by Sri Lankan authorities.

According to a statement from the President’s Media Division (PMD), the meeting took place in Singapore on July 18 and 19. The Sri Lankan delegation, appointed by the cabinet of ministers, comprised nine officials.

The PMD statement called the meeting a “significant development” but clarified that it would have “no bearing on the ongoing legal proceedings initiated by the government of Sri Lanka in Singapore, which are already underway.”

The meeting was convened in response to a request made by the lawyers on behalf of their clients following a claims action filed by Sri Lanka in Singapore in April. Both parties addressed several critical aspects related to the incident and its aftermath during this week’s meeting, the statement said.

“A key focus of the talks was to assess the outstanding interim claims put forth by the Marine Environment Authority and the Ministry of Fisheries from the Government of Sri Lanka. In response to their concerns, the Sri Lankan delegation received assurance from the ship-owner interests’ insurers that the assessment of these claims would be conducted promptly and efficiently,”the PMD said.

The attorney general, representing the government of Sri Lanka, has highlighted at the meeting the urgency of concluding the ongoing wreck decommissioning and debris recovery works within Sri Lankan waters. The PMD said the insurers of the ship-owner interests had responded positively to this, indicating their cooperation in addressing this issue.

The lawyers had also expressed their willingness to consider claims made by the Sri Lankan government concerning the damage caused to the marine environment and had showed openness to further discussions with Sri Lanka in the near future, the PMD said.

“The talks mark a significant step in resolving the aftermath of the X-Press Pearl Incident and indicate a cooperative approach by all parties involved. As the assessment of outstanding claims and environmental damage claims progresses, both the Sri Lankan government and the ship-owner interests hope to reach a fair resolution that takes into account the environmental impact and the interests of all stakeholders,” it said.

In May Sri Lanka’s main opposition party the Samagi Jana Balawegaya (SJB) issued letters of demand to the owners of the MV X-Press Pearl containership seeking compensation for the worst maritime disaster in the country’s history.

The ship, operated by Singapore based X-Press Feeders, caught fire and sank off the Colombo in May 2021 with a cargo of chemicals.

The opposition has accused the government of coming up with excuses for not actively pursue the damages claim.

Justice Minister Wijeyadasa Rajapakshe told parliament in May that the government had filed a claim in Singapore but will also fight the case in the UK after insurers and owners went to Admiralty Courts seeking to limit compensation to 19.2 million sterling pounds.

An expert committee appointed on the matter has estimated the total damage to 6.4 billion US dollars.

Sri Lanka has sought 22.1 million US dollars in damages for the marine environment and 273.014 million US dollars for fishermen, Rajapasksa told parliament.

India has sought 495.3 million Indian rupees from Sri Lanka as the cost for firefighting operations, which was 1941.5 million in Sri Lankan rupees.

Sri Lanka has hired Dentons Rodyk and Davidson LLP legal firm in Singapre and Sparke Helmore of Australia to argue its case.

The owners of the vessel and its insurers have gone to an Admiralty Court in the UK seeking to cap damages to the ship and the marine and coastal environment at 19.2 million sterling pounds, Rajapakshe said.

King’s Counsel Peter MacDonald from DAC Beachcroft firm has been hired to represent Sri Lanka in seeking a removal of the cap on damages, he said. (Colombo/Jul20/2023)

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UAE investors express interest in Sri Lanka’s energy, tourism, ports, real estate: Ali Sabry

ECONOMYNEXT – A group of investors based in the United Arab Emirates have expressed their interest in renewable energy, tourism, ports, and real estates, Foreign Minister Ali Sabry told Economy Next.

A Sri Lankan delegation led by President Ranil Wickremesinghe is in Dubai to take part in the 2023 United Nations Climate Change Conference (COP28).

Sabry said a group of large investors met the President on Friday and discussed possible opportunities in Sri Lanka.

“We met big investors here particularly on renewable energy, tourism, port development and also infrastructure development and real estate. That’s where they are doing very well,” Foreign Minister told Economy Next.

“Our embassy will organize a higher-level business delegation to visit Sri Lanka to look at the available opportunities.”

“There is a lot of traction and interest in Sri Lanka.”

Sri Lanka has been exploring to attract investors to crisis hit Sri Lanka which declared bankruptcy in April last year with sovereign debt default.

Since then, most investors have taken a step back from investing in the island nation due to its inability to serve debts and uncertainty over such investments.

Several government officials said investors may start pouring dollars into Sri Lanka very carefully after they see some certainty of debt repayments. (Dubai/Dec 3/2023)

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Sri Lanka to push for green initiative investment “after OCC finalizing” debt deals – President

ECONOMYNEXT – Sri Lanka will push for investment into green initiatives globally after the Official Creditor Committee (OCC) finalizing on the island nation’s debt restructuring, President Ranil Wickremesinghe told Economy Next at the 2023 United Nations Climate Change Conference (COP28).

President Wickremesinghe along with local and global advisors has inaugurated three ambitious projects to convert climate change-led disaster funding, which is mostly seen as donations, into viable commercial enterprises involving private sector investments.

The idea is to rally all the global nations in the Tropical Belt threatened by disasters related to climate change and bargain collectively with advanced economies which emit more greenhouse gases into the environment resulting in global warming for more green initiatives like renewable energy projects.

Wickremesinghe initiated a Climate Justice Forum (CJF), Tropical Belt Initiative (TBI), and called on the world to help establish the International Climate Change University in Sri Lanka.

His moves have been welcomed by global leaders, though analysts said an initiative like TBI is a “bold and imaginary” step.

“This is the first step. We have now put forward the proposal,” Wickremesinghe told Economy Next on Sunday on the sideline of the COP28 in Dubai’s EXPO 2020.

“There is an interest. We have to wait for OCC finalizing (debt restructuring) before pushing for investments.”


Global investors are hesitant to invest in Sri Lanka due to its bankruptcy and sovereign debt default.

Sri Lanka is still recovering from an unprecedented economic crisis which has compelled the island nation to declare bankruptcy with sovereign debt default.

President Wickremesinhe during a forum on Saturday said his initiatives would help government in advanced countries not to use tax money of its own people for climate related disasters in other countries and instead, private sector investors could help by investing in renewable energy initiatives.

President Wickremesinghe’s government has been in the process of implementing some tough policies it committed to the International Monetary Fund (IMF) to stabilize the country and ensure sustainability in its borrowing.

Sri Lanka is yet to finalize the debt restructuring fully as it still has to negotiate on repayment schedule of commercial and sovereign bond borrowing.

The OCC and Sri Lanka had agreed on the main parameters of a debt treatment consistent with those of the Extended Fund Facility (EFF) arrangement between Sri Lanka and the IMF.

The members of the Paris Club which are part of the Official Creditor Committee are representatives of countries with eligible claims on Sri Lanka: Australia, Austria, Belgium, Canada, Denmark, France, Germany, Japan, Korea, the Netherlands, Russia, Spain, Sweden, the United Kingdom, the United States of America.

The OCC has said it was expecting other bilateral creditors to consent to sharing, in a transparent manner, the information necessary for the OCC to evaluate comparability of treatment regarding their own bilateral agreement.

The OCC also has said it expects that the Sri Lankan authorities will continue to engage with their private creditors to find as soon as possible an agreement on terms at least as favourable as the terms offered by the OCC. (DUBAI/Dec 3/2023)

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Sri Lanka alcohol regulations may be spurring moonshine: Minister

ECONOMYNEXT – Sri Lanka’s alcohol regulations may be reducing access to legal products and driving illegal moonshine sector, State Minister for Finance Ranjith Siyambalapitiya said amid plans to change opening times of retail outlets.

Sri Lanka is currently discussing changing the opening times of bars (retail alcohol outlets), he said.

Sri Lanka’s excise laws may be contributing to the growth of illegal products, Minister Siyambalapitiya was quoted as saying at the annual meeting of Sri Lanka’s excise officers.

Over 20 years legal alcohol sales have grown 50 percent but illegal products are estimated to have grown 500 percent, he said.

It is not clear where the 500 percent estimate came from.

In Kandy there was a bar for every 6,000 persons but in Mullativu there was one for only 990,000 persons and people had to travel 80 kilometres to get to a legal outlet, Minister Siyambalapitiya had said.

However Sri Lanka has a widespread moonshine or ‘kasippu’ industry driven by high taxes on legal products.

The widely used ‘gal’ or special arrack is now around 3,500 rupees and may go up further with a hike in value added tax. About 2000 rupees of the sale price is taxes.

After a currency collapse and tax hikes legal alcohol sales have fallen, leading to local sugar companies burying ethanol, according to statements made in parliament.

An uneven distribution of bars may also be driving people towards alcohol.

Alcohol sales is controlled on the grounds that it is an addictive product which can lead to poverty, ill-health, bad behaviour and criminal activities, though advocates of high taxes ignore the poverty angle.

High taxes are promoted by temperance movements some of whom have called for outright prohibition in the last century.

Temperance movements spread among evangelical groups in the West and were also embraced by nationalists/moralists and independence movements in colonial authorities.

Prohibition in the US however led to more criminal activity as an organized crime took to bootlegging. (Colombo/Dec03/2023)

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