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Friday February 23rd, 2024

Sri Lanka lines up funds for drugs, but facing procurement delays: Minister

ECONOMYNEXT – Sri Lanka has lined up finances to import required drugs for the state hospitals for the next 12 months or more but procurement delays are creating shortfalls of some drugs from time to time, Health Minister Keheliya Rambukwelle said.

Under an Indian credit line 200 million has been allocated for drugs, the Asian Infrastructure Investment Bank is giving 100 million dollars, Asian Development Bank 63 million, World Bank 40 million dollars and China has given a 38 million dollar grant.

The money is easily enough for more than a year of requirements.

“I am not short of funds,” Minister Rambukwella told EconomyNext. “This department needs about 200 to 250 million dollars a year to import drugs.

“The only thing is procurement procedures are tedious. For example the Indian credit line. The procurement procedures from my end I have reduced from 9 months to 1 month. But my Indian counterparts over there, there is a huge delay.”

Sri Lanka’s drug procurement process was disrupted after the rupee collapsed earlier in the year and suppliers who had bid in rupee could not make good on their contracts. Some also had supplier credit in dollars which had since depreciated, according to industry officials.

On top of that there were forex shortages.

State hospitals are also seeing an influx of new patients who can no longer afford private care he said.

As a result he has asked for extra drugs to be ordered, going beyond usual practice of ordering an average of recent years.

“Of the vital drugs all 14 we have. We were short of anti-rabies and ant-venin. From China we have got it for one year. Six months stock has come,” he said.

“Out of the essential drugs – it keeps on changing. Now we are short of about 80 out of 385. Tomorrow it can be 60 and day after it can be 120, because the ordering pattern has been disrupted.”

“Non-essentials are ok. The name itself means it is not a life and death issue. You have alternatives, so it can be managed.

“The critical ones are – you die. That 14, if you do not have within the first hour you die. That 14 we have.”

The UNOPS and private donors were also helping he said.

“I do not know how long these will continue. Globally also conditions are not good,” he said.

“The best is to be ready.”

Sri Lanka is in the midst of the worst currency crisis in the history of the island’s intermediate regime central bank. The rupee fell from 200 to 360 to the US dollar in 2022, after two year of money printing and failed attempt to float with a surrender requirement.

Sri Lanka’ central bank has since raised rates, to reduce private credit and phase out money printing. To reduce the budget deficit, taxes have also been hiked. (Colombo/Oct17/2022)

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Sri Lankans may need to wait for Monetary Board meeting minutes despite new Act

ECONOMYNEXT – Sri Lankans may have to wait more time to read the meeting minutes of the Central Bank’s Monetary Board, a top official said, despite a new act that has made the central bank to be more transparent and accountable for its decisions.

Many central banks including the United States’ Federal Reserve, India’s Reserve Bank, and Bank of Mexico release the minutes of their monetary policy meeting to ensure transparency.

The new Central Bank Act passed by the Parliament in line with the guidance by the International Monetary Fund (IMF) includes measures for Sri Lanka’s central bank to be more transparent and accountable.

These measures include releasing the Monetary Policy Report every six months and the first such report was released on February 15.

However, the central bank has not taken a decision to release the minutes of the Monetary Board meetings on the monetary policy.

“Going forward, one day this could happen,” Chandranath Amarasekara, Assistant Governor at the Central Bank told reporters on Wednesday (21) at a media briefing.

“Right now, we have just started working on the new Central Bank Act. We are not there yet. There is no such decision on releasing minutes yet.”

The central bank in the past printed billions of rupees to keep the market interest rates artificially low and provide cheap funding for successive governments to propel a debt-driven economy.

It’s decision, however, led Sri Lanka into an unprecedented economic crisis in 2022 with sovereign debt default.

It also propped up the rupee currency artificially in the past to maintain a stable exchange rate at the expense of billions of US dollars. The move also contributed for the economic crisis and later the central bank was forced to allow over 60 percent depreciation in the rupee in March 2022.

However, none of the top central bank officials was held responsible for wrong decisions to hold interest rates artificially low with money printing and propping up the rupee. (Colombo/Feb 23/2024)

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Amid mass migration, Sri Lanka to recruit volunteers as English teachers

ECONOMYNEXT- Sri Lanka is planning to appoint foreign and expatriate volunteers to teach English for Sri Lanka students, the Ministry of Higher Education said, amid thousand of teachers migrating to other countries after the island nation’s unprecedented economic crisis.

Over five thousand teachers have left the country with the Education Ministry permission using the government’s circular of temporarily leaving state jobs while tens of thousands of teachers have left the country without informing the relevant authorities, Education Ministry officials say.

That had led to an acute teacher shortage in the country.

Suren Raghavan, the State Minister for Higher Education said the shortage has aggravated because most of the graduates who have an English degree become writers and join the private sector due to higher salary.

“They do not join government schools. This is a problem all over the country which is why we need to have an online system,” Raghavan told EconomyNext.

Separately he said on Thursday at a press conference that he had spoken to Canadian and Australian High Commissions to get the assistance of where their English teachers who have experience in teaching English as a second language in South Asia.

He also said that there is a number of teachers in the Unite Kingdom have shown interest in teaching English and they have experience in teaching in other Asian countries such as Burma and India while the teaching would be done free of charge.

The new move also comes at a time when the country’s English literacy rate is on the decline, according to the Minister.

President Ranil Wickramasinghe announced the English-for-all initiative three months ago with plans to improve English literacy at school and university level. (Colombo/Feb 23/2024)

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Sri Lanka tea production up 1.4-pct in Jan 2024, exports up 6.8-pct

ECONOMYNEXT – Sri Lanka’s tea production was up 1.4 percent to 18.73 million kilograms in January 2024, with high growns falling and low and mid growns rising, industry data shows.

High grown tea in January 2024 was 3.56 million kilograms, down from 3.36 million, medium growns were 2.6, up from 2.5 million kilograms and low growns were 12.56 million, up from 12.32 million kilograms last year.

Exports, including re-exports were up 6.88 percent to 18.76 million kilograms, industry data published by Ceylon Tea Brokers show.

Export earnings were reported at 102 million US dollars, up from 99.5 million dollars last year. The average FOB price was 5.45 US dollars a kilo down from 5.67 dollars last year.

Tea in bulk was 8.5 million kilograms valued at 12.79 billion rupees, tea in packets was 7.8 million kilograms valued at 13.1 billion rupees and tea in bags was 1.8 million kilos, valued at 5.06 billion rupees.

The top buyer was Iraq with 2.5 million kilos, up from 2.1 million last year followed by the UAE with 1.99 kilos, up from 1.86 million last year.

Russia bought 1.98 million kilos, down from 2.0 last year, Turkey bought 1.72 million kilos, from 2.3 million last year, while Iran bought 1.32 million, up from 614 million last year. (Colombo/Feb23/2024)

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