An Echelon Media Company
Sunday December 10th, 2023

Sri Lanka Litro officials say Rs.2,000 price hike needed to avoid losses

ECONOMYNEXT – Officials at Sri Lanka’s state-owned Litro Gas Lanka Ltd said there should be around 2,000 rupee price hike for a 12.5 domestic gas cylinder to avoid a loss and complete closure of the company within three months.

Claiming that they are professionals from Association to protect Litro company said the firm was deprived of 11 billion rupees in 2021 due to refusal of Consumer Affairs Authority (CAA) to raise price of Liquefied Petroleum (LP) gas cylinders.

“We cannot supply gas (at the prevailing prices). If we provide, we will have to close our company,” Piyal Colombahettige, the convener of the Association told a media briefing held at Litro Gas Corporate Office in Colombo.

Colombahettige said the company will incur a loss of 200 million rupees from the latest shipment which was ordered when the international LP gas prices was at 880 US dollar per metric ton if the cylinders are sold at prevailing 2,675 rupees.

“In March, the price of LP gas at the international market is 1,018 US dollars per metric ton. This means the loss will be more than 200 million US dollars,” he said.

The move to raise prices come amid severe shortage of LP gas throughout the country for the past one week and log queues for cooking gas.

The rupee has fallen around 40 percent since the central bank allowed flexible exchange rate on March 8.

Sri Lanka is facing a severe dollar shortage after its reserves fell over 70 percent in the first 11 months of the last year. As a result, most importers are unable to pay through banks by opening a letter of credit.

Litro raised the prices last in October 2021 to 2,750 rupees from 1,493 rupees after its repeated requests from CAA to raise prices were shot down.

According to Colombahettige, the cost of a 12.5 kg cylinder Litro gas is now estimated at 4,462.25 rupees.

“If not for a 2,000 rupee raise, the company will face a closure in three moths. If we incur the loss of 200 million rupees from the current shipment, how can we find rupee and dollars to pay the next shipment?”

“We don’t need to seek permission from the Consumer Affairs Authority (CAA) for price hike. What we are doing here is to explain the public that the company is facing a risk of closure.”

The little known Association of the Litro Company decline to comment on from whom they are requesting the price hike, except saying  “relevant parties”. (Colombo/March18/2022)

Comments (2)

Your email address will not be published. Required fields are marked *

  1. Concerned says:

    Back to the fire and dara lipa

  2. Dilrukshi says:

    Bloody idiots. Srilankan public always paid for their gas. You never gave it for free..Did we the public ask you to operate at a loss for years…Are we responsible for years of bad politically influenced decisions…

View all comments (2)

Comments (2)

Cancel reply

Your email address will not be published. Required fields are marked *

  1. Concerned says:

    Back to the fire and dara lipa

  2. Dilrukshi says:

    Bloody idiots. Srilankan public always paid for their gas. You never gave it for free..Did we the public ask you to operate at a loss for years…Are we responsible for years of bad politically influenced decisions…

ADB USD200mn 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.”

Continue Reading

Sri Lank in blackout as power grid hit by cascading failure

ECONOMYNEXT – Sri Lanka suffered a blackout as Saturday evening as the state-run Ceylon Electricity Board grid was hit by a cascading power failure.

The cascading failure is believed to have been triggered by the failure of the Kothmale-Biyagama transmission line.

“The Ceylon Electricity Board wishes to inform our customers that due to the failure of Kotmale – Biyagama main transmission line, an island wide power failure has occurred,” CEB Spokesman Noel Priyantha said.

“Step by step restorations are underway and it may take few hours to completely restore the power supply.”

With hydro plants running flat out, a outage of the line tends to create a big imbalance in the demand and supply, leading to tripping of more lines and generators.

Lines can trip due to lightening strikes, or equipment failures.

Sri Lanka last suffered a cascading failure in December 2021, due to the failure of the same transmission line.

RelatedSri Lanka power blackout as grid hit by cascading failure

Continue Reading

Sri Lanka to host regional Food and Agriculture Organization conference

ECONOMYNEXT – Sri Lanka will host the 37th session of the Asia Pacific Regional Conference (APRC) of the United Nations Food and Agriculture Organization (FAO), from February 19-22, 2024 in Colombo.

The Conference will bring together agriculture ministers and officials from 46 countries across the region to discuss challenges in food and agriculture.

“The 37th APRC will provide a vital platform for regional collaboration, benefitting the agricultural landscape, fisheries sector and environment of Sri Lanka,” Minister Mahinda Amaraweera said at a press briefing on Friday (8) to announce the conference.

FAO has had an active presence in Sri Lanka for over 40 years. “FAO has supported the country in the implementation of Good Agricultural Practices (GAP), and the development of the fisheries sector for growth and climate resilience,” Vimlendra Sharan, FAO Representative for Sri Lanka and the Maldives said.

“The APRC conference will be an opportunity to highlight the innovative approaches introduced in partnership with the government.”

By hosting APRC, Sri Lanka hopes to demonstrate the country’s dedication to the growth of sustainable agriculture, and showcase its commitment to sustainable agricultural development.

The APRC agenda will include a forum on agritourism, especially requested by the Sri Lankan government.

Continue Reading