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Thursday February 29th, 2024

Sri Lanka president apologises to Japan for cancellation of light rail project

ECONOMYNEXT – Sri Lanka President Ranil Wickremesinghe has apologised to the Japanese government for the unilateral cancellation of a Japan-funded 1.5 billion dollar light rail transit (LRT) project.

Wickremesinghe, who met Japanese Prime Minister Fumio Kishida in Tokyo on Thursday May 25, spoke on the need for legislation to ensure that large-scale bilateral projects cannot be cancelled without mutual agreement, a statement from Wickremesinghe’s office said.

The cancellation of the Japan International Cooperation Agency (JICA)-funded project was controversial in Sri Lanka after the government under then President Gotabaya Rajapaksa, which was closer to Beijing, unilaterally suspended the project as well as another 500-million US dollar tripartite deal to develop the Colombo Port’s Eastern Container Terminal (ETC) together with India. Relations soured between Sri Lanka and Japan as a result. The east Asian nation has long been considered a friend of Sri Lanka with mutually beneficial diplomatic ties going back decades.

Since his appointment as prime minister in the wake of widespread protests in Sri Lanka after its currency crashed in early 2022, Wickremesinghe has shown a keen interest in repairing ties between the two countries.

Blaming poor foreign policy on the country’s international “marginalisation”, Prime Minister Wickremesinghe in June 2022 said: “Japan is our long time friend; a nation that has helped our country greatly. But they are now unhappy with us due to the unfortunate events of the past.”

The statement from President Wickremesinghe’s office on Thursday said he had expressed his gratitude to Japan during his meeting with Prime Minister Kishida for Tokyo’s support in helping Sri Lanka recover from its ongoing macroeconomic crisis. New opportunities to enhance cooperation between the two countries were also discussed, the statement said.

In another meeting held on the same day with Japanese Finance Minister Shunichi Suzuki, Sri Lanka’s debt restructuring and the island nation’s ongoing International Monetary Fund (IMF) programme were discussed. A subsequent meeting with Foreign Minister Yoshimasa Hayashi had focused on strengthening long-term bilateral relations including increased cooperation in economic and cultural fields.

Wickremesinghe and former Prime Minister of Japan Yasuo Fukuda had participated in a breakfast meeting earlier Thursday organised by by the Japan-Sri Lanka Association where the latter had been briefed on Sri Lanka’s recovery efforts.

The statement said the president had highlighted the favourable investment climate in Sri Lanka and extended an invitation to Japanese investors to return and invest in the country.

In another meeting with a former Japanese premier, Taro Aso, Wickremesinghe had discussed potential steps to strengthen the existing close and friendly relationship with Sri Lanka, the statement said.

In a separate round of discussions with Singapore’s Deputy Prime Minister Lawrence Wong, also in Tokyo, President Wickremesinghe had reaffirmed Sri Lanka’s commitment to implementing the Singapore Free Trade Agreement (FTA), the statement added.

The president’s office said quoting Wickremesinghe that many Asian nations have already made a choice between China and the United States in a polarising geopolitical situation and that choice is Asia accommodating the ambitious projects by both Beijing and Washington.

The president had made these comments when he addressed the “Nikkei Forum: Future of Asia‟ held in Tokyo, where, according to the statement, he had highlighted the importance of Asian states having a voice in shaping the region’s role amidst the evolving geopolitics on the global stage.

“We in Asia don’t want to choose between the U.S. and China,” Wickremesinghe said.

“Many of us cannot make that choice because we have already made our choice, and that choice is Asia,” he said.


Sri Lanka President bets for China-inclusive Asia-led economy


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  1. sacre blieu says:

    An apology alone wilt not do. The minister and any others who were figured in this fiasco by fishing for the dollar bribe should be named and prosecuted. Sri Lanka must not be, anymore, a heaven for fraudsters and crooks. And this includes the others who brought this country down into a state of bankruptcy.

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  1. sacre blieu says:

    An apology alone wilt not do. The minister and any others who were figured in this fiasco by fishing for the dollar bribe should be named and prosecuted. Sri Lanka must not be, anymore, a heaven for fraudsters and crooks. And this includes the others who brought this country down into a state of bankruptcy.

Sri Lanka’s RAMIS online tax collection system “not operatable”: IT Minister

ECONOMYNEXT – Sri Lanka’s online tax collection system RAMIS is “not operatable”, and the Ministry of Information Technology is ready to do for an independent audit to find the shortcomings, State IT Minister Kanaka Herath said.

The Revenue Administration Management Information System (RAMIS) was introduced to the Inland Revenue Department (IRD) when the island nation signed for its 16th International Monetary Fund (IMF) programme in 2016.

However, trade unions at the IRD protested the move, claiming that the system was malfunctioning despite billions being spent for it amid allegations that the new system was reducing the direct contacts between taxpayers and the IRD to reduce corruption.

The RAMIS had to be stopped after taxpayers faced massive penalties because of blunders made by heads of the IT division, computer operators and system errors at the IRD, government officials have said.

“The whole of Sri Lanka admits RAMIS is a failure. The annual fee is very high for that. This should be told in public,” Herath told reporters at a media briefing in Colombo on Thursday (29)

“In future, we want all the ministries to get the guidelines from our ministry when they go for ERP (Enterprise resource planning).”

President Ranil Wickremesinghe’s government said the RAMIS system will be operational from December last year.

However, the failure has delayed some tax collection which could have been paid via online.

“It is not under our ministry. It is under the finance ministry. We have no involvement with it, but still, it is not operatable,” Herath said.

“So, there are so many issues going on and I have no idea what the technical part of it. We can carry out an independent audit to find out the shortcomings of the software.”

Finance Ministry officials say IRD employees and trade unions had been resisting the RAMIS because it prevents direct interactions with taxpayers and possible bribes for defaulting or under paying taxes.

The crisis-hit island nation is struggling to boost its revenue in line with the target it has committed to the IMF in return for a 3 billion-dollar extended fund facility. (Colombo/Feb 29/2024) 

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Sri Lanka aims to boost SME with Sancharaka Udawa tourism expo

ECONOMYNEXT – Sri Lanka is hosting Sancharaka Udawa, a tourism industry exhibition which will bring together businesses ranging from hotels to travel agents and airlines, and will allow the small and medium sector build links with the rest of the industry, officials said.

There will be over 250 exhibitors, with the annual event held for the 11th time expected to draw around 10,000 visitors, the organizers said.

“SMEs play a big role, from homestays to under three-star categories,” Sri Lanka Tourism Promotion Bureau Chairman, Chalaka Gajabahu told reporters.

“It is very important that we develop those markets as well.”

The Sancharaka Udawa fair comes as the Indian Ocean island is experiencing a tourism revival.

Sri Lanka had welcomed 191,000 tourists up to February 25, compared to 107,639 in February 2023.

“We have been hitting back-to-back double centuries,” Gajabahu said. “January was over 200,000.”

The exhibition to be held on May 17-18, is organized by the Sri Lanka Association of Inbound Tour Operators.

It aims to establish a networking platform for small and medium sized service providers within the industry including the smallest sector.

“Homestays have been increasingly popular in areas such as Ella, Down South, Knuckles and Kandy,” SLAITO President, Nishad Wijethunga, said.

In the northern Jaffna peninsula, both domestic and international tourism was helping hotels.

A representative of the Northern Province Tourism Sector said that the Northern Province has 170 hotels, all of which have 60-70 percent occupancy.

Further, domestic airlines from Colombo to Palali and the inter-city train have been popular with local and international visitors, especially Indian tourists. (Colombo/Feb29/2024)

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Sri Lanka rupee closes at 309.50/70 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 309.50/70 to the US dollar Thursday, from 310.00/15 on Wednesday, dealers said.

Bond yields were slightly higher.

A bond maturing on 01.02.2026 closed at 10.50/70 percent down from 10.60/80 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.10 percent from 11.90/12.00 percent.

A bond maturing on 01.07.2028 closed at 12.20/25 percent.

A bond maturing on 15.07.2029 closed at 12.30/45 percent up from 12.20/50 percent.

A bond maturing on 15.05.2030 closed at 12.35/50 percent up from 12.25/40 percent.

A bond maturing on 01.07.2032 closed at 12.55/13.00 percent up from 12.50/90 percent. (Colombo/Feb29/2024)

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