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Wednesday February 1st, 2023

Sri Lanka private bus services hit by fuel hoarding, tyre price hike

CROWDED: An overloaded bus in a suburb of Colombo, leaning sideways with passengers clinging to foot boards.

ECONOMYNEXT – Private passenger bus services in Sri Lanka have been hit by fuel hoarding and rising costs of tyres, with 75 percent of buses running with fewer passengers, Sri Lanka Private Bus Owners’ Association (SLPOA) Chairman Gemunu Wijeratne said.

Since June 06, the SLPOA had more than halved the number of buses that used to operate before the prevailing unavailability of fuel, but now increased operations after the government permitted private bus operators to purchase fuel from the state-run Sri Lanka Transport Board (SLTB) depots.

Wijeratne claimed that some 3,000 buses are out of service as bus owners cannot afford to buy tyres, with the increasing costs amid the country’s worst ever forex crisis. Sri Lanka’s overinflated vehicle market has begun to cool down due to the fuel crisis, but spare parts remain expensive.

“We are running at a loss because we are not operating at full capacity. Because the schools and government offices are closed, buses are practically empty in the afternoon,” said Wijeratne, speaking to EconomyNext.

Private buses now spend a longer time at bus stops waiting for passengers in an attempt to cover costs.

Meanwhile fuel hoarding was also adversely affecting bus owners who would have to wait longer in queues.

“We have asked the authorities to take action against hoarding. We cannot continue the usual operations or make any necessary changes if people who already have fuel are going rejoin the queue,” he said.

Lanka Auto Diesel, which is retailed at 400 rupees per litre can be found on the black market for over 1,000 rupees. Diesel theft has also become common in Sri Lanka, with filling station owners accused of being a part of an alleged “fuel mafia” contributing to long lines and increased scarcity.

Wijeratne said all buses would be operational once the number of passengers increased. (Colombo/Jun23/2022)

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Sri Lanka bond yields down at close

ECONOMYNEXT – Sri Lanka’s bond yields were down at close following a bond auction on Wednesday, dealers said while a guidance peg for interbank transactions remained unchanged.

“The rates were steady at the auction,” a dealer said.

“This can be a signal to the market saying the rates will go down in the future.”

A bond maturing on 01.07.2025 closed at 32.40/60 percent, down from yesterday’s 32.60/85 percent.

A bond maturing on 01.05.2027 closed at 29.10/35 marginally down from yesterday’s 29.20/75 percent.

The Central Bank’s guidance peg for interbank US dollar transactions remained unchanged at 362.14 rupees against the US dollar.

Commercial banks offered dollars for telegraphic transfers at 371.38 rupees on Friday, data showed. (Colombo/Feb 01/2022)

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Sri Lanka bill auction hits pothole after 2025 bond spike

ECONOMYNEXT – Sri Lanka sold only 45 billion rupees in Treasury bills at Wednesday’s auction after offering 120 billion rupees, data from the state debt office showed, amid market confusion over a spike in a two year bond at an earlier action.

30.1 billion rupees of 3-month bills were sold at 29.91 percent, unchanged from a week earlier after offering 60 billion rupees for auction.

5.1 billion rupees of 6-month bills were sold at 28.72 percent, flat after offering 30 billion.

10.3 billion rupees of 12-month bills were sold at 27.72 percent after offering 30 billion.

Phase II subscriptions have been opened.

The market was foxed after the 2025 bonds were accepted at sharply higher yield than market on January 30, dealer said.

There was further confusion as the there was an outright purchase of 2025 at around 29 percent earlier in January.

Some investors speculated that the authorities were trying to drive more buyers towards short end bonds as bill volumes were getting larger. (Colombo/Feb01/2023)

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Sri Lanka services exports down 5.9-pct in 2022

ECONOMYNEXT – Sri Lanka’s services exports were estimated to have fallen 5.9 percent to 1,876.3 million US dollars, the island’s Export Development Board said.

Services exports estimated is made up of ICT/BPM, construction, financial services, transport and logistics.

There are more than 500 ICT companies, the EDB said.

Sri Lanka’s merchandise exports were up 4.6 percent to US dollars 13.1 billion dollars in 2022 from 2021.

Sri Lanka’s goods exports are slowing amid lower growth in Western markets. (Colombo/ Feb 01/2023)

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