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Sunday August 14th, 2022

Sri Lanka seeks rice bailout from China after fertilizer ban

ECONOMYNEXT – Sri Lanka has sought a million tonnes of rice as a gift from China government ministers says which is expected to make good an expected crop loss from during the main Maha cultivation season from a chemical fertilizer ban.

Sri Lanka had sought the million tonnes of rice as a gift as a way mark a 30 year long barter agreement between the People’s Republic and Ceylon which ran from 1953 to 1982.

Trade Minister Bandula Gunewardena said the donation was sought during an virtual meeting with the Chinese ambassador to Colombo with the 30 years being market on December 18, 2022.

“The response was very positive from China,” Minister Gunewardene told state-run ITN television.

“What we asked was for a gift of one million metric ton of rice as paying respect for the 3 decade agreement that went on without changing under various governments.”

A million tonnes of rice is worth between 350 to 500 million dollars at current market price for Indica rice grades.

Sri Lanka’s main Maha cultivation season that end around March produces about 2.5 million metric tonnes of paddy (rough rice) and up to 3 million tonnes in good years.

About 1.9 million tonnes of milled rice is produced from a good season, which is enough for over 9 months of use at around 195,000 metric tonnes a month. Output can fall to around one 1.5 million tonnes in drought years.

A million tonne gift from China will make good a crop loss of up to 50 percent. Sri Lanka’s cabinet of ministers also relaxed import controls to allow 300,000 metric tonnes of rice from India.

Finance Minister Rajapaksa said in January the government will buy paddy at 75 rupees a kilo to make good a 30 percent crop loss as part of 220 billion rupee ‘relief package’.

Sri Lanka’s farmgate price for rice was around 50 to 60 rupees. But millers said it had risen to around 95 rupees at the beginning of the current harvest season which is just beginning. Farmers are also complaining of steep harvest losses.

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President Rajapaksa said this week that the government will also give 95 rupees for a kilo of rough rice.

Sri Lanka retail rice prices for milled rice now range around 130 to 150 rupees, depending on the grade.

“We need to understand that if we buy one kg per 50 rupees, then the price of it in the market will be 100 rupees,” Minister Gunewardene said.

“If we bought it for 75 rupees the market price will be 150 rupees. By saying we need to strengthen the farmers and get rice at 200 rupees per one kg the price of it in the market will be 400 rupees.

Sri Lanka had earlier banned the import of rice to keep domestic prices high and also give profits to rice millers. Attempts to bring price controls failed and created shortages.

In an improvement of policy the government has ended price controls.

“Rice mills owners said they will bring one kg price to 300 rupees,” Minister Gunewardene said.

“At that moment I told the president and the cabinet that we will not let one kg of Samba to go above 130 rupees, nadu we will try to give below 100 rupees or under 105 rupees.”

Sri Lanka’s consumer prices surged to 12.1 percent in the 12-month ending December 2021, after two years of money printing and exchange rate trouble. The central bank on Tuesday raised interest rates by 50 basis points. (Colombo/Jan21/2021)

Comments (2)

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  1. Kumar says:

    Sri Lankans better get used to Chinese sticky rice. Sticky white rice is a part of the Chinese cuisine. However, we buy good Sri Lankan rice in the US, with no arsenic. I suppose Sri Lankan mill owners get good money by exporting rice.

  2. aswin says:

    The chinese rice has already arrived. All produced from high quality plastics. Next will be a gift of medicine to solve the stomach problems created by eating plastic.

View all comments (2)

Comments (2)

Your email address will not be published.

  1. Kumar says:

    Sri Lankans better get used to Chinese sticky rice. Sticky white rice is a part of the Chinese cuisine. However, we buy good Sri Lankan rice in the US, with no arsenic. I suppose Sri Lankan mill owners get good money by exporting rice.

  2. aswin says:

    The chinese rice has already arrived. All produced from high quality plastics. Next will be a gift of medicine to solve the stomach problems created by eating plastic.

Sri Lanka coconut auction prices continue to climb

ECONOMYNEXT- Sri Lanka’s average coconut prices grew 3.7 percent to 64,618.23 rupees for 1,000 nuts at the last auction held on Friday August 12, official data showed.

The highest price was 62,900 rupees for 1,000 nuts, while the lowest was 57,000 rupees at the auction conducted by Sri Lanka’s Coconut Development Authority.

Buyers offered 1,019,395 nuts at the auction and sold 576,906.

Exports of coconut-based products have risen by 12 percent in January to June to 434.48 million dollars from a year earlier, data show. (Colombo/Aug13/2022)

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Chinese tracking vessel cleared to dock at Sri Lanka’s Hambantota Port

Hambantota Port

ECONOMYNEXT – Sri Lanka’s Ministry of Foreign Affairs has given the green light to Chinese tracking vessel Yuang Wang 5 to dock at the Chinese-built Hambantota Port from August 16 to 22.

Sri Lankan authorities had first given clearance to the Chinese vessel on July 12, to make a port call at the Hambantota Port from August 11 to 17​ for replenishment purposes.

However, following a diplomatic standoff after concern about the tracking vessel’s anticipated arrival were reportedly raised by the US and India, Sri Lanka’s foreign ministry requested China to defer the port call until “further consultations”.

A report by Sri Lanka’s privately owned Times Online news website said Saturday August 13 morning that the foreign ministry has authorised the docking of the ship.

Related:

Sri Lanka permits entry to controversial Chinese tracking vessel Yuang Wang 5

The ministry’s official statement released Saturday evening confirmed that the ship has been given clearance to dock at the Hambantota Port for the new dates August 16 to 22.

“The Ministry wishes to reiterate Sri Lanka’s policy of cooperation and friendship with all countries. Security and cooperation in the neighbourhood is of utmost priority. It is Sri Lanka’s intention to safeguard the legitimate interests of all countries, in keeping with its international obligations. The Ministry is deeply appreciative of the support, solidarity and understanding of all countries, especially in the current juncture when the country is in the process of addressing severe economic challenges and engaging in multiple domestic processes to ensure the welfare of the Sri Lankan people,” the ministry said, without naming the stakeholder countries. (Colombo/Aug13/2022)

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Sri Lanka looking to provide relief to bona fide protestors: justice minister

Pix by T.N.Nawas

ECONOMYNEXT – Sri Lanka has entrusted the process of identifying individuals who engaged in violence during the widespread anti-government protest to a “different group”, as there is a “practical issue” with separating those individuals, the island nation’s Justice Minister said.

“There is a problem. This is not a legal issue; it is a practical issue because the Aragalaya consists of several groups. In fact even the police has difficulty identifying who were genuinely involved in the peaceful struggle and the others who came from outside and caused some violence,” said Minister Wijedasa Rajapaksha, speaking to EconomyNext on Wednesday August 10.

“We needed assistance in identifying those who [protested] bona fide. We want to give them relief; [not] take any legal action against them.”

Sri Lanka saw a massive uprising against the government’s inability to protect people from a debilitating economic crisis caused by wrong economic policies. The public took to the streets to demand the resignation of then President Gotabaya Rajapaksha and a stop to Sri Lanka’s systemic corruption.

Most protestors focused on sustained protests in several areas of the island, particularly the GotaGoGama agitation site in front of the President’s Secretariat.

However there were incidents of violence that saw houses of ruling party MPs looted and burned down and public property damaged. President Ranil Wickremesinghe’s private residence was also burned down in July, while he was Prime Minister and protestors were occupying the Official Residence of President Rajapaksha, who had by then fled the country.

Wickremesinghe declared a State of Emergency shortly after, granting the forces power to arrest anyone suspected of engaging in violent behaviour.

However, many of the arrested protestors allege that they were not part of the “violent minority”.

“This was such a peaceful protest. When the Bastille was stormed there was not a brick left in the place,” said one protestor.

The protestors subsequently handed over the occupied government buildings to the authorities, and have now wrapped up the occupation segment of the protests following to a court order.

Activists both local and international are asking the government to repeal the State of Emergency, but Wickremesinghe has not indicated that he plans to do so anytime soon.

The Supreme Court meanwhile has granted leave to proceed to a Fundamental Rights Petition filed by former Human Rights Commissioner of Sri Lanka Ambika Satkunanathan.

Satkunanathan tweeted Friday August 12: “The Supreme Court granted leave to proceed in Articles 12(1) and 14(1) in the fundamental rights petition I filed challenging the declaration of the state of emergency and the emergency regulations.”

Though Satkunanathan had filed the petition for other allegedly violated Articles, the Supreme Court will only be proceeding with Articles 12(1) and 14(1) which deal with equality under the law and freedoms of speech, expression and assembly.

Several prominent protestors have been jailed under the Emergency laws, and on Wednesday August 10 the Immigration Department cancelled the visa of a Scotswoman who had documented the protests.

Minister Rajapaksha said that he had met with protestors, and discussed the situation regarding arrests.

“We are in the process [of identifying protestors]. We entrusted that to a different group on the advice of the president and we will do that in the following days,” he said.

“The police will have to take action only against those who engage in vandalism,” he said. (Colombo/Aug13/2022)

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