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Tuesday December 5th, 2023

Sri Lanka state minister of finance attributes economic recovery to 2023 budget

ECONOMYNEXT – Positive trends in Sri Lanka’s economy in the past year can be attributed to the 2023 budget, State Minister of Finance Ranjith Siyamabalapitiya said responding to opposition criticism.

Siyambalapitiya told parliament Tuesday November 14 morning that proposals made in the appropriation bill for 2023 by President and Finance Minister Ranil Wickremesinghe in November 2022 were instrumental in the economy’s recovery in the wake of the 2022 currency crisis.

Economic growth which stood at negative 12.4 by the third quarter of 2022 to has improved to negative 3.1 by the second quarter of 2023, Siyambalapitiya said, as a result of the budget proposals.

“There is broad consensus that by the end of Q4, growth will be positive,” he said.

Foreign reserves which stood at 1,898 billion dollars by December 2022 had increased to 3,500 billion by September 2023, said Siyamabalapitiya.

Inflation had reduced rapidly from 51.7 percent in January 2023 to 1.3 percent in September, he said.

“No one can say the positive aspects of the 2023 budget proposals did not contribute to this considerable drop in inflation,” he added.

The central bank maintained a tight monetary policy for months to tame inflation.

The state minister noted that policy rates had also dropped, though he did not attribute it to the budget. Lending rates that stood at 15.5 percent in December 2022 had lowered to 12 percent, while the deposit rate dropped from 14.5 percent in Decemer 202 to 11 percent by September 2023 September, 12 percent, he said.

Sri Lanka’s primary balance also improved as a result of the 2023 budget, claimed Siyambalapitiya.

While the country recorded a 247.3 billion negative primary balance from January to July 2022, he said, it reduced to negative 27.4 billion from January to July 2023.

“Year on year, what was a negative 3.7-percent deficit, we have been able to control to negative 0.7 this year. This is a 90-percent increase,” he said.

Revenue to GDP, in 2022, which was 8.2 percent in 2022 (2,013 billion rupees) grew to 10.1 percent or to 2,596 billion rupees in 2023, the state minister said..

“This is a a 28.9 percent increase,” he said, attributing it to the 2023 budget.

Tax revenue to GDP in 2022 was 7.3 percent, the world’s lowest revenue to GDP at just 1,751 billion rupees, but in 2023 it increased to 9.2 percent at 2,596 billion, he said.

“This is a 48 percent increase. The sole ownership of this goes to the 2023 budget,” he said.

“In 2022 August, the rupee was 361 to the dollar. In 2023, it’s 321.58 rupees. GDP in 2022 was 24,148 billion rupees, in 2023 28,100 billion. All these successes belong to the 2023 budget,” he said. (Colombo/Nov14/2023)

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Sri Lanka finding ways to clear 1.1mn pending cases: Justice Minister

ECONOMYNEXT – Sri Lanka is taking a series of steps to speed up 1.1 million pending court cases and encourage alternative dispute solving mechanisms, Justice Minister Wijedasa Rajapakshe said.

“The delay in court cases is a serious problem,” Minister Rajapakshe told a briefing at the President’s Media Centre.

“We have already taken several steps to expedite cases.”

There were 5,680 cases in Supreme Court, 4,054 in the Court of Appeal, 6,168 in the High Court of Civil Appeal, 8,363 in the Commercial High Court, 28,000 in the High Court, 254,000 in District Courts and 791,000 in Magistrates Courts.

In 2015, only 49 percent of complaints to mediation boards were resolved. Following reforms, the ratio has been increased to 70 percent.

The value of disputes going to mediation board has been raised to one million rupees from 500,000 rupees.

To solve land problems in the post-war period, special mediation boards on property was set up in the North and the East.

Mediation boards on property will be set up in another 16 districts.

Commercial High Courts were increased to four from three.

Another Commercial High Court will be set up in the future. The consideration of cases that can go to a High Court was raised from 4 million rupees to 10 million rupees.

A commercial dispute resolution law will be introduced next January.

A small claims court has been established.

Case involving disputes below 2 million rupees can be directed to small claims court.

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Sri Lanka stocks close up as some investor interest returns

ECONOMYNEXT – The Colombo Stock Exchange closed up on Monday, CSE data showed.

The All Share Price Index was up 0.22 percent, or 23.33 points, at 10,743.59.

The S&P SL20 index was up 0.68 percent, or 20.60 points, at 3,067.73.

Turnover was at 708 million. The banks sector contributed 189 million, while the food, beverage and tobacco sector contributed 176 million of this.

Sri Lanka’s stock market has seen some investor interest return after last week’s news that the country had managed an agreement on a debt restructuring deal with an official creditor committee, and foreign funds for some development projects resumed.

Top positive contributors to the ASPI in the day were Sampath Bank Plc (up at 71.50), LOLC Holdings Plc (up at 379.00), and Commercial Bank of Ceylon Plc, (up at 90.90).

There was a net foreign outflow of 52 million.

Citrus Leisure Plc, which announced that its banquet hall and revolving restaurant at the Lotus Tower would launch on or around Dec 9, saw its share price rise to 6.20 rupees. (Colombo/Dec4/2023).

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Sri Lanka rupee closes broadly steady at 328.10/30 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 328.10/30 to the US dollar on Monday, from 328.00/10 on Friday, dealers said.

Bond yields were stable.

A bond maturing on 01.06.2025 closed at 13.70/14.00 percent from 13.70/95 percent.

A bond maturing on 01.08.2026 closed at 13.90/14.10 percent from 13.90/14.05 percent.

A bond maturing on 15.01.2027 closed at 14.00/14.10 percent from 14.05/10 percent.

A bond maturing on 01.07.2028 closed at 14.20/35 percent from 14.15/25 percent.

A bond maturing on 15.05.2030 closed at 14.25/45 percent, from 14.20/45 percent.

A bond maturing on 01.07.2032 closed at 14.05/40 percent, from 14.00/45 percent. (Colombo/Dec4/2023)

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