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Thursday April 18th, 2024

Sri Lanka to stop emergency procurement of drugs

ECONOMYNEXT – Sri Lanka will stop the emergency procurement of drugs with immediate effect, its Minister of Health said on Monday (2).

“During the Covid pandemic, the State Pharmaceuticals Corporation (SPC) and the Medical Supplies Division (MSD) fell into great difficulty. We didn’t have flights to airlift medicines. So, we couldn’t bring medicines and we had to make do with what we had,” Minister of Health, Keheliya Rambukwella, told reporters at a press conference.

The minister said that due to the conditions in the country at the time, they had to resort to emergency procurements of drugs.

“Due to what we were facing at the time, we had to go for emergency procurements. We also had an economic crisis,”

At the time, banks were refusing to lend money to Sri Lanka.

Sri Lanka had to purchase medicines through the Indian credit line worth 1 billion dollars.

“We are short of 170-200 drugs. We are managing this. This can drop to 70-100,” Rambukwella said. He added that the government was working with the Bangladeshi government to procure medicines in the next three months.

While the shortage of essential medicines stemmed from the economic crisis, it persists due to the lack of a robust and transparent procurement system, trade bodies have said.

The National Medicines Regulatory Authority (NMRA) must play a much stronger, transparent, and independent role in ensuring that high-quality medicines are procured, including essential medicines that are procured through an emergency process, the Ceylon Chamber of Commerce said earlier. (Colombo/Oct2/2023)

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Sri Lanka’s discussions with bondholders constructive: State finance minister

ECONOMYNEXT – Sri Lankan authorities continue to engage all debt restructuring negotiations in good faith, within principles of equitable treatment among creditors, and with maximum transparency within the norms of such negotiations, State Minister of Finance, Shehan Semasinghe has said.

“It is standard practice, when a representative group of bondholders is formed, to entertain confidential discussions with such group and its appointed advisors. In the case of Sri Lanka, the Ad Hoc Group of Bondholders represents holders controlling more than 50% of the bonds, which make them a privileged interlocutor for Sri Lanka,” Semasinghe said on X (twitter).

“It is well understood that given the price sensitive nature of the negotiations, and according to market regulations, discussions with the Group and its advisors are to be conducted under non-disclosure agreements. This evidently restricts the ability of the Government to unilaterally report about the substance of the discussions.

“The cleansing statement, which was issued on the 16th of April, at the conclusion of this first round of confidential discussions with members of the Group, aims at informing the Sri Lankan people, market participants and other stakeholders to this debt restructuring exercise, about the progress in negotiations. It provides the highest possible level of transparency within the internationally accepted practices in such circumstances.

“As informed in this statement, confidential discussions held in recent weeks with bondholders’ representatives proved constructive, building on the restructuring proposals presented by both parties. During the talks both sides successfully bridged a number of technical issues enabling important progress to be made. Sri Lanka articulated key remaining concerns that need to be addressed in a satisfactory manner.

“The next steps would entail further consultation with the IMF staff regarding assessments of the compatibility of the latest proposals with program parameters. Following these consultations, we hope to continue discussions with the bondholders with a view to reaching common ground ahead of the IMF board consideration of the second review of Sri Lanka’s EFF program.”

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Sri Lanka rupee weakens at 301.00/302.05 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 301.00/302.05 to the US dollar in the spot forex market on Tuesday, from 299.00/10 on Tuesday, dealers said. Bond yields were broadly steady.

A bond maturing on 15.12.2026 closed stable at 11.30/35 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.05 percent up from 11.95/12.00 percent.

A bond maturing on 15.12.2028 closed at 12.10/20 percent down from 12.10/15 percent.

A bond maturing on 15.07.2029 closed at 12.25/40 percent.

A bond maturing on 15.03.2031 closed at 12.30/50 percent. (Colombo/Apr17/2024)

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Sri Lanka Treasury Bill yields down across maturities

ECONOMYNEXT – Sri Lanka’s Treasuries yields were down across maturities at Wednesday’s auction with the 3-month yield moving down 7 basis points to 10.03 percent, data from the state debt office showed.

The debt office sold all 30 billion rupees of 3-month bills offered.

The 6-month yield fell 5 basis points to 10.22 percent, with 25 billion rupees of bills offered and 29.98 billion rupees sold.

The 12-month yield dropped 4 basis points to 10.23 percent with 18.01 billion rupees of bills sold after offering 23 billion rupees. (Colombo/Apr17/2024)

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