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Monday December 11th, 2023

Sri Lanka unions agitating against IMF-backed reforms to meet president’s secretary

ECONOMYNEXT – Sri Lanka’s trade unions and professional associations agitating against an IMF-backed tax hike are to hold talks with the secretary to the president ahead of a discussion with President Ranil Wickremesinghe.

Media spokesman of the Federation of University Teachers Association (FUTA) Charudaththa Illangasinghe told reporters Friday March 17 morning that the meeting with President’s Secretary Saman Ekanayake was to be held that noon.

The discussion had been scheduled for March 21 but had been brought forward, which Illangasinghe said was a step in the right direction.

However, talks so far have been futile, he noted, adding that FUTA and other unions would like to end the talks on a positive note with a fair outcome that is acceptable to them.

Illangasinghe further said that if their March salary was taxed, all trade unions and professional unions – some of whom had by Thursday morning called off a strike – would continue their trade union action.
FUTA’s strike is still ongoing, and Illangasinghe said it will continue until a favourable decision has been made.

In the days leading up to Friday’s meeting, trade unions in Sri Lanka threatened to cripple the economy if the government did not reverse International Monetary Fund (IMF)-backed reforms, with one main opposition SJB-affiliated union leader promising a total shutdown of power & energy, medical, banking and other vital sectors starting midnight March 14.

The threat did not come to pass in its full form, with government spokesmen painting it a failure. A majority of the unions including the Government Medical Officers Association (GMOA) had called off the strike by Wednesday morning.

Related:

Sri Lanka unions threaten to cripple economy against IMF-backed reforms

However, severe trade union action by medical doctors had by then already brought the state health sector to a near-standstill. Doctors were on strike in several provinces against the income tax hike, greatly inconveniencing patients, before the strike was eventually called off.

High-income earning public servants in higher education, medical, banking, ports and other sectors have for weeks been threatening to up the ante in ongoing trade union action against Sri Lanka’s IMF-backed reforms, including a progressive income tax hike that sees the cash-strapped government collect from anyone earning over 100,000 rupees a month.

Minister of Ports, Shipping and Aviation Nimal Siripala de Silva told parliament on Thursday that 17 ships en route to the Colombo Port had turned back as a result of a recent anti-tax protest organised by port unions. He also claimed that one protesting port worker earns over 170,000 rupees a month.

Sri Lanka’s new tax regime has both its defenders and detractors. Critics who are opposed to progressive taxation said it serves as a disincentive to industry and capital which can be invested in business. They argue that a flat rate of taxation is implemented where everyone is taxed at the same rate.

Others, however, contend that the new taxes only affect some 10-12 percent of the population and, given the country’s economic situation, is necessary, if not vital.

Critics of the protesting workers argue that most of the workers earn high salaries that most ordinary people can only dream of, and though there may be some cases where breadwinners could be taxed more equitably, overall, Sri Lanka’s tax rates remain low and are not unfair. (Colombo/Mar17/2023)

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Sri Lanka wants university research to lead to commercially viable products

ECONOMYNEXT – Sri Lanka’s ministry of industries wants to ensure commercially-ready products and services are produced by university research, by facilitating partnerships with factories and entrepreneurs.

After a currency crisis, Sri Lanka’s government is in a drive to boost its trade balance by increasing exports.

“Our export basket hasn’t changed recently, partly because our small and medium entrepreneurs don’t have sufficient research and development facilities (like the multinationals) to innovate their products for the export market,” Additional Secretary of the Ministry of Industries, Chaminda Pathiraja said.

“At the same time, state universities and research institutes produce a large amount of research findings yearly, which end up sitting in those institutions; they don’t reach the industry,” Pathiraja said at a press briefing to announce a program on commercialization of new products and research, to be held tomorrow at the Waters Edge.

The networking forum will bring innovators and manufacturers together to focus on the commercialization of research for the value added tea, coir, spice, dairy products, gem and jewellery and packaging products industries.

“We want to encourage collaboration, through programs like our University Business League etc, so that the research output can be commercialized, and what is produced by our factories can increase in quantity and quality. We must focus on the export market.”

The objective of this program, he said, was to reduce the gap in acquiring innovators’ ideas and skills by the investors, and ultimately boost the manufacturing sector’s efficiency in alignment with the export market.
(Colombo/Dec11/2023)

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Sri Lanka rupee opens at 327.00/50 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee opened at 327.00/50 to the US dollar on Monday, from 327.00/30 Friday, dealers said.

On the Colombo Stock Exchange, both indices opened up: The All Share Price Index 0.28 percent at 10,823, and the S&P SL20 0.35 percent at 3,113.85.

Bond yields were up.

A bond maturing on 01.08.2026 was quoted at 14.05/20 percent from 14.05/15 percent.

A bond maturing on 15.01.2027 was quoted at 14.05/20 percent from 14.10/25 percent.

A bond maturing on 01.07.2028 was quoted at 14.20/50 percent from 14.20/35 percent.
(Colombo/Dec11/2023)

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Sri Lanka promoting Buddhist tourism from Vietnam, ASEAN

ECONOMYNEXT – Sri Lanka is planning to boost Buddhist tourism by linking temples in the country with those in East Asia, Foreign Minister Ali Sabry said after to welcoming a delegation of monks from Vietnam.

President Ranil Wickremesinghe, and Minister Sabry have initiated a temple-to-temple program where 100 Sri Lanka temples will be linked with counterparts in the Association of South East Asian Nations region.

“Tourism development will get a lot of growth with the temple-to-temple program,” Minister Ali Sabry said.

Along with the delegation of monks, five travel agents from Vietnam were also invited.

Under the first phase of the Temple-to-temple programs, several monks from Sri Lanka had received invitations from Indonesia, Malaysia, South Korea and Vietnam the Foreign Ministry said.

The Temple-to-Temple diplomacy program will be extended to Singapore, Japan, Thailand and Cambodia during the second phrase of the program.

Sri Lanka is targeting 2.3 million tourists in 2023, after getting about 1.5 million this year. (Colombo/Dec10/2023)

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