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Tuesday November 29th, 2022

Sri Lanka waste-to-energy power plant delayed by Covid-19 travel curbs

ECONOMYNEXT – A waste-to-energy plant being built north of Sri Lanka’s capital Colombo has been delayed due to Coronavirus travel restriction which had blocked the arrival of specialists from China, a minister said.

“There was a delay in the waste-to-energy power plant being built in Muthurajawela,” Power Minister Mahinda Amaraweera told reporters.

“Due to the situation, there was a delay in the arrival of persons from China involved in building this plant.”

Western Power Company, promoted by Sri Lanka’s Aitken Spence has been denied visas to bring in Chinese experts needed for the project after the airports closed in March.

SriLankan Airlines has since started to fly to Hong Kong.

Sri Lanka is ahead of many countries in curbing the spread of Coronavirus, including Singapore and Korea, and is perhaps behind only a few countries like Vietnam observers say.

But Sri Lanka had to impose strict curfews because doctors were initially reluctant to test persons outside hospital including close contacts and high risk persons.

Sri Lanka is now allowing citizens stranded overseas to come home.

Vietnam, the global leader in the fight against Coronavirus, also allowed vital foreign experts to come in as soon as domestic cases ceased and quarantine capacity was released to bring in overseas Vietnamese and students, observers familiar with the country said.

Meanwhile Minister Amaraweera said attempts were being made to remove obstacles to bringing in needed staff.

“We are going to give those facilities and in a few months it will be complete,” Minister Amaraweera said.

“We hope to have it complete it by the end of the year.”

Western Power Company would process 600 to 800 tonnes of municipal waste per day. The Ceylon Electricity Board will buy power for a price in excess of 30 rupees a unit.


Sri Lanka’s HNB syndicates R9bn loan for waste-to-energy plant

Sri Lanka’s Hatton National Bank syndicated a 9.0 billion rupee credit facility for the plant. (Colombo/June09/2020)

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  1. Abaya de Silva says:

    Simply excellent

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  1. Abaya de Silva says:

    Simply excellent

Sri Lanka rubber farmers to get boost from France, Michellin

ECONOMYNEXT – Sri Lanka will start a project supported by France and Michellin group to support 6,000 rubber farmers, cabinet spokesman Minister Bandula Gunawardena said.

Rubber farmers in Badalgama and Medagama in the Moneragala district will be supported improve their capacity and supply chains at a cost of 726,700 Euros.

Financial support will be provided by France’s Michellin group which has a subsidiary in Sri Lanka and the government of France.

The project will be implemented by France’s Ksapa group under the guidance of Ministry of Industries.

The cabinet of ministers had cleared a proposal by the Plantations Industries Minister to enter into an agreement to implement the project. (Colombo/Nov29/2022)

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A new Sri Lanka monetary law may have prevented 2019 tax cuts?

ECONOMYNEXT – A new monetary law planned in 2019, if it had been enacted may have prevented the steep tax cuts made in that year which was followed by unprecedented money printing, ex-Central Bank Governor Indrajit Coomaraswamy said.

The bill for the central bank law was ready in 2019 but the then administration ran out of parliamentary time to enact it, he said.

Economists backing the new administration slashed taxes in December 2019 and placed price controls on Treasuries auctions bought new and maturing securities, claiming that there was a ‘persistent output gap’.

Coomaraswamy said he keeps wondering whether “someone sitting in the Treasury would have implemented those tax cuts” if the law had been enacted.

“We would never know,” he told an investor forum organized by CT CLSA Securities, a Colombo-based brokerage.

The new law however will sill allow open market operations under a highly discretionary ‘flexible’ inflation targeting regime.

A reserve collecting central bank which injects money to push down interest rates as domestic credit recovers triggers forex shortages.

The currency is then depreciated to cover the policy error through what is known as a ‘flexible exchange rate’ which is neither a clean float nor a hard peg.

From 2015 to 2019 two currency crises were triggered mainly through open market operations amid public opposition to direct purchases of Treasury bills, analysts have shown.

Sri Lanka’s central bank generally triggers currency crises in the second or third year of the credit cycle by purchasing maturing bills from existing holders (monetizing the gross financing requirement) as private loan demand pick up and not necessarily to monetize current year deficits, critics have pointed out.

Past deficits can be monetized as long as open market operations are permitted through outright purchases of bill in the hands of banks and other holders.

In Latin America central banks trigger currency crises mainly by their failure to roll-over sterilization securities. (Colombo/Nov29/2022)

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Sri Lanka cabinet clears CEB re-structure proposal: Minister

ECONOMYNEXT – Sri Lanka’s cabinet has cleared proposals by a committee to re-structure state-run Ceylon Electricity Board, Power and Energy Minister Kanchana Wijeskera said.

“Cabinet approval was granted today to the recommendations proposed by the committee on Restructuring CEB,” he said in a message.

“The Electricity Reforms Bill will be drafted within a month to begin the unbundling process of CEB & work on a rapid timeline to get the approval of the Parliament needed.”

Sri Lanka’s Ceylon Electricity Board finances had been hit by failure to operate cost reflective tariffs and there are capacity shortfalls due to failure to implement planned generators in time. (Colombo/Nov28/2022)

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