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Monday February 6th, 2023

Sri Lanka will ask for vote on upcoming “unfair” UN resolution: foreign minister

  • Human rights abuses related to economic crisis included in new resolution
  • Resolution clauses against constitution: Minister says Sri Lanka won’t compromise
  • “Tarnishing our image at this point in time will have a negative impact”: Sabry

ECONOMYNEXT – Sri Lanka will seek a vote on an upcoming resolution at the United Nations Human Rights Council (UNHRC) with the help of its friends as the resolution is “unfair” and aimed at tarnishing the country’s image at a time of economic crisis, Foreign Minister Ali Sabry said.

The new resolution is likely to tighten Sri Lanka’s space to deal with international trade further as several key conventions in trade concessions like Europe’s GSP Plus are tied directly to human rights. Already the European Union has threatened to withdraw its trade concession as the country has failed to fulfill its commitments on implementing some key international conventions.

The draft resolution, titled “Promoting reconciliation, accountability and human rights in Sri Lanka” and sponsored by the United Kingdom, the United States, Germany, Canada, Malawi, Montenegro and North Macedonia, was formally handed over to the Human Rights Council Secretariat last week.

The draft text requests the Office of the High Commissioner for Human Rights to enhance its monitoring and reporting on the situation of human rights in Sri Lanka, including on progress in reconciliation and accountability, and on the human rights impact of the economic crisis and corruption.

“It is unfair,” Foreign Minister Ali Sabry told EconomyNext on Thursday September 29.

“It is against our constitution and we have to respond to that. We are not going to agree on that. Whether we will win or lose, there are things on which we cannot compromise.  We will ask for a vote through our friends,” he said.

Sri Lanka has been strongly against an external evidence gathering mechanism by the Office of High Commissioner for Human Rights though the UN body has already started the mechanism despite facing a lack of finance initially.

Sri Lanka’s human rights record has been criticised widely since the final stage of a 26-year civil war that ended in 2009 due to the alleged killing of thousands of ethnic minority Tamils by government forces. The government of Sri Lanka has repeatedly denied the allegation.

Some Western nations have already imposed a travel ban on some military leaders who led the government’s war effort on the grounds of alleged crimes. Canada and Germany had refused to accommodate Sri Lankan military officials in the island nation’s diplomatic missions in those countries.

Minister Sabry said the resolution is a concern because it seeks long term prosecution of military officials.

“Particularly what we are concerned about is an outside evidence gathering mechanism and the long-term prosecution of Sri Lankan armed forces outside Sri Lanka. That we cannot agree with,” he said.

The new resolution has called upon the government to address Sri Lanka’s ongoing currency crisis including by investigating corruption and prosecuting those responsible including public and former public officials. It has asked the UNHCR to stand ready to assist and support independent, impartial, and transparent efforts on this.

“They have brought in some economic crimes which has not been defined. Many countries have gone through (economic crises). But what is the UNHRC doing about an economic crisis?” said Sabry.

“If there is a crime, we have to prosecute in Sri Lanka. Economic recovery must take place in Sri Lanka and the international community should support us. So, tarnishing our image at this point in time will have a negative impact. People will not want to work with us and no new people want to come and invest,” he said. (Colombo/Sep29/2022)

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Sri Lanka to address SME tax problems at first opportunity: State Minister

ECONOMYNEXT – Problems faced by Sri Lanka’s small and medium enterprises from recent tax changes will be addressed at the first opportunity, State Minister for Finance Ranjith Siyambalapitiya said.

Business chambers had raised questions about hikes in Value Added Tax, Corporate Income Tax and the Social Security Contribution Levy (SSCL) that’s been imposed.

It should be explored on how to amend the Inland Revenue Act, Siyamabalapitiya said, adding that the future months should be considered as a period where the country is being stabilized.

Both the VAT and SSCL are effectively paid by customers, but the SSCL is a cascading tax that makes running businesses difficult.

In Sri Lanka SMEs make up a large part of the economy, accounting for 80 per cent of all businesses according to according to the island’s National Human Resources and Employment Policy.

(Colombo/ Feb 05/2023)

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Sri Lanka revenues Rs158.7bn in Jan 2023 up 51-pct

ECONOMYNEXT – Sri Lanka’s government revenues were 158.7 billion rupees in January 2023 but expenditure and debt service remained high, Cabinet spokesman Minister Bandula Gunawardana said.

In January 2022 total revenues were Rs104.5 billion according to central bank data.

Sri Lanka’s tax revenues have risen sharply amid an inflationary blow off which had boosted nominal GDP while President Ranil Wickremesinghe has also raised taxes.

Departing from a previous strategy advocated by the IMF expanding the state and not cutting expenses, called revenue based fiscal consolidation, he is attempting to do classical fiscal consolidation with spending restraint.

President Ranil Wickremesinghe has presented a note to cabinet requesting state expenditure to be controlled, Gunawardana told reporters.

State Salaries cost 87.4 billion rupees.

Pensions and income supplements (Samurdhi program) were29.5 billion rupees.

Other expenses were 10.8 billion rupees.

Capital spending was   21 billion rupees.

Debt service was 377.6 billion rupees for January which has to be done with borrowings from Treasury bills, bonds and a central bank provisional advance of 100 billion rupees, Gunawardana said.

Interest costs were not separately given. (Colombo/Feb05/2023)

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Sri Lanka’s Ceylon Tea prices down for second week

ECONOMYNEXT – Sri Lanka’s Ceylon Tea prices fell for the second week at an auction on January 31, with teas from all elevations seeing a decline, data showed.

“In retrospect, the decline in prices would be a price correction owing to the overall product quality and less interest from some key importers due to the arrival of cargo at destinations ahead of schedule,” Forbes and Walker tea brokers said.

The weekly sale average fell from 1475.79 rupees to 1465.40 rupees from a week ago, according to data from Ceylon Tea Brokers.

The tea prices are down for two weeks in a row.

High Growns

The High Grown sale average was down by 20.90 rupees to 1380.23 rupees, Ceylon Tea Brokers said.

High grown BOP and BOPF was down about 100 rupees.

“Ex-Estate offerings which totalled 0.75 M/Kg saw a slight decline in quality over the previous week” Forbes and Walker said.

OP/OPA’s in general were steady to marginally down.

Low Growns

In Low Grown Teas, FBOP 1 was down by 100 rupees and FBOP was down by 50 rupees while PEK was up by 150 rupees.

The Low Growns sale average was down by 8.55 rupees to 1547.93 rupees.

A few select Best BOP1s along with Below Best varieties maintained.

OP1                     Select Best OP1’s were steady, whilst improved/clean Below Best varieties maintained.   Others and poorer sorts were easier.

PEKOE                 Well- made PEK/PEK1s in general were steady, whilst others and poorer sorts were down.

Leafy and Semi Leafy catalogues met with fair demand,” Forbes and Walker brokers said.

“However, the Small Leaf and Premium catalogues continued to decline.

“Shippers to Iran were very selective, whilst shippers to Türkiye and Russia were fairly active.”

This week  2.2 million Kilograms of Low Growns were sold.

Medium Growns

Medium Grown BOP and BOPF fell by around 100 rupees

The Medium Growns sale average was down by 33.40 rupees to 1199.4 rupees.

“Medium CTC teas in the higher price bracket witnessed a similar trend, whilst teas at the lower end were somewhat maintained subject to quality,” Forbes and Walker brokers said.

“Improved activity from the local trade and perhaps South Africa helped to stabilize prices to some extent.”

OP/OPA grades were steady while PEKOE/PEKOE1 were firm, while some gained 50-100 rupees at times.

Well-made FBOP/FBOPF1’s were down by 50-100 rupees per kg and more at times.

(Colombo/Feb 5/2023)

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