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Sunday December 10th, 2023

Sri Lanka’s Litro promises continuous LP gas supply; CPC says fuel en route

File photo of fuel queue in 2022

ECONOMYNEXT – Sri Lanka’s state run liquid petroleum (LP) gas company Litro announced a continuous supply of cooking gas cylinders to the market starting Friday (18), while the Ceylon Petroleum Corporation (CPC) said a fuel consignment sufficient for 20-25 days is also expected.

A Litro spokesman said 120,000 cylinders of LP gas were to be released to the market on Friday after a consignment of 3,500 metric tons of gas was unloaded at the Muthurajawela gas terminal.

The spokesman said that, in the coming days, Litro will issue gas according to market demand.

However, media reports showed long queues of people outside gas traders for long hours till the cylinders arrived. An ongoing forex shortage has led to similar queues for many essentials including fuel.

The dealers said, even though cylinders have been issued by the supplier, they have yet to reach them for distribution.

With the government focusing on purchasing fuel for daily consumption as well as power generation, importers said that commercial banks are no longer opening letters of credit (LCs) for them.

Last week, both Litro and the private Laugfs Gas Pvt Ltd that make up the LP gas duopoly in Sri Lanka predicted a possible shortage. Both companies had suspended gas supply to the market for a few days until Litro recommenced distribution on Friday with the arrival of the new consignment.

Meanwhile, fuel stations said demand for kerosene has increased, and people waiting in line at fuel stations can also be seen along with vehicles waiting for petrol or diesel.

Several fuel stations that supply CPC fuel and Indian Oil Company (OIC) fuel told EconomyNext that several types of fuel are not available to consumers at the moment.

“We have no types of fuel yet. Not Until Monday (21). We have closed the station,” a spokesman for an IOC fuel station in Maharagama said.

Another IOC station in Colombo 07 told EconomyNext that diesel will not be available till late evening on Friday, but enough petrol stock is available for consumers.

Despite CPC claims that there is no fuel shortage in the country, media reports continue to show long ng queues of vehicles waiting in front of CPC fuel station island wide.

CPC chairman Samantha Ratnayaka on Wednesday (16) said Sri Lanka was due to receive 140,000 metric tons of diesel and 60,000 metric tons of petrol in the next few days.

“Apart from the petrol consignment we unloaded on Wednesday, we expect to receive 60,000 metric tons of petrol,” Ratnayaka said.

“We have yet to receive these consignments, but they will be sufficient for around 20-25 days, so there will be no fuel storage in the country in the near future,” he said.

Officials said even though Sri Lanka has enough fuel for daily consumption, panic buying by consumers has created shortages in the country. (Colombo/Mar18/2022)

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ADB USD200mn loan for Sri Lanka economic stabilization efforts

ECONOMYNEXT – The Asian Development Bank (ADB) has approved a US 200 million dollar concessional loan to Sri Lanka to help stabilize the country’s finance sector.

The Financial Sector Stability and Reforms Program comprises two subprograms of IS 200 million dollars each, according to a statement by the ADB.

“The program’s overarching development objective is fully aligned with the country’s strategy of maintaining finance sector stability, while ensuring that banks are well-positioned for eventual recovery,” ADB Country Director for Sri Lanka Takafumi Kadono was quoted as saying in the statement.

“The expected development outcome is a stable financial system providing access to affordable finance for businesses in various sectors of the economy.”

The ADB statement continues:

“Subprogram 1 targets short-term stabilization and crisis management measures that were implemented in 2023, while subprogram 2 is planned to be implemented in 2024 and focuses on structural reforms and long-term actions to restore growth in the banking sector.

The program will help strengthen the stability and governance of the country’s banking sector; improve the banking sector’s asset quality; and deepen sustainable and inclusive finance, particularly for women-led micro, small, and medium-sized enterprises.

According to the International Monetary Fund’s (IMF) latest review, Sri Lanka’s economy is showing tentative signs of stabilization, although a full economic recovery is not yet assured.

The program is a follow-on assistance from ADB’s crisis response under the special policy-based loan that was approved for Sri Lanka in May 2023.

It is aligned with the fourth pillar of the IMF’s Extended Fund Facility provided to Sri Lanka to help the country regain financial stability.

It is also in line with the government’s reform agenda, including strengthening the operational independence of the Central Bank of Sri Lanka (CBSL) and its designation as the country’s macroprudential authority.

In designing this subprogram 1 loan, ADB has maintained close coordination and collaboration with the IMF to design targeted regulatory reforms for the banking sector—including the asset quality review—and with the World Bank on strengthening the deposit insurance scheme.

“The loan is accompanied by a $1 million grant from ADB’s Technical Assistance Special Fund to provide advisory, knowledge, and institutional capacity building for Sri Lanka’s Ministry of Finance and CBSL.”

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Sri Lank in blackout as power grid hit by cascading failure

ECONOMYNEXT – Sri Lanka suffered a blackout as Saturday evening as the state-run Ceylon Electricity Board grid was hit by a cascading power failure.

The cascading failure is believed to have been triggered by the failure of the Kothmale-Biyagama transmission line.

“The Ceylon Electricity Board wishes to inform our customers that due to the failure of Kotmale – Biyagama main transmission line, an island wide power failure has occurred,” CEB Spokesman Noel Priyantha said.

“Step by step restorations are underway and it may take few hours to completely restore the power supply.”

With hydro plants running flat out, a outage of the line tends to create a big imbalance in the demand and supply, leading to tripping of more lines and generators.

Lines can trip due to lightening strikes, or equipment failures.

Sri Lanka last suffered a cascading failure in December 2021, due to the failure of the same transmission line.

RelatedSri Lanka power blackout as grid hit by cascading failure

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Sri Lanka to host regional Food and Agriculture Organization conference

ECONOMYNEXT – Sri Lanka will host the 37th session of the Asia Pacific Regional Conference (APRC) of the United Nations Food and Agriculture Organization (FAO), from February 19-22, 2024 in Colombo.

The Conference will bring together agriculture ministers and officials from 46 countries across the region to discuss challenges in food and agriculture.

“The 37th APRC will provide a vital platform for regional collaboration, benefitting the agricultural landscape, fisheries sector and environment of Sri Lanka,” Minister Mahinda Amaraweera said at a press briefing on Friday (8) to announce the conference.

FAO has had an active presence in Sri Lanka for over 40 years. “FAO has supported the country in the implementation of Good Agricultural Practices (GAP), and the development of the fisheries sector for growth and climate resilience,” Vimlendra Sharan, FAO Representative for Sri Lanka and the Maldives said.

“The APRC conference will be an opportunity to highlight the innovative approaches introduced in partnership with the government.”

By hosting APRC, Sri Lanka hopes to demonstrate the country’s dedication to the growth of sustainable agriculture, and showcase its commitment to sustainable agricultural development.

The APRC agenda will include a forum on agritourism, especially requested by the Sri Lankan government.

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