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Saturday March 2nd, 2024

Sri Lanka’s state-run fuel retailer to digitize tendering from next month: Minister

ECONOMYNEXT – Sri Lanka’s state-owned fuel retailer Ceylon Petroleum Corporation (CPC) will implement an automated tendering system for fuel purchase from next month to minimize corruption, the State Power and Energy Minister said as the IMF has demanded strong anti-corruption measures.

The International Monetary Fund (IMF) has demanded strong anti-corruption measures in return to its $3 billion, 48-month loan to ensure the country does not return to another economic crisis.

Analysts say Sri Lanka’s governance system is totally corrupted with an over bloated state sector. The island nation with 22 million population has one state official for every 16 citizens.

President Ranil Wickremesinghe’s government has already enacted an anti-corruption law, but the public perception on the corrupt governance has not changed as there has been no action against politicians and bureaucrats who have been accused of corruption.

“We will implement in CPC from next month an e-procurement system for the first time in Sri Lanka,” D V Chanaka, State Power and Energy Minister said on Thursday (19).

“The registered suppliers will receive the tenders generated through the e-procurement system. There will be a deadline to submit the tender along with the premiums. But before that they need to tick many requirements including specimens, bid bonds etc.”

The CPC tenders have been under scrutiny in the past for not awarding to the lowest bidder. Government officials have said the “technical errors” in the tender process have been the reasons for such a decision.

“When we do this, there won’t be any errors from suppliers. So there won’t be a situation where suppliers make technical errors,” Chanaka said.

“Once the deadline is over, the system will generate the lowest bidders. Then we allow another 10 minutes to shortlist the top five lowest bidders. Those five can rebid if they want. Those five will see only the prices without the names.”

“This process will get repeated for three times and automatically the system will generate the agreement to the lowest bidder. Once the bidet agrees to the agreement, the system will issue the contract. So the system will be fully transparent and nobody can influence.”

In the past, successive Sri Lankan government have come up with strong anti-corruption measures and the law implementing authorities can take action under the existing legal system. However, no measures have been implemented so far, analysts say. (Colombo/Oct 21/2023)

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Sri Lanka eyes SOE law by May 2024 for better governance

ECONOMYNEXT – Sri Lanka is planning to pass a Public Commercial Business (PCB) Act improve governance of state-owned enterprise by May 2024 as part of an anti-corruption efforts following an International Monetary Fund assessment.

Sri Lanka’s state enterprises have been used by politicians to give ‘jobs of the boys’, appropriate vehicles for personal use, fill board of directors and key positions with henchmen and relatives, according to critics.

Meanwhile macro-economists working for the state also used them to give off-budget subsides or made energy utilities in particular borrow through supplier’s credits and state banks after forex shortages are triggered through inflationary rate cuts.

The government has taken billons of dollars of loans given to Ceylon Petroleum Corporation from state banks.

There have also been high profile procurement scandals connected to SOEs.

An SOE Reform Policy was approved by Sri Lanka’s cabinet of ministers in May 2023.

The Public Commercial Business (PCB) Act has now been drafted.

A holding company to own the SOEs will be incorporated and an Advisory Committee and Board of Directors will be appointed after the PCB law is approved, the statement said. (Colombo/Mar01/2024)

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Sri Lanka rupee closes at 308.80/90 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 308.80/90 to the US dollar Friday, from 309.50/70 on Thursday, dealers said.

Bond yields were broadly steady.

A bond maturing on 01.02.2026 closed at 10.65/75 percent up from 10.50/70 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.05 percent from 11.90/12.10 percent.

A bond maturing on 01.07.2028 closed at 12.15/35 percent down from 12.20/25 percent.

A bond maturing on 15.07.2029 closed at 12.25/40 percent up from 12.30/45 percent.

A bond maturing on 15.05.2030 closed at 12.30/45 percent down from 12.35/50 percent.

A bond maturing on 01.07.2032 closed at 12.50/13.00 percent from 12.55/13.00 percent. (Colombo/Mar1/2024)

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Sri Lanka stocks close up 0.37-pct, Expo to de-list

ECONOMYNEXT – The Colombo Stock Exchange closed up 0.37 percent on Friday, and SG Holdings, the parent company of Expolanka Holdings Plc, said it was taking the company private.

Expolanka is the largest listed company on the Colombo Stock Exchange.

“Expolanka Holdings PLC has, at the Board Meeting held on 1st March 2024, considered a request from its principal shareholder and resolved to initiate the de-listing of the Company’s shares from the Official List of the Colombo Stock Exchange subject to obtaining necessary shareholder approval and regulatory approvals,” the company said in a stock exchange filing.

As per arrangements with SG Holdings Global Pte Ltd, the Company’s majority shareholder, it will purchase its shares from shareholders who may wish to divest their shareholding in the Company at a purchase price of Rs 185.00 per share. The share closed up at 150.50.

The broader All Share Index closed up 0.37 percent, or 39.47 points, at 10,691; while the S&P SL20 Index closed down 0.64 percent, or 19.59 points, at 3,037.

Turnover stayed above the 1 billion mark for the sixth consecutive day, registering 1.4 billion.

Crossings in Melstarcorp Plc (135mn) up at 89.50, Hatton National Bank Plc (64mn) up at 158.00, Hemas Holdings Plc (53mn) up at 75.00 and Central Finance Company Plc (26mn) up at 103.50, added significantly to the day’s turnover.

“The upward trend is continuing, with more retail buying also coming in, the number of trades was more than 10,000 today,” a market participant said. “Investors are looking for undervalued stocks and buying in quantities.” (Colombo/Mar1/2024).

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