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Thursday February 29th, 2024

SriLankan Airlines break-up or not decision soon: Minister

ECONOMYNEXT – A decision on whether to spin-off subsidiaries of SriLankan Airlines or privatize the entire entity as a single entity would be made soon by a committee, Aviation Minister Nimal Siripala de Silva said.

SriLankan Airlines official had been summoned to the committee earlier this week.

The Ministry of Aviation first proposed that 49 percent of the catering unit, and 49 percent of ground-handling – which had given over to SriLankan – be sold to settle its debt. Then 49 percent of SriLankan be sold.

“There are two schools of thought,” Minister de Silva said. “At the cabinet the matter was discussed and his Excellency the President has referred the matter to the Treasury.”

Catering and ground-handling are captive profitable businesses which may represent easy money for those who buy the firms, according to some observers.

Ground-handling, which is a separate business from airline operations, however also represents easy money for the airline and can potentially bring tax revenues to the state if spun off and taxed appropriately.

Meanwhile Minister de Silva said the Chairman and Board was summoned before a Treasury Committee which is looking in to the matter.

“And they are discussing what is the best way out,” he said. “We will be guided not by a political decision but by a professional decision that will be given. So I think in one or two weeks they will consider this and given us a professional opinion.”

SriLankan Airlines has about a billion US dollars of debt including a sovereign guaranteed debt, and arrears to state-run Ceylon Petroleum Corporation on fuel bought before 2019.

Related

SriLankan Airlines loses Rs248bn in four months after soft-peg collapse

SriLankan Airlines has reported large losses since it was taken from its managing shareholder by former President Mahinda Rajapaksa. Some of the recent losses are from the collapse of the central bank’s soft-peg (flexible exchange rate). (Colombo/Dec04/2022)

Comments (4)

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  1. Diogenes Fernando says:

    I’d be interested to hear what Bellwether has to say about this…

  2. sacre blieu says:

    Full of deceit and deception in the manner its cost overruns. False and fictitious claims, and inflated costs, like many government institutes. Free rides by many, etc. The agony of the public being penalized for fraud, bribery and corruption should end forthwith, with no procrastination.

  3. sacre blieu says:

    Firstly and more importantly, find out those who have plundered the airline and feel that they have got away free from justice. Do not suffer the many with the burdens of the dishonest and corrupt few, the evidence of which stares in the face.

  4. emilyjoack says:

    Please sell the complete airline immediately
    you are wasting poor people’s money, and our children need a future

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Comments (4)

Cancel reply

Your email address will not be published. Required fields are marked *

  1. Diogenes Fernando says:

    I’d be interested to hear what Bellwether has to say about this…

  2. sacre blieu says:

    Full of deceit and deception in the manner its cost overruns. False and fictitious claims, and inflated costs, like many government institutes. Free rides by many, etc. The agony of the public being penalized for fraud, bribery and corruption should end forthwith, with no procrastination.

  3. sacre blieu says:

    Firstly and more importantly, find out those who have plundered the airline and feel that they have got away free from justice. Do not suffer the many with the burdens of the dishonest and corrupt few, the evidence of which stares in the face.

  4. emilyjoack says:

    Please sell the complete airline immediately
    you are wasting poor people’s money, and our children need a future

Sri Lanka’s RAMIS online tax collection system “not operatable”: IT Minister

ECONOMYNEXT – Sri Lanka’s online tax collection system RAMIS is “not operatable”, and the Ministry of Information Technology is ready to do for an independent audit to find the shortcomings, State IT Minister Kanaka Herath said.

The Revenue Administration Management Information System (RAMIS) was introduced to the Inland Revenue Department (IRD) when the island nation signed for its 16th International Monetary Fund (IMF) programme in 2016.

However, trade unions at the IRD protested the move, claiming that the system was malfunctioning despite billions being spent for it amid allegations that the new system was reducing the direct contacts between taxpayers and the IRD to reduce corruption.

The RAMIS had to be stopped after taxpayers faced massive penalties because of blunders made by heads of the IT division, computer operators and system errors at the IRD, government officials have said.

“The whole of Sri Lanka admits RAMIS is a failure. The annual fee is very high for that. This should be told in public,” Herath told reporters at a media briefing in Colombo on Thursday (29)

“In future, we want all the ministries to get the guidelines from our ministry when they go for ERP (Enterprise resource planning).”

President Ranil Wickremesinghe’s government said the RAMIS system will be operational from December last year.

However, the failure has delayed some tax collection which could have been paid via online.

“It is not under our ministry. It is under the finance ministry. We have no involvement with it, but still, it is not operatable,” Herath said.

“So, there are so many issues going on and I have no idea what the technical part of it. We can carry out an independent audit to find out the shortcomings of the software.”

Finance Ministry officials say IRD employees and trade unions had been resisting the RAMIS because it prevents direct interactions with taxpayers and possible bribes for defaulting or under paying taxes.

The crisis-hit island nation is struggling to boost its revenue in line with the target it has committed to the IMF in return for a 3 billion-dollar extended fund facility. (Colombo/Feb 29/2024) 

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Sri Lanka aims to boost SME with Sancharaka Udawa tourism expo

ECONOMYNEXT – Sri Lanka is hosting Sancharaka Udawa, a tourism industry exhibition which will bring together businesses ranging from hotels to travel agents and airlines, and will allow the small and medium sector build links with the rest of the industry, officials said.

There will be over 250 exhibitors, with the annual event held for the 11th time expected to draw around 10,000 visitors, the organizers said.

“SMEs play a big role, from homestays to under three-star categories,” Sri Lanka Tourism Promotion Bureau Chairman, Chalaka Gajabahu told reporters.

“It is very important that we develop those markets as well.”

The Sancharaka Udawa fair comes as the Indian Ocean island is experiencing a tourism revival.

Sri Lanka had welcomed 191,000 tourists up to February 25, compared to 107,639 in February 2023.

“We have been hitting back-to-back double centuries,” Gajabahu said. “January was over 200,000.”

The exhibition to be held on May 17-18, is organized by the Sri Lanka Association of Inbound Tour Operators.

It aims to establish a networking platform for small and medium sized service providers within the industry including the smallest sector.

“Homestays have been increasingly popular in areas such as Ella, Down South, Knuckles and Kandy,” SLAITO President, Nishad Wijethunga, said.

In the northern Jaffna peninsula, both domestic and international tourism was helping hotels.

A representative of the Northern Province Tourism Sector said that the Northern Province has 170 hotels, all of which have 60-70 percent occupancy.

Further, domestic airlines from Colombo to Palali and the inter-city train have been popular with local and international visitors, especially Indian tourists. (Colombo/Feb29/2024)

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Sri Lanka rupee closes at 309.50/70 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 309.50/70 to the US dollar Thursday, from 310.00/15 on Wednesday, dealers said.

Bond yields were slightly higher.

A bond maturing on 01.02.2026 closed at 10.50/70 percent down from 10.60/80 percent.

A bond maturing on 15.09.2027 closed at 11.90/12.10 percent from 11.90/12.00 percent.

A bond maturing on 01.07.2028 closed at 12.20/25 percent.

A bond maturing on 15.07.2029 closed at 12.30/45 percent up from 12.20/50 percent.

A bond maturing on 15.05.2030 closed at 12.35/50 percent up from 12.25/40 percent.

A bond maturing on 01.07.2032 closed at 12.55/13.00 percent up from 12.50/90 percent. (Colombo/Feb29/2024)

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