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Thursday June 20th, 2024

SriLankan Airlines to swap Airbus A350s for smaller planes

ECONOMYNEXT – State-run SriLankan Airlines is on track to renegotiate an order for four Airbus A350 long haul aircraft for other aircraft more suited to its route network at no additional cash cost for Sri Lanka, a top official said.

"The balance A350 aircraft are being renegotiated with Airbus so that they will be converted at competitive prices, to aircraft that Sri Lanka needs in the next 10 years," advisor to the finance ministry Mano Tittawella said.

"So this can be done without any financial burden to Sri Lanka’s government or SriLankan and we will be able to have the right aircraft that the fleet requires.

"…[T[hose negotiations are going very well, and the idea is that the at the current market prices these orders will be converted into more suitable aircraft, which will be delivered to SriLankan Airlines in the next 5 to 7 years."

A new board that took over in April under Ranjith Fernando, a veteran banker and public servant hired specialist negotiators to talk with Airbus.

The deal is under is expected to come under a special presidential commission which is probing irregularities in the airline under its earlier boards and chief executives.

The cancellation of A350 orders from Aercap, a leasing firm, by the previous board also drew controversy and criticism due to the payments made to the leasing firm.

The controversial order for about a dozen A350s is expected to be a key focus of a Presidential Commission of Inquiry that is probing irregularities at the airline.

Meanwhile Tittawella said talks were progressing well.

The government’s public private partnership unit will resume a search for a partner for SriLankan Airline in September or October calling expressions of interest he said.

He expects at least two parties to be in the last stages of negotiations by the first quarter of 2019.

Tittawella, when he headed a privatization commission in the 1990s, brought Emirates as managing partner to SriLankan.

SriLankan made almost a billion dollars of losses after Emirates exited when ex-President Mahinda Rajapaksa cancelled the visa for its chief executive. (Colombo/Aug21/2018)

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Sri Lanka shares debt management experience at global forum

ECONOMYNEXT – Sri Lanka has shared its experiences at a forum on debt management to “provide lessons for others”, State Minister of Finance Shehan Semasinghe has said.

Semasinghe spoke on “The Role of Debt Management in Navigating Crises” at the 14th Debt Management Facility (DMF) Stakeholders’ Forum, in Livingstone, Zambia.

“I shared the experiences of Sri Lanka which can provide valuable lessons for others and explored the critical elements of capacity building and sound institutional practices in managing debt, particularly in the context of economic challenges,” Semasinghe said on X (twitter).

“Sri Lanka’s experience demonstrates that effective debt management is not just about managing numbers but also about building robust institutions and capacities.”

The journey underscores the importance of transparent, accountable governance and the need for international support and cooperation in times of crisis, he said.

“Sri Lanka prioritized addressing gaps in public debt management by drafting a consolidated Public Debt Management Act, ensuring clarity and legal robustness and establishing a centralized Public Debt Management Office with operational autonomy.

“The role of debt management in navigating crises is multifaceted and critical. Further, by investing in capacity building, adhering to sound institutional practices, and strategically managing debt restructuring and liability operations, countries can better withstand economic shocks and pave the way for sustainable recovery.”

Developing countries face severe debt distress as they are more vulnerable to external shocks, Semasinghe said, and “managing global debt requires coordinated international efforts on debt restructuring where necessary, timely fiscal policy adaptation and help sustainable economic growth.”

The state minister also pointed out the financial impact of climate change was an emerging challenge, as countries need investment to mitigate and adapt to climate impacts, “especially through non-debt creating inflows, which would require private capital mobilization.” (Colombo/Jun20/2024)

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Sri Lanka rupee closes stronger at 305.10/30 to US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed stronger ahead of the long weekend at 305.10/30 to the US dollar on Thursday, up from 305.40/55 to the US dollar Wednesday, dealers said, while some bond yields edged up.

A bond maturing on 15.12.2026 closed at 10.45/80 percent, up from 10.35/75 percent.

A bond maturing on 01.07.2028 closed at 11.20/45 percent.

A bond maturing on 15.09.2029 closed at 12.00/15 percent, up from 11.95/12.35 percent.

A bond maturing on 01.12.2031 closed at 12.05/25 percent.

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Sri Lanka stocks close up, JKH trade pushes turnover

ECONOMYNEXT – The Colombo Stock Exchange closed up on Thursday, data on its site showed.

The broader All Share Index closed up 0.19 percent, or 23.11 points, at 12,249; while the more liquid S&P SL20 Index closed up 0.15 percent, or 5.33 points, at 3,610.

Turnover was 2 billion. Nearly half of this (Rs980mn) came from a crossing on John Keells Holdings Plc. The share closed down at 202.00.

“There were several crossings today which pushed turnover,” market participants said.

“Institutions and high net-worth activity drove the market, while the retail investors we feel are still about uncertain and adopting a wait-and-see approach.”

Melstacorp Plc was among the companies that saw active volumes (Rs194mn) in the day. The share closed up at 87.10.

Top contributors to the index included TeeJay Lanka Plc (up at 41.70), Sampath Bank Plc (up at 79.50), Hatton National Bank Plc (down at 201.00). Hayleys Plc (up at 105.00) and its subsidiary Hayleys Fabric Plc (up at 46.60) were also positive contributors. (Colombo/Jun20/2024)

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