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Saturday March 2nd, 2024

Switzerland and Sri Lanka to calm matters down

They have been eyeball to eyeball, staring each other down over the past month, but as of this week, Sri Lanka and Switzerland will begin the long-slow dance to step back from further confrontation towards normalizing relations.

This is not because it is the season of good cheer, but both sides are showing that they want a way out lest more serious damage is done to the relationship between the two countries.

The dispute is over whether or not Garnier Banister Francis, a Visa Assistant in the Swiss Embassy was abducted by unknown men, sexually assaulted and threatened to reveal information about Chief Inspector Adrian Nishantha Silva of the CID on November 25.  

Silva, who fled to Switzerland on November 24 is a key investigator who probed sensitive cases connected to the Rajapaksa family including President Gotabaya Rajapaksa during the last government.

The government, even before the investigations and the case before the Magistrate is over, declared that such a thing did not happen.

The Swiss government, protecting its local employee, says it maybe did and asked that conclusions be made after the investigation ends.

President Gotabaya Rajapaksa meeting Swiss Ambassador Hanspeter Mock in Colombo on Dec 16, 2019/PMD Photo

At heart is the somewhat hasty move by the Swiss embassy in Colombo to take the first statement made by Francis to them as a complaint to the Sri Lanka government. Swiss Ambassador Hanspeter Mock met Prime Minister Mahinda Rajapaksa with this information and the PM ordered an investigation.

That investigation found that Francis’s story did not match CCTV and Uber records of what she did that day after she left work.

Complicating matters further, Francis’s version of the event was at the core of news stories that appeared in the international media, including the New York Times. The news stories said that the incident raised fears of a “crackdown” by the new President’s cohorts against dissent. They asked whether this was a return of the dreaded White vans just a week and a day after President Gotabaya Rajapaksa was elected.

This controversy is one of the worst diplomatic incidents this country has ever faced. It came hours before the newly minted President was going on his maiden state visit to neighbouring India. The government’s knee-jerk reaction was to say “Western conspiracy.”

 “I am the victim (of a conspiracy),” President Rajapaksa told the Media.

Then Francis was summoned to the CID and questioned for thirty hours over several days where she changed her story about being accosted on the street. She agreed with what the police found where CCTV records show her entering an apartment block known as Palm Court in Colombo 3 and going home after that, according to phone tracking information.  That night, she had gone to the Embassy to meet some diplomats.

Francis told the detectives that the sexual assault and the intimidation took place while she was in an apartment in Palm Court.

The government disputes that pointing to footage of her coming out of the apartment block where she “does not look as she was assaulted or intimidated.” She was accompanied by a woman who is said to be a teacher. Francis says her abductors warned her to act normal when she leaves the building. Francis says she was in the building to see the teacher who has reportedly told police that no such incident took place.

Then on December 17, Francis was charged with falsification of evidence and bringing the government into disrepute and arrested.

She is now in remand custody and will be produced again in court on December 30.

Following the arrest, the exchanges between Berne and Colombo became heated.

The Swiss expressed concern at Francis’s arrest and called for due process to be followed, warning that “in this high-profile case Sri Lanka’s reputation as a country that upholds the rule of law is at stake.”

Talk of “due process” and “rule of law” are serious in diplomatic language as it carries with it the implied threat that Sri Lanka can be branded as a “rogue” state which is a major deterrent for foreign investment.

Foreign Relations Minister Dinesh Gunewardene, shot back saying “Sri Lanka has fully complied with national law and international judicial standards and that any assertion to the contrary was factually inaccurate.”

The Swiss statement, in turn, slammed Sri Lanka for making public statements “questioning her (Francis’s) account before the investigations had been completed.”

But now both sides appear determined to calm things down.

From today the Sri Lankan Ministry of Foreign Relations will not issue any more press releases on this matter, RepublicNext reliably learns.

Yesterday a top official from the Ministry told RepublicNext off-the-record that “this is no longer a diplomatic issue, it is a law and order problem.”

This is a clear signal that both sides want to bring the impasse to an end and allow ‘due process” of the courts to take over.

It is important for Sri Lanka to seek a compromise with the Swiss because in case tensions continue to rise, the issue can become a European issue, a multi-lateral one, which is much more difficult to unravel than a bi-lateral spat between Colombo and Berne. It is important that Sri Lanka contains this issue as a bilateral issue as a multi-lateral dispute can lead to sanctions and other measures.

As an indication that Berne was willing to negotiate Senior Swiss diplomat Jörg Frieden came to Sri Lanka and met Minister Gunawardena telling him that “the principle of the presumption of innocence applies and that the health and safety of our embassy staff take priority.”

It is a month since Francis went on that life-changing journey home, and this Christmas her children will not have their Mom at home.

But now both sides appear determined to calm things down.

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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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