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Tuesday February 27th, 2024

Top court faults Sri Lanka ex-President, Fin Min, PB, CB, Governors for economic collapse

ECONOMYNEXT – Sri Lanka’s Supreme Court has faulted Gotabaya Rajapaksa, P B Jayasundera, Basil Rajapaksa, Treasury Secretary S R Attygala, Central Bank Governors W D Lakshman, Nivard Cabraal and the Monetary Board for Sri Lanka’s latest economic crisis.

In a four to one decision the Supreme Court gave the ruling after considering two fundamental rights petitions. Justice Priyantha Jayawardana dissented.

The petitioners told court that the respondent individuals as well as the Monetary Board, which was a body which made decisions regarding the value of the rupee and operated the central bank, had engaged in wrongful and irrational and illegal acts.

The decision had resulted in catastrophic long-term and short-term ramifications to the economy, and caused the country to default on the repayment of foreign debts, for the first time in its history, and has relegated Sri Lanka to a state of bankruptcy, they told court.

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Sri Lanka to seek private investments in water sector

ECONOMYNEXT – Sri Lanka is looking to form public private partnerships in the water sector, specifically to focus on rural water supply, Minister of Water Supply and Estate Infrastructure Jeevan Thondaman has said.

“Not privatization, but public private partnerships,” Thondaman said at a press briefing on Monday. “When we enhance private sector participation, we create a more competitive industry with better quality and cheaper prices.”

A water tariff formula, which will be reviewed annually or bi-annually, has been formulated and will be submitted to the cabinet, parliament and COPE committee, he said.

“Once this is in place, we will be able to attract investors to come on board. The water sector till now has not had a PPP model. We want to bring in private public sector partnerships in rural communities’ water supply; we believe they will be able to work hand in hand with community-based organizations to provide water to those who need it.

“I can give you one example, when you look at the water bottle that is being manufactured by the Water Board, you will see it’s from the Hanthana Estate; but people in Hanthana Estate still don’t have drinking water. There has been a top to bottom approach. Now we want to go rural first.

Most projects in the water sector had stalled post-crisis, Thondaman said, and the priority now was to resume them before attracting further investment into the sector. The minister said that there had been discussions with the Japan International Cooperation Agency (JICA) and the Asian Development Bank.

“Right now the water sector is in a process of restructuring.”

Further funds from the international agencies are dependent on the country carrying out reforms in the sector. “About 75 percent of our reforms our complete, and we should be able to take it forward,” Thondaman said adding that most unions were cooperating. “Once this is complete we should be able to bring in 200 million dollars into the country.” (Colombo/Feb27/2024)

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Sri Lanka rupee opens stronger at 310.50/75 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee opened at 310.50/75 to the US dollar Tuesday, from 310.80/311.00 on Monday, dealers said.

Bond yields were down.

A bond maturing on 01.08.2026 was quoted at 10.85/95 percent.

A bond maturing on 15.09.2027 was quoted at 11.75/85 from 11.80/90 percent.

A bond maturing on 01.07.2028 was quoted at 12.10/20 percent.

The Colombo Stock Exchange opened down; The All Share Price Index was down 0.04 percent at 10,607, the S&P SL20 was up 0.01 at 3,057. (Colombo/Feb27/2024)

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Sri Lanka and India negotiating on bilateral investment treaty: report

ECONOMYNEXT – Sri Lanka and India is working on a bilateral investment treaty, a media report quoted High Commission Santosh Jha as saying.

The investment treaty is separate from an Economic and Technological Co-operation Agreement which is also under discussion, Jha was quoted as saying by Bloomberg Newswires.

Discussion on the ETCA, are at an advanced stage, the report said.

The ETCA will address the issues like non-tarriff barriers.

Under the Indo Lanka Free Trade Agreement India has become the third largest export destination. In 2023 Sri Lanka exported 829 million US dollars of goods to the country, just behind UK at 846 million US dollars.

It also has to ensure that Lanka does not become a conduit that other countries can use to push finished goods into India.

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