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Monday April 15th, 2024

Vietnam takes in over 300 rescued Sri Lanka boat people

ECONOMYNEXT – Vietnam vessels are taking in 305 boat people from Sri Lanka who were fleeing a currency crisis and were found adrift in a disabled fishing boat near Spratley islands, reports said.

The Sri Lankans were on board, LADY R3311 LD, a fishing boat out of Myanmar and were rescued by Helios Leader, a Japanese ship, Vietnam’s Tuoitre newspaper reported.

The fishing boat is believed to have been travelling to a third country, possibly Canada, reports said.

The Japanese ship brought the Sri Lankan’s to Vung Tau, a now a top sea resort where they were transferred to a Vietnamese maritime rescue vessel SAR 413.

UPDATE: Sri Lanka boat people come ashore in Vietnam after initial resistance

A Sri Lanka diplomat had also accompanied Vietnam officials, the newspaper said.

There were women, children in the group and at least two men were found with injuries.

Vietnam has dispatched a second ship CSD 8001, to bring the boat people to the shore.

Sri Lanka’s rupee collapsed from 200 to 360 to the US dollar in 2022 after two years of money printing to boost growth (output gap targeting or stimulus) by suppressing interest rates. Sri Lanka’s macro-economists busted the rupee from 4.70 since a money printing central bank set up in 1950 gave them the power to mis-target interest rates.

Pressure is mounting to take away the power to print money from macro-economists and hard peg the currency and restore free trade and end foreign exchange controls restoring economic freedoms of the poor.

Ironically Vung Tau, was a key port where Vietnamese boat people fled after the fall of Saigon.

Later as the Vietnamese dong collapsed in the 1980s a fresh wave to boat people left.

Vietnam Dong fell from around 23700 to 24,800 in October after several years of low rates and the State Bank of Vietnam is jacking up rates to protect the currency. The exchange rate was key to maintaining foreign investor confidence and stability, SBV Governor said.

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Sri Lanka to discuss two contentious points with bondholders: report

ECONOMYNEXT – Sri Lanka and sovereign bondholders are to discuss two matters in the near future which the two sides failed to reach agreement at March talks in London, a media report quoting a top aide to President Wickremesinghe as saying.

Sri Lanka and bondholders had discussed four matters on restructuring international sovereign bonds in late March and agreement had been reached on two, President’s Chief of Staff Sagala Ratnayake was quoted as saying on state-run ITN television.

A restructuring proposal by bondholders was not in line with IMF requirements, and Sri Lanka had sent a counter proposal, he said.

The matters will be discussed at round of talks in the near future.

Sri Lanka was optimistic of reaching an agreement with the bondholders before June, officials have said.

According to matters already in the public domain, sovereign bond holders are keen to get a bond tied to dollar gross domestic product, as they feel IMF growth projections are too low.

In past re-structuring so-called value recovery instruments, a type of warrant, gave their owners extra payments if a country did better than expected and were tied to items like oil prices.

Bondholders had initially proposed bond which would have a lower hair cut initially, and it will have additional hair cuts if growth is low (about 3.1 percent) as projected in an IMF debt sustainability analysis. (Colombo/Apr15/2024)

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BIMSTEC Secretary General visits Sri Lanka, discusses regional cooperation

ECONOMYNEXT – The Secretary General of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), discussed measures to enhance regional cooperation, during his visit to the island last week.

Ambassador Indra Mani Pandey, Secretary General of BIMSTEC visited Sri Lanka from 07 – 12 April 2024, following his assumption of office as Secretary General of BIMSTEC in January this year.

The Secretary General “met with senior officials of relevant Ministries/Agencies to discuss measures to enhance regional cooperation under various BIMSTEC initiatives,” the Foreign Ministry said in a statement.

Several BIMSTEC countries have bilateral trade agreements, such as Sri Lanka and India, Thailand and Myanmar, Sri Lanka and Thailand, but no collective regional agreement to enable intra-regional leverage.

During the visit, Secretary General Pandey held discussions with Ministry of Foreign Affairs officials and paid courtesy calls on the President and the Minister of Foreign Affairs.

Secretary General Pandey participated at an event on “Regional Cooperation through BIMSTEC” organized by the Lakshman Kadirgamar Institute (LKI) on 9 April. (Colombo/April15/2024)

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Sri Lanka rupee closes weaker at 299.00/10 to the US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed at 299.00/10 to the US dollar in the spot forex market on Monday, from 298.50/55 on Wednesday, dealers said, while bond yields were broadly steady.

A bond maturing on 15.12.2026 closed stable at 11.30/35 percent.

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

A bond maturing on 15.12.2028 closed at 12.10/20 percent up from 12.10/15 percent.

A bond maturing on 15.09.2029 closed stable at 12.20/40 percent. (Colombo/Apr15/2024)

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