Author: TELO Admin

The Chairman of the China Merchants Group (CMG), China’s largest diversified conglomerate, who was on a visit to Sri Lanka says the Group’s latest investment plans will up its accumulated investments in the island to reach nearly 2 billion US Dollars.

Chairman Miao Jianmin, who is on his first visit to the country, attended a signing and ribbon cutting ceremony held at the Hambantota International Port for 15 projects. The China Merchants Group which entered the Sri Lankan market in 2008, accumulated a total investment of 1.68 billion US dollars as at the beginning of 2023. The Group has just signed another investment agreement with the Sri Lankan government, with plans to invest 400 million US dollars to build a modern logistics centre in Colombo. The new development will up CMG’s accumulated investment in Sri Lanka to reach over 2 billion US dollars, making it the largest foreign investment enterprise in the island.

“On this fertile land, we will write an extraordinary chapter together, and promote Hambantota Port to move forward and become a new bright spot and driving force in Sri Lanka and the Indian Ocean,” the CMG Chairman said.

The project signing event held at the Hambantota Maritime Center Sky Lounge, included MoUs, commercial agreements, office lease and land lease agreements. The partnering organisations present were Bhathiya Trading Company, COSCO Shipping Lines Lanka, Shipload Maritime, United Life Supermarket, HXZA Lanka International, Lu Fortune Investment, China State Construction Engineering Corporation, Sinopec Fuel Oil Lanka Limited and Inchcape Mackinnon Mackenzie Shipping.

Expressing full confidence in the development of Hambantota International Port, Chairman Miao Jianmin said that CMG will continue to increase investments in Sri Lanka and establish extensive cooperation with everyone. The China Merchants Group brings to Sri Lanka, their rich experience in port and park management coupled with advanced technology. The Group plans to build Hambantota International Port into an important logistics centre and industrial base on the island as well as the Indian Ocean region.

With a 150 year history, the China Merchants Group is a diversified conglomerate with key business areas focused on transportation and logistics, comprehensive finance, urban and park development. The Group’s most recent interests include emerging industries such as healthcare and testing.

In addition to the signings, HIP celebrated three projects in the industrial park that have reached completion. A ribbon cutting ceremony was held for the completed phase 1 of the INSEE warehouse by Siam City Cement, the covered bonded warehousing facility by Hambantota Port & Logistics Services and the plug-and-play, park-in-park facility by Shenzhen Xinji Group.

The event also marked the commencement of Phase II of the INSEE Warehouse by Siam City Cement (Lanka) Limited as well as the state-of-the-art yacht building facility by SeaHorse Yachts (Pvt) Ltd.

Vice Presidents of CMG Deng Renjie and Feng Boming and Wang Xiufeng, CEO of CMPort, subsidiary of CMG and HIPG’s global partner were present at the event. Johnson Liu, CEO of HIPG and Ravi Jayawickreme, CEO of HIPS were also in attendance.

Chief of Air Staff, Air Chief Marshal V R Chaudhari on Tuesday met Sri Lanka’s top military leaders and exchanged views on several matters of bilateral importance, while recalling the longstanding friendship between the two countries, amid China’s growing influence in the island nation.

Air Chief Marshal Chaudhari, who arrived here on Monday on a four-day official visit to Sri Lanka, called on the Commander of the Sri Lankan Air Force (SLAF), Air Marshal Sudarshana Pathirana at Air Force Headquarters here.

As part of India’s commitment towards capacity building of Sri Lanka Armed Forces, Chief of Air Staff of the Indian Air Force presented AN-32 propellers to ensure high operational readiness of the aircraft held with Sri Lanka Air Force.

“Air Chief Marshal VR Chaudhari #CAS @IAF_MCC donated AN-32 propellers to Commander @airforcelk at Katunayake Air Base on behalf of Government of India. Highlights India’s resolute commitment towards capacity building of SriLanka Armed Forces,” the the Indian High Commission in Colombo tweeted.

The Chief of the Air Staff is visiting Sri Lanka at the invitation of Air Marshal Pathirana. He was received upon arrival by the Commanding Officer SLAF Station Colombo, Air Commodore Suresh Fernando, and was presented a Guard of Honour which was conferred by the Colour Squadron of the SLAF, Sri Lanka’s News 1st channel reported.

He also met with the Commander of the Sri Lanka Navy, Vice Admiral Priyantha Perera at the Navy Headquarters, Colombo.

Upon his arrival, he was welcomed at the portals of the Navy Headquarters in compliance with naval tradition.

“Visit of Air Chief Marshal VR Chaudhari #CAS @IAF_MCC to Sri Lanka: Day 2 engagements in the morning. Meeting with Air Marshal Sudarshana Pathirana, Commander @airforcelk. Meeting with Vice Admiral Priyantha Perera, Commander @srilanka_navy,” the Indian mission tweeted.

Air Chief Marshal Chaudhari also met with Maj. Gen Senarath Yapa, Commandant National Defence College, Sri Lanka and delivered a talk on the transformation of the Indian Air Force to the senior Sri Lankan Armed Forces officers attending the College, it added.

He also gifted books worth 10 million Sri Lankan Rs to the prestigious.

During the discussions, the two sides exchanged views on several matters of bilateral importance, whilst recalling the longstanding friendship between the two countries.

After his arrival here on Monday, Air Chief Marshal Chaudhari sought the blessings of Lord Buddha at the sacred Gangaramaya Temple in Colombo.

The visit will enhance the existing professional ties and bonds of mutual cooperation between both nations, an official statement said.

“The visit symbolises strong relations and close cooperation between the two friendly neighbours, with Sri Lanka being accorded the status of ‘Priority One’ partner by India. Underlining the strong bonds of friendship between the two services,” the Indian mission said in a statement Monday.

“The visit of Chief of Air Staff, Indian Air Force would strengthen the existing relations between the two countries and facilitate discussions on common security challenges and enhancing capacity and capability building initiatives towards ensuring Security And Growth for All in the Region (SAGAR), as propounded by Prime Minister Narendra Modi,” the statement said.

In February 2021, at the invitation of the Commander, Sri Lanka Air Force, a 22 aircraft contingent of the Indian Air Force participated in the 70th anniversary celebrations

In addition, the Indian Air Force was the first responder by deploying its assets expeditiously for providing 12T medical supplies in May 2020 and 100T nano fertilisers in November 2021.

In August last year, Vice Chief of Indian Navy Vice Admiral S N Ghormade paid a two-day visit to Sri Lanka and handed over a Dornier maritime surveillance aircraft to the island nation’s Navy to further boost bilateral defence partnership.

Sri Lankan President Ranil Wickremesinghe was present at the handover ceremony which took place as India celebrated the 75th anniversary of its independence. The ceremony to hand over the aircraft also happened a day before Yuan Wang 5, a Chinese missile and satellite tracking ship docked at Sri Lanka’s Hambantota port.

India’s concerns come amidst China’s growing influence in Sri Lanka – which is currently struggling to come out of a severe economic crisis.

Beijing has loaned billions of dollars to Sri Lanka as part of its Belt and Road Initiative (BRI) to build infrastructure in Asia. However, some of the infrastructure projects under the BRI have not worked in Sri Lanka’s favour.

In 2017, for example, China Merchants Port Holdings took a majority share with a 99-year lease in Hambantota port – where the Yuan Wang 5 was docked – after Colombo struggled to repay the debt incurred to build it.

Source – PTI

Pakistan took the crown for Asia’s fastest inflation from Sri Lanka as a weaker currency and rising food and energy costs drove price gains to a record in April.

Consumer prices rose 36.4% in April from a year earlier, the highest since 1964, according to data released by the statistics department Tuesday. That compares with a median estimate for a 37.2% gain in a Bloomberg survey and a 35.4% increase in March.

The data shows Pakistan’s inflation outpaced price gains in Sri Lanka that eased to 35.3% in April and is starting to show signs of recovery from an economic crisis. The Pakistani rupee is one of the worst performing currencies globally so far in 2023, declining 20% to the dollar, and making imported goods more expensive.

Transport prices climbed 56.8% while food inflation quickened 48.1% in April from a year earlier, data showed. Clothing and footwear prices gained 21.6% and housing, water and electricity costs rose 16.9%.

Pakistan’s inflation is expected to rise further after authorities raised taxes and fuel prices to meet the IMF’s conditions for the revival of a $6.5 billion loan program.

The bailout funds would be crucial for helping Pakistan to pay for essential imports like food and fuel and to avoid a default next month. However, the IMF is seeking financing assurances before restarting aid.

To rein in price pressures, the State Bank of Pakistan hiked its benchmark interest rate last month to 21% — the highest since central bank data going back to 1956. Rising inflation could keep borrowing costs elevated for the South Asian nation that struggling with a slow recovery after last year’s floods.

The central bank’s next monetary policy review is due on June 12.

High prices are adding further pressure on Prime Minister Shehbaz Sharif who is also grappling with a political crisis. His rival Imran Khan is seeking early elections and has threatened to return to street protests if his demands are not met.

Source – Bloomberg

Experts opine that a great deal of attention needs to be given to pension funds like the Employees’ Provident Fund if any action is being taken concerning domestic debt, when implementing the agreements reached with the International Monetary Fund.

They point out that if a large amount of the debt obtained from the EPF is slashed in the process of restructuring domestic debt, it would negatively impact the beneficiaries.

A week ago, Sri Lanka’s President told Parliament that the island nation’s total debt was 83.6 billion US dollars, with foreign debt at 41.5 billion US dollars and domestic debt at 42.1 billion US dollars.

On the 12th of April 2022, the Central Bank Governor and the Finance Secretary speaking to reporters said that Sri Lanka will temporarily suspend foreign debt payments to avoid a hard default.

It’s been over a year since Sri Lanka decided to suspend foreign debt payments.

According to the program implemented by Sri Lanka in collaboration with the International Monetary Fund, the ability to repay debt has become a key condition for restabilizing the country’s economy.

For that, it is expected that a significant part of the total amount of debt taken by Sri Lanka will be slashed, while a concessionary program will be introduced to for the repayment of another portion of debt,

Foreign Minister Ali Sabry, PC said Sri Lanka hopes to reduce the debt obligation by USD 14 Billion.

The necessary measures that will be taken, with regard to foreign debt, are still in the discussion stage.

In the meantime, the government has now focused its attention towards domestic debt.

According to the Governor of the Central Bank, domestic debt optimization is expected and the necessary measures that are required, are still in discussion level.

The Central Bank explained that the measures that would be taken regarding the amount it has borrowed from treasury bills as optimization.

Although it can be explained in the sense of optimization, the exact steps that would be taken have not yet been explained.

In the meantime, the central bank has announced that there is an opportunity to voluntarily decide and take steps regarding treasury bonds.

According to the data presented to the investors by the Governor of the Central Bank and the Secretary of the Ministry of Finance last March, by the end of 2022, the government had borrowed USD 11.4 billion dollars through treasury bills.

The highest percentage of treasury bills of 62.4% was borrowed by the Central Bank.

The total amount of debt the government borrowed through treasury bonds was 24 billion US dollars.

42.7 percent of it was obtained from pension funds, including the Employee Provident Fund.

According to the report of the Auditor General who investigated the bond transactions, the loss to the Employee Provident Fund from the bond scam at that time was 8.7 billion rupees.

Experts point out that measures should be taken to prevent such a situation from occurring again.

Starting the IMF debate, the President gave an assurance in the parliament and at the United National Party May Day rally on May 1st that he would act in a manner that would not harm the Employees’ Provident Fund.

It should be appreciated.

However, when News 1st contacted the EPF Department, it said that the government has not called for any discussion with regard to domestic debt restructuring.

The Employees’ Provident Fund is currently the largest and most widespread Social Security Scheme in Sri Lanka and can be considered as a little ‘Peace of Mind’ for the employees of Private Sector firms, State Sponsored Corporations, Statutory Boards and Private Business.

The aim of the EPF is to assure financial stability to the employee in the retirement stage of life and to reward the employee for his or her role in the economic growth of the country.

Therefore, isn’t it important to make decisions regarding the EPF with a more comprehensive discussion and proper planning?