Sri Lanka is a country that violated its Constitution since Independence: – Victor Ivan

The attack on journalist Chamuditha Samarawickrama’s residence and the arrest of Shehan Malaka Gamage, a social media activist who raised concerns regarding the Easter Sunday attack, within a span of a few hours, raised eyebrows among the public. But these incidents happen in a country that also witnessed assassinations and abductions of journalists and activists in broad daylight. Oppression and threats to freedom of expression are signs of a failed democracy and from time to time, segments of society have voiced against such undemocratic moves that often took place with state awareness. In a candid interview with the Daily Mirror, veteran journalist Victor Ivan opined that while Sri Lanka is moving towards an anarchical state, the prevailing crisis also marks the end of Sinhala-Buddhist nationalism.
Excerpts :

Q What are your observations regarding the prevailing situation in the country?

Right now we’re in a critical situation. We’re witnessing all signs of a state that is on the verge of an anarchy. Since independence we have had a history of indiscipline. We have been a country that violated the constitution ever since we gained independence. There’s no other country that has violated its Constitution this way. As such we haven’t progressed in our thinking patterns or attitudes. Even though human rights have been included in our Constitution the state apparatus has continued to violate human rights. Those who violate the human rights haven’t been given adequate punishments and those who were victimised by such incidents weren’t compensated adequately either. Hence, the judiciary, Parliament and the Executive have been backward. Journalists too are backward. I don’t see journalists getting together and working for the common good. When Lasantha Wickrematunga was assassinated in broad daylight, it wasn’t a problem for journalists. Journalists aren’t united and they have a certain ego. Recent incidents have shown that we are heading towards disaster. So far no journalist has done a comprehensive analysis on the prevailing crisis. We don’t see them or editors of media houses questioning the president when he holds press conferences or meetings. Journalists have a duty to inform the public, but we don’t see them doing that anymore. All these are signs of a backward society.

Q What do these incidents indicate about the future?

These incidents are not just the fault of the existing regime. Nobody questioned the President when he was contesting for the Presidential Election. There were allegations regarding his dual citizenship and many other lawsuits filed against him. When these cases were presented to the judiciary they had a duty to investigate; say for example about claims regarding his dual citizenship. Then this matter was presented to the Election Commission. Neither Sajith Premadasa nor Anura Kumara Dissanayake queried about this matter during their campaigns. This matter didn’t arise during the election petition. Then why should we be surprised about Shehan Malaka’s arrest or Chamuditha’s incident? There’s nothing called law and order anymore. Our intelligence services think they are not answerable to the public. But the world over, intelligence services are being monitored. The fact that their expenses, the way they get clues and the way they’re conducting investigations is done without proper monitoring is a joke. In other countries political leaders are bound by the law. But here, politicians are above the law and that is a sign of a stupid country. We are nearing the end of an era and a new era is yet to dawn. But if that era is to be a progressive one, people need to be more critical. One good thing is that people are learning. We are familiar with the breakdown of various parties, be it one that forms the government or the opposition. But we’re not familiar with the breakdown of the state. This may lead to a state of anarchy and I do not know where it would end.

Q Do you think people are misusing their right to freedom of expression?

When mainstream media don’t operate according to certain principles how can you expect social media to follow suit? I feel that social media is effective. The only issue is that there’s an overwhelming amount of information and we’re now tasked with checking the accuracy of these information. Therefore there’s the good and the bad both. Social media has sparked a debate about various topics. We too had similar incidents from Dr. Shafi Shihabdeen’s incident to infertility pills, the fertiliser issue etc. Since 1978 there existed a massive robbery of public money. Politicians flourished at the expense of the taxpayers’ money. We live in a country where people have to look after a President after he retires. When people in the North were deprived of electricity for 10 long years we chose to ignore it. But today, we’re facing the same fate they were in. One positive thing I see in this crisis is that this is the end of Sinhala-Buddhist nationalism. Even though the President scored points by taking Sinhala-Buddhist nationalism at the core of his political agenda, he has ultimately dragged the country towards a hell hole.

Q Social media has given more space for people to express their ideas. Do you think there has to be more controls on new media?

We now live in a modern society. Back in the day, one has to study a particular field be it what produces a doctor, engineer, pilot etc. Today the value of people in these professions are deteriorating. That’s the same with journalism as well. In my point of view social media is progressive. Back then, if I had been a victim of injustice, then I had to meet an editor at a media house and convince him to write the story. This is a difficult task. But as soon as Shehan Malaka got arrested he took his phone and went live on Facebook. This video has over 10,000 views. However, if not for social media the dictatorship would have aggravated further.

Q There have been no proper investigations conducted on assassinations, abductions with regards to journalists or attacks on media houses. Your comments?

Journalists report about various incidents to inform the public. However, they too are divided among themselves. We can’t only blame it on the state. If there’s no democracy and people also choose to ignore these incidents and if journalists too have no unity among themselves, what exactly is the problem?

Q Most arrests take place in the form of abductions. Shouldn’t there be a more organised way of arresting an individual?

Most wanted criminals are shot dead by the Police. Then the Police claim that the suspects attempted to open fire at them and they were killed in an encounter. If we are nurturing a society like that, there’s no point in shouting if such an incident happens to you or me.On the other hand, most journalists try to be too political. There are a few talented individuals also. But we do not know how they could sustain in the industry. However, I see that people are learning and the youth too have started to question these incidents and have developed an interest to dig deeper into various issues. That too is a positive sign.

Q These incidents take place at a time when we are going in for another UNHRC session. But the government hasn’t responded to any of these incidents. Isn’t it a black mark on the incumbent regime?

More than a black mark it shows that the rulers are stupid. Do you see the public protesting against these incidents? That also shows that we’re living in a primitive society. Even though we speak English and dress well we haven’t progressed in our thinking and attitudes.

Q The incumbent regime promised to restore national security and it was their main campaign slogan. Don’t these incidents prove the opposite?

Sri Lanka’s Presidential system is extremely corrupt. One needs to have around Rs. 3 billion in order to contest for Presidency. The incumbent President campaigned for more than a year. Now we see that those who spent on him are reaping benefits. This is why there’s a crisis in almost everything from coconut oil to fertilisers etc. In such a situation it’s difficult to escape or recover from this crisis. In that case we need to bring about a structural transformation. It’s paramount that the Sinhala, Tamil and Muslim communities live in unity and harmony. Law and order needs to be restored. The judiciary, Parliament and the Executive need to be restructured if we are to move forward.

Q What’s the role of the media in the prevailing situation?

The primary role is to inform the public about prevailing issues. Those who join media should first realise that we’re not in Europe or India for that matter. They may face certain challenges when carrying out their duties. But informing the public is important.

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Parliament to convene from 22nd to 25th of February

The Committee on Parliamentary Business at a meeting held on Thursday (Feb. 17), decided to hold Parliamentary sessions next week from the 22nd to 25th of February, Minister Dinesh Gunawardena, the Leader of the House announced.

Accordingly, during the session on Tuesday (Feb. 22), a regulation under the Licensing of Produce Brokers Act and a regulation under the Rubber Replanting Subsidy Act are to be approved in Parliament.

On Wednesday (Feb. 23), an adjournment debate by the Opposition will be taken up.

An amendment to the Fauna and Flora Protection Ordinance and an order to gazette the Coconut Tree under the Felling of Trees (Control) Act, will be tabled in Parliament on Thursday, (Feb. 24).

Moreover, several regulations under the Imports and Exports (Control) Act and orders under the Strategic Development Projects Act will also be tabled in parliament for approval.

$50m defence credit line for Sri Lanka: Pakistan MoDP advised to seek approval from ECC

Pakistan Ministry of Finance (MoF) has advised Ministry of Defence Production (MoDP) to seek Economic Coordination Committee (ECC) approval for establishing Defence Credit Line Facility of $50 million for Sri Lanka before starting negotiations and finalizing terms and conditions, official sources told Business Recorder.

Pakistan and Sri Lanka enjoy cordial relations, characterized by historic affinities, geographic location and cooperation in various fields including defence and defence Industry. Sri Lanka, during last few decades, has emerged as one of the largest markets for the indigenously produced military hardware of Pakistan. However, owing to financial constraints of Sri Lanka, business between the two countries remains much below its potential.

During his visit to Sri Lanka from 23-24 February 2021, Prime Minister Imran Khan announced a Defence Credit Line of $ 50 Million for Sri Lanka to enhance bilateral Defence and Security cooperation. In pursuance of Prime Minister’s commitment with Sri Lankan Government, a draft MoU regarding Defence Credit Line facility was prepared and shared with Ministry of Foreign Affairs, Ministry of Finance and Economic Affairs Division.

Ministry of Foreign Affairs has concurred with the draft. Currently, the MoU is in process of vetting by Economic Affairs Division and Finance Division. In a recent development; however, MoDP has been advised by Finance Division to obtain principle approval of ECC/ Cabinet for opening of Defence Credit Line Facility of$ 50 million for Sri Lanka, before engaging in negotiations with the bilateral partner.

Finance Division has, itself, supported the proposal in principle. Ministry of Defence has sought principle approval of ECC for extending the Defence Credit Line Facility of $50 million to Sri Lanka in terms of Rules 16(1) d) of the Rules of Business 1973.

Hope for Sri Lanka: Namal launches campaign in a bid to become PM

Minister of Youth and Sports Namal Rajapaksa has decided to launch a national political campaign, it is learnt.

According to sources at Temple Trees, the campaign titled ‘Hope for Sri Lanka’ has been endorsed by Prime Minister Mahinda Rajapaksa and is expected to be implemented by mobilising all State Ministers.

It is reported that the campaign will kick off from the Southern province at the end of March. Sources said that the public will be apprised on the progress of the development programmes initiated by respective State Ministers during the last two years.

Expressing views on the ‘ Hope for Sri Lanka’ campaign, a senior Minister of the ruling coalition said that the primary objective of this campaign is to set the stage for Namal Rajapaksa to become the next Prime Minister.

The Minister further stated that Prime Minister Mahinda Rajapaksa had disclosed to close associates of his intention to retire from politics at the end of this year and also intimated his desire to hand over the Premiership to Namal Rajapaksa.

It was reported that President Gotabaya Rajapaksa had informed Namal Rajapaksa to make preparations to contest the 2024 presidential election, citing Finance Minister Basil Rajapaksa’s propensity to leave the country during times of crisis.

Namal Rajapaksa’s ‘Hope for Sri Lanka’ campaign comes in the wake of Finance Minister Basil Rajapaksa’s recent launch of an island wide development drive.

‘Ayaweyen Weda Lakshayak’ (100,000 tasks initiative) programme as envisioned by Budget 2022 covering 14,022 Grama Niladhari Divisions and 336 Divisional Secretariat Divisions was launched by the Finance Minister with the aim of securing the SLPP candidacy for the 2024 presidential elections.

US dollar will hit Rs 300 in near future

UNP Leader Ranil Wickremesinghe yesterday (16), warned the US dollar would reach Rs 300 before the end of the year.

In a statement, he said the economy is deteriorating, while both the dollar deficit and the rupee deficit have not been resolved yet.

“Today, the real value of the rupee is actually Rs 250 to the dollar. Even more so, this way it can go up to Rs 275. If we do not stop there, it will reach Rs 300 before the end of the year,” he said.

The middle class is facing hardship, many are being pushed down the economic ladder. The agriculture sector has been destroyed. Small and big businessmen are unable to procure goods to do their work. This is the problem faced by the citizens. By June and July, we will have to repay foreign loans again. We have a total of US$ 6 billion to repay this year. We have not yet discussed the situation with the IMF. So we have to find the money to repay the loans in June and July. New problems are continuing to arise and this is why the banking system has been abandoned, Wickremesinghe said.

“Under Article 4 of the IMF’s Constitution, each member state is required to discuss and report on its economic situation once a year. The IMF team arrived in Sri Lanka last December. We know that the report will be presented next week. As soon as the Government receives that report they have to present it to Parliament. Once it is presented to Parliament we must hold a debate on it. The proposals put forth in the report must be discussed. From there, we will see if we can come to a consensus and agree to basic principles. It is our duty,” he said.

Speaking further, the UNP Leader said, “Our country just has a single resource and that is the younger generation which comprise Millennials and Generation Zs. We need to think about that group. They want to create a future, but they have lost faith. The Government has broken its trust.”

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Sri Lanka’s Printing Industry at the brink of collapse

Sri Lanka’s printing industry is facing difficulties to continue operations due to the shortage of raw materials.

The Book Publishers’ Association recently pointed out that the prices of paper have risen by about 150 percent amidst the prevailing shortage of US dollars to import the paper required to meet the local demand.

The rate of paper imported to Sri Lanka is now gradually declining, compared to 120,000 tonnes of paper imported to the country every month usually, a spokesperson for the National Paper Company Limited told News 1st.

The Printing Press Owners meanwhile, pointed out that there is a shortage of Ink and Toners as well in the local market.

Earlier, Sri Lankan Book Publishers warned that the book publishing process for school Exercise Books has dropped by 70%, mainly due to banks not opening Letters of Credit to import paper.

Book Publishers told News 1st that they are finding it difficult to source paper to keep up with the demand.

Due to the present economic situation, their production process which operated all week is limited to two to three days, local publishers said.

They are requesting the authorities to immediately intervene and solve the issue and warned that if this situation continues there will be a serious shortage of exercise books when schools re-open for the second term.

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Sri Lanka’s Usable Foreign Reserves at Critical Level

The near-term external debt servicing capacity of Sri Lanka has reached a really challenging position. Usable foreign reserves of the country have fallen to a miniscule and hence critical level of a mere US$ 100 million, sources at the Central Bank of Sri Lanka (CBSL) told Ceylon FT yesterday.

“There is yet no clear road map for managing the near-term external financing gap of the country. Currently, the Government for the most part is dependent on expensive local banking sector short-term currency swaps to finance its day-to-day external payments,” the sources said.

Sri Lanka’s total foreign currency loans, securities, and deposit obligations this year stood at US$ 6.9 billion, of which US$ 1.8 billion were due in the first three months of the year, according to the CBSL.

Hence, they point out that, in the next few weeks, the Government will inevitably have to embark on an IMF-initiated debt and economic restructuring programme.

Accordingly, the Minister of Finance Basil Rajapaksa is likely to formally initiate discussions with the IMF in the next few months, they predicted.

The final report of the IMF routine Article IV consultation group has already been submitted to CBSL and the Ministry of Finance for their observation and review.

They said the report will be submitted to the Executive Board of the IMF on 25 February 2022. The views of the Government of Sri Lanka will be included in the submission.

It is learnt that the report highlights the risk of default of its external debt by Sri Lanka together with its growing budget deficit, rising level of inflation and multiple exchange rates (Formal and informal markets).

Given the circumstances, the Government has decided to submit the IMF Article IV Report to the Cabinet this coming Monday and seek consent on the immediate steps to be undertaken in managing the economy.

CBSL sources said no other acceptable alternative solution or major foreign exchange inflow is available to significantly reverse the rapid depletion of foreign reserves of Sri Lanka.

Sources at CBSL, however, said CBSL is still in the process of securing a US$ 500-1,000 million swap facility with the State of Qatar.

Sri Lanka is eligible for IMF support under the four-year Extended Fund Facility (EFF), possibly about US$ 2 billion carrying an interest rate of less than 2 per cent.

An IMF programme will assist in restructuring the debt under the Paris Club and secure new facilities from the World Bank and enable re-entry into global capital markets.

There is a reasonable probability of achieving debt sustainability, removing import controls without facing a costly restructuring of commercial loans, economists said.

According to sources, the CBSL has requested for an extension of the US$ 400 million swap facility (under the SAARC Framework) received from the Reserve Bank of India and further deferral of the Asian Clearing Union (ACU) settlements. However, no positive response has been received so far, sources said.

A few weeks ago, the CBSL was able to defer over US$ 500 million settlements with the ACU by two months until March 2022. In recent years, the Government has taken steps to obtain several swap facilities under the SAARC Framework spanning 2019-2022. On all such occasions India has maintained that the assistance of IMF should be sought as a long-term solution.

In this backdrop, Sri Lanka has so far not been compelled to opt for an IMF-based programme due to assistance forthcoming from India on humanitarian grounds, but critics say the situation is likely to change in the future. The Government is also considering reaching more ‘bridging finance’ options through India, Japan, China and the Middle Eastern Nations to finance the day-to-day external obligations.

In this context, Japanese authorities have, however, insisted that for such a loan agreement it would be imperative for Sri Lanka to access an IMF programme.

Fitch Ratings estimates CBSL will need to arrange for some US$ 2.4 billion to help State-owned and private-sector firms in the country honour their debt obligations for 2022, over and above the US$ 4.5 billion central government debt.

The country also needs around US$ 20 billion for essential imports such as fuel, food and intermediate goods for exports.

As at end January 2022, the official gross foreign reserves of Sri Lanka was at the US$ 2.36 billion level, of which US$ 1.5 billion was derived from Chinese swap facilities that can only be used for limited import activities with China. In addition, the gross reserves included a US$ 200 million swap facility from Bangladesh and a US$ 400 million short-term swap facility with India. Sri Lanka has already deferred ACU payments worth US$ 510 million.

All major political parties struggling to remain intact

*Several MPs in the government ranks voiced their concerns and disappointment at the way they were being treated by the SLPP

*Ranawaka is already in discussions with Wickremesinghe and Welgama to form a common alliance

*Sirisena is also eying the leadership of a new alliance and is in talks with some political parties to contest a future election separately

All major political parties in Sri Lanka are presently struggling to remain intact and are likely to start splitting, with one alliance already to be named in early March signalling a split in the present government, the Daily Mirror learns.

The alliance which will be announced early March will be of 12 political parties who are presently with the government coming together as one alliance, while continuing to function with the SLPP. This includes some SLFP members and the parties led by Wimal Weerawansa, Udaya Gammanpila and Vasudeva Nanayakkara. The alliance is likely to be announced in the first week of March.

A split in the government was very evident when the co parties of the government were left out from the SLPP convention held in Anuradhapura last week. Several MPs in the government ranks voiced their concerns and disappointment at the way they were being treated by the SLPP and will now come under one separate alliance while continuing to function in the government. The second alliance under discussion is that of SJB MP Champika Ranawaka, UNP Leader Ranil Wickremesinghe and Kumar Welgama.

The Daily Mirror learns that Ranawaka has asked for the deputy leadership post from SJB Leader Sajith Premadasa who is yet to respond. Ranawaka has in the past not denied his intention to contest a future presidency and is already in discussions with Wickremesinghe and Welgama to form a common alliance. Some SLFP MPs have also agreed to join this alliance. Discussions are still underway and not finalized yet, senior political sources said.

Minority parties in the SJB have also voiced their disappointment at the SJB Leadership as they were promised the SJB would convert into a broad alliance and not function as one party, giving these MPs more recognition. However, this pledge is yet to be fulfilled by Premadasa. Some MPs representing the minority parties are now awaiting the formation of new alliances to decide their future. The third alliance in the offing is that of former president Maithripala Sirisena. Political sources said that Sirisena is also eying the leadership of a new alliance and is in talks with some political parties to contest a future election separately.

Sri Lankan banks’ asset quality under pressure as relief measures end – Fitch Ratings

Sri Lankan banks are likely to face continued asset-quality pressure in 2022 as rising macroeconomic stresses stemming from the sovereign credit profile pose a threat to borrowers’ repayment capacity, alongside the conclusion of most relief measures in 2021, Fitch Ratings said in a release.

Fitch-rated banks’ stage 3 (impaired) loans ratio has remained broadly unchanged since 2019 (9M21: 9.4%, 2019: 9.5%), as relief measures prevented deterioration in lending quality. However, asset-quality pressure was evident in elevated loan-impairment charges and a rising share of stage 2 loans in gross loans. The share of loans under moratorium at Fitch-rated banks declined, estimated at 10% of gross loans at end-September 2021 (end-1H20: 26%).

Fitch expects Sri Lanka’s economic performance to weaken in 2022, forecasting growth to slow to 2.0%, although downside risks to forecasts remain. Stage 3 loans are likely to increase in 2022 but a sharp rise in the ratio may not be apparent due to robust loan growth. Credit costs are likely to remain high, although below 2021.

“We believe Sri Lankan banks face added asset-quality pressure from their government securities holdings, particularly those denominated in foreign currency which accounted for around 6.5% of Fitch-rated banks’ total assets at end-9M21,” Fitch Ratings said.

The report, “Sri Lankan Banks Dashboard: February 2022”, is available at www.fitchratings.com or by clicking the link in this media release.

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Sri Lanka & India to discuss Fisheries Issue

All possible steps will be taken to prevent Indian fishermen from illegal fishing in the territorial waters of Sri Lanka, by breaching the maritime boundaries, Sri Lanka’s Ministry of Fisheries emphasized on Wednesday.

Discussions in this regard will be held with the Government of India in the coming weeks, Indu Ratnayake, the Secretary to the Fisheries Ministry told News 1st.

The Indian Government has also agreed to hold discussions, according to Ratnayake.

The authorities are focusing on future steps that could be taken with regard to the vessels and fishing gear seized by security forces, she further noted.