Category: Featured Headlines

The Chinese organic fertiliser manufacturer Qingdao Biotech Group Co. Ltd has put forwarded a set of conditions to the Agriculture Ministry, demanding the payment of 70 percent of agreed price in the original tender agreement and additional freight charges.

The company is trying to push through a controversial shipment of organic fertiliser and has placed fresh demands for the return of its ship as the controversy over the shipment continues.

The Chinese company demands that it should be paid seventy percent (USD 5.6 million) of the initial tender agreement (USD 8 million), USD 36 million as freight cost and a joint statement with the Ministry to pronounce that the shipment was turned down on an import permit dispute, not on the quality of the fertiliser, according to ministerial sources.

In addition to these conditions, the company also indicated that the shipment should not be subjected to fresh testing of samples in future.

The demands were made in a November 9 letter sent by Chinese company director Song Hai Meito to Agriculture Minister Mahindananda Aluthgamage and State Minister Shasheendra Rajapaksa. The letter was copied to chairmen of Commercial Fertilizers Ltd and Ceylon Fertiliser Company Ltd.

The letter came in the wake of the Agriculture Ministry rejecting requests from the Chinese company to go for a third party test and made it clear that under no circumstances, would the contaminated shipment be allowed to discharge its cargo in any port in the country.

However, Minister Aluthgamage told the Sunday Times that the Government was willing to consider sharing losses if the current shipment was returned and a fresh shipment with fertiliser of accepted specifications was sent.

He said that if necessary, microbiologists from China and local microbiologists could sit together and test samples.

Early this week, Ministry officials met a delegation representing the Chinese fertiliser company to resolve the issue but the meeting ended inconclusively.

As of yesterday evening, the ship Hippo Sprint carrying 20,000MT of contaminated fertiliser was tracked near Kalutara, some 25 nautical miles from the Colombo port. Last week, the ship reappeared on maritime radars after briefly disappearing for days but remained in Sri Lankan waters.

Commercial Fertilizers Ltd Chairman Methsiri Wijegunawardana confirmed the receipt of the letter but declined to comment on the content since the matter was under judicial scrutiny. “There is a judicial process underway on this matter. Whatever the matter the party wants to negotiate, can do so through court process,”

The Colombo Commercial High Court is scheduled to hear the case on Friday.

The Lanka Sama Samaja Party (LSSP) led by Prof. Tissa Vitarana, has decided to quit the government, reports say.

According to the ‘Lanka C News’ website, Prof. Vitarana had stated that although a request had been made to discuss the anti-public conduct and threats made by the members of coalition’s main stakeholder – the Sri Lanka Podujana Peramuna (SLPP), party leaders have not responded.

‘Lanka C News’ further reports :

Therefore, Prof. Vitarana is of the view that the LSSP shouldn’t remain a part of the government coalition any longer.

Accordingly, the proposal to leave the government would be submitted during the next politburo meeting of the party, he had further said.

Eleven political parties of the government coalition are to meet at minister Udaya Gammanpila’s home tomorrow (15).

They are to discuss at length on backing the proposals of Budget 2022.

They are also to discuss the future decisions they would take with regard to the Yugadanavi pact.

Echoing longstanding fears of Tamil grassroots activists and politicians, the Catholic leadership in Sri Lanka’s north and east has raised the alarm over endless state sponsored efforts to alter the ethnic makeup of the war-torn region.

While visiting the north, the Swiss Envoy to Sri Lanka was told that the government has launched a concerted effort to change the demography of the Tamil majority Trincomalee, Mullaitivu and Mannar districts by settling Sinhalese from other areas.

This rare declaration by the Catholic hierarchy was made in unison at a meeting with Ambassador Dominik Furgler in Jaffna.

Four Bishops, Dr. Fidelis Lionel Emmanuel Fernando of Mannar, Justin Bernard Gnanapragasam of Jaffna, Christian Noel Emmanuel of Trincomalee and Joseph Ponniah met the visiting diplomat on Wednesday (10) at the Jaffna Bishops House.

18,000 yet to be resettled

Tamils who are the majority of the region are further frustrated with the government due to its seizure of Tamil owned land to create Sinhala colonies, Ambassador Furgler was told.

He also heard the government being accused of abandoning development work in the north and the east while obstructing Indian assistance.

A day after the Swiss envoy’s meeting with the Bishops, Tamil National Alliance MP Sivagnanam Shritharan told parliament that war displaced 14,000 from Jaffna and 4000 from Kilinochchi are yet to be resettled despite the end of war 12 years ago.

“Seized land has not been returned to Tamils. Meanwhile it is bringing Sinhalese from outside to annihilate another nationality,” said the lawmaker from Jaffna.

According to data collected by local activists, the military, forest department, wildlife department and the archaeology department are the main government institutions actively involved in grabbing land in the north and east.

Amidst lukewarm interest in what the Government had hoped will be one of its key means of attracting revenue, more than 50 prime lands in Colombo city and outstations are being offered on lease for local and foreign investors in a move to raise at least US$ 6bn.

The lands will be offered on Public Private Partnerships or joint ventures with the State holding 51 percent of shares, Urban Development Ministry Secretary Sirinimal Perera told the Sunday Times.

Some of the lands had previously been offered out without takers while additional properties have also been identified. Earlier expectations that a party named M/S Shumookh Investment and Services (SIS) of the Sultanate of Oman would take up the nine-acre Chalmers’ Granary land and the Air Force Headquarters have not materialised.

These two properties are also now on the list along with Summit Flats in Colombo 5—for which a Dubai investors had expressed interest—where ten acres are on offer for luxury apartments; six acres each in Vauxhall Street and D.R. Wijewardene Mawatha in Colombo; the Nugegoda and Kollupitiya markets; the Pettah World Market with four acres; three acres each in Rajagiriya, Denzil Kobbekaduwa Mw and Battaramulla; and lands located in Nuwara Eliya and Kandy. Fifty-five acres in Ekala, too, are available.

A Korean investor has come forward for the Welikada prison property, proposing to build the proposed new jail in Horana for relocation in exchange for the land on which the present facility stands.

The terms available are 33, 50 or 99-year leases for mixed development projects, residential towers, hospitality and leisure projects, logistic hubs and multi-storied car parks among others.

The Urban Development Ministry will facilitate loans and support for the respective projects after the leases. If, however, there is no progress after two years, the land will be taken back.

Despite aggressive marketing, however, interest has been lacking. One of the reasons is because of competition from Colombo Port City which also has prime property on offer with all supporting infrastructure in place, authoritative sources said. Meanwhile, the residential apartment market in Colombo is also now saturated.

However, the UDA is holding another investment forum on November 25 at Water’s Edge in Battaramulla to “energise Sri Lanka’s economy”. It will showcase all available prioritised real estate projects in the categories of mixed development, residential tower development, hospitality and leisure development, office tower development, logistic hub development, and multi-storied car park development.

On Friday, Finance Minister Basil Rajapaksa presenting the Budget for 2022 declared that the Government will look into whether conditions currently imposed to facilitate attraction of foreign direct investment should be relaxed. He also proposed that investment through local and international sources into mixed development projects on Railway Department lands should be considered.

(Reuters) – Sri Lanka is confident of not defaulting on its debts and will work on gradually improving the quality of its foreign exchange reserves, finance minister Basil Rajapaksa said on Saturday.

Rajapaksa said when presenting Sri Lanka’s 2022 budget on Friday that the government will cut its budget deficit to around 8.8% of gross domestic product in 2022. The deficit target for 2021 was revised to 11.1%.

“Sri Lanka has never defaulted in its history and that record will be maintained,” Rajapaksa told a briefing, a day after presenting the annual budget.

“Even part of our reserves are borrowed but we will improve the quality of reserves gradually from next year till 2024. By 2024, we are confident we will be able increase reserves and put debt on a sustainable footing,” he added.

The government did not provide an estimate for 2022 growth in its budget but at a forum on Saturday central bank governor Nivard Cabraal said growth is likely to improve in 2022.

“This year we are looking at 5% growth and if we have a good year in 2022 with tourism reaching a quarter of pre-2019 levels then we are well on course for 6% growth,” Cabraal said.

“This will mean our macroeconomic fundamentals will be in much better shape than now”.

CHALLENGING FUTURE

Debt repayment is one of the key challenges facing Sri Lanka with foreign exchange reserves having dropped to $2.27 billion as of end October.

Rajapaksa said remittances and tourism, which are the top two sources of dollar inflows, have both been affected by the COVID-19 pandemic and it has been tougher to attract investors.

“But we want to reduce borrowings. I guarantee that the $1.54 billion up to July 2022 will be repaid,” he added.

Treasury Secretary S. R. Attygalle said the budget is likely to bring in structural reforms to support and strengthen growth and improve Sri Lanka’s fiscal position.

He said the government has a revenue target of 15% of GDP by 2025 and that expenditure will be strictly managed.

“The revenue side is a challenge but with tourism bouncing back Sri Lanka will become comfortable in the next 12 to 18 months,” he added.

Analysts, however, are unsure if the announcements in the budget are enough to instil confidence in investors, ratings agencies and market participants.

“Overall, the budget is unlikely to help the economic situation significantly and does not give a strong indication of how it expects to meet its debt obligations going forward or how it expects to address the plummeting reserves,” said Trisha Peries, head of economic research at Frontier Research.