Category: News

The US yesterday (7) spoke about Sri Lanka during the interactive dialogue about the country at the 49th regular session of the United Nations Human Rights Council (UNHRC), where they called upon the Government of Sri Lanka (GoSL) to engage with Tamil and Muslim parties for a “lasting political solution”.

“We call on the Government to engage with Tamil and Muslim political parties and civil society organisations to advance an inclusive, lasting political solution,” the representative for the US said in Geneva, Switzerland, yesterday.

The UK noted setbacks in “several emblematic human rights cases” and said that the “recent appointment of an individual named in a key emblematic case as a Provincial Governor is particularly worrying”. Admiral of the Fleet Wasantha Karannagoda, who was named in the “Navy 11” case with regard to the disappearance of 11 youths allegedly at the hands of the Sri Lanka Navy, was recently appointed as the North Western Province Governor. Furthermore, the UK also raised concerns of land grabbing in the Northern and Eastern (N-E) Provinces. “The UK also notes concerns of surveillance and the harassment of the civil society and the militarisation of civilian government functions,” added the UK representative.

Meanwhile, Amnesty International said that it remains deeply concerned by the “shrinking civic space and therefore, urged the Government to halt reprisals against critics and perceived critics, including those advocating for justice for the April 2019 bombings”. “Families of the disappeared continue to face obstacles and pushback from state agents while they demand their right to truth and justice, including through the State’s pursuit of court orders attempting to restrict their freedom to protest. The State’s alarming discrimination and targeting of the Muslim community continues unabated,” said Amnesty International. The organisation also called for an immediate moratorium on the PTA, echoing the call of the UN High Commissioner (HC) for HR, Michelle Bachelet in her update about Sri Lanka this year.

Representing the International Harm Reduction Association, Ambika Satkunanathan raised concerns about the militarisation of drug control and treatment in the country and its negative reprisals on the treatment, the individual, and public health. “A worrying pattern of deaths in custody of persons arrested for drug-related offences in alleged shootouts with law enforcement or while assisting law enforcement officials have been documented. The lack of investigations into these custodial deaths entrench impunity and the use of violence by state agencies,” said Satkunanathan.

In March 2021, the UNHRC passed Resolution 46/1, which recognises the importance of preserving evidence relating to violations of human rights in Sri Lanka in order to advance accountability, and as such, a call has been made to implement an “evidence preserving” mechanism in the country. It was adopted on 23 March 2021 at the UNHRC with 22 votes in favour of it and 11 votes in opposition while 14 Member States abstained from voting.

In her written update this month, Bachelet has called upon the UNHRC and its Member States to co-operate with the Office of the UNHCHR in its discharge of accountability related work under Resolution 46/1 and to provide it with the adequate human and financial resources in order to enable it to effectively deliver the full mandate given under the Resolution.

Countries such as China criticised Resolution 46/1 yesterday. “The Resolution is not in line with the principles of impartiality, non-politicisation, objectivity, and non-selectivity and nor has it been endorsed by the State in question. We call on the relevant parties to respect Sri Lanka’s sovereignty and political independence and pass human rights development of their own choice in light of their national conditions,” said China.

In a statement made yesterday, the Sri Lankan Foreign Ministry said that Sri Lanka received “overwhelming support from countries of the Global South who expressed support for the Government’s significant efforts towards reconciliation and reiterated the importance of objective and constructive co-operation as the fundamental basis for multilateral engagement”. “Addressing the UNHRC on 4 March at the commencement of the interactive dialogue, Foreign Minister Prof. G.L. Peiris, while reiterating Sri Lanka’s commitment to continuing its voluntary international undertakings on human rights and engaging with the UN, including the UNHRC, referred to serious anomalies and weaknesses in the update presented by Bachelet,” the statement noted.

While raising concerns regarding the continued lack of progress on accountability and regret that there have been setbacks in several emblematic human rights cases, the United Kingdom called on the Government of Sri Lanka to engage constructively with the recommendations in resolution 46/1 and to co-operate with your Office.

The UK’s Global Ambassador for Human Rights, Rita French delivering her statement during the Interactive Dialogue on the OHCHR report on Sri Lanka, said they welcomed recent releases on bail of Ahnaf Jazeem and Hejaaz Hizbullah as a positive first step. Whilst we acknowledge initial reforms of the Prevention of Terrorism Act, these do not go far enough.

“Madam High Commissioner, The United Kingdom welcomes your update. We share your concerns regarding the continued lack of progress on accountability and regret that there have been setbacks in several emblematic human rights cases.

We welcome recent releases on bail of Ahnaf Jazeem and Hejaaz Hizbullah as a positive first step. Whilst we acknowledge initial reforms of the Prevention of Terrorism Act, these do not go far enough.

Whilst we acknowledge the NGO Secretariat move to the Foreign Ministry, we have concerns around surveillance and harassment of civil society, and militarisation of civilian governmental functions. The appointment of an individual, named in a key emblematic case, to the post of Provincial Governor, is particularly worrying.

Whilst we acknowledge ongoing work in Government institutions on reparations and missing persons, it is crucial this is accompanied by a comprehensive reconciliation and accountability process.

We note with concern that minority communities are facing increased marginalisation, with allegations of land grabs in the North and East of the country.

We call on the Government of Sri Lanka to engage constructively with the recommendations in resolution 46/1 and to co-operate with your Office,” she said.

Eleven constituent parties of Sri Lanka’s ruling coalition will contest a future election as a new alliance without the ruling Sri Lanka Podujana Peramuna (SLPP) but it will likely not be under the leadership of former president Chandrika Bandaranaike Kumaratunga contrary to some media reports, State Minister Dayasiri Jayasekara said.

The Sri Lanka Freedom Party (SLFP) general secretary told EconnomyNext Monday evening that the question of who will lead the alliance is not of concern at present.

“We don’t know who the leader will be. Former President Maithripala Sirisena also [figures in that discussion]. So let’s see what happens,” said Jayasekara.

Asked if the SLFP, a party increasingly at odds with the SLPP, are discussing possibilities with the recently ousted ministers Wimal Weerawansa and Udaya Gammanpila, the state minister simply said the 11 partner parties have come together.

In the event of a snap election, said Jayasekara, the parties will form an alliance and contest together.

“Definitely without the SLPP,” he said.

“There is no need to contest with them again. You know what the situation is now after contesting with them.”

The popularity of Sri Lanka’s ruling coalition, of which Jayasekara’s SLFP is a major partner, has dwindled to an all time low, as the public continues to endure severe hardships in the face of rising cost of living on top of an ongoing energy crisis.

The energy crisis in turn has been caused by a severe forex shortage brought about by excess money printing to keep interest rates low in a pegged exchange rate regime. Queues for essential items including milk powder, fuel, cooking gas, among other things, has eroded the SLPP’s popularity which secured a two-thirds majority at the 2020 parliamentary elections.

The SLFP has been critical of the government from within, though no firm decision has yet been made about quitting the alliance and sitting in the opposition. Other constituent parties in the ruling coalition have also expressed their dissatisfaction with the status quo.

Asked if the party can continue to work with the government in the midst of rising tensions, Jayasekara said: “Let’s see. That’s a decision the party has to make. I can’t make it on my own.”

Sri Lanka’s central bank said it is abandoning a 200 to the US dollar peg after printing money though multiple means which were making outflows greater than inflows, creating forex shortages and parallel exchange rates.

The central bank said “greater flexibility in the exchange rate will be allowed to the markets with immediate effect.”

“The Central Bank is also of the view that forex transactions would take place at levels which are not more than Rs. 230 per US dollar.”

The rupee is trading in the kerb market around 249 to the US dollar. Exporters have been selling unofficially around 245 to the US dollar.

It is not clear whether the 230 rate will be controlled or it will be a allowed to free float.

Devaluations are hit or miss affairs, analysts say, unlike a clean float which is followed by a steep rate hike to curb domestic credit which succeeds every time.

The current statement came after a 100bp rate hike, which is still far below inflation of 15.1 percent with the budget deficit also around 10 percent of gross domestic product.

Related

Sri Lanka has to hike rates, tourism recovery will not help end forex crisis: Bellwether

The earlier 200 to the dollar non-credible peg was only partially defended through ‘reserves for imports’ leading to forex shortages.

The central bank has surrender requirements, which can undermined the exchange rate, analysts say.

The central bank has lost reserves after record money printing to keep interest rates artificially low and the ability to defend the currency peg.

The full statement is reproduced below:

Policy package to support greater macroeconomic stability: Allowing flexibility in the exchange rate

Considering the severity of the external shocks and recent developments in the domestic front, the Monetary Board of the Central Bank of Sri Lanka announced a comprehensive policy package on 04 March 2022 with the view to counter such economic headwinds.

The Central Bank also indicated that it will continue to closely monitor the emerging macroeconomic and financial market developments, both globally and domestically, and will stand ready to take further measures as appropriate, with the aim of achieving stability in the fronts of inflation, the external sector, the financial sector, and real economic activity.

In that context, greater flexibility in the exchange rate will be allowed to the markets with immediate effect. The Central Bank is also of the view that forex transactions would take place at levels which are not more than Rs. 230 per US dollar.

The Central Bank will continue to closely monitor the developments in the domestic foreign exchange market and make appropriate policy adjustments accordingly.

India has called for a road map from Sri Lanka on how it is going to overcome its economic crisis in the long term as well as to clear the decks for a long list of its economic cum strategic demands for implementation in the North and the East of Sri Lanka.

Till then the future of the one billion dollar emergency loan from India seems uncertain.

Finance Minister Basil Rajapaksa’s twice cancelled visit to India after securng a USD 500 million loan in December last year to clinch a further one billion dollar loan for emergency supplies of food, fuel and medicines to overcome the ongoing economic crisis in Sri Lanka is yet to be rescheduled. The December loan taken by Sri Lanka was also to be repaid this week.

The Sunday Times learns that the Indian Government is awaiting the green light from the Colombo Government on both fronts, i.e. the economic action plan aimed at long term recovery from the country’s foreign exchange and debt repayment crisis and to the Indian list of demands to start economic projects in Sri Lanka. Neither Colombo nor New Delhi has officially mentioned either so far.

The Indian demands involve a string of maritime security agreements that will strengthen India’s strategic interests, particularly around the eastern Trincomalee harbour. These include Donier surveillance aircraft for the Sri Lanka Air Force, a ship repair dock for the Sri Lanka Navy in Trincomalee and posting of a Sri Lankan Navy officer at the Intelligence Fusion Centre, a Bahrain-based intelligence sharing office which is a US Navy initiative to combat international terrorism, the narcotics trade and ensure safe maritime passage for commercial vessels in the region.

One of the key pressure-points from the Indian Government is to start a renewable energy (solar power) project in and around Sampur near Trincomalee. An earlier plan by India to begin a coal power project in joint partnership with Japan has now been abandoned as Sri Lanka announced a move away from coal plants as part of its futuristic energy policy.

The reopening of the Palay airport for commercial operations and several cultural projects in the Jaffna peninsula are also among items on the list already made public.

The Indian Government also wants to enter into the renewable energy field in the Delft islet after it scuttled a Chinese company securing the project following an Asian Development Bank ((ADB) tender procedure.

The one billion US dollar loan from India agreed to earlier in principle by the Indian Finance Ministry remains suspended for now, until guarantees are given from the Sri Lankan side, it is learnt.

The Indian High Commission said it did not want to comment on Finance Minister Rajapaksa’s visit as it was not formally announced that he was to visit New Delhi for a one billion dollar loan facility. Last week, however, the mission stated that the visit fixed for last week was rescheduled as Foreign Affairs Minister S. Jaishankar had to urgently visit Paris on official business.

Mr. Jaishankar was earlier due in Colombo on March 18, but the high commission remained tight-lipped on the visit taking place.