Category: News

Swap discounts of the rupee has widened and banks had further tightened the opening of letters of credit amid forex shortages market participants said as overnight liquidity injections continued to rise and short term gilt yield corrections reversed.

In the forex market swap discounts had further widened with foreign banks reducing their activity, market participants said.

Spot/1 month was quoted around -70/-50 cents

Spot/3-months had widened to -300/-250 from around -190/-150 last week.

Spot/6-months had widened to -700/-600 cents fro around -350/-300 cents.

The controversy over People’s Bank being ‘blacklisted’ by China had also impacted perceptions of some counterparties, market participants said.

As forex availability tightened, banks had further tightened the opening of letters of credit, financial sources said.

Sri Lanka’s three month Treasuries yield which had begun to correct upwards after price controls were lifted fell in November amid liberal injection of money from the 6.0 overnight window.

Currency pegs break and forex shortages emerged due to open market operations of soft-pegged central banks and outright bond purchases to maintain unrealistic gilt yields.

Window borrowings reached 312 billion rupees on November 17 from 261 billion rupees on October 29.

The central bank had been mopping up some of the excess money injected from the window into short banks in a sterilization trap.

“When banks borrow printed money from the overnight window to buy Treasuries, forex shortages worsens and it is more difficult to maintain the peg at 203 to the US dollar,” EN’s economics columnist Bellwether says.

“The central bank will then have to sell more dollars and lose more reserves to maintain the peg.”

“When dollars are sold more liquidity is injected to stop the overnight rates from going up and tightening the system.”

The central bank was also intervening in forex markets to give dollars for essential imports such as fuel, which also results in more rupee injections to maintain the overnight rates, or there will be a reduction of money withdraw through repo auctions.

Some secondary market quotes for bonds of several maturities were seen on Wednesday though there was little trading.

On Thursday at close a 15/12/2023 bond was quoted at 8.55/75 percent, dealer said.

A 15/03/2024 bond was quoted at 9.15/30 percent.

A 15/09/2024 bond was quoted 9.35/50 percent.

A 15/12/2024 bond was quoted 9.45/55 percent.

A 15/01/2027 bond was quoted 10.80/95 percent.

A 01/09/2028 bond was quoted 11.30/50 percent.

A 15/03/2031 bond was quoted 11.80/95 percent.

An explosion has taken place at a building at Cinnamon Gardens on Reid Avenue, Colombo 7, Police Spokesman SSP Nihal Thalduwa said.

The explosion took place inside the hotel premises owned by McDonald’s, the fast food company, located on the ground floor of the old Race Course building.

It is suspected that the explosion might have been due to a gas leak and the Colombo Municipal Council Fire Brigade and the police took steps to bring the fire under control, the spokesman said .

Two persons who were at the parking near the building were injured in the incident.

The Government Analyst is to inspect the site to ascertain the cause of the explosion, he further said.

The final encounter of the Prime Minister Mahinda Rajapaksa Trophy Four-Nation Football Tournament was also played at the Racecourse Grounds in Reid Avenue last night

Sri Lanka cannot continue to obtain loans as a country, says Foreign Minister Prof. G.L. Peiris.

Expressing his sentiments during a program carried out by the Ministry of Foreign affairs focusing on the economic revival in the country, the Minister of Foreign Affairs Professor G. L. Peiris said that International assistance will be obtained to build the country through a policy framework that is not limited to only one group in the future.

Speaking further, the Foreign Minister said that in order to build the country, Sri Lanka must focus on other ways to earn capital. Investments, trade, tourism and then the income brought by migrant workers are certain examples of the ways which the country can focus in order increase capital, he said.

Furthermore, the Foreign Minister said that Sri Lanka had opened its borders, and that tourists have already started coming in to the country, and cited the tourism situation in the country as an example of Sri Lanka being able to deal with the outer world.

” Even the UK prime minister has appointed an agent to focus on the trade deals with us. This is a great novel opportunity for us. Then on the tourism sector, we should focus in new tourism methods, for example, environment tourism. We can coordinate with our diplomatic missions and promote it,” the Minister said.

Additionally, he also said that Sri Lanka is also focusing on increasing the country’s scope, especially when it comes to migrant workers. The Minister also spoke of the earlier situation when Korea announced that they will only allow migrant workers who had been working at the country for a long period of time to come back and work in Korea.

Further noting the high profile delegation from the European Union visiting Sri Lanka to discuss on the GSP+ issue, the Minister said that Sri Lanka was able to show the EU the country’s stance and enunciate to them on the mechanism the Government has implemented to rectify any misunderstandings.

” When it comes to our foreign policy, we are on the stance that we must have equal diplomatic relationships with every country in the world. We must have a good diplomatic relationship with India. We must not forget China as well, they helped us a lot in developing our infrastructure. 65% of our exports are being sent to the Western World, which means our ties with USA and Europe are vital as well. All our diplomatic missions are now focused on Economic Diplomacy, that aspect will be their priority,” Prof. G.L. Peiris added.

Being a good leader and maintaining that high quality for half a century is no mean achievement. One must possess effective leadership qualities that helps one achieve higher goals and objectives. This is true of the nonviolent resistance and persistence of Mahatma Gandhi and the magnanimous vision of Nelson Mandela. Our leaders, their policies and their acts are creating history for generations to come.

In his 76 years of life, Sri Lankan Prime Minister Mahinda Rajapaksa has established himself as a national leader and an international statesman of considerable stature. During his 51 year-long political career, he has represented the spirit of an era, the pulse of the nation and the warp and woof of the social, cultural and political fabric of Sri Lanka.

He is known as the ultimate survivor, a political enigma, an ardent nationalist, a champion of the people, protector of the nation, trusted custodian of Buddhism and the guardian of religious freedom of all communities, a human rights activist, and last but not the least, an untiring street-fighter. These are few sobriquets of Mahinda Rajapaksa, who celebrates his 76th birthday on Thursday.

Political career

Mahinda Rajapaksa began his checkered political career on May 27, 1970 as the youngest Parliamentarian. He reached his zenith when he guided the Lankan Armed Forces to end the 30-year-long fight against the brutal terrorist organization, the Liberation Tigers of Tamil Eelam (LTTE) in 2009 as the President and Supreme Commander of Armed Forces of Sri Lanka.

He entered Parliament at the young age of 24 and served in many capacities over many years. He held several ministries ranging from Labour to Fisheries becoming Prime Minister in 2004. He was elected The fifth Executive President of Sri Lanka in the following year.

Although Rajapaksa was born into a land-holding elite family, he was always very close to the common people irrespective of their creed, caste, religion or social status. His uncle, D. M. Rajapaksa, known as the ‘Lion of Ruhuna’ was a popular political leader of the area. After his demise, Mahinda’s father, D. A. Rajapaksa, served as a member of the Sri Lankan Parliament, holding the Beliatta seat from 1947 to 1965. In 1970, Mahinda became Sri Lanka’s youngest-ever Member of Parliament when he was elected to the seat that his father had vacated just five years earlier. Young parliamentarian Mahinda studied law after completion of school studies and received a law degree from Colombo Law College in 1974.

Mahinda’s exceptional characteristic has been the ability to face defeats. After losing his seat in parliament in 1977, he focused on his law career until reentering Parliament in 1989, this time representing the Hambantota district. He was reelected and continued as a Parliamentarian until 2005.

A popular center-left politician, Mahinda was at the forefront as a defender of human rights during the state suppression of a youth rebellion in 1987-90, when Sri Lanka was recognized as one of the world’s most dangerous countries for the supporters of youth rebellions. His fight for the rights of the suppressed people stood him in good stead in his political journey throughout.

In the January 2010 presidential election, he got reelected easily, winning 58 percent of the vote. Rajapaksa’s second term saw sustained economic growth. He continued to enjoy the strong support of the large Sinhalese majority in the country. However, his relations with Western countries were strained over Sri Lanka’s refusal to bow down to their call for international investigations of the military’s treatment of Tamils in the last phase of the conflict.

Addressing the United Nations General assembly he said, “Sri Lanka’s Government, at all times responsive to the priorities reflected in domestic public opinion, is engaged in all measures required for meaningful progress in these fields. A significant event in this regard is the opportunity which the people of the Northern Province enjoyed at the elections, to elect their representatives in the Provincial Council. It is a matter of legitimate satisfaction to me that this was made possible after the lapse of almost a quarter of a century. There can be no doubt regarding the crucial importance of this measure in the context of political empowerment and reconciliation. It is clearly the responsibility of the international community to assist with these efforts and to ensure their success for the benefit of all the people of Sri Lanka.”

Without mincing his words, President Mahinda Rajapaksa pointed out that in spite of the visible progress made, and consistent engagement with UN mechanisms, many countries are surprised at the disproportionate emphasis on Sri Lanka, and the unequal treatment through the multilateral framework. The basis for this relentless pursuit was questioned.

“It is my conviction that the UN system should be astute to ensure the consistency of standards applied so that there is no room for suspicion of manipulation of the UN System by interested parties to fulfill their agendas,” he said.

Mahinda Rajapaksa worships the soil of Sri Lanka after winning the war against the LTTE
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Charismatic leader

The emphasis put by Mahinda Rajapaksa as the President of the country in 2012 is equally relevant today. The UN has consistently ensured cooperation between States, and provided a universal platform for discussions on a range of issues, contentious or otherwise. “It is imperative that we jealously protect and abide by the principle of equal treatment of countries, which has been the very basis of this global organization. Be it economic or political issues, equality must form the bedrock of all international interactions,” he said.

The crusade commenced by Mahinda Rajapaksa and the policies outlined by him will continue to guide the nation for years to come. The people’s mandate given at the Presidential Election in November 2019 to his brother Gotabaya Rajapaksa, was another fitting tribute to Mahinda, a leader who has carved a niche for himself in the history of our nation.

Today, as Prime Minister in the government of President Gotabaya Rajapaksa, Mahinda will no doubt carry forward his mission of ensuring equality and prosperity for all the peoples of Sri Lanka.

Emphasizing this, Mahinda Rajapaksa, in a recent speech, stressed his commitment to work with determination and patience to ‘safeguard the Motherland we have built, and take it further to the heights of world-winning achievements’.

“Our future responsibility is to safeguard all those achievements and proceed with the tasks of nation building,” said Mahinda Rajapaksa, the charismatic leader with an ever-growing political appeal.

Zahran Hashim’s ideology was that one of the rewards awaiting those who perform Jihad was 72 virgins in heaven, said Director General of the Institute of National Security Studies Prof. Rohan Gunaratna.

He made this revelation during a televised interview recently.

“Zahran Hashim believed that those who performed Islamic Jihad were entitled to 72 virgins in heaven. He firmly believed that by his attack, he would be able to meet his God in heaven, and would receive pardon for all his wrong doings. This ideology also claimed that 70 members of his family will be entitled to see heaven when they die,” he said.

Gunaratna added that this ideology was taught to the other suicide bombers, who also firmly believed and accepted this ideology.

“The other suicide bombers believed that they would also be doing the right thing by performing Jihad as per Zahran’s teachings,” he added.

Meanwhile, in the video that was recently released, Hashim claimed that the funds used to carry out the attacks were “halal”, Gunaratna explained, and that funding was not provided by non-Muslims or any Government.

“The source of finance for Zahran is from the two sons of the richest spice trader in Sri Lanka. All the ongoing international investigations on the source of funding also show that it came from a company owned by the spice trader’s sons,” Gunaratna mentioned.