SRI LANKA NEWS IN BRIEF – (OCTOBER) 2018)
The total number of tourist arrivals to Sri Lanka during September reached 149,087, posting a 2.8% year-on-year growth, while pushing cumulative arrivals to over 1.7 million, latest data released by the Government said.. In September the largest source market for tourists was India, followed by China and the United Kingdom. As at 30 September, 1,731,922 tourists had visited Sri Lanka for this year – an 11.6% growth over last year when 1,551,931 tourists had visited the country during the same period. Asia and Pacific continued to be the largest source of tourist traffic to Sri Lanka with 47% of the total traffic received in September 2018, while Europe accounted for 43% of the total traffic, America 6%, Middle East 3% and Africa 1%. India, China, the United Kingdom, Australia and Germany were Sri Lanka’s top five international tourist generating markets in the month of September this year. India was the largest source of tourist traffic to Sri Lanka with 22% of the total traffic received in September. China accounted for 13% of the total traffic, while the United Kingdom, Australia and Germany accounted for 9%, 6% and 6% respectively. Cumulative earnings amounted to $2,160 million during the first half of 2018. Tourism Development Minister John Amaratunga said he was hopeful that by the end of this year the country would be able to increase its numbers to 2.5 or three million. Tourist arrivals rose 3.2% to 2.1 million last year. Tourism revenues rose by a similar percentage to an all-time peak of $ 3.63 billion. (Daily Financial Times, 5.10.2018).
The pressure on Sri Lanka’s currency is expected to abate with the anticipated receipt of US$ 1 billion through a syndicated loan from the China Development Bank (CDB) followed by projected inflows of another US$ 1.5 billion in the coming months. boosting reserves. Sri Lanka is likely to go for a sovereign bond issue of around US$ 1 billion as soon as possible before the US hikes interest rates again, and seeks to generate US$ 500 million through the sale of two bonds in Chinese and Japanese denominated currencies. Noting that the loan from the CDB will be provided at an interest rate of 5.25% and hold an eight-year tenure, Governor Coomaraswamy described the deal as ‘phenomenally good’ for Sri Lanka given that the secondary market for dollar-denominated International Sovereign Debt is presently trading at rates of above 7%. The Sri Lanka rupee has depreciated by 10.1% against the greenback, the country’s gross official reserves were estimated at US$ 7.18 billion as at September 28, 2018. The Central Bank said Sri Lanka’s average rate against the USD during the past week stood at Rs. 169.74 while it has spent US$ 200 million on a net basis in defending the currency so far. (Sunday Observer 7.10.2018)
Importers raised prices of household electrical and electronic items this week — and they warned prices may be raised further for new stocks. Reports said there was a 20 percent increase in the prices of television sets, washing machines, fans, refrigerators, rice cookers and imported foot wear among other items over the week. This came after the Finance Ministry last week imposed tough measures on imports to ease pressure on the Sri Lankan rupee. A leading importer said that due to the 100 percent upfront deposit required and the depreciation of the rupee the impact on prices would be reflected in the new stocks. The new measures which also apply to mobile phones have resulted in an upward revision of prices. Tyre prices also have been revised. Meanwhile, the Finance Ministry’s decision to suspend concessionary vehicle permits to state-sector officers for six months is expected to save about US$ 400 million during the period, an official said. (Sunday Times 7.10.2018)
Another three elephants faced calamity at Namalgama in Welikanda, where they were knocked down by a night mail express train on Saturday night. They were hit by the Colombo-bound night mail express train from Batticaloa around 9.40 p.m., police said. The three elephants had been severely injured and died on the spot. The train had derailed due to the accident. When the accident happened there had been about 600 passengers and none of them were reported injured. The elephant – train accidents along the Batticaloa line had become a big threat to the jumbos for a long time. This was the second such major accident that had taken place within the past three weeks where a herd of elephants were killed. At dawn on September 18, three elephants were knocked down by the Batticaloa-bound fuel train while they were crossing the track at the 127-milepost between Habarana and Palugaswewa Railway Stations. Among the dead elephants on that occasion was a pregnant she-elephant. The train was also derailed in that accident. (Daily News, 8.10.2018)
The Government had been deprived an income amounting to approximately Rs.197 billion due to taxes in default as at the end of last year, the Inland Revenue Department (IRD) performance report for the year 2017 indicated. Tax evasion remains one of the main reasons for the default of taxes. The report was tabled in Parliament last week. The Gross Income Tax in default stood at Rs.117.6 billion as at December 31, 2017 as per the report. However, out of the total sum of taxes in default, Rs.177 billion has been categorised as “disputed taxes” meaning that the tax payers have lodged appeals invoking their rights against assessments. Similarly, out of the total of default income tax, Rs.112 billion came under the category of disputed taxes. The total collectible tax (excluding disputed taxes and penalties) as at the end of last year stood at Rs.19.3 billion. The total collectible penalty (for not paying taxes) stood at Rs.12.7 billion. According to the report, a total of Rs.258 million due as “surcharge on income tax” had been defaulted. The defaulted amount of Value Added Tax (VAT) stood at Rs 50 billion. The report however pointed out that the Government had collected Rs 229.841 billion from income tax last year. The total income tax payers as at the end of 2017 stood at 1,247,946 and out of them 49,000 were companies. Employees paying income tax under Pay-As-You-Earn (PAYE) scheme stood at 1,051,364 and the Government collected Rs. 32,920million from PAYE. However compared to 2016, revenue from income tax had dropped by 3.59 percent. The Government had also collected Rs.443.739 billion as Value Added Tax (VAT) and Rs.101.824 billion as Nation Building Tax (NBT). The total revenue collected by the IRD last year was Rs.836.518 billion recording an increase of Rs.194.971 billion over that of the previous year. It was a 45.67 percent contribution to the total Government revenue of the year. (Daily News 16.10.2018)
September tea output fell to its lowest level for the month since 2001, industry data showed yesterday and the state-run Tea Board warned of adverse weather conditions for the fall after a prolonged drought.
Monthly output fell for the fourth straight month, declining 24.9% in September to 19.3 million kg. Production in the first nine months of 2018 has fallen 4% from the same period last year.
“The fall is mainly due to the drought,” Sri Lanka Tea Board Director-General S.A. Siriwardena told Reuters.
“But we saw some rain during the last few weeks which will improve production.”
Siriwardena expects full-year production to reach 310 million kg. The Tea Board in August said it may have to downgrade its full-year forecast for tea production after output tumbled 14% in that month from a year earlier due to the drought. Tea is Sri Lanka’s top agricultural export and one of the main foreign currency earners for the $ 87 billion economy. Earnings from tea exports for the first seven months fell 2% to $ 854.2 million, compared with the same period last year. Sri Lanka’s tea output rose 5% to 307.1 million kg last year, recovering from a seven-year low of 292.6 million kg in 2016.Tea production in 2017 was affected by severe drought followed by flooding and poor application of fertiliser, while a government ban on pesticides and restricted labour added to the sector’s problems. (Daily Financial Times, 20.10.2018).
Batticaloa bound ‘Meena Gaya’ intercity train has collided with a wild elephant yesterday and derailed, the Welikanda Police said. The train plying from Colombo to Batticaloa has hit a female elephant around 2 a.m. on Monday morning between the Moragollagama and KonWewa railway stations near Welikanda. The elephant believed to be about 20 years old was severely injured and wildlife veterinary surgeons have attended to the injured elephant, local media reports said. The passengers of the train were not hurt due to the derailment. Measures to re-rail the train has started promptly, the Railway Department said. The Batticaloa bound train collided with an elephant on Sunday early morning also in Palugasweva area killing the elephant. The train derailed after striking the elephant.(Daily Financial Times, 24.10.2018).
The U S Department of State has provided nearly Rs. 600 million ($3.5 million) in assistance towards Sri Lanka’s demining efforts this year, the US Embassy said today. So far in 2018, US funding has cleared 1.86 million square meters and safely removed 9,344 land mines and unexploded ordnance and 8,637 items of small arms ammunition. Chargé d ‘affaires Robert Hilton said they are proud to support Sri Lanka’s national mine action strategy and the goal of making Sri Lanka mine-impact free by 2020. “Landmine removal directly supports peace and reconciliation in Sri Lanka by allowing citizens to return safely to their homes, businesses, schools, and places of worship,” he said. Since 2002, the US has provided more than Rs. 9.5 billion to clear explosive hazards in Sri Lanka. Thanks to US funding and in cooperation with the Sri Lanka Army, the Batticaloa District was declared mine-impact free in 2017. US funding continues to assist in clearance efforts in the other eight districts affected by landmine contamination and currently supports 664 de-mining jobs across the Northern and Eastern Provinces. The US Government has assisted in clearance operations through its local partner the Delvon Association for Social Harmony and through international partners such as HALO Trust and the Mines Advisory Group.(Daily Mirror, 24.10.2018).
Former President Mahinda Rajapaksa was yesterday sworn in as Prime Minister by President Maithripala Sirisena. Newly elected Prime Minister Rajapaksa told The Island last night that the new government was faced with daunting challenges but it would overcome them all. Rajapaksa said that action would be taken to hold long overdue Provincial Council polls and national polls in due course. Presidential polls are is scheduled for 2019 and parliamentary polls for 2020. Rajapaksa assured that the new government would address public grievances. The new PM was sworn in at the Presidential Secretariat at 7.20 pm soon after the UPFA had informed Speaker Karu Jayasuriya of its decision to quit the UNP-led National Unity Government. Among those who accompanied Rajapaksa for the swearing-in ceremony were Basil Rajapaksa and Chairman of Sri Lanka Podujana Peramuna (SLPP) Prof. G.L. Peiris. Sources close to President Sirisena told The Island that the SLFP group loyal to President Sirisena had unanimously decided to leave the government. Sirisena commanded the support of 24 SLFP MPs. In addition to them, the President had the backing of two CWC members. Previously, Rajapaksa was the PM from 2004 to 2005, when he went on to become the President. Rajapaksa contested the last parliamentary election 2015 August as the UPFA’s prime ministerial candidate but could not secure a working majority in parliament. The UPFA group in parliament comprises 95 elected and appointed MPs. The UNP had 107 MPs, including one elected on the SLMC ticket. One of its MPs yesterday pledged his support to PM Rajapaksa. The UNP group includes seven SLMC and five All Ceylon Makkal Congress (ACMC) MPs. Party sources told The Island that the SLMC and the ACMC parliamentary groups were having talks at the time this edition went to press. The Tamil National Alliance (TNA) and the JVP parliamentary groups, supportive of the UNP in parliament, consist of 16 and 06, respectively. Last night around 10.35 Presidential Secretariat released one page letter sent by President Sirisena to Wickremesinghe. President Sirisena said he had removed Wickremesinghe from the post of PM with immediate effect in terms of powers vested in him. (Daily Island, 27.10.2018).
President Maithripala Sirisena suspended parliament Saturday to forestall a challenge against his surprise ouster of the prime minister, deepening a sudden swell of political turmoil in the island nation. Police cancelled all leave as tensions heightened in Colombo a day after the president’s dismissal of rival Ranil Wickremesinghe, who was replaced by controversial former strongman leader Mahinda Rajapakse. Parliamentary officials said the president had suspended the 225-member parliament until November 16. Wickremesinghe had earlier demanded an emergency session to prove he still commanded a majority. Wickremesinghe continued to occupy Temple Trees, the official residence of the prime minister, and insisted in a letter to Sirisena that he was still in office. “Get this controversy out of the way,” Wickremesinghe told reporters in a press conference at the residence. “Reconvene parliament immediately so that I can prove my majority.” Parliamentary sources said Speaker Karu Jayasuriya would now have to decide if he recognised Rajapakse or Wickremesinghe as the prime minister. Overnight, Rajapakse loyalists stormed two state-owned television networks — which they regard as loyal to Wickremesinghe’s outgoing government — and forced them off the air. They resumed broadcasting Saturday and were supporting Rajapakse. There were reports of sporadic attacks against supporters of Wickremesinghe’s United National Party in several parts of the country after Rajapakse was sworn in late Friday. The streets of the capital remained mainly calm Saturday but security was tightened around Temple Trees, Rajapakse’s residence and the state television station. This is the second time that a president has ousted Wickremesinghe from office. In 2004, just two and a half years into a six-year term, the then president sacked him and called snap elections. After winning the premiership a third time in August 2015, Wickremesinghe amended the constitution to remove the head of state’s power to sack prime ministers to prevent a repeat of his earlier ouster. However, Rajapakse loyalist and former foreign minister G. L. Peiris said they believed there was nothing illegal about sacking Wickremesinghe and challenged him to prove his majority on November 16. (Sunday Island, 28.10.2018).
The swearing in of the new cabinet concluded at the Presidential Secretariat with the rest of the portfolios to be revealed at a later date. List of Ministers who were sworn in today (Oct 29). Mahinda Rajapaksa – Minister of Finance and Economic Affairs, Nimal Siripala de Silva – Minister of Transport and Civil Aviation, Dr. Sarath Amunugama: Minister of Foreign Affairs, Mahinda Samarasinghe: Minister of Ports and Shipping, Mahinda Amaraweera: Minister of Agriculture, Dr. Wijeyadasa Rajapakshe: Minister of Education and Higher Education, Ranjith Siyambalapitiya: Minister of Power and Renewable Energy, Wijith Wijayamuni Zoysa: Minister of Fisheries & Aquatic Resources Development and Rural Economic Affairs, Faiszer Musthapha: Minister of Provincial Councils, Local Government, and Sports, Douglas Devananda: Minister of Resettlement, Rehabilitation, Northern Development & Hindu Religious Affairs, Arumugam Thondaman: Minister of Hill Country New Villages, Infrastructure and Community Development, Vasantha Senanayake: Minister of Tourism and Wildlife, State Ministers: Suresh Vadivel: State Minister of Plantation Industries, Deptuy Ministers: Ananda Aluthgamage: Deputy Minister of Tourism and Wildlife (Times Online, 30.10.2018).