SRI LANKA NEWS (JUNE 2023) – by Victor Melder.
The deficit in the merchandise trade account narrowed to US dollars 583 million in April 2023, from US dollars 728 million recorded in April 2022 due to a larger decline in imports, compared to the decline in exports. However, the trade deficit showed an increasing trend on a monthly basis since February 2023. The cumulative deficit in the trade account during January to April 2023 was USD 1,444 million, a sizable decline from US dollars 3,125 million recorded over the same period in 2022. Earnings from merchandise exports declined by 12.6 % in April 2023, over April 2022, to US dollars 849 million, recording the lowest earnings since April 2021. The decline in earnings from industrial exports, including garments, associated with slowing external demand mainly contributed to this contraction in export earnings in April 2023, compared to a year earlier. Meanwhile, export earnings have declined month-on-month basis due to a broad-based decline in earnings from most of the major export categories, partly driven by low activities during the April holiday season Expenditure on merchandise imports declined by 15.8 %to US dollars 1,431 million in April 2023, compared to US dollars 1,699 million in April 2022. A decline in expenditure was observed in imports of intermediate goods and investment goods, while an increase was recorded in imports of consumer goods. However, there is an increase in the import expenditure in general since March 2023. Meanwhile, cumulative import expenditure during January to April 2023 declined by 28 % over the corresponding period in 2022. (Daily Island, 2.6.2023)
Workers’ remittances increased notably to US dollars 454 million during April 2023 in comparison to US dollars 249 million in April 2022. Meanwhile, based on the provisional data, total departures for foreign employment during January to April 2023 and departures in April 2023 amounted to 95,892 and 19, 774, respectively, compared to the annual departures of 311,056 recorded in 2022. (Daily Island, 2.6.2023)
Tourist arrivals declined in April 2023 to 105,498, compared to 125,495 arrivals recorded in March 2023, largely due to seasonal impact. In comparison, the arrivals were recorded at 62,980 in April 2022. Meanwhile, the monthly tourist arrivals continued to exceed 100,000 level during January to April 2023, leading to cumulative arrivals recording at 441,177 compared to 348,314 arrivals recorded during the corresponding period in 2022. Consequently, earnings from tourism during January to April 2023 amounted to US dollars 696 million, compared to US dollars 591 million in the comparable period in 2022. Earnings from tourism in April 2023 were estimated at US dollars 167 million, in comparison to US dollars 198 million in the previous month and US dollars 109 million in the corresponding month inthe previous year. (Daily Island, 2.6.2023)
In a bid to address the growing concern over wage disparities and the rising cost of living, estate-based trade unions are now demanding an increase in the daily wage of plantation workers. Accordingly, the unions are demanding the workers be paid a minimum wage of Rs. 2500. The call comes after a three-year struggle to enforce the previous Gazette notification, which set the daily minimum wage at Rs 1000. However, certain plantation companies have continued to flout the order, leaving workers in a precarious financial situation. Lanka Jathika Estate Workers Union (LJEWU) General Secretary MP Vadivel Suresh said unions have formally requested the convening of the wages board to address the
pressing issue. “It has been three years since the daily salary was increased to Rs. 1000. However, some plantation companies are still violating the order. The living expenses of the people have increased significantly during this time,” he added. Highlighting the need to adjust wages according to the rising cost of living, the MP said plantation workers require at least Rs. 3250 to meet their daily expenses. “However, taking into account the circumstances faced by the plantation companies, we are requesting a minimum daily wage of Rs. 2500,” he said. General Secretary of the Ceylon Workers Congress, Minister Jeevan Thondaman said he supports their demands for an increase and emphasised the importance of reaching a joint decision through the wages board promptly. (Daily Financial Times, 7.6.2023)
More than one hundred buildings, located within the Galle Fort, have been purchased by foreigners, increasing the value of one perch to Rs 22 million, the Galle Heritage Foundation said. With this development, the population within the fort, which used to be around three thousand, has decreased to around 1000. According to the foundation, some foreigners who have purchased property are facing many problems due to the fraudulent sale of the land and buildings by brokers. It was also said that due to the high price of one perch in Galle Fort, there is a decrease in the arrival of new investors. An official of the foundation said that there are about 450 buildings in the fort that are run by government institutions, and more than 100 of them have been purchased by foreigners to run tourism business. These buildings are of archaeological value belonging to the Dutch and English eras. (Daily Mirror, 9.6.2023)
Dr. Bandula Gunawardena, Minister of Transport, Highways and Mass Media, said that there is no possibility of recovering Sri Lanka Railways by running them as a department any longer and if it is not to be privatized, it must be converted into an authority. The Minister pointed out that the Railways cannot be made a profitable entity by maintaining it as a department since a department lacks the capability to conduct commercial operations. The Minister also said that we should get rid of the departmental bureaucracy and go to a system that operates under the control of the board of directors as the Port Authority and Telecom were developed in order to protect the security of the job and pension without harming even a minor employee of the institution. He said that during the 2021 Covid-19 year, the overall revenue of the Department of Railways was at 2.6 billion rupees. However, the cost for maintaining the service during the year was at 40 billion rupees. He pointed out that the Department has paid 2.3 billion rupees as overtime payments and another 2.3 billion rupees for fuel during that year. The Minister said the Department sustained losses worth of 2.0 billion rupees in 2022 and if the government is not willing to provide funds to cover the losses then the foreign investments should be brought in to mitigate this loss. He said if the foreign private entity is willing to bring down locomotives and provide an income to the state from its services, the he should agree for such arrangement. The decision cannot be made on the whims and needs of a Department and this issue should be rectified during his tenure. (Colombo Page, 12.6.2023)
In the first five months of this year, the remittances received from Sri Lankans working abroad has increased to US$ 2,346.9 million, the Central Bank of Sri Lanka has announced. The value of the remittances during the same period last year was US$ 1,335.6 million. The remittances received by Sri Lanka this year compared to first five months last year has increased by 75.7 percent. In the month of May 2022, remittances of US$ 304.7 million were received and compared to this, the remittances received in May this year is US$ 479.7 million, showing an increase in remittances this year. Meanwhile, in the month of April 2022, Sri Lanka received remittances to the tune of US$ 249 million and the remittances received in the month of April this year is US$ 454 million. In 2022, 311,056 Sri Lankans went abroad for work and this year, 95,892 people have gone abroad for work during the period from January to April 1. The number of people who went abroad for work in April this year is 19,774. (Daily News, 13.6.2023)
Sri Lanka’s economic output as measured by Gross Domestic Product (GDP) for the 1st quarter from January 1st to March 31st of 2023 has been estimated as negative 11.5 percent indicating a considerable contraction of the economy compared to the same quarter in the previous year. Accordingly, the Gross Domestic Product for Sri Lanka for the first quarter of the year 2023 at constant price (2015) has declined up to Rs. 3,114,187 million from Rs. 3,519,400 million which recorded in the first quarter of the year 2022, the Department of Census and Statistics said in its report Thursday. In addition, the Gross Domestic Product for Sri Lanka for the first quarter of 2023 at current price has increased up to Rs.
7,328,574 million from Rs. 5,543,306 million which recorded in the same quarter in year 2022 registering 32.2 percent of positive change in the current price GDP. The three major economic activities of the economy; ‘Agriculture’, ‘Industry’ and ‘Services’ have contributed their share to the GDP at current prices by 8.0 percent, 28.7 percent and 58.2 percent respectively, while ‘Taxes less subsidies on products’ component has contributed 5.1 percent of share to the GDP in the first quarter of year 2023. Meanwhile, Agriculture sector recorded an expansion of 0.8 percent while Industries and Services sectors recorded 23.4 percent and 5.0 percent negative growth rates respectively during this quarter. (Colombo Page, 16.6.2023)
At least 3.9 million people or 17 per cent of the population in Sri Lanka is in moderate acute food insecurity, according to a latest report issued by the FAO/WFP Crop and Food Security Assessment Mission. The report states that this is nearly a 40 per cent decrease from June/July last year. “An estimated 17 per cent of the population is in moderate acute food insecurity in Sri Lanka, especially in the Northern, Eastern and Central Provinces, indicating an improvement compared to 2022,” the report mentioned. According to the report, nearly 10,000 people are severely acute food-insecure, down from 66,000 people last year. Further, the report highlights that the highest level of acute food insecurity was in the estate sector (tea production) and among households deriving their main incomes from social protection schemes such as Samurdhi and disability benefits, linked to unaffordability of food and healthy diets. The latest findings are based on the Crop and Food Security Assessment Mission (CFSAM) report jointly carried out in February/March 2023 by the Food and Agriculture Organization of the United Nations (FAO) and the United Nations World Food Programme (WFP). (Daily Mirror, 16.6.2023)
Sri Lanka has reached a deal with Russian nuclear giant Rosatom to build a nuclear power plant that may run two reactors and generate 300 megawatts of energy, the Sri Lankan ambassador in Russia said. “We will go for a nuclear power plant …There are options actually … two sources, 300 megawatts,” Janitha Abeywickrema Liyanage told Sputnik on the sidelines of the St. Petersburg International Economic Forum. The ambassador said that having its own power plant would allow the Indian Ocean island nation to overcome the energy crisis. The government will speed up the approval process to begin construction in the near future.” There is a proposal and there is approval to follow the procedures from the Sri Lankan cabinet, and the International Atomic Energy Agency is also now looking at it, and they have set up certain working groups. Rosatom has set up four working groups in four different areas,” she said. (Daily Mirror, 16.6.2023)
Air pollution has increased the risk of heart disease in Sri Lanka like elsewhere in the world, a top cardiologist said. Addressing a news briefing yesterday, Dr. Anidu Pathirana, Consultant Cardiologist at the National Hospital of Colombo said, “Air pollution has long been considered a significant environmental concern, but its impact on human health is now coming to the forefront with new research.” “As such, air pollution has been identified as a major risk factor of developing heart disease,” he highlighted. “When you breathe in poor quality air, the air pollutants can travel deep into your bloodstream through your lungs, and to your heart. This can increase your risk of developing heart and circulatory diseases, ” he underscored. Dr. Pathirana said since air pollution in Sri Lanka is on the rise, it is vital to adopt safety measures to keep diseases associated with air pollution at bay, adding, heart patients should avoid exposure to air pollution. In addition, he said “Air Pollution does not only affect patients suffering from heart disease but also other non-communicable diseases such as high blood pressure, cholesterol, diabetes, cancer diseases and chronic lung illnesses.” Air pollution is contamination of the indoor or outdoor environment by any chemical, physical or biological agent that modifies the natural characteristics of the atmosphere. According to WHO data, almost the entire global population (99%) is exposed to air pollution levels that are higher than recommended levels. Thus, it is essential to expand use of clean fuels and technologies to reduce household air pollution and protect health. These include solar, electricity, bio-gas, liquified petroleum gas (LPG), natural gas, alcohol fuels. (Daily Mirror, 18.6.2023)
The Indian government has approved the allocation of over Rs.4,500 million (US$ 15 Million) for the modernization of the signal system on the Northern Railway Line between Colombo to Kankesanthurai under the Indian Credit Line. The Indian Government made this allocation following a discussion between Transport, Highways and Mass Media Minister Dr. Bandula Gunawardhana and Indian High Commissioner in Colombo Gopal Baglay. It is expected that the travel time between Colombo and KKS will reduce by one hour and 30 minutes with the completion of modernisation of the Northern Railway Line. He said that the railway line between Anuradhapura to Maho is under reconstruction and the project will be completed within next two months. (Daily News, 21.6.2023)
Consultant Community Physician at the Department of Non-Communicable Diseases of the Ministry of Health Dr.Samitha Siritunga stated that 35 people die every day due to various accidents. He said that 4 people die every three hours due to accidents and 1 out of every 5 people who meet with accidents needs medical attention. He said that it is estimated that about 3 to 4 million people face accidents that deserve medical attention, and accidents are among the top ten causes of death in this country. He also stated that around 12,000 people in Sri Lanka die annually due to accidents and accidents have become the main cause of death in the economically productive age group between 15 and 44 years of age. (Daily News, 26.6.2023)
The Wildlife Department gave a pledge before the Court of Appeal that Macaque monkeys will not be exported to China. Deputy Solicitor General Manohara Jayasinghe, representing the Department of Wildlife, made this promise when a writ petition filed by a group of environmental activists to nullify the decision taken to export 100,000 monkeys to China was called before the Court of Appeal. When the petition was taken up for consideration before an Appellate Court bench comprising Chairman Judge Nishanka Bandula Karunaratne and Judge A. Marikkar, the Deputy Solicitor General agreed and then it was ordered that the petition be called again on July 6th. This petition was filed by 27 parties including Sri Lanka Wildlife and Environment Protection Association, Ven. Matara Ananda Sagara Thero, Otara Gunawardena, and Rukshan Jayawardena. The petitioners claim that there have been reports that the government is preparing to export 100,000 monkeys to China and information has been revealed that as the first step, 10,000 monkeys are to be exported.The petitioners pointing out that this action is completely contrary to the provisions of the Flora and Fauna Ordinance Act as well as the Animal Cruelty Prevention Act have stated that this action will have a negative impact on the biodiversity of the Sri Lankan environment .The petitioners had asked the Court of Appeal to issue a writ order to annul the decision as it was unclear for what purpose the monkeys were to be exported. (Colombo Page, 28.6.2023)
The World Bank is likely to approve US$700 million in budgetary and welfare support for Sri Lanka, State Minister of Finance Ranjith Siyambalapitiya confirmed. This is to be taken up at the next board meeting of the World Bank on June 28. Meanwhile, Reuters quoting an unnamed sources said. Of the proposed World Bank funding, US$500 million will be for budgetary support and is likely to come in two tranches of US$250 million each. The first tranche is likely to be disbursed immediately after board approval with the next possibly in October, as the bank watches the progress of Sri Lanka’s debt restructuring and the first review of the IMF programme, due in September, the World Bank source
added. The remaining US$200 million will be earmarked for programmes to assist the poor, whose numbers have doubled to 25% of the population since the onset of the Indian Ocean nation’s worst economic crisis early last year, another World Bank source said. “Households that have registered for support will be ranked… and the lowest 2 million will be eligible for support,” the source added, according to Reuters. The International Monetary Fund approved a bailout of nearly US$3 billion in March, which Sri Lanka expects will bring additional funding of up to US$4 billion from the World Bank, the Asian Development Bank and other multilateral agencies. (Daily News, 2.6.2023)
About 70 pilots attached to SriLankan Airlines had resigned during the past six months, Opposition Leader Sajith Premadasa said yesterday in Parliament. “There are fewer than 260 pilots at SriLankan now. Another 18 are to join Emirates soon,” he said.SriLankan needs 330 pilots to operate its flights optimally, Premadasa said. Meanwhile, from 18 to 22 June, SriLankan Airlines have cancelled 13 flights, Sri Lanka Freedom Party (SLFP) MP Dayasiri Jayasekera said in Parliament on Friday. The passengers of these flights had to be accommodated in star class hotels, he said. “We don’t know how much money was spent to pay for the accommodation. But it’s obvious that dozens of million rupees must have been spent”. The flights of Sri Lankan Airlines are delayed because of a union action taken by pilots and engineers and not because of sudden illnesses of pilots as stated by the government, he said. They have resorted to union action because the government had not paid them an allowance that was due during the COVID period, the SLFP MP went on to say. “The government wants to sell SriLankan Airlines. So they are deliberately running it to the ground. Buses that carry air passengers are not allowed to enter the airport premises. People are compelled to walk a long distance, dragging their luggage,” he said. (Daily Island, 29.6.2023)
