SRI LANKA NEWS (MAY 2022)- By Victor Melder.

Tea production in March had slumped by 24% to 22 million kg from a year earlier, marking it as the lowest crop since 2009, Asia Siyaka Commodities said. It also said in 2020 when the country went into complete lockdown in mid-March and production declined to 13.5 million kg. Quoting Sri Lanka Tea Board preliminary data, Asia Siyaka said first quarter production dropped by 15% to 63 million kg from 74.5 million kg a year ago. This year’s January – March figure is also the lowest since 2009. In that year production slumped due to fallout from the global financial crisis and the market collapsed, teas remained unsold and farmers stopped plucking their fields and estates were pruned.  Asia Siyaka said this year’s first quarter losses however resulted from dry weather that took its toll on bushes that had not received adequate fertilizer since Q4 2021 and in some cases even before. All three elevations are down but the sharpest loss has come from Low Growns. Last year’s Q1 quantity was 46.4 million kg for the elevation whereas during January – March 2022 production has slumped 18% to 38 million kg.  High Growns performed relatively better largely due to Regional Plantation Companies pumping in their fertiliser reserves which limited crop loss to 7% from 16 million kg to 14.8 million kg. Mediums declined from 11.9 million kg to 10.1 million kg this year. (Daily Financial Times, 2.5.2022)

Sri Lanka lost over $ 22 million or Rs. 8.25 billion industrial export income yesterday, as tens of thousands of workers of Export Processing Zones (EPZ) came out of their factories and staged protests demanding the Gotabaya Rajapaksa-led Government to quit over the worst-ever economic crisis. The national level hartal yesterday was being carried out after 69 years, bringing the entire economy to a standstill since the demonstrations began, with both State, private sector employees and civil organisations taking part.  The previous such national level protest was held on 28 April. “We estimate total industrial exports worth over $ 22 million were impacted by the hartal yesterday and of that around $ 14 million were apparel exports,” Free Trade Zone Manufacturers’ Association (FTZMA) Secretary Dhammika Fernando said. Sri Lanka has been hit by months of acute shortages of food, fuel, and medicines, prompting widespread protests countrywide. With representatives in all 14 EPZs in the country, representing around 1,500 export manufacturers are deeply concerned about prolonged national catastrophe caused by a multitude of issues including wrong decision making and lack of good governance by the country’s administration. With no factories able to operate in key EPZs – Katunayake, Biyagama and Seethawaka, Fernando said that the investors will surely think twice now on continuity of their business. None of the containers or vehicular movements inwards or outward the EPZs were allowed by the protesters yesterday.  

Following worldwide adverse publicity on hartal yesterday, the stakeholders feared losing valuable customers, losing credibility and investors moving to other destinations.   “Many of our members are looking at the bigger picture and seeking for long term economic solutions, amidst multiple challenges. They are concerned about the continuity of their businesses going forward,” National Chamber of Exporters of Sri Lanka (NCE) Secretary General and CEO Shiham Marikar told the Daily FT. The export industries collectively called on the Government and all the parliamentarians just a month ago on the serious economic consequences if fast action is not taken to stabilise the macro-economy.  The Daily FT learns that order books for certain apparel companies are empty beyond June. The closure of banks too caused a lot of inconveniences to many businesses and particularly to exporters. In 2021, Sri Lanka’s exports recorded $ 15.12 billion, up by 23% from 2020 sustaining its resilience, despite an unprecedented economic crisis. The year 2021 performance comes second only to $ 15.91 billion recorded in 2018. (Daily Financial Times, 9.5.2022)

Sri Lanka’s Ministry of Defense has announced that the Armed Forces have been ordered to shoot at anyone who robs or damages public property or causing harm to others amid escalating clashes. Meanwhile, according to Sri Lanka Police, eight people have died following Monday’s (9) attack on the peaceful protesters by the former Prime Minister Mahinda Rajapaksa’s supporters and a number of properties belonging to political leaders and vehicles were damaged.Sri Lanka Police on Tuesday (10) released the details of the number of people who died following Monday’s (9) clashes and also the number of property that was damaged. According to a Police Media Division release 6 deaths were reported from the Western Province and two 2 deaths were reported from the Southern Province. Among the dead were a Member of Parliament, a Pradeshiya Sabha Chairman, a Sub-Inspector of Police and a Police Sergeant. A person who was injured in a clash in Colombo has died due to a heart attack after being admitted to the Colombo National Hospital. A 28 year old Sub Inspector of Police had died on admission to the Colombo National Hospital due to a tear gas canister exploding, police sources said. SLPP parliamentarian Amarakeerthi Athukorala and his security guard committed suicide when his vehicle was surrounded by protesters in Nittambuwa while a youth was shot dead by the MP. Meanwhile 08 persons were injured in a shooting at a protest held near the residence of the Chairman of the Weeraketiya Pradeshiya Sabha and two people died. The chairman of Imaduwa Pradeshiya Sabha, A.V. Sarath Kumara has died of a heart attack after he was injured during an attack on his residence last night (May 09), according to the police. Meanwhile, 216 persons injured in the clashes in Colombo have been admitted to the Colombo National Hospital. Hospital sources stated that 05 of them are receiving treatment in the Intensive Care Unit. Among the injured is the Senior DIG in charge of the Western Province Deshabandu Tennakoon, who was hospitalized after being assaulted by a group at Perahera Mawatha, Colombo. It is reported that MP Kumara Welgama has been hospitalized with minor injuries after being assaulted by a group near the Makumbura Expressway. A total of 47 vehicles were set on fire, while 38 houses were also torched. In addition, 41 vehicles and 65 houses were also damaged. (Colombo Page, 11.5.2022)

Tamil National Alliance (TNA) Parliamentarian M.A. Sumanthiran yesterday said that former Prime Minister Mahinda Rajapaksa must be arrested and prosecuted. “Mahinda Rajapaksa who just resigned, must be arrested and brought before the law along with all others who organised and brought the attackers to Colombo,” he tweeted on his official handle yesterday.Soon after the attacks on peaceful protestors yesterday afternoon, he called for the resignation of President Gotabaya Rajapaksa, Prime Minister and Inspector General of Police (IGP). The President, PM and the IGP should resign forthwith! PM for instigating and supplying the hoodlums to attack peaceful protestors, the IGP and the President for deliberately filibustering until the attacks could be carried out before acting,” he tweeted. (Ceylon Today, 11.5.2022)

Defence Secretary Kamal Gunaratne said that former Prime Minister MahindaRajapaksa was evacuated to the Trincomalee Naval Base for security reasons following the tense situation outside the Temple Trees.  Speaking at a media briefing at the Ministry of Defence, He said that former Prime Minister will be given adequate security and he would be transported to a preferred location when the situation returns to normalcy (Daily Mirror Online, 11.5.2022)

Lankan researchers have described a new-to-science species of flowering plant, categorizing it as critically endangered because of its small and declining population and restricted range. A report published by the Mongabay said that Impatiens jacobdevlasii is named in honor of Dutch botanist Jacob de Vlas, co-author of a series of illustrated guides on the more than 3,000 known flowering plants of Sri Lanka. The Knuckles mountain range in central Sri Lanka is a UNESCO-declared World Heritage Site that’s home to a rich diversity of wildflowers. Among them are plants in the genus Impatiens, a new member of which has just been described by Sri Lankan researchers in the journal Phytotaxa — and which is already considered critically endangered because of its fleeting rarity. The road to the discovery began in 2016, when researchers Champika Bandara, a Ph.D. candidate at the University of Sri Jayewardenepura, and Sanath Bandara Herath of the Open University of Sri Lanka (OUSL), were exploring the plant life along the banks of a stream in the Dothalugala area of the Knuckles range. It was here where they first spotted a purple impatiens flower that neither had ever seen before. Gopallawa’s discovery, however, occurred on a different trail in the mountains, called Thangappuwa, about 20 kilometers (12 miles) from the earlier location. Realizing that he was looking at an undescribed species, and aware that Bandara and Herath were also working on an unknown impatiens, Gopallawa reached out to the others to compare notes. The study that emerged from their collaboration, published this April, describes a new species that the researchers named Impatiens jacobdevlasii, after Jacob de Vlas, a Dutch botanist best known for co-authoring the Illustrated field guide to the flowers of Sri Lanka with his wife, Johanna. Published in three volumes from 2008-2019, the guide lists more than 3,000 native and introduced flower plants found on the island. The new species is categorized as critically endangered in light of its low population, declining population trend, and limited distribution. Bandara said the Dothalugala population of I. jacobdevlasii has declined by 80% since that initial 2016 sighting. The Dothalugala population is located near a stream along the Deanston–Dothalugala nature trail, and Thangappuwa population is found on wet, rocky surfaces along the Thangappuwa–Alugallena nature trail. Any road-clearing, weeding, construction or maintenance efforts by the authorities should prioritize the management and further conservation of this new species, Bandara said. (Sunday Island, 15.5.2022)

India has taken steps to send a consignment of essential medicines worth around Rs. 88.7 million to crisis-stricken Sri Lanka as aid. The state government of Tamil Nadu has taken steps to send this stock of essential medicines to Sri Lanka. In view of the current challenges facing Sri Lanka, the State Government of Tamil Nadu, India has planned to send Rs. 280 million worth of essential medicines to Sri Lanka and this stock is the first phase. The Tamil Nadu government had passed a resolution in the Assembly last month to send medicines and in total 137 types of medicines will be sent. The medicines will be sent to Sri Lanka along with other essential items. The minister said the Union government would decide which part of Sri Lanka the goods will be sent to. Tamil Nadu is the first State in India to come forward to help Sri Lanka with medicines. (Colombo Page, 17.5.2022)

Eight new cabinet ministers of the all party government were sworn in before President Gotabaya Rajapaksa at the President’s House in Colombo this morning (23), President’s Media Division said. President Rajapaksa has appointed the following new ministers:Douglas Devananda – Minister of Fisheries. Bandula Gunawardena – Minister of Transport and Highways, Minister of Mass Media. Keheliya Rambukwella – Minister of Water Supply and Drainage. Mahinda Amaraweera – Minister of Agriculture, Wildlife and Wildlife Conservation. Ramesh Pathirana – Minister of Industries. Vidura Wickramanayaka – Minister of Buddhasasana, Religious and Cultural Affairs. Ahmed Nasir – Minister of Environment. Roshan Ranasinghe – Minister of Irrigation, Minister of Sports and Youth Affairs. (Colombo Page, 23.5.2022)

The government has decided to grant financial assistance of Rs. 5000-7500 per month for the next two months from May to provide relief to 3.3 million Samurdhi recipients, low income earners and those who have become helpless due to rising commodity prices and economic pressure.. Accordingly, this program will be implemented to benefit 3.3 million persons including 1,765,000 Samurdhi recipient families, 730,000 low income families, elderly and disabled persons and kidney patients. Arrangements have been made to release the allowance for the month of May next week as the first phase. The Government has made arrangements to provide relief to the beneficiaries for a period of three months using a portion of the US $ 300 million received from the World Bank. The Ministry of Samurdhi and the Department of Samurdhi Development are playing a major role in directing this program which is being implemented on the instructions of the Prime Minister’s Office and the Ministry of Finance. Accordingly, arrangements have been made to credit the monthly allowance directly to the families of all the beneficiaries, including Samurdhi recipient families, to their own bank accounts. Director General of Samurdhi Bandula Thilakasiri, who plays a significant role in implementing the program, said that arrangements have been made to provide a minimum of Rs. 5,000 to a maximum of Rs. 7,500 to members of Samurdhi recipient families. They have been facilitated to withdraw the money through Samurdhi banks across the country. (Colombo Page, 23.5.2022)

Sri Lanka’s nationwide inflation in April 2022 determined under the National Consumer Price Index (NCPI) jumped to 33.8 percent from 21.5 percent recorded in March 2022 on a year-on-year basis, the Department of Census and Statistics reported Monday. The NCPI for all items for the month of April 2022 increased to190.3 from 172.7 in the previous month. With respect to April 2021, the reported inflation for the month of April 2022 was mainly due to the higher price levels prevailed in both food and non-food groups. Accordingly, the Year-on-Year inflation of the food group increased to 45.1 percent in April 2022 from 29.5 percent in March 2022 and the Year-on-Year inflation of the non-food group increased to 23.9 percent in April 2022 from 14.5 percent in previous month. Contributions to the inflation rate of April 2022 from food group and non-food group are 21.07 percent and 12.73 percent respectively. The moving average inflation for the month of April 2022 is 13.0 percent. The corresponding rate for the month of March 2022 was 10.6 percent. (Colombo Page, 24.5.2022)

Sri Lanka took almost four decades to double its female labour force participation rate from about 19% in 1953 to 36 % in 1990. Since then, the female labour force participation rate has averaged just 33 % and has been on a declining trend in recent years. Although Sri Lanka is ahead of the South Asian average of 24 %, the country’s female labour force participation remains much lower than the ‘upper middle income’ country average of 55% according to the Central Bank annual report -2021.  The continued stagnation of the female labour force participation is a key policy issue to be addressed as the economy struggles with a rapidly ageing population, labour productivity issues and increasing migration, especially of skilled and semi-skilled workers.  With due consideration for considerable investments that consecutive governments have made in the education and health sector over the last seven decades, it is noted that bringing women into the labour force and thereby creating an expansion of the labour force can have significant positive impacts on the growth process of the country, while also ensuring the efficacy of such investments, amid limited fiscal space.  (Daily News, 24.5.2022)

Sri Lanka has hired heavyweight financial and legal advisers Lazard and Clifford Chance as it prepares for the difficult task of renegotiating its debts, a trio of sources told Reuters on Monday. The move is the latest development in Sri Lanka’s worst economic crisis since independence from Britain in 1948 and comes after the country was officially declared in default for the first time ever last week after it halted debt payments. All three sources asked not to be named because the talks remain private. Spokespeople from Sri Lanka’s Cabinet and Lazard, which has handled debt talks for dozens of crisis-strained countries in recent years, did not immediately reply to requests for comment while law firm Clifford Chance declined to comment. Experts and economists have been waiting for the appointment as the country looks to restructure over $12 billion of overseas debt that had been building up for years but become unsustainable when COVID-19 hammered the economy. The economy of around 22 million people began to show cracks in 2019 after large tax cuts by President Gotabaya Rajapaksa’s government drained the country’s coffers. The pandemic then shattered the lucrative tourism industry, and rising global prices have left Colombo struggling for essentials such as fuel, medicine and food. Violence between pro- and anti-government factions and police left nine dead and more than 300 injured earlier this month. That was followed by the resignation of former prime minister Mahinda Rajapaksa.  “By far the most important thing is to what extent the government will have the political will, and the ability, to deliver on the pre-conditions for the IMF programme,” said Gramercy’s co-head of sovereign research & strategy, Petar Atanasov. “Governments are often willing to do the things that are required when their backs are completely against the wall.” While there are hopes a deal can be struck to ease the economic crisis, it is unlikely to be straightforward. A mix of loans from China, India and Japan, as well as all the bonds held by private investment funds mean long-resisted but now embraced talks with the International Monetary Fund (IMF) could be complex, especially if social unrest worsens. Other factors have included heavily subsidised domestic prices of fuel and a decision to ban the import of chemical fertilisers, which devastated the agriculture sector. (Daily Mirror Online, 24.5.2022)

Scientists have rediscovered Sri Lankan Clubtail (Anisogomphus Ceylonicus), one of the rarest species of dragonflies in the country. The team that made the discovery comprised Amila Sumanapala of the Department of Zoology and Environment Sciences, University of Colombo, T. Ranasinghe of the Butterfly Conservation Society of Sri Lanka, and D. Sumanapala of the Faculty of Graduate Studies, University of Sri Jayewardenepura. According to lead scientist Amila Sumanapala Sri Lankan Clubtail is one of the rarest species of dragonflies. First collected in 1859, it was only known from the original collection and another collection record made a century after in 1962. This species had not been found anywhere in Sri Lanka for close to 60 years until the team encountered a larva during a survey conducted in 2021. Anisogomphus ceylonicus is one of the few Odonates of Sri Lanka with no photographic records of a living specimen available hitherto. It was first discovered from Ramboda over 140 years ago based on a female specimen, which was originally described as Gomphus ceylonicus and later assigned to the genus Heliogomphus by F.C. Fraser (Bedjanič & van der Poorten 2013). Almost a century later, Lieftinck (1971) collected an immature male and its exuvia of a clubtail dragonfly from Rambukpath Oya, 10 miles northwest of Hatton in 1962 and described it as Anisogomphus solitaris. However, Bedjanič & van der Poorten (2013) recognized that H. ceylonicus is conspecific with A. solitaris, and thus reassigned it to the genus Anisogomphus. Since the discovery of the species, only these two records have ever been documented (Bedjanič et al. 2014), despite odonatological surveys and numerous biodiversity explorations conducted countrywide. (Daily Island, 25.5.2022)

The Government of Sri Lanka is planning to obtain another USD 500 million short term loan from India to purchase petroleum products. Actions have already been taken by now for obtaining a short – term loan facility of USD 500 million with the assistance of the export – import bank of the Indian government as well as another loan facility of USD 200 million under the assistance of the State bank of India in order to purchase petroleum products required by this country under the current economic circumstances prevailing within the country, a statement on cabinet decisions said. The cabinet of ministers granted approval for the proposal submitted by the Minister of Power and Energy to obtain a series of short – term loan facilities worth another USD 500 million with the assistance of the export –import bank of the Indian government in order to purchase petroleum products required by the country settling the foreign exchange shortage existing at the moment. (Colombo Page, 25.5.2022)

Sri Lanka’s Prime Minister Ranil Wickremesinghe has been sworn in as the new Minister of Finance, Economic Stability and National Policies. The Prime Minister took oaths before President Gotabaya Rajapaksa at the President’s House in Colombo this morning (25), President’s Media Division said. Secretary to the President Gamini Senarath was also present at the occasion. (Colombo Page, 25.5.2022)