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IMF said to discuss SL loan approval even as China stalls

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The International Monetary Fund (IMF) is considering approving a loan for Sri Lanka, even without China’s assurance of debt-restructuring support, Bloomberg News reported on Friday.

Read Bloomberg full report

The International Monetary Fund is considering approving Sri Lanka’s bailout even without the formal assurance of debt-restructuring support from China, the nation’s biggest bilateral creditor, according to people familiar with the discussions.

Under a rarely used policy on lending into official arrears, the IMF may consider approving Sri Lanka’s loan because China’s assurance is the only prerequisite missing, according to the people who declined to be identified because the information isn’t public.

This provision is aimed at preventing a creditor from blocking assistance to a country in dire need of financing and has shown commitment to meet loan conditions.

An IMF spokesperson said that it’s premature to discuss the precise IMF policies that could be applied to lending to Sri Lanka, and that the nation’s authorities continue to seek financing assurances so that the fund’s executive board can consider their request for a loan. IMF staff also continue to engage with the Sri Lankan authorities who are working on completing upfront policy measures, the spokesperson said.

IMF Policy

The IMF can use the policy on lending into official arrears if it deems prompt financial support is essential and sees the country pursuing appropriate policies and making good-faith efforts to reach an agreement with creditors, according to an explanation on the fund’s website.

Moving forward with loan approval would be a shift from its position earlier this month, when it said the approval of Sri Lanka’s $2.9 billion Extended Fund Facility will depend on whether the nation can secure assurances from all bilateral creditors. 

The development comes as World Bank President David Malpass said Thursday that long extensions of debt are among the options that G-20 nations and others are considering to help ease the burden for poor countries.

The IMF, World Bank and Group of 20 nations chair India separately held virtual discussions Friday on global sovereign debt ahead of the finance ministers and central bank governors’ meeting in Bangalore next week.

Sri Lanka and Pakistan count on IMF loans to provide immediate relief by shoring up their foreign-currency reserves and unlocking more funding.

Pending China’s creditor assurance, Sri Lanka is trying to meet other reform conditions set by the IMF, including increasing electricity tariffs and clearing a new monetary law for parliament approval. The government may also loosen its grip on a currency band to meet the fund’s requirements.

The Paris Club — an informal group of rich, mostly western creditors — and India have provided formal support to Sri Lanka’s loan recast, leaving China as a holdout. 

China, which accounts for about 52% of the bankrupt nation’s bilateral debt, has instead offered term extensions via the state-owned Export-Import Bank.

Debt negotiations have dragged since Sri Lanka defaulted in May, causing severe supply shortage, depleting its foreign-currency reserves, sending inflation and borrowing costs soaring and pushing the economy into a recession.

While the nation has repurposed some funds to ease the shortage and damp price pressures, it would need IMF’s bailout and other funding to turn the situation around.

By  Ruchi Bhatia and Eric Martin
— With assistance by Anusha Ondaatjie and Asantha Sirimanne

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CIABOC, CID launch probe on Deshabandu’s assets

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The Commission to Investigate Allegation of Bribery or Corruption (CIABOC) has begun a probe on the assets of suspended Inspector General of Police (IGP) Deshabandu Tennakoon.

The investigation began following the discovery of a large stock of foreign liquor, hampers filled with gifts and various food items during a search of Mr Tennankoon’s Hokandara residence.

The Sunday Times understands that the Criminal Investigation Department (CID) has also launched a probe to look into whether the suspended IGP had committed any offences under the Prevention of Money Laundering Act in acquiring assets.

It is alleged that several assets Mr. Tennakoon has accumulated have not been registered in his name. The probe will focus on whether he had obtained assets using other people as cover.

Public Security Minister Ananda Wijepala, meanwhile, told the Sunday Times that the government intends to file legal action against Mr. Tennakoon for dereliction of duty during the ‘Aragalaya’ period.

The Bribery Commission’s investigation into Mr. Tennakoon has been launched on the basis of submissions presented by Additional Solicitor General Dileepa Peiris, PC, in the case over the 2023 Weligama shooting incident, in which an officer from the Colombo Crimes Division was killed. He opposed bail being granted to the suspended IGP after Mr. Tennakoon surrendered to the Matara Magistrate’s Court.

Mr. Tennakkon has been remanded till April 3.

While Mr Tennakoon has been suspended from functioning in his duties as the IGP by the Supreme Court since July last year and he is technically still the IGP, Senior DIG Priyantha Weerasooriya serves as Acting IGP.

The National Police Commission too does not have the power to interdict the IGP. Since the IGP is appointed by the Constitutional Council (CC) on the recommendation of the President, taking disciplinary action against him falls on the President and the CC. Removal of the IGP, however, will require an impeachment motion to be presented to Parliament.

(sundaytimes.lk)
(This story, originally published by sundaytimes.lk has not been edited by SLM staff)

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Maithripala Sirisena claims he holds world record for most lawsuits

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Former President Maithripala Sirisena has claimed that he holds the world record for being the most sued individual, with approximately 400 lawsuits filed against him. 

In an interview with *Deshaya*, Sirisena stated that while he has never filed lawsuits against others, he has been targeted extensively by legal actions.

Sirisena remarked that these lawsuits will only end upon his death, as he emphasized that no one lives forever. 

He also drew parallels between his political philosophy and the fates of iconic leaders like Mahatma Gandhi, Abraham Lincoln, and S.W.R.D. Bandaranaike, who were assassinated for their ideals. 

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Woman among 3 arrested over Devundara shooting

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Police have arrested three suspects, including a woman, in connection with the shooting near the Devundara Sri Vishnu Devalaya in Matara late last night (21) which claimed the lives of two persons, said police.

Additionally, investigations have revealed that the prime suspect behind the killings is notorious underworld figure Shehan Sathsara, also known as “Bale Malli”, who is believed to be hiding in Dubai.

According to police, the attack stemmed from a dispute between the two victims, identified as Pasindu Tharaka (29) and Yomesh Nadeeshan, and Bale Malli.

The shooting occurred at around 11:45 p.m. on Sinhasana Road, in front of the southern entrance of the Devundara Sri Vishnu Devalaya. 

Two unidentified gunmen, who arrived in a van, had rammed the victims’ motorcycle before opening fire with a T-56 assault rifle and two 9 mm firearms, police said.

(adaderana.lk)

(This story, originally published by adaderana.lk has not been edited by SLM staff)

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