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Rs. 10 bn. allocated for future elections  – Siyambalapitiya

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State Minister for Plantations, Enterprise Reforms and Finance, Mr. Ranjith Siyambalapitiya, has announced that a dedicated allocation of Rs. 10 billion has been reserved for potential future elections. This provision, while not explicitly outlined in the budget proposals, has been included in the estimates.

Furthermore, the State Minister has conveyed that the Executive Committee of the International Monetary Fund (IMF) is scheduled to deliberate on the release of the second instalment of the extended credit facility to Sri Lanka on December 6th.

State Minister for Plantations, Enterprise Reforms and Finance, Mr. Ranjith Siyambalapitiya, made these remarks during his participation in a press briefing held at the Presidential Media Centre (PMC) today (21), under the theme ‘One Way to a Stable Country’.

Speaking further, State Minister Siyambalapitiya highlighted the challenges faced in formulating this year’s budget. He underscored that in 2023, the government’s revenue experienced a 16% decline from the targeted amount, a circumstance attributable to the prevailing negative economic conditions. Addressing the inherent limitations faced during the budget preparation, he acknowledged the constraints in pursuing objectives such as maintaining a robust primary account.

Moreover, in addressing the budget deficit, when expenditures surpassed income, resorting to borrowing became necessary. However, the forthcoming year presents a constrained borrowing environment, with limited space available. Previously, local borrowing was facilitated through various accessible means, but with the implementation of the new Central Bank Act, borrowing has been subject to restrictions. The government now has the authority to borrow only in response to sudden announcements by the Central Bank.

Despite accusations labelling this year’s budget as an election-oriented one, it is crucial to recognize the imperative of responding to the challenges faced by a society under considerable strain. In such a context, it becomes obligatory to address the needs of those significantly impacted by economic adversity.

We have allocated Rs. 10 billion for upcoming elections, although this provision was not formally presented in the budget proposals but has been factored into the estimates.

Furthermore, it is essential to recognize that no nation has advanced without a sustainable stream of tax and government revenues. When we assumed these responsibilities, the tax structure was predominantly comprised of 80% indirect taxes and 20% direct taxes. Over time, we have strategically reduced the indirect tax rate, bringing the direct tax rate closer to 30%.

Additionally, the State Financial Management Responsibilities Act No. 03 of 2003 mandates maintaining the budget deficit at 5%, a target that, in practice, has proven challenging. Over the last two decades, this target was achieved only in 2016 and 2017. Sustaining this requires a rigorous approach involving substantial expenditure reductions and revenue generation. Notably, public welfare expenditure, which stood at 65 billion, is projected to rise to 209 billion this year. Efforts are underway to implement practical reforms, including amendments to certain laws, to align legislation with operational realities. Activating dormant tax revenues is also a priority in our pursuit of fiscal sustainability.

Moreover, there is a potential to elevate the state income ratio from its current 8.3% to 10.1% by the end of this year, and following the implementation of the 2024 budget, this ratio could further rise to 12.3% by the close of that year. Regardless of the political party in power, sustaining a nation necessitates the continual growth of state revenue.

In a remarkably short period, we successfully alleviated the frustrations associated with the historical instability of the state. Concurrently, efforts are underway to enforce the Anti-Corruption Act, aligning with the commitments made under the agreement with the International Monetary Fund.

Furthermore, plans are in place to conclude the electronic tax information gathering program and the Revenue Administration Management Information System 2.0 (RAMIS 2.0) project by the year’s end. The upcoming weeks are deemed pivotal for Sri Lanka’s economic trajectory. On December 6, the Executive Committee of the International Monetary Fund is set to convene and deliberate on the release of the second instalment of the extended credit facility. Furthermore, discussions and finalization of the proposal for the restructuring of bilateral debt are scheduled.

(President’s Media Division)

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SC judgement on petitions challenging IGP’s appointment, on July 24

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The Supreme Court is to pronounce judgement on the petitions, challenging the appointment of Inspector General of Police Deshabandu Tennakoon, on July 24.

The petitions were filed by 08 parties including His Eminence Malcolm Cardinal Ranjith.

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Lawyers helped Kanjipani Imran & Ganemulle Sanjeeva to escape from SL – Tiran

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Kanjipani Imran and Ganemulle Sanjeeva, who are wanted by the police, were helped by their lawyers to escape from the country, Minister of Public Security – Tiran Alles has said.

He has said this during a media briefing held in Colombo today (July 18). 

The minister also stated that the police has seized drugs amounting to Rs. 19 billion as well as 955 firearms, since the ‘Yukthiya’ operation kicked off on Dec. 17, 2023.

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“Japan ready to resume suspended official development assistance projects”

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Dr. IZUMI Hiroto, the head of the Japanese delegation visiting Sri Lanka, lauded the successful completion of the country’s debt restructuring process, noting that it has paved the way for the resumption of Japanese Official Development Assistance (ODA) projects. 

These projects, which include several initiatives that were suspended last period, are now poised to restart, signaling a renewed phase of cooperation and development.

Dr. Hiroto highlighted that the international community’s confidence in President Ranil Wickremesinghe’s leadership is strongly reflected in the expedited success of the debt restructuring agreements. This achievement, accomplished in partnership with the Official Creditors’ Committee and the International Monetary Fund, underscores a remarkable turnaround for Sri Lanka.The high-level Japanese delegation, comprising representatives from the housing, construction, and urban sectors, met with President Ranil Wickremesinghe at the Presidential Secretariat this morning (18).

During the meeting, Dr. IZUMI Hiroto highlighted the successful completion of Sri Lanka’s debt restructuring process and announced that projects under Japanese Official Development Assistance (ODA), including those previously suspended, are set to resume.

The discussion also focused on new investment opportunities in Sri Lanka, emphasizing the potential for enhanced cooperation between the two nations. The delegation expressed their appreciation for Sri Lanka’s economic progress and the swift achievement of debt restructuring agreements in collaboration with the Official Creditors’ Committee and the International Monetary Fund. They praised President Wickremesinghe’s leadership in navigating the country through its financial challenges, which has restored international confidence and paved the way for renewed development initiatives.

President Ranil Wickremesinghe, recalling Japan’s invaluable support during Sri Lanka’s debt restructuring process, emphasized Sri Lanka’s commitment to deepening economic cooperation with Japan across various sectors, including education and agricultural modernization. The President stressed the importance of resuming stalled projects under Japanese cooperation to further strengthen bilateral relations.

Additionally, President Wickremesinghe highlighted the critical role of the Colombo Dockyard, underscoring its significance as a key institution in Sri Lankaís maritime and industrial landscape.

The Japanese delegation noted that several projects that are currently suspended, including the Bandaranaike International Airport (BIA) Development Project, the Colombo Port Eastern Terminal Development Project, the Central Expressway Construction and the Digital Broadcasting Project, can be promptly restarted.

Additionally, the delegation highlighted the potential to resume the Light Railway Transit (LRT), which was halted by the previous government. They are actively assessing locations to re-implement this project, recognizing its significant potential to alleviate traffic congestion in Colombo city.

Both sides emphasized the significance of Public-Private Partnerships (PPP) in executing housing for low-income earners and other urban development projects. It was also highlighted that the Government of Sri Lanka is committed to promoting environmentally friendly projects and renewable energy in line with its policies and international agreements.

The Japanese delegation expressed their willingness to the President to recruit Sri Lankan graduates in the field of technology for job opportunities in Japan’s private sector. This initiative aims to improve the electricity supply sector in Japan. The delegation also highlighted the Joint Credit Mechanism (JCM), which encompasses projects designed to promote environmental sustainability by utilizing advanced Japanese technology to reduce carbon dioxide emissions.Chief of Presidential Staff and Senior Advisor to the President on National Security Sagala Ratnayaka, Japanese Ambassador to Sri Lanka H.E. Mizukoshi Hideaki, Chairman of the Board – Japan Bank for International Cooperation (JBIC) Mr. MAEDA Tadashi, Presidential Senior Advisor to the President on Economic Affairs Dr. R. H. S. Samaratunga, and the Managing Director/CEO of the Colombo Dockyard PLC Mr. Thimira S. Godakumbura, along with representatives from several leading businesses in Japan attended the discussion.

President’s Media Division (PMD)
18.07.2024

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