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SL to secure likely 6-yr. moratorium on debt owed to India, Paris Club

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Sri Lanka is close to finalising a debt treatment plan with India and the Paris Club, sources familiar with the negotiations said, pointing to a likely moratorium of upto six years and a reduced interest rate during the repayment period.

“The discussions are at an advanced stage. A formal agreement on the terms can be expected very soon,” the Colombo-based source told The Hindu on Thursday, after a recent discussion among members of the Official Creditor Committee [OCC].

As many as 17 countries that have extended loans to Sri Lanka formed the Committee last year for ease of debt restructuring negotiations. China opted to stay out of the platform, but has been attending its meetings as an observer. Meanwhile, Colombo has repeatedly assured the OCC that it would negotiate repayment of Chinese loans on comparable terms.

Finalising agreements with the official creditors and reaching “in principle” agreements with the key private creditors would be “critical next steps” in Sri Lanka’s economic recovery plan, the International Monetary Fund (IMF) on Thursday. After defaulting on its nearly $ 50 billion external debt in April 2022, Sri Lanka has been engaging with its diverse lenders to work out a debt treatment plan that is compatible with its pace of recovery. While Colombo is said to have made considerable progress in negotiating a deal with its bilateral creditors, private creditors holding the largest chunk of Sri Lanka’s foreign debt continue to pose a challenge.

Meanwhile, Sri Lanka got a step closer to receiving the next instalment of the International Monetary Fund’s (IMF) assistance, as part of the $3 billion package it obtained last year, to recover from the unprecedented financial crash witnessed in the island nation in 2022. Authorities reached a staff-level agreement with the Fund on the second review of its four-year Extended Fund Facility (EFF) arrangement. Upon completion of the IMF Executive Board’s review, Sri Lanka would have access to about US$337 million, taking IMF assistance it has received so far to $1 billion, the Fund said in a statement.

Commending Sri Lankan authorities for “making good progress” in implementing an “ambitious” reform agenda, IMF officials told a media gathering in Colombo that the government had shown “commendable outcomes”, in curtailing inflation, ensuring reserve accumulation, and strengthening public finances.

(The Hindu)

(Except for the headline, this story, originally published by ‘The Hindu’, has not been edited by SLM staff)

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BASL Bar Council condemns Tiran Alles’ statement, calls for resignation

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The Bar Council of the Bar Association of Sri Lanka (BASL) yesterday passed a resolution condemning the recent statement made by Public Security Minister Tiran Alles calling upon newly-passed out police recruits that it was not a sin to eradicate criminals.

BASL President Kaushalya Nawaratne told the Sunday Times that the resolution was moved over the statement made by the Minister on Thursday at the passing out parade of specially-trained officers of the first combat motorbike unit to eradicate criminal elements in the Western and Southern Provinces at the STF Camp in Katukurunda, Kalutara.

The Minister told the officers “it is not a sin” to eradicate those involved in murders, selling drugs and trafficking drugs.

The Bar Council resolved that if the Minister does not step down, the President should take action to remove him from the Public Security Ministry post, Mr Nawaratne said.

The Bar Association stated that they would resort to local as well as international legal action if the Minister would not be removed from his position.

Mr Nawaratne said that the statement comes in the wake of a breakdown of the law and order situation and alleged that the Sri Lanka Police was involved in various illegal acts in the recent months.

(sundaytimes.lk)

(Except for the headline, this story, originally published by sundaytimes.lk has not been edited by SLM staff)

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Sri Lanka faces challenges in mega project implementation

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More than 300 contracts connected to 35 mega projects were suspended last year, and Rs. 2.3 billion was demanded as compensation by contractors for just nine of them, the Finance Ministry’s Project Management and Monitoring Department (PMMD) says, adding there is a probability that claims will also be submitted over another 22.

A total of 37 projects achieved no physical progress during the last quarter of 2023, according to the PMMD’s latest report released last month.

Among them are 17 projects out of 33 for which foreign disbursements were stopped.  Implementation delays are reported in 41 other projects owing to the poor performance of contractors. As this issue prevails in about 20 percent of total projects, it is important to consider the performance of contractors as a criterion for the renewal of their registration to resolve the repetition of this issue, the report states.

The PMMD’s latest data come amidst strong words in the International Monetary Fund’s (IMF) Governance Diagnostic Assessment, which pointed to recurrent problems in how successive Sri Lankan governments carried out mega projects.

Citing the PMMD’s 2022 fourth-quarter report, the multilateral lender notes that the most common issue affecting implementation is the delay in receiving allocation and imprest, “which proves that projects have commenced without appropriate budgetary allocations in the annual budget.” Another was the delay in land acquisition, it states, “again showing that projects are initiated without actually being ready”.

There are also procurement-related matters, the absence of performance indicators and outputs and the poor performance of contracts. And the Ministry of Finance “lacks basic information on projects, including the expected revenues and the potential cost of early termination given the limited data provided on projects and problems accessing necessary data”.

The PMMD’s new report says that delays have been a common practice, with “no evidence reported on actions taken against the responsible parties who have not taken appropriate steps for time management in projects, resulting in the failure of economic plans formulated based on the expected benefits of projects”.

The time period agreed upon for delivering outputs in an astounding 99 projects had lapsed at the end of last year while 20 of them obtained extensions beyond four years. Thirteen projects have not met even 25 percent of the expected target, even after more than half the project period, the PMMD notes.

For the first time, the PMMD has identified 30 projects that faced major implementation delays, including the Irrigation Ministry’s Uma Oya Multipurpose Development Project, which was inaugurated this week after ten extensions.

Another flagged project is the Irrigation Ministry’s Asian Development Bank-funded Mahaweli Water Security Investment Programme, the scope of which was drastically reduced by withdrawing 11 out of 21 packages owing to failure to execute them within the planned timeframe as well as the inability to begin new contracts in a restricted financial situation.

“The most complex tunnel construction package, which is currently ongoing and achieved about 20% progress, should be completed within 18 months and the balance loan amount of USD 159 million should be disbursed during this period Otherwise, that loan amount will be cancelled without any use.” the PMMD warns.

(sundaytimes.lk)

(Except for the headline, this story, originally published by sundaytimes.lk has not been edited by SLM staff)

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“230 rehab centers island-wide tackle drug addiction”

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The National Dangerous Drugs Control Board says that 230 rehabilitation centers have been established to treat drug addicts in the country.

Its Chairman Attorney Shakya Nanayakkara says that the services of these rehabilitation centers will commence from the 7th of May.

The centers can accomodate up to 20,000 patients.

(newsfirst.lk)
(Except for the headline, this story, originally published by newsfirst.lk has not been edited by SLM staff)

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