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Discussion Starter · #1 ·
Hi Guys, I thought this topic would be timely as SL always tend to follow wrong part for economic development and If Israel can be a develop country I asked why cant we??????
Lately I have seen over protection and state interference citing "protecting local production and self sufficiency" and back in 80's entrepreneurship was killed by these ad-hoc ill-fated polices,,,, So before we head in to another disaster I think it's timely that we have some in put in this regard.
 

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Discussion Starter · #2 ·
Sri Lanka new vehicles ownership may drop 40-pct: industry

July 03, 2012 (LBO) - New vehicle registrations in Sri Lanka may drop up to 40 percent in 2012 and dreams of motor bike owners to move on to small cars will be shattered, industry officials said.

In 2011, 525,421 new vehicles including 253,331 motor bikes and 57,886 motor cars were registered, up 46 percent from a year earlier.

Precipitous

The Ceylon Motor Traders' Association, an industry body, says higher import duties, a weaker exchange rate and higher interest rates is slowing demand for motor vehicles in the island.

"With all these negative factors we can expect a drop of around 30 to 40 percent in vehicle registrations to an estimated total of around 360,000 this year," Tilak Gunasekekera, chairman of the Ceylon Motor Traders Association said.

Car registrations at the Department of Motor Traffic have dropped 26 percent to 21,884 in the first half of 2012 from 29,883 a year earlier.

Motor trade officials say a state import duty hike has sent prices of smaller cars (below 1000 cubic centimeter engine capacity) like the Indian-made Maruti Alto up putting them beyond reach of the people with modest incomes.

Sri Lanka's finance ministry jacked up taxes on cars in particular after credit taken to manipulate oil prices and more than 250 billion rupees printed to manipulate interest rates and monetize the budget deficit sent the rupee down from 110 to 130 to the US dollar.
Authorities have had a habit of imposing trade controls on citizens ever since a money printing central bank was created in 1951, which created high inflation and 'foreign exchange shortages'.

Authorities singled out car owners and motor cycle owners to hit the hardest, while potential truck and bus owners were left relatively untouched, in line with the discriminatory state interventionism that has been generally practiced in the country in past half century.

Analysts say a general rise in interest rates or a depreciation of the currency is neutral across citizens.

Shattered Dreams

Car industry officials say the hardest hit are citizens with modest means, who were planning to move to cars from motor bikes.

"People like to shift from two wheels to four, now that dream is shattered," Gunasekera said.

"They should have increased taxes on a fairer platform. This is far too high" he said.

In May the sales of Maruti Alto, Sri Lanka's best-selling car fell to 288 units from 537 units in April 2011, an analysis by JB Stockbrokers, an equities research house showed.

According to data from Sri Lanka's Department of Motor Traffic registration of smaller cars below 1000cc engine capacity has dropped to 7,343 in the first half of 2012, compared to 12,432 registrations in the same period last year.

"The government should have encouraged smaller cars at a time when the world is looking for economical and smaller cars to fit into their cities," Gunasekera said.

At the moment state workers however get 'permits' to import tax slashed cars, in another discriminatory practice.

The agents for a top Japanese brand said they expected profits to drop 35 percent this year and their sales were now mostly confined to state orders or those coming from 'permits'.

Analysts had also warned that imposing trade controls are in fact an economic sanction imposed on a country by itself and problems with the exchange rate - which come from monetary policy - should be addressed monetarily.

Cars which were charged higher duty even after a tax cut give revenues to the state and prohibitive taxes that reduces imports will expand the budget deficit, driving interest rates higher or requiring fresh taxes on other goods.

In the 1930s, the so-called 'Great Depression' was also worsened and a recovery delayed by trade controls.

Motor trade officials say the industry contributed about 35 billion rupees by way of taxes to the state. In 2011 the Department of Motor Traffic had also earned 7.0 billion rupees in various registration fees.
 

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Discussion Starter · #3 ·
Sri Lanka senior opposition figure calls for end to arbitrary rule

July 01, 2012 (LBO) - Karu Jayasuriya, deputy leader of Sri Lanka's main opposition United National Party has called for an end to arbitrary rule stemming from the current constitution, a report said.

"As a member of the UNP, the country’s single largest political party, I believe that the time is right to call upon my fellow members of opposition to unite in shedding our differences, letting go of old wars and seemingly insurmountably diverse ideologies, in order to unite and emerge stronger than ever against a common enemy," Jayasuriya was quoted as saying in a statement by The Island newspaper.

"The executive presidency is not just the enemy of the UNP or the JVP (a Marxist party) or the TNA (a Tamil minority party) or even the SLFP (the main party of the ruling coalition) – in its all pervasive, destructive omnipresence it is the singular enemy of Sri Lanka and so our agenda, as a common opposition would be a worthy one and one that will win the support of all Sri Lankans."

No Apology

Jayasuriya however has not apologized to the people of Sri Lanka for the constitution enacted by his party in 1978, which paved the way for an unrestrained state.

Legal analysts say the 1978 constitution dealt the final blow to the institution of permanent secretaries which separated the general machinery of the state from the political administration allowing rule of law and justice to be dispensed to the people equally.

Without just rule of law, there can be no freedom.
The institution of permanent secretaries was already partially broken in a 1972 constitution which abolished the island's civil service commission, a British device which gave rule of law and justice not only to Britain, but even to its colonial territories.

The civil service commission which was in charge of appointments transfers and disciplinary action of permanent secretaries, the most senior civil servants, allowing state officials act justly and ensure rule of law without fearing reprisals from elected rulers.

The 1972 constitution made the tasks a function of the cabinet and the 1978 constitution made the president the sole appointing authority and disciplinarian. Ministry secretaries, not only judges, need security of tenor to act justly by the people.

Analysts say the new system led to a general deterioration of rule of law in the island, in the dispensation of not only criminal justice but in all government services.

An attempt was made to correct the system with so-called 'constitutional councils' which was also swept away by the last change to the constitution.

Arbitrary Rule

"The intimidation of the press, the harassment of political detractors and the impunity with which the regime conducts itself can all be traced directly back to the tragic flaws of our presidential system which affords absolute power," Jayasuriya said.

"Every aspect of life, whether it is judicial independence, the rule of law, media freedom or the economy is shaped and determined by the will of one all powerful man.

"Until one individual can no longer lay claim to such absolute power, none of these issues can be put right and Sri Lanka and Sri Lankans will continue to suffer the insane policies derived by its all powerful rulers for their benefit and theirs alone."

Legal analysts have said that Sri Lanka's constitution itself promoted arbitrary rule, when the fundamental objectives of a constitution in the post-feudal Europe was to restrain the state (which had replaced the feudal ruler) and provide absolute guarantees of equality to people.

Overtime, the 'police', the lynchpin of the criminal justice system which protected the people from arbitrary action of powerful persons in the society in Western Europe, became an Eastern European-style device which protected rulers instead.

Legal analysts have said that while the fundamental characteristics of many institutions in Sri Lanka had been gradually turned upside down they had continued to be referred to under the old labels, misleading the public.

Before the arrival of Europeans Sri Lanka also had a system of justice, which when operated properly allowed 'just kings' to rule for long periods in peace and prosperity.

Without a legislating parliament which can cook up even unjust laws overnight, feudal rulers were restrained by centuries old custom which evolved very slowly as well as practices in texts coming from elsewhere in South Asia (Nithishashtra), according to some writers.

A feudal rule was also restrained by ministers and other practices which allowed aggrieved citizens and their children to protest in front of castle gates by wailing.
 

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Legal analysts say the 1978 constitution dealt the final blow to the institution of permanent secretaries which separated the general machinery of the state from the political administration allowing rule of law and justice to be dispensed to the people equally.

Without just rule of law, there can be no freedom.
The institution of permanent secretaries was already partially broken in a 1972 constitution which abolished the island's civil service commission, a British device which gave rule of law and justice not only to Britain, but even to its colonial territories.

The civil service commission which was in charge of appointments transfers and disciplinary action of permanent secretaries, the most senior civil servants, allowing state officials act justly and ensure rule of law without fearing reprisals from elected rulers.

The 1972 constitution made the tasks a function of the cabinet and the 1978 constitution made the president the sole appointing authority and disciplinarian. Ministry secretaries, not only judges, need security of tenor to act justly by the people.

Analysts say the new system led to a general deterioration of rule of law in the island, in the dispensation of not only criminal justice but in all government services.

An attempt was made to correct the system with so-called 'constitutional councils' which was also swept away by the last change to the constitution.
"Every aspect of life, whether it is judicial independence, the rule of law, media freedom or the economy is shaped and determined by the will of one all powerful man.

"Until one individual can no longer lay claim to such absolute power, none of these issues can be put right and Sri Lanka and Sri Lankans will continue to suffer the insane policies derived by its all powerful rulers for their benefit and theirs alone."
This right here. Without fixing this, our country's institutions will never be truly functional or efficient.

The current 'development' can not be sustained nor can it be called real development until we some how address this issue. Unfortunately for Sri Lanka though I don't see it happening in the near future. Adding to that apparently talking or even hinting that the various branches of the government and civil service should be independent means you are on the payroll of 'imperialist western nations'/NGOs/ 'vijathika balawega' :lol: And it doesn't seem that most citizens give a damn either as long as roads are being built.. :nuts:

Anyway despite all the shouting our current opposition wouldn't be any better on this issue either, if they come to power.

Maybe I'm being an idealist, but I don't want to live in a county where a politician's son could beat a man to death and walk away scot-free, or where the state institutions are so inefficient they have to use the army instead. No matter how shiny the new expressways of that country are.
 

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Discussion Starter · #5 ·
This right here. Without fixing this, our country's institutions will never be truly functional or efficient.

The current 'development' can not be sustained nor can it be called real development until we some how address this issue. Unfortunately for Sri Lanka though I don't see it happening in the near future. Adding to that apparently talking or even hinting that the various branches of the government and civil service should be independent means you are on the payroll of 'imperialist western nations'/NGOs/ 'vijathika balawega' :lol: And it doesn't seem that most citizens give a damn either as long as roads are being built.. :nuts:

Anyway despite all the shouting our current opposition wouldn't be any better on this issue either, if they come to power.

Maybe I'm being an idealist, but I don't want to live in a county where a politician's son could beat a man to death and walk away scot-free, or where the state institutions are so inefficient they have to use the army instead. No matter how shiny the new expressways of that country are.
sadly politics is every where,,, you need so called connections for even basic things in sri lanks,, i guess here call it
:lol:
 

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Discussion Starter · #6 ·
Sri Lanka should implement measures in lessons commission: professionals

July 04, 2012 (LBO) - Sri Lanka should implement several key measures contained in a report by a commission which studied lessons to be learnt from a recent civil war, some of which can be done without delay, a civil organization of professionals has said.

Sri Lanka's Organization of Professional Association, a civil society organization said a report by Lessons Learnt and Reconciliation Commission (LLRC) had come up with many good recommendations to promote good governance and ethnic reconciliation.
"The LLRC also had time to examine and deliberate on the issues that they took up for their consideration and therefore we could accept them as adequately studied proposals that would address may of the issues that have been highlighted," the OPA said in a statement.

The LLRC was set up after the end of a 30-year war between Tamil separatists and the Sri Lankan state. However there had also been two armed uprisings by mainly enthic Sinhalese militants, since the island gained self-determination from British rule.

Though some measures may need deliberation, the OPA said others could be implemented immediately.

"The OPA considers that the implementation of the first group of recommendations could be initiated without delay," the civil society organization said.

"The OPA also considers that the Government should make a strong and determined effort to the LLRC recommendation."

The OPA said the administration should give priority to proposals to re-start judicial review of legislation, re-establish independent public service commissions, strengthen judicial independence and enact a right to information law.
The OPA said an independent public service commission, a police commission, an elections commission, a judicial services commission, a human rights commission and a commission to investigate bribery and corruption should be established.

Sri Lanka's civil service commission, and the institution of permanent secretary, which was the lynchpin of an independent public service was destroyed by two constitutions enacted in 1972 and 1978.

An attempt to re-establish the independence of the public service, rule of law and justice, through a series of constitutional commissions was also scuttled by a recent amendment to the constitution.

One of the origins of Sri Lanka's ethnic conflict was a 'law' which made one language spoken by a sections of citizenry superior to others, in violation of section 20 of the then constitution.

The OPA also said that the constitutional provisions on official languages should be fast-tracked, information on those in custody should be given to immediate relatives, illegal groups should be dis-armed and legal ownership of land should be given to re-settled refugees.

The OPA said the quick implementation of the recommendations would also end accusations especially from foreign critics about delaying tactics and a lack of commitment by the administration.

Sri Lanka's civil organizations were largely inactive following independence from British rule and watched in the sidelines while elected rulers changed constitutions, enacted discriminatory laws and the independence of the public service was destroyed leading to the gradual erosion of rule of law, justice and freedoms.
 

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Discussion Starter · #7 ·
Sri Lanka expropriated sugar firms begin to hit tax payers

July 05, 2012 (LBO) - Two sugar mills expropriated by the state last year has begun to burden ordinary citizens with the finance ministry channeling 557 million rupees from taxes extracted from the people to the firms.

A mid-year fiscal report to parliament revealed that 550 million rupees had been given to cover day to day expenses of two expropriated firms, Pelwatte and Sewanagala Sugar Industries.
Seven million rupees had also been given to buy a vehicle.

Ironically the handouts have been channeled via a entity called the 'Ministry of Productivity Promotion.'

Sugar also is also given import protection through taxes, curtailing the trade freedoms of the poorest sections of society most.

The money has been channeled to the two firms without first going to parliament for approval using so-called contingency funds from the Treasury, a process that has evolved in Sri Lanka despite parliament being nominally in control of finances.

Sri Lanka's rulers expropriated a series of private firms including the two sugar firms, last year through a controversial law that where rulers resumed violating citizens property rights.

The law flack from critics for being flawed legislation that was ad hominem and trespassed on the separation of powers between the executive and the judiciary.

The law was passed despite a nominal constitutional guarantee against expropriation.

Expropriations and violating people's property rights originated mostly in then-East European countries like Germany which were consumed by Marxian thought, after legislating parliament emerged.

Sri Lanka started widespread expropriations after gaining self-determination from British rule in the middle of the last century, killing a newly emergent native entrepreneurs and driving out foreign citizens who had invested in the island.

.wtf:bash::bash::bash::bash::bash::bash::bash::bash::bash::bash:
 

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Discussion Starter · #8 ·
IMF URGES SRI LANKA TO LOOK TO INDIA, CHINA FOR EXPORTS

The International Monetary Fund has urged Sri Lanka to focus more on sales to India and China to boost its faltering exports and support economic growth.

Sri Lanka’s exports accounted for 17.8 percent of gross domestic product last year, slumping from 33 percent in 2001, though export revenue has risen by 69 percent to $8.1 billion in absolute terms.

Koshy Mathai, the IMF resident representative for Sri Lanka and Maldives, said the exchange rate, high electricity prices and rigid labour laws could all account for the slowdown in export growth.

“We are not going to have economic success if we continue having exports declining relative to the size of economy. It is only with export growth, that the Sri Lankan economy is going to go forward,” Mathai told an exporter forum in Colombo late on Tuesday.

Despite its proximity to India, the United States and Europe still account for 60 percent of the the country’s exports, and economic slowdowns in those regions have resulted in a 5.4 percent fall in exports during the first five months of the year compared to the same period last year.

Sri Lanka’s May exports fell 15.1 percent year-on-year.

India accounted for just 4.9 percent of Sri Lanka’s total exports in 2011, led by machinery and equipment, animal fodder, spices and garments, while China accounted for only around 1 percent.

“Failing to take advantage of the opportunities provided by the economic growth by those areas (in China and India) today would be ashamed, would definitely be giving up an opportunity for Sri Lanka to go forward,” Mathai said.

The International Monetary Fund, which has just fully disbursed a $2.6 billion loan to Sri Lanka, said last month that it has begun talking with authorities in Colombo about arranging a new credit called an extended fund facility. (Reuters)

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Sri lanka probably has one of the worst labor laws in Asia,, sooo stiff which scare off any potential investor to the island and also electricity traffic,,, what a joke,, what cant they expedite Sampur power plant,, if Gov which is basically ECB don't have the money please for god sake let the other players to come in instead of playing with the national economy which potentially can affect quality of citizens! same with the refinery case as well,,,, if we dont have the money let the foreign investors to come in instead of going for loans every single need!
 

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Discussion Starter · #9 ·
Sri Lanka create state posts tens of thousands unemployable graduates

Nov 12, 2012 (LBO) - Sri Lanka has created 21,463 new posts in ministries up to August 2013 out of which 18,128 were for unemployable graduates educated at tax payer expense, data released under a fiscal management law shows.

In 2009 44,532 new posts were created including 40,095 in departments, 1,769 in ministries, 1,641in provincial councils and 1,027 in statutory boards.
In 2010, 5,302 new posts were created and in 2011 3,950 new posts were created.

In 2012 up to August 25,470 new posts had been created including 2,618 in departments, 286 in provincial councils, 541 in statutory boards and 562 in development projects in addition to the 21,463 in ministries.

In contrast only 215 "unnecessary posts" had been suppressed up to August 2012, 747 in 2011, 546 in 2010 and 2,106 in 2009.

President Mahinda Rajapaksa said in his budget speech that 91,000 graduate have been employed in the public sector since 2006.

Sri Lanka already has a bloated public sector which is eating up more than half of all the taxes collected from the people.

Up to August 2012 state salaries and pensions ate up 303 billion rupees out of 562 billion in taxes collected or 54 cents out of every tax rupee.

Unemployable graduates have been running a successful tax spending scheme for years, getting themselves a tax payer funded salary and lifetime pension.
The graduates who lack skills or the attitude to work in the productive sector agitate and hold protests in a railway station in Sri Lanka's capital to push for tax payer funded jobs.

They are educated at state universities at the expense of taxes collected from the people in Sri Lanka's so called tax-payer funded 'free' university system.

Some of them follow external degree programs and many are from the arts stream. Graduates of resident courses at state universities including engineering, medicine, management and information technology are in high demand from productive sectors.

Sri Lanka's economic development ministry said a week before the budget that 51,450 unemployable graduates will be given state jobs.

The statement came as the head of Sri Lanka's inland revenue department said a 'tax week' will be launched to net 50,000 new income tax payers.

Large tax collection systems were set up first in Western Europe helping expand the state, setting up an irresistible temptation for the ruling class and special interest groups to grab a part of the tax pie by becoming a tax spender.

Sri Lanka inherited Western-style customs and revenue collection agencies when the island gained independence from the British.

Tax spender schemes are easier to carry out in countries where tax payers and those who work in productive sectors are less aware of the workings of the basic Western European style state and its tendency to go astray and be mis-used by special interest groups.
 

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Discussion Starter · #10 ·
Privatisation of The Ceylon Electricity Board

I was delighted to read in Thursday’s ‘Island’ that Dr Sarath Amunugama had suggested that the C.E.B. should be privatized. Sarath is one of the most intelligent and educated men in the Cabinet. In suggesting what he did he was only playing the role of the child who pointed out that the Emperor was naked.

Let me for the benefit of non-ideologues point out a few truths:

No State Owned Enterprise (SOE) anywhere in the world, but particularly in Sri Lanka, can ever run a commercially oriented enterprise as efficiently as the private sector. There are a number of reasons for this. The first thing is to accept that it has nothing to do with any difference in the intellectual capacity of managers in the public and private sectors. In fact in the earliest days when the leading firms were British (the thirties and forties) most private sector executive trainees were sportsmen who excelled at games such as Cricket and Rugby rather than shone as scholars. This recruitment policy was based on the belief that such games developed team spirit that would contribute to the success of organizations. There was some truth in this because a well knit team with a good captain was often more successful than a collection of prima donnas. The point I wish to emphasize is that my belief that private sector management of a commercial enterprise is superior to public sector management is not based on a belief that private sector managers are cleverer than public sector managers.

The reasons why private sector management is more effective than public sector management are many, and universal. Before I list them out I will first dispel a commonly held fallacy that has resulted in much misunderstanding about the very nature of Privatisation. The essence of Privatisation is that management of the SOE is transferred to the private sector. Ownership does not have to be transferred. Thus the sale of ‘Crown Jewels’ argument, the favourite theme of ideologues, is immediately blunted. If the CEB is privatized government assets do not have to be sold. It is management control, and only management control, that necessarily must be transferred.

Now for some of the reasons why the CEB (and every other SOE) are necessarily inefficient. The first is that it is a political entity rather than a commercial entity. It is a vital source of political patronage. The politicians in charge, directly and indirectly, look upon it as a source of employment. Jobs are given freely to their friends and relatives. Every SOE inevitably becomes over-staffed. Those who are given the jobs are not necessarily the most qualified or suitable. Everybody knows this; not even the politicians would have the gumption to deny this.

There is no incentive whatsoever to hard work in an SOE. An employee’s rewards, in salary and bonuses (if such there be) are not based on how hard or efficiently he works. This is utterly demoralizing. Inevitably, everybody does the minimum. If any citizen doubts this he should visit a few SOE’s and compare the atmosphere of total relaxation therein with a visit to a few private sector offices. The contrast is stark.

In an SOE there is political interference with management decisions. As a result of this discipline is very poor. Managers soon learn that it does not pay to attempt to discipline lazy or incompetent workers.

In an SOE nobody can be dismissed for incompetence. Our labour laws are so heavily weighted in favour of the employee that even in the private sector it is becoming almost impossible to dismiss an employee for anything short of dishonesty.

In an SOE employees do not have any concern for the success or even survival of the enterprise. Their employment is secure.

It is a total pipe-dream for politicians to imagine that any tinkering they can do with the CEB could make a material dent in its annual losses. It is estimated that the loss in 2012 would be in the region of Rs 50 billion. Has any politician cared to think of how much could be done for the poor in terms of health services and education, for instance, if these losses can be drastically reduced?

Has even an ideologue forgotten what it was like before telecommunication was privatized? What bribes and time it took to get a telephone line? Politicians and trade unions were vehemently opposed to the privatization of Telecom in 1996 when I attended a meeting (along with other private sector leaders) in Paris with H.E. Chandrika Kumaranatunge, World Bank representatives, Donors and potential iinvestors. I recall that in response to a query from a potential investor, the President explained that Privatisation of Telecom had been deferred because of the opposition from Trade Unions. I urged the President to ignore the Unions and go ahead with the Privatisation because millions of citizens would benefit, and it would be a political triumph. I pointed out that it could be done by de-regulation rather than by a wholesale transfer of assets. She had the courage and wisdom to make the decision within a few weeks, and it turned out to be a wonderful success.

A wise and courageous leadership today would re-examine its ideological opposition to Privatisation. A pragmatic re-think of ideological shibboleths is called for. The JVP would be upset, but should we worry?

(The writer is a former Chairman of Aitken Spence)[/FONT][/SIZE]
 

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I was delighted to read in Thursday’s ‘Island’ that Dr Sarath Amunugama had suggested that the C.E.B. should be privatized. Sarath is one of the most intelligent and educated men in the Cabinet. In suggesting what he did he was only playing the role of the child who pointed out that the Emperor was naked.
I dont take Dr Sarath Amunugama seriously. This is not the first time he has made such a statement. He makes these statements, collects the Oohs and Aahs but doesnt take any stand on it.
 

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Infrastructure spending spree!

The govt is going on an infrastructure spending spree. In addition to the existing projects, almost every day additional new projects are announced. And these are all fully govt owned projects.

Most of these are financed by commercial borrowings (mainly China)

Spending on infrastructure is good. The spending boosts the economy and the infrastructure once developed gives further impetus to the economy.

However there is a downside. Most of the infrastructure projects take time to kick in their benefits. Lots of them like the HIA and the Hambantota port will take years before the benefits accrue to the economy.

But interest and capital repayments on the loans have to be made irrespective of the returns on the project. (being totally govt owned)

The question is,

Is our economy in a position to take the shocks that may arise from this spending spree. At the moment, govt finances are under quite a lot of stress.
 

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Interesting article on Airport hubs and Mattala

Rohan Samarajeeva has written an interesting article on hub airports and looked at Colombo and Mattala in terms of being a hub. The full article is available on

http://www.lankabusinessonline.com/fullstory.php?nid=1829264474

On why any Sri Lankan airport needs to be a hub-

"Countries like Singapore and Sri Lanka that do not have the luxury of a massive domestic catchment area; they are compelled to pay greater attention to transit passengers in order to fill their flights and make best use of their airports."

On Mattala as a passenger airport

"The question that will naturally arise is the impact of Mattala. A hub is about people coming on one flight and conveniently getting on another. There is not much value in coming to Colombo and departing from Mattala, or vice versa. For example, having all the flights to and from South East Asia coming to Mattala while Colombo serves South Asia and western destinations does not make a lot of sense since that will not make either airport an attractive hub and will actually harm the potential of each.".........

"Another danger is that the airport authorities will try to cross-subsidize Mattala, by offering below-cost ground services there and jacking up the prices in Colombo even further. Another is the mandating of the use of Mattala, irrespective of commercial considerations. "

On Mattala as a service airport

"The authorities need to think of a rational economic application now that the airport has been built. An air freight cargo hub seems to make prima facie sense. In terms of aircraft movements, obscure Memphis, Tennessee, and Louisville, Kentucky, are among the busiest in the world, because they serve as hubs for FedEx and UPS respectively.

While the volumes of air freight carried by these companies as well as others such as DHL and TNT are growing rapidly in South Asia, the region still lacks hubs. The closest are situated in the high-cost locations of Bahrain, Dubai and Singapore. It would be quite a coup for the Aviation Ministry to attract the first such hub in South Asia to Mattala"
 

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Discussion Starter · #14 · (Edited)
Under-fire Treasury Secretary struggles to balance budget

Will PBJ throw in the towel?

By Bandula Sirimanna

Plagued by financial constraints, the Treasury is resorting to local commercial borrowings anticipating difficulties in raising revenue through taxes this year, informed sources said.

The Treasury officials are yet to work out modalities on balancing the revenue account as the 2013 budget proposal restricted foreign borrowings to Rs. 86 billion (aroundUS$675 million) from Rs. 205.6 billion in 2012 (US$1.6 billion), these sources revealed.
Sri Lanka is experiencing an erosion of the tax base as the financial authorities had to downgrade the tax revenue from the projected 12.7 per cent of GDP in 2012 to 12.2 per cent, official sources said.

It is hoped to compensate the tax revenue reduction this year through the Central Bank profit transfer like in previous years, they disclosed.

In the face of a worrisome balance of payment crisis, Treasury Secretary Dr. P B. Jayasundera has not issued any directive to treasury officials during the past few weeks as he was under fire from government top ranks, Finance Ministry sources said.
There was a plan to increase local borrowings from state banks, but it cannot be materialized as these banks are also under financial constraints due to the increase in salary bills as a result of\ thousands of new recruitment and overhead expenses, these sources revealed.

Dr. Jayasundera has tried to seek a loan of US $ 1 billion from IMF to finance the government’s budget for 2013 in accordance with the Budget announcement that it will not go for any more commercial borrowings from international markets this year.
But it has failed, as the treasury has sought quick money from the IMF without strict conditions.
The sources said that the IMF gives loans only to central banks in member countries to tackle balance of payment crises and had duly informed Treasury officials during recent discussions.

There is an exception to this only when a country faces a severe economic crisis, officials said.
The Treasury is struggling to meet day to day expenses of the government and it has borrowed a sum of over Rs. 8 billion from the funds of Telecommunication Regulatory Commission and Rs. 800 million from National Lotteries Board, informed sources said.
According to Finance Ministry officials, Dr. Jayasundera is highly frustrated with the outburst of Housing Minister Wimal Weerawansa who started publicly attacking him as an ‘economic assassin’.

The reason for the anger of Weerawansa was the rejection of four housing project reports submitted by him to the Treasury seeking new funds, they said.

Dr. Jayasundera was completely against the utilising of public funds for unviable projects and he had also rejected a similar request made by another highly influential young MP recently,[/COLOR] official sources revealed.
He became highly unpopular among top government ranks due to these reasons, they said.

ST

1, Sri Lanka must trim its bloated public servants
2, Fuel prices must reflect global fluctuation should not hold up like they did last year will end up Rupee yet tumbling in its as*S
3, SL should also need find cheap electricity, may come at at cost like using coal but COL must be brought down an Gov may have to give up its grip paying ways private companies to play a part.

If they can do this, SL will surely can be next Asian tiger, surely MR has balls like what he did with LTTE but need support from his Jumbos:lol:

Any comments?
 

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Will PBJ throw in the towel?

By Bandula Sirimanna

Plagued by financial constraints, the Treasury is resorting to local commercial borrowings anticipating difficulties in raising revenue through taxes this year, informed sources said.

The Treasury officials are yet to work out modalities on balancing the revenue account as the 2013 budget proposal restricted foreign borrowings to Rs. 86 billion (aroundUS$675 million) from Rs. 205.6 billion in 2012 (US$1.6 billion), these sources revealed.
Sri Lanka is experiencing an erosion of the tax base as the financial authorities had to downgrade the tax revenue from the projected 12.7 per cent of GDP in 2012 to 12.2 per cent, official sources said.

It is hoped to compensate the tax revenue reduction this year through the Central Bank profit transfer like in previous years, they disclosed.

In the face of a worrisome balance of payment crisis, Treasury Secretary Dr. P B. Jayasundera has not issued any directive to treasury officials during the past few weeks as he was under fire from government top ranks, Finance Ministry sources said.
There was a plan to increase local borrowings from state banks, but it cannot be materialized as these banks are also under financial constraints due to the increase in salary bills as a result of\ thousands of new recruitment and overhead expenses, these sources revealed.

Dr. Jayasundera has tried to seek a loan of US $ 1 billion from IMF to finance the government’s budget for 2013 in accordance with the Budget announcement that it will not go for any more commercial borrowings from international markets this year.
But it has failed, as the treasury has sought quick money from the IMF without strict conditions.
The sources said that the IMF gives loans only to central banks in member countries to tackle balance of payment crises and had duly informed Treasury officials during recent discussions.

There is an exception to this only when a country faces a severe economic crisis, officials said.
The Treasury is struggling to meet day to day expenses of the government and it has borrowed a sum of over Rs. 8 billion from the funds of Telecommunication Regulatory Commission and Rs. 800 million from National Lotteries Board, informed sources said.
According to Finance Ministry officials, Dr. Jayasundera is highly frustrated with the outburst of Housing Minister Wimal Weerawansa who started publicly attacking him as an ‘economic assassin’.

The reason for the anger of Weerawansa was the rejection of four housing project reports submitted by him to the Treasury seeking new funds, they said.

Dr. Jayasundera was completely against the utilising of public funds for unviable projects and he had also rejected a similar request made by another highly influential young MP recently,[/COLOR] official sources revealed.
He became highly unpopular among top government ranks due to these reasons, they said.

ST

1, Sri Lanka must trim its bloated public servants
2, Fuel prices must reflect global fluctuation should not hold up like they did last year will end up Rupee yet tumbling in its as*S
3, SL should also need find cheap electricity, may come at at cost like suing coal but COL must be brought down an Gov may have to give up its grip paying ways private companies to play a part.

If they can do this, SL will surely can be next Asian tiger, surely MR has balls like what he did with LTTE but need support from his Jumbos:lol:

Any comments?
I must agree with the points you made. How many ministers do we have? 100? It's absurd. And your right, we need to invest more in renewable energy, which will be cheaper in the long term so we do not have to buy coal. If the oil-gas exploration is successful, and brings high yields, we should use that too.
 

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Discussion Starter · #16 ·
I must agree with the points you made. How many ministers do we have? 100? It's absurd. And your right, we need to invest more in renewable energy, which will be cheaper in the long term so we do not have to buy coal. If the oil-gas exploration is successful, and brings high yields, we should use that too.
Well we badly need back-benches and right to information bill passed they those so called ministers can be publicly scrutinized. Sadly it is not the case and may end up in the hospital or death if you investigate like what happened to the the journalist from SL.
 

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The sad/insane thing about this huge number of ministers is, successive governments WILL maintain that same number or higher regardless of election promises and crap like that.

Otherwise it'd probably result in mass defections and government collapse.

And where the hell is the Right to Information Bill ? Every once in a while there will be a small article on the paper, but still nothing.
 

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Discussion Starter · #18 ·
The sad/insane thing about this huge number of ministers is, successive governments WILL maintain that same number or higher regardless of election promises and crap like that.

Otherwise it'd probably result in mass defections and government collapse.

And where the hell is the Right to Information Bill ? Every once in a while there will be a small article on the paper, but still nothing.
It was shot down as the GOV has majority in the Parliament
 

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Discussion Starter · #19 ·
Sri Lanka state entity listing a 2-3 year process: SEC chief

Feb 27, 2013 (LBO) - Listing minority stakes in state entities is a two to three year process, but there is positive response to the move from the highest levels of the administration, Securities and Exchange Commission Chairman Nalaka Godahewa said.

"Sri Lanka Insurance is already in the pipe line. By 2015 it will come to the market," Godahewa told the LBR-LBO Chief Financial Officers forum Tuesday.
"Before that we need to bring others to the market."

Godahewa said the policy of the administration was not to privatize state entities, but listing minority stakes was not privatization as many people would own the stock.

"We are telling the government that this is not privatization, it is actually peoplisation," he said. "You are putting out state entity shares to a large base of ordinary people to buy."

"The good thing is that at senior levels of government, that acceptance is there. Now it is a matter of who comes first."

Two years ago the state abandoned plans to list SriLankan Catering, a profitable unit of SriLankan Airlines after going through most of the preliminary process of listing.

In countries like Malaysia where stock market capitalization exceeds gross domestic product, listing of state entities contributed in a big way to market growth.

Lloyd Fisher, an emerging markets investor, who took part in the forum said in the early 1990s Malaysia had caught the eyes of international investors with the listing of Tenaga Nasional, the state power utility and Malaysia Telecom.

Sri Lanka Telecom is now listed.

Critics say many of the large state entities in Sri Lanka are making losses because elected rulers tends to use them to as spending tools to buy votes, thereby boosting state consumption.

State entities also borrow from banks, taking the savings of ordinary people to run losses.

In addition to the deficit in the current account of the budget, which makes the central government a net consumer, economic analysts say losses in state enterprises which boost state consumption is a key drag on the island's overall domestic saving rate.

Losses at the state petroleum utility alone are about 1.5 percent of gross domestic product.

Ironically however they are classed with private enterprises when calculating the domestic saving rate, leading to a widely held but mistaken idea that 'Sri Lanka's people have a low savings rate'.

But there are still some profitable state entities including state banks, port and airport utilities which could also tap into the markets to raise capital for their own expansion, instead of depending on debt or capital injections at tax-payer expense.

India has already listed many state enterprises and is gradually selling down the state share.

In Vietnam more than 200 state enterprises have been listed for privatization following the latest economic downturn following the collapse of a credit bubble partly caused by recent 'stimulus spending' and the state is tightening finances.

http://lbo.lk/fullstory.php?nid=1443705475

Why so hard rulers?
 

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From the internet edition of the Island of 27/02/2013 http://www.island.lk/index.php?page_cat=article-details&page=article-details&code_title=73534



President keen on re-fleeting Mihin with US-made Boeing
February 26, 2013, 9:09 pm


By Harischandra Gunaratna

The government has decided to do away with Airbus and re-fleet its budget carrier Mihin Lanka with Boeing in the near future.

Civil Aviation Minister Priyankara Jayaratne said that President Mahinda Rajapaksa has expressed his keenness on purchasing the US manufactured Boeing in preference to the existing Airbus for Mihin Lanka.

The Mihin fleet consists of three A-320 aircraft taken on lease at the moment.

In an interview with The Island Financial Review Jayaratne said, "The three airbus in the Mihin fleet will be shifted to Sri Lankan Airlines after the Boeing aircraft is delivered and soon Cabinet approval will be sought before calling of tenders".

Aviation sources said the government was likely to go for Boeing’s proven mid-range workhorse 777.

A few years ago Boeing even put on a full sales pitch in Sri Lanka with a well organised show at the Colombo Hilton.

"It is imperative that Sri Lankan Airlines undergoes modernisation as soon as possible and possess a fleet of brand new aircraft as 51% of the losses incurred by the national carrier were on fuel as the existing fleet possess a number of obsolete aircraft guzzling fuel," the minister said.

Asked for the reasons of this sudden change of heart, the minister jokingly said that the government doesn’t want to fallout with America.

Asked when would the first aircraft be ordered, the minister said first Cabinet approval would be sought for the purchase of six wide-bodied A-330s for the National Carrier and added that immediately after delivery of the Airbus for the national carrier, re-fleeting of Mihin Lanka would commence.

The delivery of the brand new Airbus were expected to begin by the end of the year on lease purchase, Jayaratne said.

When asked about the cost of the aircraft he said "We cannot arrive at a figure as tenders have not been called yet."

The budget carrier will be revamped to serve more efficiently, Jayaratne said.

"Many thousands of Sri Lankans who could only dream of visiting the key Buddist sites in India have already visited them and the loans on easy payment terms organised by different banks were a boon to millions of pilgrims with the advent of Mihin Lanka," he pointed out.

The Minister said that certain travel agents organising pilgrimages to India fleece the ignorant public through devious means and the government would be keeping a close tab on such agents, the minister said.

Last year, an Auditor General’s report highlighted the extent of Mihin’s financial plight.

The budget airline sustained a loss of Rs. 3.1 billion in 2007/8; Rs. 1.3 billion in 2008/9; Rs. 1.2 billion in 2009/10; Rs. 940 million in 2010/11 and Rs. 1.9 billion in 2011/12.

Grants from the Treasury amounted to Rs. 507 million in 2012; Rs. 406 million in 2011; Rs. 1,508 million in 2010; Rs. 2,882 million in 2009; Rs. 500 million in 2008 and Rs. 250 million in 2007.


Shouldn't techincal evaluation comittees choose aircraft?

And note the losses of Mihin air at the bottom of the article
 
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