The Executive Board of the International Monetary Fund (IMF) has completed the first review of the 48-month Extended Fund Facility (EFF) arrangement for Sri Lanka.

The completion of the first review allows for an immediate disbursement of around US$337 million, bringing the total IMF financial support disbursed so far to about US$670 million.

Following the Executive Board discussion on Sri Lanka, Mr. Kenji Okamura, Deputy Managing Director has issued the following statement :

“Macroeconomic policy reforms are starting to bear fruit and the economy is showing tentative signs of stabilization, with rapid disinflation, significant revenue-based fiscal adjustment, and reserves build-up.

“Performance under the EFF-supported program has been satisfactory. All quantitative performance criteria for end-June were met, except the one on expenditure arrears. All indicative targets were met, except the one on tax revenues. Most structural benchmarks were either met or implemented with delay by end-October 2023. The publication of a Governance Diagnostic Report, the first in Asia and a structural benchmark under the program, is a commendable first step towards addressing deep-rooted corruption weaknesses. Continued commitment to improving governance and timely implementation of the report’s recommendations can deliver tangible economic gains to all citizens.

“Sri Lanka’s agreements-in-principle with the Official Creditors Committee and Export-Import Bank of China on debt treatments are consistent with the EFF targets. They are an important milestone putting Sri Lanka’s debt on the path towards sustainability. A swift completion and signature of the Memoranda of Understanding with the official creditors is important. Timely implementation of the agreements, together with reaching a resolution with external private creditors on comparable terms, should help restore Sri Lanka’s debt sustainability over the medium term.

“To ensure a full and swift recovery, sustaining the reform momentum and strong ownership of reforms is of paramount importance. Key priorities include advancing revenue mobilization, aligning energy pricing with costs, strengthening social safety nets, rebuilding external buffers, safeguarding financial stability, eradicating corruption, and enhancing governance.

“Reinforcing the revenue-based fiscal consolidation supported by revenue administration reforms is critical to recover from program slippages and promote a break from past policy shortcomings.

“The Central Bank of Sri Lanka should continue to focus on the multi-pronged disinflation strategy to safeguard the credibility of its inflation targeting regime. Accumulating reserves, supported by exchange rate flexibility, remains an important priority under the EFF.

“Implementing the bank recapitalization plan and strengthening financial supervision and crisis management framework are crucial to safeguard financial sector stability.

“Further strengthening the social safety net and protecting social spending remains critical to safeguarding the poor and vulnerable.’’

Police have arrested a saffron robed individual over conduct deemed as offensive to Buddhism.

The 34-year old individual, who identifies as one ‘Vishwa Buddha’, is a resident of Ratnapura and was arrested from the area of Kalagedihena.

The suspect is to be produced before the Colombo Magistrate Court tomorrow (Dec. 13).

The CID is conducting further investigations.

In a significant stride toward advancing the fisheries and aquatic resources sector, Fisheries Minister Mr. Douglas Devananda announced the enactment of a revised Fisheries Act. The draft of this transformative legislation has been forwarded to solicit opinions and insights from field experts, marking a collaborative effort to optimize the industry’s potential.

Addressing the media at the Presidential Media Centre (PMC) under the theme Collective path to a stable country,’ today (12), Minister Devananda highlighted key initiatives aimed at bolstering the fishing community. Notably, the encouragement of using battery motors for fishing boats was underscored as a measure to alleviate production costs for fishermen and address fuel-related challenges.

Minister Douglas Devananda, while providing his insights during the press conference, expressed admiration for the unprecedented budget plan presented by the current government led by President Ranil Wickremesinghe. The multifaceted challenges posed by factors such as the aftermath of war and the impact of the COVID-19 pandemic have led to economic setbacks, causing the country to face considerable adversity. He attributed the rapid recovery of the economically challenged country to the President’s guidance, leadership and the collective support of the nation.

He also said that while abroad, the Minister frequently faces queries from international counterparts curious about Sri Lanka’s rapid recovery. In response, the Minister credits this success to President Ranil Wickremeinghe’s adept guidance and strong leadership. The Minister highlights the President’s distinctive personality and commends the unwavering support from those aligned with the current government. Additionally, the Minister underscores the vital role played by the people of Sri Lanka in understanding the nation’s challenges. Their active cooperation and collaborative efforts with the government have proven instrumental in navigating the crisis and expediting the recovery process.

In the 2024 budget, the Ministry of Fisheries has been allocated Rs. 8,400 million, off that Rs. 6,077 million allocated for capital expenditure and Rs. 2,323 million for recurrent expenditure. Minister Devananda emphasized the importance of utilizing these funds to enhance the overall development of the country, particularly focusing on improving the livelihoods of the fishermen. He also called for support from domestic and foreign private investments to further boost the marine industry.

Battery motors to curb fuel costs
Owing to the surge in fuel prices, the fishing industry in Sri Lanka has experienced significant setbacks. Acknowledging the uncontrollable fluctuations in international fuel prices, the government cannot be held responsible for the resulting increase in prices domestically. In response to this challenge, strategic plans are underway to enhance the maritime sector by maximizing available opportunities.

The government is actively exploring various alternative methods, with a specific focus on reducing both fuel and production costs within the fishing industry.

Concurrently, a comprehensive study has been undertaken to assess the viability of incorporating battery motors in fishing boats. This initiative aims to alleviate the production costs for fishermen and address the on-going challenges associated with fuel consumption. Experimental trials have been conducted in this domain to gauge the effectiveness and feasibility of integrating battery-powered motors into fishing activities.

Amended Fisheries Act
The Minister highlighted the forthcoming introduction of a new amended Act on Fisheries and Aquatic Resources, emphasizing the collaborative approach taken to seek expert opinions and improve the draft.

‘Most effective solution’
The matter of Indian fishermen participating in fishing activities within Sri Lankan waters necessitates a diplomatic resolution between the two nations. As per the Constitution of India, fisheries issues fall under the jurisdiction of the state government.

In line with this, it is the Minister’s stance that the most effective solution involves direct engagement. Therefore, he advocates for all members of parliament representing the Northern Province to engage in discussions directly with Indian authorities, including those from Pondicherry and the Tamil Nadu state government and the Indian Media. to solve Indian fishermen

President’s Media Division (PMD)
12.12.2023