Sri Lanka News in Brief OCT 2016 – Compiled by Victor Melder

Community Medicine Specialist of the Sri Lanka Family Health Bureau Dr. Kapila Jayaratne yesterday said that around 270,000 children below 16 years were hospitalised due to accidents annually and of them 2,600 succumbed to their injuries. Dr. Jayaratne said the majority of little victims were pronounced dead before admission to hospital and only 150 died in hospital. Dr. Jayaratne said there was a dire need for victims of accidents to be brought to hospital immediately in a proper manner. He said there had been an increase in the deaths of children due to accidents while the maternal and new born deaths were at a low level. Dr. Jayaratne said children's deaths were mostly due to homicides, road accidents, drowning, burns, poisoning etc. Of the victims 50 percent were under the age of ten, he said. According to police reports last year 4,012 children had met with road accidents and of them 1,087 had suffered serious injuries and 152 had died, Dr. Jayaratne said. "Every seven hours a child dies in an accident in Sri Lanka and 50 children die in this manner a week while a child is admitted to hospital every two minutes due to an accident; every hour 31 children injured in accidents are hospitalised." (Daily Island 1.10.2016)

Ceylon Tea Services PLC, the Merril J. Fernando Company that has established its Dilmah brand in global tea markets earnings for itself the reputation of establishing a fully owned Ceylon tea brand, last week adopted a special resolution at it's annual general meeting to rename itself as Dilmah Ceylon Tea Company PLC. The company also decided to amend its articles by including the objective of "to carry on the business of the manufacture and export of value added tea." Incorporated in 1981 the company, a subsidiary of MJF Teas (Pvt) Ltd., was later listed on the Colombo Stock Exchange and is among the highest dividend payers of companies quoted on the CSE. CTS like other companies in the MJF group are strong supporters of environmental and social causes through the MJF Foundation devoting a share of its earnings to these activities. (Sunday Island 2.10.2016)

The Cabinet has approved a 15 percent Value Added Tax (VAT) and 5.00 rupees production tax on cigarettes as well as an increase of cess on the import of "beedi" leaves, a statement said. "Cabinet has decided to impose 15 percent VAT on cigarettes again, increase the current production tax to Rs. 5/- for any size cigarette, and to increase the cess on import of beedi leaves from 2,000 rupees to 3,000 rupees and to take other actions to minimise the tobacco use in the country," the Cabinet announcement said. "15 percent of Sri Lanka's population between the ages of 18-69 smoke and the State spends 72 billion rupees each year to treat tobacco related illnesses." Currently taxation on cigarettes in Sri Lanka is the third highest in Asia. In the first half of 2016 the Government earned 46 billion rupees, up 12 percent from the previous year. (Sunday Island 2.10. 2016)

Researchers from Fort Detrick in the USA are collaborating with a lab in Sri Lanka to understand a dangerous, 'poorly understood' disease. A bacteria called Burkholderia pseudomallei – generally found in Southeast Asia and northern Australia – causes an infection that is difficult to treat and can be fatal, according to Mohan Natesan, a scientific investigator at the U.S. Army Medical Research Institute of Infectious Diseases at Fort Detrick. To help bridge the gaps in scientific knowledge about the bacteria and the disease it causes, the Army institute is collaborating with Genetech, a lab in Sri Lanka. The Fort Detrick lab started working with Sri Lankan investigators in 2014. The Army intends to contract with Genetech for 18 months. The bacterial infection that results from Burkholderia pseudomallei is called melioidosis and can affect humans and animals. The disease's effects range from a chronic, localized infection to an acute, fatal bloodstream infection. The infection spreads by contaminated soil and water. In tropical areas where the bacteria is more common, the number of infected patients increases during the rainy season. According to a 2012 paper published in a Sri Lankan journal, it's 'highly likely' that many cases go uncounted, partially because the disease affects mainly rural communities, can be rapidly fatal and is not widely known among clinical staff. "Melioidosis is an under-reported and poorly understood disease," Natesan wrote in an email. Genetech's role will be to collect samples from patients, document cases of melioidosis and analyze patients' immune response to the infection. The clinical sites the lab maintains are in locations where people are more likely to get the disease. The data that's collected will help the Army institute understand the infection and develop diagnostic tools, therapeutic products, and vaccines against melioidosis, Natesan wrote in an email. The lab's partnership with Fort Detrick researchers helped establish a small surveillance program for melioidosis in Sri Lanka. The team found more than 65 cases in 2015, many of which would have been fatal if they had gone unidentified, according to Caree Vander Linden, a spokeswoman for the institute. The bacteria is 'naturally resistant' to many common antibiotics, Vander Linden said. Symptoms of melioidosis range from fever, headache, muscle or joint pain to seizures, anorexia and disorientation. According to the Centers for Disease Control and Prevention, symptoms generally appear two to four weeks after exposure to the bacteria. (Sunday Observer 2.10.2016)

Male and female cancers have surged in the past four decades with health officials saying that the rates were similar to Western countries. According to statistics from the National Cancer Control Program (NCCP), cancer prevalence in the country soared from 31.6 in 1995 to 70.9 in 2006 per 100,000 of the population. It also accounted for 27% of all newly diagnosed cancers among females in 2006. Consultant Community Physician and Co-ordinator of the NCCP island-wide program, Dr. Suraj Perera said 80 percent of the cancers had four risk factors identified by the World Health Organisation – unhealthy diet, physical inactivity, alcohol and tobacco consumption. In Sri Lanka, the causes can be traced to bad eating habits such as consuming too much animal fat and too few vegetables which has resulted in obesity, leading to early development of non-communicable diseases (NCD), sedentary life styles and alcohol and tobacco consumption. "Cancer is responsible for 9% of all NCD deaths in Sri Lanka," Director General, Health Services, Dr. P.G. Mahipala said. According to the WHO, Sri Lanka ranks as the highest in NCDs in South East Asia. According to Epidemiology reports, in 2012, it was found that proportional mortality percentage of total deaths in all ages and both sexes with regard to cancer was 10% and from other NCDs 10%. "The commonest neoplasm among Sri Lankan adults is breast cancer as evident by its age-standardised rate of 10.8 cases per 100,000 reported in 2006. Neoplasms were also the second most common cause of deaths of all hospital admissions in 2007," Director, National Cancer Control Program, Dr Neelamani Paranagama said. (Sunday Observer 2.10.2016)

The number of Sri Lanka's endemic birds could increase by two more new species, going up from 31 to 33 this year, sources of the Field Ornithology Group of the Department of Zoology, Colombo University said. The list of country's endemic birds numbers 31 species and scholars have suggested that two more species be added to it. If the international scientific data recorders deem those two species to be endemic to the country, the list would be increased, FOGSL sources said. The number of bird species found in Sri Lanka is 504 and among that number are some bird species which had been noticed only once at various places. The number of endemic species has changed many times over the years. This is largely due to "close taxonomic revisions." Bird Life International recognizes Sri Lanka as one of the world's Endemic Bird Areas, sources said. The FOGSL is a non-profit organisation that works for the conservation of birds and environment. It works as a non-governmental organization, but is affiliated to the Department of Zoology, Faculty of Science, University of Colombo. FOGSL was established in 1976, to achieve the following objectives: to bring together persons who are interested in the study and conservation of birds of Sri Lanka; to generate interest among laypersons and students of natural history in the study and conservation of birds; to institute, direct and carryout island wide field study programmes on various aspects of bird biology and to establish links with other groups in other parts of the world with similar interests. The FOGSL is the national affiliate of the Bird Life International, which is the umbrella organization for all the institutes working on conservation of birds around the world. (Daily Island 3.10.2016)

SriLankan Airlines had lost Rs16.3 billion, including one-off items, but operating losses had been cut to Rs9.03 billion from Rs11.5 billion during the last financial year, chairman Ajith Dias said. "In the five months from April to August, operating losses have been further cut to Rs2.32 billion from Rs3.71 billion, he said at a media conference held at the SriLankan Airlines office at World Trade Centre yesterday. He said that interest costs alone were Rs2.53 billion and the government is planning to take off some of the debt and clean up the balance sheet to make the national carrier a profitable entity. The total interest bearing liabilities as at 31st August to banks/financial institutions are US $ 478.5 million.The interest cost for the current financial year is estimated at Rs 6.2 billion, Dias said. At the end of the last financial year, without the one off payment relating to cancellation of the lease of one A 350 aircraft, the airline's group loss stood at Rs 9.03 billion, which represents a 45 percent improvement for 2015/16 financial year compared to the previous year, he said. Dias said that Mihin Lanka will be amalgamated to Sri Lankan Airlines and all routes that were operated by Mihin, including Bahrain and Muscat, will be operated by SriLankan Airlines. At present they have four flights and three will be kept by SriLankan Airlines and one will be handed over to the lessor by terminating its contract, he said. SriLankan will be the only carrier to Gan Island in Maldives, focusing on regional routes where yields are higher, Chief Executive Officer Suren Ratwatte said. "Out of 300 employees in Mihin Lanka, half of them will be absorbed into SriLankan Airlines staff and the fate of the rest will be decided by December, because Mihin will last till December, he said. The BIA is scheduled to be closed for eight hours in 2017 for three months, to carry out maintenance work on the runway. The airport operations will be halted for eight hours per day for a period of three months from January 05 from 8.30 a.m. to 4.30 p.m. Ratwatte also said that 5 brand new Airbus A320neo aircraft will be added on lease to the fleet in 2017. (Daily Island 6.10.2016)

Parliament was informed yesterday that the Prime Minister's office had hired helicopters and other aircraft from January 10, 2015 to April 30 2016 at a cost of Rs. 123 million. This was revealed by a statement tabled by the state Minister of Defence Ruwan Wijewardene in answer to a question raised by Joint Opposition MP Udaya Gammanpila. The answer further revealed that the Prime Minister's office had hired helicopters 35 times, during the aforementioned period, at a cost of Rs 123 million, which was paid to the Air Force by the Prime Minister's office. In addition, the Secretary to the Ministry of Foreign Affairs, too, had hired helicopters 16 times at a cost of Rs 12.9 million while Minister of Industry and Commerce Rishad Bathiudeen had hired helicopters 13 times for a fee of Rs 6.1 million. Former President Mahinda Rajapaksa had hired helicopters 11 times paying Rs 5.2 million, while former President Chandrika Kumaranatunga had hired a helicopter once. Ministers Vajira Abeywardana, Sagala Ratnayake and MP Wijeyakala Maheswarana had each hired helicopters once. In total helicopters were hired 169 times by the state, private institutions, politicians and individuals during the specified period. (Daily Island 7.10.2016)

Approximately 30 square kilometres of land in the Northern Province and some parts of Anuradhapura and Polonnaruwa Districts had yet to be cleared of land mines and other unexploded ordnance which were the results of 30 year long war, according to Delvon Assistance for Social Harmony (DASH) Programme Manager Ananda Chandrasiri. The Japanese Government granted a total sum of US$ 811,369 to on-going Sri Lankan de-mining projects. DASH has received US$ 590,415 and Sharp received US$ 220,954. DASH Programme Officer Chandrasiri noted that DASH had cleared and released more than 4.6 square kilometres of land so far by removing 31, 296 antipersonnel mines, 58 anti-tank mines and 30,431 items of explosive remnants of war. Highlighting the Government's aim of mine-impact free Sri Lanka by 2020, Chandrasiri said Sri Lankan programme had proved to be one of the most successful mine action stories in the world."Currently, we are operating in three districts namely Kilinochchi, Mulativu and Vavuniya," he said. Japan has been a major donor supporting mine clearance in Sri Lanka to accelerate the resettlement of Internally Displaced Persons (IDPs) and to facilitate engagement in agriculture and other livelihood activities of the returnees. Since 2003, the Government of Japan has provided a sum of nearly US$ 29.5 million for demining activities in the North and the East under its Grant Assistance schemes. This can be seen as a vital contribution by Japan in achieving Sri Lanka's target of being mine-impact free by the year 2020. (Daily Island 7.10.2016)

The Global Burden of Disease, Injuries, and Risk Factors (GBD) – 2015 study revealed that 20.6 per cent of Sri Lankans died of ischemic heart disease (Coronary Heart Disease) last year. The Institute for Health Metrics and Evaluation, University (IHMEU) of Washington said yesterday that the GBD – 2015 study identified it to be one among the top five causes of death in the country last year. The other causes were Cerebrovascular diseases (a group of conditions that affect the circulation of blood to the brain -11.8 percent), diabetes (7.9 per cent) asthma (5.2 per cent) and self harm (five per cent). The GBD – 2015 also identified the top five causes of years lived with disability (YLDs). Low back and neck pain caused 11.4 percent of total YLDs, 10.6 per cent of sense organ diseases, 7.9 per cent diabetes, 6.6 percent due to skin diseases and 6.2 percent YLDs due to depressive disorders. The top five causes of disability -adjusted life years (DALYs) in 2015 had been Ischemic heart disease, (9.5 percent), diabetes (6.8 per cent), low back and neck pain (5.1 per cent), self harm (five percent) and cerebrovascular diseases (4.67 percent). High systolic blood pressure was responsible for 12 percent total DALYs last year. Identifying the top five risk factors in terms of DALYs for 2015, the GBD study revealed that high fasting plasma glucose was responsible for 10.7 percent total DALYs. 5.9 percent cholesterol, 5.7 percent high body mass index and 4.8 per cent diet low in whole grain. The number of maternal deaths in 1990 had been 269 while the number of maternal deaths last year had dropped to 107. The Ratio of maternal deaths in 1990 per 100,000 live births had been 75.2 while last year it dipped to 33.1 per every 100,000 live births. The life expectancy of women in 2005 had been 78 while it increased to 81.2 last year. In the same period life expectancy of men has risen from 70.1 to 74.1. However this progress was threatened by increasing numbers of people suffering serious health challenges related to obesity, high blood sugar levels, alcohol and drug abuse. (Daily Island 8.10.2016)

Sri Lanka's cash-strapped national carrier said Wednesday it will pay a penalty for cancelling leases on four Airbus A350s, with official sources putting the figure at about $115 million. SriLankan Airlines chairman Ajith Dias said it cancelled four of the long-route planes from leasing giant AerCap that had been contracted by the former government. Dias, told reporters the planes were not required as the airline was focusing on more profitable short-haul flights. The move comes as the current government is in the process of finalising a partner to revive the loss-making carrier. Dias said the fate of another four A350s ordered for delivery after 2020 will have to be decided by the new investment partner, although the current government has said it wants the entire deal scrapped. SriLankan pulled out of three leases after agreeing to pay $98 million, a government source involved in the transaction said. The airline also paid $17.7 million earlier this year to stop delivery of the fourth that had been due next year, the source said. "The penalty translates roughly to the lease rentals for 24 months for three aircraft that should have been delivered from this year," the source told AFP asking not to be named. "It was easier to cancel the fourth one because its delivery date was in late 2017." Former president Mahinda Rajapakse ordered all of the planes as part of a $2.3-billion re-fleeting programme for the airline that is now being investigated for corruption. The airline is weighed down by losses of nearly a billion dollars. SriLankan was profitable before Rajapakse cancelled a management agreement with Emirates in 2008 following a personal dispute. The carrier had refused to bump fare-paying passengers and give their seats to Rajapakse's family members. An angry Rajapakse removed the Emirates-appointed CEO of SriLankan from the post and replaced him with his own brother-in-law, who had no airline experience, and is now under investigation for corruption. (Sunday Island 9.10.2016)

More than 500,000 people in 17 districts had been adversely affected by the prevailing drought, the Disaster Management Centre (DMC) stated. People in Trincomalee, Batticaloa, Ampara, Polonnaruwa, Anuradhapura, Kurunegala, Puttalam, Kilinochchi, Vavuniya, Mulaitivu, Ratnapura, Kegalle, Moneragala, Matale, Kandy, Gampaha and Kalutara districts are facing a severe water shortage. A survey has revealed that 133,313 people in the Eastern Province, 132,644 in the North Central Province, 65,374 in North Western Province, 8,775 in Northern Province, 11,559 in Sabaragamuwa Province, 44,824 in Uva Province, 28,699 in Central Province and 94,130 people in Western Province have been affected by the prevailing drought. According to the DMC situation report, the drinking water is being provided in bowsers to the people in Kinniya, Thambalagamuwa and Mutur in the Trincomalee District, Welikanda, Thamankaduwa, Dimbulagala, Lankapura, Hingurakgoda and Madirigiriya in the Polonnaruwa District, Polpithigama, Rasnayakapura, Polgahawela, Ganewatta, Wariyapola, Nikaweratiya, Kotawehera and Ehetuwewa in the Kurunegala District. According to the Irrigation Department, the water levels of a number of reservoirs have receded drastically. According to the Ceylon Electricity Board (CEB) the hydro power generation capacity has dropped to a mere 13.34 per cent at present. (Daily Island 10.10.2016)

Japan yesterday extended a loan package amounting to Japanese Yen 33,137 million (approximately Rs. 48 billion) to Sri Lanka consisting of two loans aimed at facilitating the economic and social development in the country. The details of the program and project financed under the loans are as follows; 1. Development Policy Loan (Private Sector Development, Governance Improvement and Fiscal Consolidation) (Japanese Yen 10,000 million). This loan is to provide untied financial support directly to the treasury upon completion of the package of policy and institutional reforms by the Government of Sri Lanka. 2. Anuradhapura North Water Supply Project (Phase 2) (Japanese Yen 23,137 million) The Anuradhapura North Water Supply Project (Phase 2) will improve the water supply facilities and switch the water source from groundwater to safe surface water, improving the access of area residents to safe drinking water. The Phase 2 of this project is to supplement and broaden the project implementation area of the Phase 1, which is now ongoing with the loan amounting to Japanese Yen 5,166 million extended in March 2013. These loans offered on highly concessional terms and conditions are administered by the Japan International Cooperation Agency (JICA). (Daily Island 11.10.2016)

The Presidential Secretariat yesterday appointed the first batch of retired military personnel as technical officers, under a newly introduced scheme. President Maithripala Sirisena presented letters of appointment to 50 retired members of the military. The national project to recruit retired soldiers with the objective of obtaining their services was initiated by the government. This project aims to channel the contribution of the war veterans after retirement towards national development, while contributing to their welfare as well. The President pointed out that unlike other categories of government service, military personnel retire at an early age despite their capacity to serve longer. "Though some groups make various complaints stating that the government is not treating the military personnel well, the current government focuses on their welfare unlike any former government. The government is committed to protect their dignity", the President said. However the President assured that the move will not affect any new recruitment to the government. "We will offer the opportunities to the educated young generation as usual," he stated.
Over 110,000 retired military personnel have been identified as suitable for re-recruitment through the new scheme. To carry out the task, a welfare department for retired military personnel has been set up, under the Defense Ministry. (Daily Financial Times 12.10.2016).

The 16-acre plot of land Malwana, at the centre of a case at the Pugoda Magistrate's Court will be put up for auction. Pugoda Magistrate D. A. Ruwan Pathirana made the order today. It was alleged the land, and the house on it, belonged to former Economic Development Minister Basil Rajapaksa, and that it was bought using public funds. However, at the last hearing, lawyers for the former Economic Development Minister told Court the land did not belong to their client. This came after Government Solicitor General Thusith Mudalige suggested the land in question be sold and the money credited to the case. (Daily News 14.10.2016)
An upbeat Prime Minister Ranil Wickremesinghe said Sri Lanka's foreign reserves would be boosted by over $1 billion when proposed Public-Private-Partnerships (PPPs) for the Hambantota port and airport are wound up next month.
Following Wickremesinghe's visit to Beijing in April 2016, it was announced that the Sri Lankan Government had proposed debt-equity swaps for the Hambantota mega infrastructure projects. Subsequently it was announced that the Government was in talks with Chinese companies to take over the debt and management of the port and airport that were built on Chinese loans taken by former President Mahinda Rajapaksa. "Certainly, the port is going to be over a billion (dollars) and the airport will be another hundreds of millions. We have asked for upfront payment," Wickremesinghe said, addressing the opening session of the Institution of Engineers. "That is all money coming to our reserves at a time when the global economy is weak" he added. According to the Prime Minister's office these two transactions are expected to constitute non-debt creating FDI inflows which would increase unencumbered official reserves significantly. Sri Lanka faced an impending balance of payment crisis last year and early this year but negotiated an Extended Fund Facility (EFF) of $1.5 billion with the International Monetary Fund (IMF) to stabilise the economy. In August 2016 the country's official reserves increased to $124.7 million to stand at $6.6 billion, up from $6.5 billion at the end of July. Echoing his recent comments at the World Economic Forum in India, Wickremesinghe pointed out that global economic power is shifting to Asia, emphasising South Asia in particular. He stressed that Sri Lanka should take advantage of the current and future economic conditions and integrate with its neighbours to boost the country's economy.
"This is a once-in-a-lifetime opportunity for us. If we miss this, we are going to miss it altogether," said Wickremesinghe. (Daily Financial Times 15.10.2016)
Investigations into the murder of former Sunday Leader editor Lasantha Wickrematunga took a new turn with a retired sergeant major of the army intelligence unit committing suicide by hanging himself at his home in Kegalle after allegedly signing a letter admitting to the killing, police headquarters sources said yesterday. The dead sergeant major was identified as Edirisinghe Jayamanne (52), a resident of Karandupana, Kegalle. A note believed to have been written by the retired sergeant major said: "It was I who killed Sunday Leader Editor Lasantha Wickrematunga, My friend Malinda Udalagama, who has been arrested for it is not responsible for the murder. Please release him." The retired sergeant major was a father of three and his wife was working abroad, police said. The second son of the retired soldier was to leave the country to attend a sports event on Thursday. He had accompanied the son to the latter's school and returned home after handing over the boy to the school authorities. His eldest son was not at home attending to his work while the youngest child was in school. According to the preliminary investigations Jayamanne hanged himself from a rafter in his home around 8.30 am. A neighbour, a trishaw driver first saw Jayamanne hanging. He informed the Kegalle police of the incident. Police arrived at the Jayamanne's house and brought the body down. The police found the note written by Jayamanne on a table near his body. Police sources said that Jayamanne's son had identified that it was his father's hand writing. Kegalle Police are conducting further investigations under the supervision of Kegalle Superintendent of Police A. Serasinghe. (Sunday Island 16.10.2016) .

A police alert shortly after President Maithripala Sirisena's controversial remarks heightened fears of a "coup" similar to the alleged action of his predecessor in trying to remain in power by using force. Police across the capital were ordered by a senior Deputy Inspector-General to remain on maximum alert with further instructions due on Thursday as the nation grappled with Sirisena's controversial remarks last week. President Sirisena signalled his honeymoon with the government of Prime Minister Ranil Wickremesinghe may be over after lambasting the country's top three anti-graft bodies for politically-motivated prosecutions. "It looks like the police thought that the President will take over the Law and Order ministry," an official source said. "Police went on alert to prevent a possible street protest by the UNP (United National Party of Wickremesinghe)." Several senior police officers are miffed with Minister Sagala Ratnayake who recently shot down extravagant spending proposals of the police while marking their 150th anniversary. Ratnayake was also reportedly cross with police chief's lengthy lectures. As the anticipated take over of the Law and Order ministry failed to materialise, police turned the alert into a "special crime busting exercise" with Senior DIG Nandana Munasinghe saying the alert was to catch criminals. (Sunday Island 16.10.2016)

Ceylon Tea Services PLC (CTS), the Merril J. Fernando company which will soon be renamed Dilmah Ceylon Tea Company PLC, has posted its best profit in four years of Rs. 1.615 billion after tax, up 33.3% from Rs. 801.47 million a year earlier and paid a dividend of Rs. 30 per share against Rs. 22.50 the previous year, in the year ended March 31, 2016. Revenue was down 1.6% to Rs. 7.24 billion due to what Fernando said was a marginal drop in volume. But gross margins improved 42% due to a decline in the cost of tea and some packaging materials. Also an exchange loss of Rs. 186 million the previous year reversed to a gain of Rs. 853 million "benefiting from cautious foreign currency management, prompt repatriation of all foreign exchange earnings to take advantage of higher interest rates paid by local banks as well as depreciation of the Sri Lanka rupee." However, investment on brand advertising and promotion remained high. "There is now a growing awareness of good quality in food and drink and Dilmah single origin tea is at the forefront of the message," Fernando said. "There is significant improvement in interest in Dilmah single origin tea from top end food service customers." CTS have a stated capital of Rs. 200million and total assets of Rs. 10.48 billion. Total liabilities stood at Rs. 793.8 million. Fernando's companies MJF Teas (Pvt) Ltd. (65.38%) and MJF Exports (Pvt.) Ltd. (21.28%) followed by the EPF with 7.74% are the dominant shareholders of CTS. The CTS share which closed at Rs. 616.50 at the end of the last financial year traded at a high of Rs. 800 and a low Rs. 550.10 during the year under review. The company has a total of 892 shareholders in its books. The directors of the company are: Messrs. Merril. J. Fernando (Chairman), Himendra. S. Ratnaweera (Deputy Chairman/CEO), Malik. J. Fernando, Dilhan. C. Fernando, Mrs. Minette Perera, Roshan Tissaaratchy, Rajan Asirwatham and Gritakumar. E. Chitty. (Sunday Island 16.10.2016).
Sri Lanka President's unexpected outburst on Wednesday against police and the criminal justice system has sent shock waves through the political establishment. Much of his remarks appeared to be aimed at criticising his own government led by Prime Minister Ranil Wickremesinghe who is yet to react publicly. Here are the key points made by President Maithripala Sirisena. 1) Independent commissions should keep the President informed. President Sirisena reprimanded secretaries and heads of independent commissions for carrying out their work without keeping him informed. 2). Actions of the Financial Investigations Division (FCID), Criminal Investigations Department (CID) and the Independent Commission to Investigate Allegations of Bribery and Corruption (CIABOC) are politically motivated. The President's remarks appear to confirm the allegation made by his predecessor Mahinda Rajapaksa that investigations against him, his family and associates were a political vendetta. 3). The President said the authorities were holding military intelligence officers in remand custody for over 10 months without charging them. He was referring to the case of Prageeth Eknaligoda who disappeared two days before the January 2010 presidential elections. The President said he was promised by the investigators that the suspects will be held for just two weeks only, but they are languishing in remand for over 10 months. 4). He criticised delays in the criminal justice system and accused law enforcement authorities of holding suspects for lengthy periods without trial or charges being framed. It is the same allegation made by hundreds of Tamil detainees languishing in jail for over 10 years without any charges brought against them. 5). The President promised decisive action against those "conspiring in corners." He did not specify what action he would take as president, commander-in-chief and the defence minister. He said he had decided to end his long silence and speak out. (Sunday Island 16.10.2016))

Tourist arrivals at 209,351 recorded a growth of 19.1 per cent, year-on year, in July 2016. Accordingly, tourist arrivals during the first seven months of 2016 increased by 16.7 per cent to 1,173,618 in comparison to the corresponding period of 2015. The top five sources of tourist arrivals in July 2016 were China, India, UK, Germany and France, accounting for 49.8 per cent of the total during the month. Cumulative earnings from tourism1 increased to US dollars 1,945.2 million during the first seven months of 2016 compared to US dollars 1,667.1 million recorded during the same period in 2015. Workers' remittances declined by 4.4 per cent, year-on-year, to US dollars 572.8 million in July 2016 from US dollars 599.3 million in July 2015. The decline in workers' remittances can be mainly attributed to the prevailing economic stagnation in Middle Eastern countries and lower migration under the unskilled categories. However, the cumulative inflow from workers' remittances increased by 3.8 per cent to US dollars 4,185.9 million during the first seven months of 2016 in comparison to the corresponding period of 2015. (Daily Island 19.10.2016)
Finance Minister Ravi Karunanayake said that the government plans on reducing the budget deficit to 4.7 percent of the GDP in 2017. "We had a budget deficit of 6.7 percent of the GDP last year and this year's target will be 5.4 percent.It will be further reduced to 4.7 percent in 2017, Karunanayake told parliament yesterday, while presenting the Appropriation Bill for 2017. The Bill was tabled in the House when Parliament convened at 10:30 last morning. Expenditure heads:Ministry of Defence – Rs.284.04 billion, Ministry of Highways – Rs.16.34 billion,Ministry of Education – Rs.76.94 billion, Ministry of Health – Rs.160.97 billion, Presidential Secretariat – Rs.6.45 billion, Office of the Prime Minister – Rs.1.25 billion. Total expenditure heads – Rs. 1,824 billion. (Daily Island 21.10.2016)
The government yesterday presented to Parliament its estimated expenditure for the next year in which the expenses of the President's office rose by three times while defence allocation has been pruned down. The appropriation bill presented to Parliament by Finance Minister Ravi Karunanayake has estimated the total government expenditure of over Rs 1,819 billion (Rs 1,819,544,000,000). The amount is a decrease when compared with the government expenditure in 2016 of Rs. 1,941 billion. The limit on borrowings for 2017 has been set at Rs 1,489 billion (Rs 1,489,205,436,000). The allocation to the President's Office which was Rs 2.3 billion in 2016, has been increased to around Rs 6.4 billion (6,452,679,000) in the next financial year, indicating a three-fold increase. Of this amount, around Rs 1.9 billion will go towards Recurrent Expenditure, while the rest will be for Operational and Development activities under the President's Office. Defence Ministry Allocations for 2017 have taken a dip from the previous year, along with allocations made to the Ministry of Education. The Defence Ministry allocation for 2017 is around Rs 284 billion (284,044,344,000), of which, around Rs 251 billion will go towards Recurrent Expenditure and around Rs 32.2 billion towards Capital Expenditure. In 2016, Defence allocation stood at more than Rs 306 billion, of which more than Rs 257.6 billion went towards Recurrent Expenditure,while Capital Expenditure was around Rs 48.9 billion. The Ministry of Mahaweli Development and Environment also coming under the purview of the President has been given a sum of Rs 57.6 billion (57,623,465,000). In the appropriation bill for the year 2016, that ministry had been given Rs 69,495,807,000. The expenditure of the Prime Minister for the next year has been envisaged at Rs 1,255,271,000. Yesterday's presentation is considered as the first reading of the Appropriation Bill. Its second reading is scheduled to commence with Finance Minister Karunanayake presenting budget proposals to the House on November 10. The budget debate is tentatively scheduled to continue till Dec 10. (Daily Island 21.10.2016)

IGP Pujith Jayasundara yesterday promised tough action against all those who had allegedly suppressed information about the killing of two Jaffna University undergraduates in Kokuvil area. Five police personnel including an SI and a sergeant have been arrested and interdicted over the killings which led to a tense situation in Jaffna yesterday with a public protest. It has been revealed that the victims had been returning from a party in Kokuvil when the police ordered them to stop. They proceeded without heeding the order and the police opened fire seriously injuring the rider. The magisterial inquiry has revealed that the rider had suffered two gun shot injuries to the head and the pillion rider had died when their motorcycle crashed into a wayside parapet wall. The police claimed the victims had been drunk at the time of the incident. (Daily Island 22.10.2016)

Sri Lanka's tea output fell for the eighth month running in September, data from the state-run Tea Board showed. Brokers said the decline was due to a series of factors including drought following flooding, the poor application of fertiliser, low market prices and a government ban on the use of pesticides. Output in September fell by 27.2 percent from a year earlier, the Tea Board's data showed. The last monthly gain was in January. "Now the drought conditions after the floods have hit the production," said Anil Cooke, head of Asia Siyaka Commodities, told Reuters. Tea is Sri Lanka's top agricultural export commodity and one of the main foreign currency earners for the $82 billion economy. (Sunday Island 23.10.2016)

Inflation, as measured by the change in the National Consumer Price Index (NCPI) (2013=100), which is compiled by the Department of Census and Statistics, increased to 4.7 per cent in September 2016 from 4.5 per cent in August 2016, on year-on-year basis. Both Food and Non-food categories contributed towards the year-on-year inflation in September 2016. The change in the NCPI measured on an annual average basis increased to 3.8 per cent in September 2016 from 3.6 per cent in August 2016. When the monthly change is considered, the NCPI increased from 113.3 index points in August 2016 to 113.5 index points in September 2016. This monthly increase was mainly due to the increase in prices of the items in the Alcoholic Beverages and Tobacco category. Within the Food category, prices of fruits, big onions, rice and coconut increased during the month. Prices in Clothing and Footwear; Furnishing, Household Equipment and Routine Household Maintenance; Education; Restaurants and Hotels and Miscellaneous Goods and Services sub-categories also increased during September 2016. Meanwhile, prices in Housing, Water, Electricity, Gas and Other Fuels; Health; Transport; Communication and Recreation and Culture sub-categories remained unchanged during the month. The NCPI Core inflation, which reflects the underlying inflation in the economy decreased to 5.7 per cent in September 2016 from 6.0 per cent in August 2016, on year-on-year basis. Annual average NCPI Core inflation increased marginally to 5.7 per cent in September 2016 from 5.6 per cent in August 2016. – Central Bank (Daily Island 24.10.2016)

The Value Added Tax (Amendment) Bill was passed in Parliament with a majority of 66 votes. The bill received 112 votes in favour and 46 against while 65 MPs were absent. MPs of the Joint Opposition and the JVP voted against the bill. All TNA MPs including the Opposition Leader R. Sampanthan were absent. Joint opposition MPs were wearing black armbands in protest against the Bill. At the end of the second reading stage debate on the bill Joint Opposition MP Bandula Gunawardena asked for a division by name. Accordingly the VAT would be applicable to a large number of goods and services including telecom fees and tobacco with effect from midnight yesterday. Finance Minister Ravi Karunanayake said that the VAT would not be applicable to health and hospital services, postal, housing and smart phones. The government expected a revenue increase of Rs 1.8 billion by the end of this year from the new tax increase. The list of items exempted from the tax is as follows: wheat flour, rice, sugar, lentil, wheat, dry fish, canned fish, Maldives fish, spices, bread, liquid milk, tea, rubber, coconut, coconut milk, coconut oil, prawns, eggs, fruits, vegetable, potato, sprats, red onion, garlic, big onions, green gram, chillies, cowpea, chick peas, dhal, coriander, peanuts, fertiliser, medicine manufacturing equipment and machines, medicine packing equipment, wheel chairs, ayurvedic products, crutches, hearing aids, Braille equipment, Braille paper, spectacle frames, spectacle producing raw material, outpatient department services, consultations and diagnostic services, surgical services, caesarian services, transport services, diesel, kerosene, petrol, jet fuel, vehicles liable for production taxes, bowsers, agricultural seeds, agricultural plants, agricultural machinery, tractors, bakery products, fisheries equipment, paddy mill machinery, milk processing machinery, greenhouse machinery, electricity, solar energy, computer parts, power saving bulbs, education services, computer software, sports equipment, life insurance, books, mobile phones, gems, pearls, diamonds, gold, platinum, library services, housing rentals and leasing. The opposition called for a division at the end of third reading too. The third reading vote received 76 votes in favour and 23 against. Accordingly the bill was passed with amendments. (Daily Island 27.10.2016)

The Treasury had released a total of Rs.4,489.90 million to the Central Bank to repay Golden Key Credit Card Company depositors under the first and second repayment schemes as determined by the Supreme Court, the govenrment announced. Media Minister Gayantha Karunathillake addressing the weekly Cabinet Press Briefing at the Parliamentary Complex said that the required funds were released following Cabinet approval for the repayment proposal submitted by Finance Minister Ravi Karunanayke on Tuesday. A second Memorandum by Karunanayake for a further Rs.4055.1 million to fund the last tranche was also approved by the Cabinet of Ministers, Karunathillake noted. He said that swift action would be taken to dispose the assets of Golden Key Credit Card Company and its subsidiaries and credit the proceeds to the Treasury. (Daily Island 27.10.2016)

Sri Lanka will sell to a Chinese company 80 percent of a $1.5-billion port in its south, where China has also been offered an investment zone, in a bid to cut the country's debt burden, Finance Minister Ravi Karunanayake said.
The move follows an offer made by Prime Minister Ranil Wickremesinghe during a visit to China in April, to swap equity in Sri Lankan infrastructure projects against some of the $8 billion in debt the Indian Ocean island owes to China.
The Hambantota port was built with the help of Chinese loans and contractors in 2010 under former leader Mahinda Rajapaksa, as part of efforts to boost development of infrastructure after the conclusion of a 26-year-long civil war in 2009.
But the port, and a nearby airport, also Chinese-financed, had been seen as a white elephant because it was not financially viable, the current government has said."For somebody like the Chinese, it is the silk route transit point," Karunanayake told a meeting of the country's Foreign Correspondents Association late on Thursday.China's interest in the port is seen as part of its ambitions to build a "Maritime Silk Route" to the oil-rich Middle East and onwards to Europe. (Daily Financial Times 29.10.2016)