Prime Minister Ranil Wickremesinghe yesterday informed Parliament that the Government plans to investigate bond issuances before 2014 that were in the form of direct placements, borrowings made without obtaining Parliamentary approval, and allegations of insider trading at the stock exchange during the Rajapaksa regime.
By Ashwin Hemmathagama
– Our Lobby orrespondent
Opposition lawmaker JVP MP Bimal Rathnayake accused the Government of slowing the process followed to file action in relation to completed investigations by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC). “It is clear that the number of investigations conducted by the Commission to Investigate Allegations of Bribery or Corruption has gone down drastically. This could be
Sri Lanka must grab opportunity for shipping industry to grow: Harsha
- Exports top $ 1 billion for third consecutive month
- Apparel, tea and exports lead charge with growth
- numbers Trade deficit widens on fuel and rice imports
- triggered by lingering drought impactRice imports grow to $ 22 million from $ 1.4 million, fuel imports jump 69%
- BOP records $ 2 billion surplus, reserves grow to $ 7.3 billion
September exports grew 12.6%, surpassing the $ 1 billion mark for the third consecutive month, but the month also saw the trade deficit increase on higher fuel and rice imports as well as a dip in tourism and remittance earnings, the Central Bank said yesterday.
Despite the mixed performance, releasing the external sector report, the Central Bank pointed out reflecting continuous investor confidence, the financial account of the Balance of Payments (BOP) continued to strengthen during the month with higher foreign inflows to the Colombo Stock Exchange (CSE) and the government securities market. Subsequently, the overall balance recorded a surplus of $ 2 billion by end September 2017.
Meanwhile, gross official reserves increased to $ 7.3 billion as at end September 2017 from $ 6 billion as at end 2016.
“The deficit in the trade balance widened in September 2017 while the cumulative trade deficit during the first nine months of 2017 also expanded when compared with the corresponding period of the previous year.
This was mainly due to the additional import expenditure incurred due to the prevailing drought condition in the country,” the Central Bank said.
Earnings from exports which grew since March 2017 continued their increasing trend in September 2017 as well. This growth was mainly led by higher earnings from industrial exports owing to the increase in exports of textiles and garments as a result of improved garment exports to both the US and EU markets.
Further, earnings from the export of petroleum products increased significantly owing to higher export volumes and prices of bunker and aviation fuel. In addition, earnings from rubber products rose, reflecting higher earnings from rubber tyres and surgical and other gloves.
Meanwhile, earnings from agricultural exports continued to increase in September 2017 from the beginning of the year. This was due to the improved performance in tea, owing to higher prices in the international market and a marginal growth in export volumes. Earnings from spices also increased considerably due to the higher export volumes of pepper, cloves and cinnamon. Reflecting the positive impact of the removal of the ban on exports of fisheries products to the EU market and the restoration of the GSP+ facility, earnings from seafood exports increased considerably with a 153% year-on-year growth in exports to the EU market.
Expenditure on imports increased in September 2017, recording double-digit growth for the third consecutive month as a result of higher expenditure incurred on intermediate goods, particularly fuel. Expenditure on fuel imports increased significantly due to the combined effect of high prices in the international market and higher volumes of fuel imported for thermal-based power generation.
Further, base metals led by iron and steel, mineral products led by cement clinkers and building materials led by cement imports increased notably, reflecting higher demand by the construction sector. Meanwhile, expenditure on consumer goods imports declined owing to lower prices and volumes of sugar imports. However, following measures taken to fulfil the shortage of rice in the domestic market, expenditure on rice imports continued to increase in September 2017 adding around 497,889 metric tons so far during 2017 from 21,457 metric tons imported during the corresponding period of 2016.
Despite the slower than expected improvement in the current account, the financial account of the BOP was strengthened during September with continuous foreign inflows. Continuing the positive trend witnessed since March 2017, foreign investments to the government securities market recorded net inflows for the seventh consecutive month, reflecting positive investor sentiment.
In addition, long-term loans to the Government increased on a net basis during the first nine months of the year. Meanwhile, foreign investments in the CSE recorded a net outflow (including both secondary and primary market foreign exchange flows) during September, mainly due to a one-off transaction of a Sri Lankan conglomerate acquiring the foreign stake of a company operating in Sri Lanka.
However, on a cumulative basis, foreign investments in the CSE recorded a substantially high net inflow during the first nine months of 2017 in comparison to the net outflow recorded during the corresponding period of 2016.
Remittances shrink 16.7% in Sept.
Remittances continued to be a concern with a 16.7% drop to $ 481 million in September bringing the year to date figure down by 7.4% to $ 4.9 billion from a year earlier.
“Slower growth in economic activities and adverse geopolitical conditions prevailing in the Middle Eastern region continued to have a negative impact on workers’ remittances. As such, workers’ remittances declined significantly in September 2017. Following the same trend, workers’ remittances recorded a decline during the first nine months of 2017, in comparison to the corresponding period of 2016,” the bank said.
The signing of a Memorandum of Understanding between Sri Lanka and South Korea on an Employment Permit System (EPS) to provide more job opportunities will be among the highlights of President Maithripala Sirisena’s three-day state visit to the South Korean capital of Seoul which begins today.
The agreement, which comes into effect next year, will benefit people seeking employment in South Korea where some 30,000 Lankans are already employed.
The EPS will provide greater benefits to workers. Agreements on economic cooperation, the Economic Development Cooperation Fund (EDCF) and cultural cooperation are among those slated to be inked during the President’s visit.
President Sirisena arrives in Seoul today upon an invitation extended to him by South Korean President Moon Jae-in.
The visit takes place in conjunction with the 40th anniversary of the establishment of diplomatic relations between Sri Lanka and South Korea.
The President will visit the Cheong Wa Dae or the Blue House, the official residence of President Moon, on Wednesday where he will be ceremoniously received with a Guard of Honour and a 21-gun salute.
The two leaders will discuss matters of mutual interest to strengthen cooperation between the two countries, following which there will be bilateral meetings involving visiting Sri Lankan ministers and their South Korean counterparts.
President Sirisena this evening will visit the Jogyesa Temple, an ancient Korean Buddhist shrine, and on Wednesday morning pay his respects at the Memorial Tower to commemorate soldiers who sacrificed their lives for the country.
The President will also meet members of the Sri Lankan community this evening.
In addition, President Sirisena is scheduled to attend a business forum and speak with four major Korean business associations, all potential investors. Sirisena is due to end his official visit on Thursday evening.
- New legislation empowers SEC far greater and deals more comprehensively with market misconduct and provides protection to whistle-blowers
The far reaching and comprehensive Securities Exchange Bill has been published in the gazette by the Minister of National Policies and Economic Affairs last week and will be presented to Parliament shortly.
The Bill aims to establish the Securities and Exchange Commission of Sri Lanka; to regulate market institutions, public offers of securities, market intermediaries; to deal with market misconduct; and to meet the challenges encountered by securities markets in an effective and efficient manner and to repeal the Securities and Exchange Commission of Sri Lanka Act, No. 36 of 1987.
The proposed Bill gives more powers to the Commission and deals more comprehensively with market misconduct and provides protection to whistle-blowers.
The new Bill which will replace the Securities and Exchange Commission of Sri Lanka Act, No. 36 of 1987 lays down measures to deal with market misconduct and to meet the challenges encountered by securities markets in an effective and efficient manner.
It encompasses the Establishment of the Commission, its powers, duties and functions of the Chairman, and staff; market and market institutions, establishment, operation and regulation of exchanges, clearing house, central depository, issue and trading of listed and unlisted securities, protection of clients assets, establishment of a and role of recognised market operator.
It also extensively deals with market misconduct, lists prohibited conduct, and insider trading.
Funds of the Commission, and Fund to provide Compensation to investors , provisions relating to the Institutional Framework ; Provisions relating to the Enforcement Mechanism.
According to SEC sources the new Act while some commended the proposed amendments others claimed this was too draconian, stringent and not necessary for a developing market such as Sri Lanka. Some suggested that the new provisions will impede market violations and that an element of market malpractice was necessary to drive the market.
Despite these baseless arguments, SEC believes the new Act will form a sound foundation for capital market regulation and additionally expand our scope with enhanced enforcement capabilities. Furthermore it will introduce powers for civil and administrative sanctions and will also include more provisions to regulate hitherto unregulated capital market intermediaries and products and ensure better safeguard of investor interests.
The passage of the proposed Act would not only complete a longstanding initiative of the SEC, but also decisively define our ability to engage in effective and holistic regulation of the capital market, according to the SEC.
SEC last year and early this year invited feedback from stakeholders including the general public to foster transparency in the law making process and induce meaningful contributions from all.
Extensive public consultation was conducted with respect to the draft Securities Exchange Act in early 2017 both in the interest of maintaining transparency throughout the legislative process and that of ensuring the enduring relevance of the legislation promulgated today to market participants.
“Having received the insights and feedback of a cross-section of regulates and other market participants over the course of several weeks, we are confident that the present draft has greatly benefited from the consideration and incorporation of multiple perspectives during its formative stages,” SEC said.
“This will be a singular achievement as the Commission has been struggling to bring in a new Act since 2011,” SEC said whilst acknowledging the invaluable contribution made by the drafting committee headed by Kanag-Isvaran P.C.
The Attorney General has agreed to submit a motion in the Court of Appeal requesting a hearing for the petition filed against the gazette on the staging of the local government poll.
This development had taken place at last evening’s party leaders meeting held at the Parliament complex, which both Attorney General Jayantha Jayasuriya and Elections Commission Chairman Mahinda Deshapriya attended, according to party sources.
Special Assignments Minister Dr. Sarath Amunugama yesterday threw a “searchlight” on loss-making state-owned enterprises (SOEs), urging officials to utilise the assets under institutions more effectively and called on the public
Prime Minister Ranil Wickremesinghe on Monday made perhaps his best pitch to woo a more proactive private sector role to usher in greater socioeconomic prosperity in the country
The proceedings of the Presidential Commission of Inquiry on the controversial bond issuance formally concluded yesterday with Prime Minister Ranil Wickremesinghe appearing before the Commission amidst an unusually large