Sri Lanka sea food exports to EU up 200-pct

ECONOMYNEXT – Sri Lanka’s exports of sea food to the European Union, which accounts for about 28.7 per cent of total sea food exports, grew over 200 per cent in September 2016 from a year ago, the central bank said.

Export earnings of sea food increased, both in value and volume terms, in September 2016, it said in a statement.

The growth in earnings from sea food exports to the EU, for the second consecutive month, showed improved demand from the EU after it removed the fish export ban imposed on Sri Lanka.

In contrast, earnings from textiles and garments exports, which account for around 43 per cent of total export earnings, contracted for the second consecutive month by 7.1 per cent, year-on-year, to 382 million US dollars, the central bank said.

This was due to a temporary slowdown in global demand for garment exports from the traditional markets, such as the USA and EU, in September 2016.

Sri Lanka to give resident visas for large foreign depositors in banks

ECONOMYNXT - Sri Lanka will give a 5-year resident visa for foreign individuals who deposit 300,000 US dollars in banks and rights to lease land for those investing over1.5 million dollars, Finance Minister Ravi Karunanayake said.

The visa will be immediately available through an administrative order but it could legislated later in the year, he said.

The possibility of giving permanent residence is also a possibility for larger investors, he said.

The funds have to come through legal banking channels and they should not have been acquired through legal means, he said.

He said Sri Lankans who hold money abroad are also encouraged to bring them back to the country.

Sri Lanka Treasury unit to handle public-private partnerships

ECONOMYNEXT – Sri Lanka’s government is to set up a new unit in the Treasury to handle Public-Private Partnerships (PPPs) along with PPP cells in relevant ministries, a spokesman said.

The Public-Private Partnership Division will help implement the government’s priority projects with public private partnerships, according to the proposal approved by the Cabinet of Ministers this week.

The joint proposal was made by Ravi Karunanayake, Minister of Finance and Malik Samarawickrama, Minister of Development Strategies & International Trade.

The PPP division will hire people with commercial technical expertise and will help deal with a number of solicited and unsolicited proposals on a public-private partnerships basis.

The main aims of the PPP division is to manage project selection and implementation and provide project transaction advice.

PPP cells will be set up in relevant ministries to handle the work and liaise with the PPP Division.

The PPP division’s role is to provide oversight in execution, transparency, good governance, formulation of policies and recommendations to the Cabinet Committee on Economic Management.

Sri Lanka 03-month Treasuries yield hits 8.97-pct at auction

ECONOMYNEXT – The yield on three-month Sri Lankan Treasury Bills hit 8.97 percent at au auction Tuesday, up 19 basis points from last week, the debt office of the Central Bank said.

The yield on the 06-month bill rose 10 bp to 9.89 percent, while the yield on one-year bills rose 09 bp to 10.31 percent, a statement said.

The debt office said it got Rs47 billion worth of bids and accepted bids worth Rs23.8 billion.

Sri Lanka calls international bids to add 60MW to national grid

(LBO) – Sri Lanka’s cabinet has decided to purchase 60 megawatts of power through an open international competitive bidding process for a short term period of six months starting from February.

This 60MW is to be installed at three or more suitable locations to ease the transmission constraints that has arisen in the Central and Southern Provinces.

According to the recommendations made by Public Utilities Commission, more generation capacity should be added to the national grid to ensure uninterrupted power supply.

Met Department said adequate rainfall could not be expected during the coming 4 months and therefor it is not prudent to rely on the existing hydropower capacity of 1,350MW which is 30 percent of the 3,900MW of total installed capacity.

The cabinet approval has also been received to extend the expired agreement periods of three furnace oil power plants for six months.

Accordingly, agreement periods will be extended for Ace Power Plant Embilipitiya (100MW), Ace Power Plant Matara (20MW) and Heladhanavi Power Plant Puttalam (100MW).

The CEB requested to extend the power purchase agreements of these power plants by five years.

The ministry however said it is not appropriate to extend the period by 5 years as the government is also looking at purchasing these three power plants for the future energy demands.

In case the procurement process is completed to purchase the three power plants, the power purchase agreements will be terminated.

European Commission proposes restoring Sri Lanka’s GSP+

(LBO) – The European Commission said it proposed to the European Union to remove significant import duties on Sri Lankan products, to restore GSP Plus trade access to Europe’s export market.

“The Commission today proposed that a significant part of the remaining import duties on Sri Lankan products should be removed by the European Union in exchange for the country’s commitment to ratify and effectively implement 27 international conventions on human rights, labour conditions, protection of the environment and good governance,” the EU statement said.

The European Parliament and the Council have now up to four months to raise potential objections before the measures become effective.

“These one-way trade preferences would consist of the full removal of duties on 66 percent of tariff lines, covering a wide array of products including textiles and fisheries.”

However they said removal of customs duties would be accompanied by rigorous monitoring and conditional on continued commitment to sustainable development, human rights and good governance.

“GSP+ preferences can make a significant contribution to Sri Lanka’s economic development by increasing exports to the EU market,” Cecilia Malmström, Trade Commissioner for the EU said.

“But this also reflects the way in which we want to support Sri Lanka in implementing human rights, rule of law and good governance reforms.”

The full statement follows

Brussels, 11 January 2017

Removal of customs duties would be accompanied by rigorous monitoring and conditional on continued commitment to sustainable development, human rights and good governance.

The Commission today proposed that a significant part of the remaining import duties on Sri Lankan products should be removed by the European Union in exchange for the country’s commitment to ratify and effectively implement 27 international conventions on human rights, labour conditions, protection of the environment and good governance. These one-way trade preferences would consist of the full removal of duties on 66% of tariff lines, covering a wide array of products including textiles and fisheries.

These preferences would come under a special arrangement of the EU Generalised Scheme of Preferences, known as GSP+. This arrangement is designed to support developing countries by fostering their economic development through increased trade with Europe and providing incentives to take tangible measures towards sustainable development. The European Parliament and the Council have now up to four months to raise potential objections before the measures become effective.

Trade Commissioner Cecilia Malmström said: “GSP+ preferences can make a significant contribution to Sri Lanka’s economic development by increasing exports to the EU market. But this also reflects the way in which we want to support Sri Lanka in implementing human rights, rule of law and good governance reforms. I am confident of seeing timely and substantial further progress in these areas and the GSP+ dialogue and monitoring features will support this reform process. This should include making Sri Lankan counter-terrorism legislation fully compatible with international human rights conventions.”

Granting access to the GSP+ scheme does not mean that the situation of the beneficiary country with respect to the 27 international conventions is fully satisfactory. Instead, it offers the incentive of increased trade access in return for further progress towards the full implementation of those conventions, and provides a platform for engagement with beneficiaries on all problematic areas. As is the case for all GSP+ countries, the removal of customs duties for Sri Lanka would be accompanied with rigorous monitoring of the country’s progress in the area of sustainable development, human rights and good governance.

Sri Lanka had already benefited from GSP+ in the past. In 2010 the EU decided however to stop the preferential treatment for Sri Lankan imports due to the failure to address reported human rights violations in the country. In 2015, the new government of Sri Lanka set out a path of major reforms aiming for national reconciliation, respect of human rights, the rule of law and good governance principles, as well as sustainable economic development. The Sri Lankan government applied for GSP+ in July 2016 and the Commission’s assessment has concluded that it met the GSP+ entry criteria set out in the EU Regulation.