SRI LANKA UPDATE | 31 May 2024 – 6 June 2024

💰 The Economy
📰 International Monetary Fund (IMF) Board to take up Sri Lanka programme review on 12 June
The IMF Executive Board will review Sri Lanka’s economic policies and reforms on 12
June. The State Minister for Finance stressed the need for international support to
unlock further funding for economic stability and growth.

📰 SriLankan Airlines make profits as currency depreciation stops
SriLankan Airlines reported a net profit of LKR 1,124 million for the nine months to
December 2023, reversing a LKR 73.26 billion loss from the previous fiscal year.
Exchange gains of LKR 3.1 billion were noted, amid deflationary Central Bank policies.

📰 Sri Lanka relaxes food import controls
Sri Lanka’s Cabinet relaxed import controls on pulses, to combat black markets and
reduce food prices after a currency collapse. Import licenses on 53 Harmonized System
(HS) codes were removed following recommendations from a committee of top officials.

📰 President addresses economic recovery and Starlink delays
The Presidential Secretariat hosted a Youth Dialogue featuring President Ranil
Wickremesinghe and key advisors, discussing Sri Lanka’s economic recovery, debt
concessions, and a shift to an export-oriented economy. They addressed the Starlink
initiative’s potential, currently on hold for regulatory evaluation.

📰 High-level delegation of Swedish companies in town marking 75 years of bilateral ties
A delegation of Swedish companies are in Sri Lanka from 5 to 7 June to explore trade
and collaboration opportunities. Led by the Swedish Ambassador, the delegation aims
to strengthen ties in green and digital transition sectors.

📰 United Petroleum signs with Board Of Investment (BOI) to manage 200 fuel stations
United Petroleum Lanka Ltd. has signed an agreement with Sri Lanka’s BOI for a USD
27.5 million investment in the import, storage, and sale of petroleum. The company
will manage 200 fuel stations, including 150 currently operated by Ceylon Petroleum
Corporation (CEYPETCO) and 50 new stations.

⚖ Politics & Policy
📰 Cabinet clears the revising of Value Added Tax (VAT) Act
The Cabinet approved the drafting of a Bill to revise the Value Added Tax Act No. 14 of
2002, based on recommendations from a temporary VAT committee. The revisions aim
to address the removal of tax reliefs and implement changes from the Value Added Tax
(Amended) Act No. 32 of 2023.

📰 Election Commission urges Parliament to enact broad advance voting law
The Election Commission (EC) urged legislative authorities to enact laws to improve
advance voting systems, addressing concerns from groups like free trade zone

📰 Constitutionality of Economic Transformation Bill challenged in Supreme Court
A Special Determination petition filed in the Supreme Court challenged the
constitutionality of the Economic Transformation Bill, arguing it requires approval by
referendum in addition to Parliamentary consent.

📰 Government agrees to all Supreme Court amendments to pass Electricity Bill
The Power and Energy Minister announced that the Government has agreed to all
amendments proposed by the Supreme Court to the ‘Sri Lanka Electricity Bill’. The
Supreme Court ruled that several clauses of the Bill needed a special majority and one
clause required a referendum.

📰 ‘Enterprise Sri Lanka’ to be established as a dedicated agency for Small and Micro Enterprise (SME) support
The Sri Lankan Government intends to create ‘Enterprise Sri Lanka,’ a consolidated
agency to support the struggling Small and Micro enterprise (SME) sector. It will merge
existing entities like the Export Development Board and the National Entrepreneurship
Development Authority.

📰 New regulatory body to be established to prevent fuel shortages
The Power and Energy Ministry announced plans for a regulatory body to ensure
uninterrupted fuel supplies at Sri Lankan filling stations. The initiative aims to prevent
fuel shortages and queues.

📰 President keen to strengthen ties with India, as Modi wins election
President Wickremesinghe congratulated Indian Prime Minister Narendra Modi on his
election victory, expressing Sri Lanka’s eagerness to enhance their partnership.

📰 Sri Lanka to establish a dedicated Green Economy Unit within the Finance Ministry
President Wickremesinghe, in his capacity as Finance Minister, announced plans to
establish a Government unit within the Ministry of Finance to fund green economy
programs in Sri Lanka.

📰 High-level Thai delegation explores renewable energy collaboration with Hayleys
A high-level Thai delegation, led by Deputy Permanent Secretary for Foreign Affairs and
the Thai Ambassador to Sri Lanka, visited Hayleys Fabric and Hayleys Solar to explore
renewable energy solutions and cooperation.

⁉ What you need to know
📰 Star Garments Group expands with acquisition of Bernard Boteju Kolonna plant
Star Garments Group has expanded with the acquisition of Kolonna Manufacturing Ltd.,
marking its twelfth factory in Sri Lanka. This move aims to create over 1,000 job
opportunities in the Ratnapura district, emphasizing Star’s commitment to Sri Lanka’s
apparel sector growth.

Disclaimer – This Advisory is intended for circulation among JAAF stakeholders only.
Please do not circulate or share on social media.

This Advisory, written for our partners interested in developments in Sri Lanka against
the backdrop of the current crisis, is an update on the one issued last week. This
document summarises results covering significant political and economic events. The
Advisory includes economic, political, social and governance perspectives. It draws on
news reports, analyses, Government announcements and documents, and other sources
that we may be in contact with or have access to.
This Advisory was prepared by the Strategic Communications Unit of Adfactors PR

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