Food for thought

The IMF recently praised Sri Lanka for bringing inflation under control. But on the streets, the price of food has been rising relentlessly. Increases are seen in the price of wheat flour, bread, rice, vegetables, coconut, coconut oil, big onions and red onions. The cause? A combination exposure to global prices in the wake of IMF reforms, and the Sri Lankan state's ham-fisted efforts to fix prices in favour Sinhala producers and consumers at the same time.

FDI slow despite war end

While Sri Lanka makes much of a ‘post-conflict economy’ foreign direct investment actually fell in the first six months of 2010 compared with the same period last year, the Central Bank reported in August. FDI dropped to $208 million, compared to $250 million in the first half of 2009, logged amid the final stages of the war, Reuters reported. And the reason? Uncertainty and government policies.

Tears and tractors: delivering aid in Sri Lanka

Just the other day, this newspaper raised doubts as to who India’s aid intended for the Tamil areas will actually go . As if on cue, the point was made. In Sri Lanka it seems not even the International Committee of the Red Cross can guarantee aid will be delivered to the right beneficiaries.

Swearing in to be ‘beautiful’

As the date for President Mahinda Rajapaksa to be sworn in for his second term approaches, the public service has been called upon to undertake a new task – making the country beautiful. Thus the police are instructing residents in their areas to keep the streets clean, to prune branches and to put flower beds outside their homes, reported the Sunday Times . The paper added that soldiers are engaging in development projects and the military is also doing the work of the Health Department to warn against infectious diseases. Maybe Sri Lanka can convince the IMF that a large military is...

Where will India's aid go?

A 65 acre industrial estate in Atchuvely is to be developed bilaterally through a partnership between the Sri Lankan government and the Indian government, the Daily Mirror reported . This is part of a range of activities Delhi is initiating to develop the war-shattered Tamil areas of the island. India is supplying 500 four-wheel tractors to promote agriculture in the Northern Province, Sri Lankan state media reported . Indian High Commissioner Ashok K Kantha said Delhi also plans to assist in setting up an Agriculture Research Training Centre and Agriculture Faculty in the Northern Province...

Nationalization by stealth

The current Sri Lankan government made it clear from the start that it was opposed to the privatization of government owned enterprises. “The policy of the government was to retain ownership and management of ‘strategic’ enterprises such as state banks, electricity and utilities and make them profitable”, reported the Sunday Times, commenting on the government stance. That making public enterprises profitable has been a difficult – if not impossible – task in the past has not stopped the government trying. As the Sunday Times report noted, “losses in public enterprises reached a record level last year and this year’s losses are likely to be larger”. But now the government has extended the policy further, moving from holding on to state enterprises to actively acquiring (privatizing) other ‘strategic’ enterprises to ‘manage them in the national interest’.

Shell quits Sri Lanka gas business amid state price control

Sri Lanka’s government is buying back Royal Dutch Shell's stake in the part privatized gas company, Shell Gas Lanka. Shell’s decision to sell follows long running quarrels with the Government over the price at which the company could sell gas in the country. The $63 million sale returns the LP gas business in Sri Lanka to 100% state ownership. President Mahinda Rajapakse’s populist government had been at loggerheads with the oil and gas giant over the price at which gas is sold: the government has been insisting gas be sold at less than international market prices.

Corrupt or not?

Transparency International (TI) has released its report for 2010. With a score of 3.2 points Sri Lanka is ranked 91 out of 178 countries, up from 97th position last year. Of interest is how the news was reported. The government Sunday Observer interpreted this to mean that Sri Lanka was “low in corruption”, while ColomboPage reported a “marginal” improvement in tackling corruption but noted that “based on the criteria used by the TI Sri Lanka is not among the countries shown improvement from 2009 to 2010”. The Sri Lanka Guardian on the other hand pointed out that “Sri Lanka continues to be...

Profiting from Northeast disinvestment

The Sri Lankan mobile operator Dialog Axiata made a net profit of 1.69 billion rupees in the September 2010 quarter compared with a loss of 439 million rupees a year ago, Lanka Business Online reported . While this was partially due to cost cutting, the main driver was a huge increase in sales (16.2% or 10.56 billion rupees) and the main area in which sales have increased is mobile – both phones and broadband, according to the report. Tamils across the Northeast, lacking the infrastructure for fixed line access to telephones and internet, have been turning in increasing numbers to mobile...

PR and development

Sri Lanka’s fees for UK public relations firm Bell Pottinger (£3m) is greater than the amount pledged for development in Jaffna (£2.85m), the Sri Lanka Guardian reported today. The amount pledged for Jaffna, moreover, is uncertain to be followed through.