• Govt. awaits Indian and Chinese response on debt restructuring plan, Jan. deadline likely
• RW reads riot act to UNP Management Committee, calls for start of polls preparations
• UNP to discuss a common pro-Govt. alliance under a common symbol with SLPP today
• SLPP split on whether to go solo at LG Polls or contest under a common symbol alliance
• UNP and SLPP commence finalising nomination lists amidst talks, deposits being paid
• SLFP dissidents discuss forming alliance with New Lanka Freedom Party, CBK to support
• SLFP dissidents’ religious observances hijacked by MR, takes lead in Kataragama events
• SLFP says no political alliance with SJB, discussions only on forming a centre-left alliance
• SLFP, Nidahasa Council and Supreme Lanka Council discuss being led by leadership council
• New alliance and new symbol this week, says Wimal; talks continue during weekend

“I can handle the economy, but the mad hatters are the difficulty,” President Ranil Wickremesinghe said during an informal discussion on Friday (6) with editors. 

The President made this comment on the issues faced by him in governance, especially in relation to implementing the Government’s proposed reforms process, which is part of the economic recovery programme, with officials who seem to be working at cross purposes.

However, the Government has its work cut out with the proposed reforms agenda, implementing the country’s economic recovery programme, and now gearing for Local Government (LG) Polls, while Opposition parties and trade unions agitate urging the Government to provide relief to the people. 

A campaign to collect 6.9 million signatures for a petition against the move to increase electricity tariffs once again launched last week from Matara. It was interesting to see the number of 6.9 million individuals being transformed from what was once a public mandate to a protest campaign.

Meanwhile, the Central Bank of Sri Lanka (CBSL) on Wednesday (4) announced its short- to medium-term policy path along with other measures that will be implemented to restore price stability and to maintain the financial system. “Inflation expectations remain well anchored along the projected disinflation path,” the CBSL statement said.

However, the CBSL has refrained from referring to a specific time to secure the International Monetary Fund (IMF) deal, which was expected to be reached this month after failing to reach the initial deadline of December 2022 to finalise the Staff-Level Agreement (SLA). Reaching the IMF deal appears to be increasingly elusive as the CBSL has last week referred to a timeframe of “early 2023” to reach the IMF deal. 

The CBSL has also stated that it expected the new Central Bank Act to see passage through Parliament for its enactment, reinforcing its core objective of achieving price stability via a flexible inflation-targeting framework.

Be that as it may, five-and-a-half months later, some form of stability has set in for the country, giving hope to the people of things getting better from this year on.

However, as pointed out by President Wickremesinghe last Friday (6), the country is in need of securing the IMF deal in order to gain access to other international funding. “It is not easy to secure funding when a country has declared bankruptcy,” he said.

Explaining the process of finalising a debt restructuring plan with Sri Lanka’s key creditors, Wickremesinghe noted that the country was awaiting the response of only India and China to finalise the restructuring programme.

“India is facing issues in finalising the deal, given that it is the first time it is working on a debt restructuring programme. For China, it is about the precedence an agreement on debt restructuring with Sri Lanka would have on other countries it has lent money to,” Wickremesinghe said, adding that he was nevertheless confident that the debt restructuring plan with India and China could be finalised this month.

Given that none of the creditors have been asked to agree to a haircut on debt with only a request for a rescheduling of repayment period being extended to 20 years, the Government of Sri Lanka says that the debt restructuring programme would be presented to the IMF Board as soon as it is finalised.

According to Wickremesinghe, Sri Lanka has already complied with most of the IMF requests while only a few more points remain to be implemented, which the President states “will not be an issue in moving forward with them”.

He added that foreign investors were also awaiting the finalisation of the debt restructuring plan to move forward with their plans in Sri Lanka.

Reforms programme

However, the President pointed out that one of the key concerns of those providing financial assistance was that funds provided to Sri Lanka should not be used to fund losses. “They (donors) want the funds to be utilised in the health sector and food manufacturing (agriculture) sectors. Therefore, the Government cannot proceed with loss-making enterprises,” Wickremesinghe noted, while reiterating the Government’s commitment to proceed with the proposed public sector reforms as well as that of State-Owned Enterprises (SOEs).

Referring to the SOE reforms programme, Wickremesinghe noted that the only way forward for SriLankan Airlines was to privatise it. As for the Ceylon Petroleum Corporation (CPC), steps have been taken to cover its losses through the cost reflective pricing mechanism. “The only issue with CPC is its debt. Now the CPC has sought five years to repay the debt.”

However, Wickremesinghe noted that the situation with the Ceylon Electricity Board (CEB) was worse than that of the CPC, with losses being estimated to cost around Rs. 200 billion. “The choice now is between increasing VAT or the electricity bill,” the President said, adding that there was no issue over the supply of coal to the Norochcholai Power Plant for power generation.

“Restructuring is the only way for the country now, with the foreign exchange issues,” Wickremesinghe observed. 

The Government has so far identified SriLankan Airlines, CEB, Lanka Hospitals, Hilton Colombo, Sri Lanka Telecom (SLT), and Waters Edge as the institutions to be restructured/privatised.

Wickremesinghe also explained that while the process to unbundle the CEB was ongoing, Lanka Hospitals would be put on the stock market, most probably this week. He added that the next steps on Hilton Colombo would be initiated once the existing legal issues were resolved.

“A holding company will be set up to hold the shares of these institutions. It will be formed in the second week of this month (January),” Wickremesinghe said.

Relocations from Fort

Meanwhile, the Government is also looking at relocating some of the key State-owned institutions in the Fort area under the programme to form the ‘Heritage Square,’ which is a development project aimed at attracting tourists and foreign businesses. The area in Fort will cover the President’s House, Foreign Ministry building, and Police Headquarters.

Following its relocation, both the old buildings will be renovated and used as tourist attractions under the Colombo Heritage Square initiative. The concept aims at replicating the walking streets of Barcelona, Spain, which is home to several tourist attractions such as the Plaça de Catalunya and the Christopher Columbus Monument.  

President Wickremesinghe told The Sunday Morning that the President’s House would be relocated to Sri Jayewardenepura Kotte in line with an earlier plan. As for the Foreign Ministry, he noted that an alternative location had already been identified for the relocation.

The Police Headquarters meanwhile is to be relocated to the current Sri Lanka Air Force Headquarters in Colombo 2 once the three armed forces are headquartered at the Akuregoda military compound.

“The Heritage Square will also bring in good investments,” Wickremesinghe said.

Meeting the Brits

During a recent lunch held for President Wickremesinghe for the new year, the President took the opportunity to engage in some light-hearted jousting with the British High Commissioner.

Arriving for the lunch, the President was greeted at the entrance by former UK PM David Cameron, British High Commissioner Sarah Hutton, and Presidential Envoy to Europe Nirj Deva Aditya. Upon seeing the High Commissioner, the President jovially announced that the former Prime Minister had defied the recent travel advisory of his High Commission in Colombo. 

Cameron was in Sri Lanka during the last couple of weeks on a private visit with his family, spending the greater part of the holiday down south. In fact, social media users were quick to share images of the former PM enjoying the beach clubs in Hiriketiya. 

Upon returning to Colombo, the former Premier paid a courtesy call on the President at the Presidential Secretariat before attending a lunch held in honour of the President.

MR hijacks SLFP

Meanwhile, the annual all-night pirith chanting ceremony organised by the Sri Lanka Freedom Party (SLFP) was held in Kataragama on 31 December under the patronage of the dissident MPs of the SLFP.

However, it was interesting to see Sri Lanka Podujana Peramuna (SLPP) Leader and former Prime Minister Mahinda Rajapaksa (MR) taking the lead in the religious observances organised by the SLFP. MR was once a leader of the SLFP until he defected from the party and became Leader of the SLPP when Maithripala Sirisena took over the leadership of the SLFP in 2015.

It is learnt that arrangements for the religious observances were all prepared by the dissident MPs including the illumination of the Kiri Vehera dagoba in Kataragama. However, when the SLFPers had made their way to commence the religious observances and illuminate the dagoba, the Chief Prelate of the temple had told the SLFP MPs that MR was also close by to worship at the temple and that they could all wait a few minutes for MR also to arrive at the location. The SLFP MPs had looked at each other, but had refrained from making any comments.

A few minutes later, MR had made his way to Kiri Vehera with his family and a group of his loyalists. After making his way to where the SLFP MPs were, he had greeted them and the SLFP MPs had also exchanged pleasantries. The Chief Prelate had then invited MR to switch on the lights on the dagoba.

The SLFP MPs were surprised by the move, but had remained silent since the religious observances had been planned by them during the past few weeks. Finally, the religious observances were held under the patronage of SLPP Leader MR.

Among the participants were MR, Speaker of Parliament Mahinda Yapa Abeywardena, Ministers Mahinda Amaraweera and Nimal Siripala de Silva, State Ministers Chamara Sampath Dasanayake, Dr. Suren Raghavan, and Jagath Pushpakumara, MPs Chamal Rajapaksa, Duminda Dissanayake, and Shasheendra Rajapaksa, and former MP Pandu Bandaranaike.

Speaking to the media during the event, Amaraweera said: “The SLFP and all those who respect the slain Prime Minister S.W.R.D. Bandaranaike and the late Premier Sirima Bandaranaike were invited to participate in this event. Accordingly, a large number of people took part. Some people think that the SLFP is something that is limited to a name board or a building, but today it was confirmed that it is not the case.”

At the event, Dissanayake said: “Some people had claimed that President Ranil Wickremesinghe would be the Chief Guest of this occasion and thus tried to discourage our party members. However, we have responded to those accusations by getting former SLFP Chairman Rajapaksa to attend this event. We have disproven the claims of those trying to label us as being United National Party (UNP) members.”

Gearing for polls

However, it is once again time for talks on political alliances as the Election Commission last week called for nominations for the Local Government Elections.

Election Commission Chairman Nimal Punchihewa has stated that Local Government Polls would be held before 15 March in order to establish 340 Local Government bodies by 19 March.

He told the media that the District Secretaries acting as District Returning Officers (DROs) would issue the gazette in 25 districts, giving the date to accept nominations on Wednesday (4), while the day of election is to be announced after the conclusion of acceptance of nominations.

Accordingly, the announcement was made on Wednesday that nominations for the Local Government Elections would be accepted from 18-21 January. Nominations will be accepted until 12 noon on 21 January.

Punchihewa had also told the media last week that the Election Commission would make all efforts to restrict the cost to under Rs. 8 billion and that it would not be Rs. 10 billion as currently anticipated. Hence, the commission has decided to hold the Local Government Polls on a weekday as conducting the election on a holiday or during the weekend requires paying for travelling, accommodation, overtime, and meal allowances, etc. to election officials.

The split

However, the Government last week decided to seek the observations of the Attorney General with regard to the holding of Local Government Polls since it was learnt that there was a division within the Election Commission on the matter. The Government’s decision to seek the Attorney General’s opinion on the polls was seen as a means of obstructing the process of holding the Local Government Elections by officials at the commission who are supportive of holding the polls.

Nevertheless, senior officials at the commission, it is learnt, had communicated to the President that holding elections while a clear division existed among the officials could cause complications when engaged in the election process. The senior officials had proposed that elections be called only after receiving the observation of the Attorney General and an assurance from the Treasury on the allocation of funds to hold the polls.

However, the gazette announcing the calling of nominations for the Local Government Elections was issued under the names of the five members of the Election Commission. 

President Wickremesinghe when questioned about the Local Government Elections stated that the Attorney General has been directed to work with the Election Commission on clearing any doubts, if any, about holding the polls. “The commission cannot be split or else there will be complications,” he noted.

As for the allocation of funds for the polls, the President noted that there had to be a proper calculation done first on how much was needed to hold the polls and the Treasury should afterwards announce how much it could allocate for the elections.

Meanwhile, G.L. Peiris of the Nidahasa People’s Council last week stated that Local Government Polls can only be postponed through a referendum and not even by a motion presented to Parliament. He has further noted that there was a Supreme Court verdict to the effect.

According to Peiris, any statement that elections could be postponed through a motion passed in Parliament to the effect is incorrect.

RW’s riot act

The UNP Leadership Committee came under pressure from the President this past week over what insiders described as “a slow response to the pending election”. The party’s Management Committee was to meet on Tuesday (3) to discuss the impending polls and to report back to Wickremesinghe the following day, Wednesday (4).

However, the management meeting was called off at the last minute by a senior party member and the meeting with the President was held without any progress to report on.

During this meeting, the President had reportedly urged the leadership to take decisive steps in regards to both the upcoming Local Government Elections and the party regrouping. It was during the meeting that the President reminded the Management Committee that he had stepped away from operations of the party as promised following the 2020 elections and it was time the seniors took over. Certainly this change of tactics by the President appears to have taken effect, with UNPers around the country being activated this past week in preparations for the elections. 

Accordingly, nomination lists are being prepared by the party, with the aim that the UNP would use this election to announce to the country its return to top flight politics. 

It was during this meeting that the President had also announced that he would not be playing any role in the elections as it was essential that he remained a unifying figure for the political establishment. Several UNPers had raised concerns that with no political party holding an advantage for the elections, the results would very possibly see the country left polarised. It was on the back of these concerns that the UNP has proposed that they form a common alliance with all political parties and individuals who are supporting the Government at this juncture.

Common symbol

According to highly-placed sources, the proposal of forming a common alliance was made with the belief that if the public is shown that there is a wide-base platform for the Government, it would most likely energise the voters. However, further concerns were raised over whether or not an election at this juncture would see a substantial voter turnout. 

Political pundits have estimated that if the Local Government Elections are to be held as scheduled, due to the antipathy towards the political establishment, voter turnout will not exceed 50%. For a country that traditionally boasts voter turnouts closer to 80%, this will certainly bode ill for all political hopefuls.

However, the UNP seniors have discussed that the party contests under the ‘elephant’ symbol in several Local Government bodies that are favourable to the party, like Colombo, Kandy, and Nuwara Eliya. The same concept is expected to be applied to the SLPP, as the party would also be contesting separately in some of the Local Government bodies.

Meanwhile, the UNP on Tuesday (3) started interviewing applicants hoping to contest the LG Polls as well as for electoral organiser positions, said its General Secretary Palitha Range Bandara. 

Six interview boards would be involved in the process at Sirikotha, he said at a media briefing. Answering a question, he said an alliance with the SLPP was yet to be decided, although members of that party, the SLFP, and many other parties had inquired if they could receive nominations from the UNP.

Split in SLPP

The UNP seniors are to hold a discussion today (8) with the SLPP to explore the possibility of forming an electoral alliance. 

However, a group of SLPP seniors who are adamant to see the party contest separately under the ‘pohottuwa’ symbol without a common symbol initiated a programme last week to rush and make the deposit payments for the party’s candidacy at the Local Government Elections. The SLPP’s first deposit was made for the Kalutara District under the leadership of MP Namal Rajapaksa and Rohitha Abeygunawardena. The auspicious time to make the payment was 10.33 a.m. on Thursday (5) with the auspicious direction being the west.

However, the UNPers during the discussion with the SLPP are to raise the question of the SLPP making deposit payments for the polls under the party while discussing the formation of an alliance under a common symbol.

However, some SLPPers including SLPP ministers have expressed concerns over contesting the impending election under the party symbol. Some of these members had last week met the President and expressed their support to contest under a common symbol. 

The concern of these SLPPers was that some people in the electorates were still disgruntled with the SLPP and might not respond positively to the ‘pohottuwa’ symbol.

The SLPP meanwhile stated last week that the party would contest the impending Local Government Polls on its own under the ‘pohottuwa’ symbol for a majority of the Local Government bodies. The announcement was made by Basil loyalist, SLPP General Secretary Sagara Kariyawasam.

According to Kariyawasam, the SLPP candidates will contest under other party symbols only in certain Local Government bodies. Kariyawasam expressed confidence last week saying that it was important to win an election and that the party would be on the path to victory.

The SLPP is capable of securing a vast majority of the Local Government bodies by contesting under an alliance comprising its affiliates, Kariyawasam has told the media last week. The SLPP General Secretary has also stated that the SLPP had exchanged views with the UNP on forming an alliance, but that no final decision had been reached on forming a political alliance.

SLPP senior, former Minister S.M. Chandrasena meanwhile dismissed rumours of the possibility of postponing the impending Local Government Elections by saying that there was no such move and that the SLPP was prepared to face the polls. He told a news conference held at the SLPP Headquarters last week that the party’s nomination lists had already been prepared.

Dissidents turn to CBK

The dissident SLFP MPs led by the likes of Ministers Mahinda Amaraweera and Nimal Siripala de Silva have meanwhile discussed the possibility of throwing their weight behind the New Lanka Freedom Party led by MP Kumara Welgama and supported by former SLFP Leader and President Chandrika Bandaranaike Kumaratunga (CBK).

While the UNP had also discussed with the SLFP dissidents on being part of the common alliance under discussion between the UNP and SLPP, a dissident SLFP MP told ‘Black Box’ that the SLFPers would be more comfortable with an alliance with the New Lanka Freedom Party.

However, the MP noted that the New Lanka Freedom Party Alliance could be part of a broader alliance if discussions were successful.

SLFP’s new alliance

Meanwhile the SLFP has publicised the fact that the party is currently holding discussions with other centre-left parties in the Opposition to form an alliance to contest the impending Local Government Elections.

SLFP General Secretary Dayasiri Jayasekara has said last week that the party is currently negotiating with “independent” MPs, including Dullas Alahapperuma, on the possibilities of forming alliances.

“We have already started negotiations with all the other parties, including the Dullas group, and we are still discussing with them. In the meantime, we are talking to the faction led by Wimal Weerawansa and Udaya Gammanpila as well. There are a further seven to eight parties with whom we are discussing now. We intend to finalise this as soon as possible. We are moving forward as an alliance,” he has noted, adding that the SLFP has so far held discussions with 27 political parties.

When asked if the SLFP would form any alliance with the Samagi Jana Balawegaya (SJB), he has said: “No, we will not, because we mean to have a centre-left movement with all other such parties and not with the SJB.”

According to Jayasekara, the SLFP is looking at contesting some Local Government bodies under the party’s ‘hand’ symbol and other bodies under the United People’s Freedom Alliance (UPFA).

When asked about the possibilities of forming alliances to contest at the Local Government Polls, he has noted: “We are still in discussions. The process is underway. We are first considering forming the alliance under the UPFA. It is our main alliance and has been a very powerful alliance since 2004 under the betel leaf symbol. If that doesn’t happen, we intend to form a new alliance.”

Leadership Council

However, the SLFP, Nidahasa People’s Council, and the Supreme Lanka Council are continuing with the discussion on forming a political alliance to contest the Local Government Elections.

The ‘Black Box’ reported last week that the Nidahasa People’s Council and the Supreme Lanka Council had all proposed that the new alliance be led by a new leader and not by SLFP Leader Maithripala Sirisena.

The parties have discussed the possibility of reviving the SLFP-led UPFA, but have called for a new leadership for the alliance. It has also been proposed that the name of the UPFA be changed to People’s Freedom Alliance (PFA) when forming the new alliance.

It is learnt that the discussion between the parties is now focused on forming a Leadership Council consisting of leaders of each of the alliance parties to lead the alliance instead of one individual leading the proposed alliance. 

It is also learnt that each party will be permitted to appoint two to three members to the proposed Leadership Council. It has been proposed that the SLFP be allocated 40% of the membership of the Executive Committee, while the other two parties are allocated 30% each. However, a final decision is yet to be reached on the proposed Leadership Council. The preliminary discussions on the alliance are expected to be concluded this week.

MP Jayantha Samaraweera, who is a council member of the Supreme Lanka Council, observed that the new alliance in the making would be the one to save the country from its current crisis and that the people were eagerly awaiting its official announcement.

Weerawansa meanwhile said last week that a new alliance under a new symbol was in the making and that a final decision on the alliance between the Nidahasa People’s Council and the Supreme Lanka Council would be reached during the weekend and would be announced tomorrow (9).

Tamil parties talk

The Tamil National Alliance (TNA) on Thursday (5) attended a meeting at the Presidential Secretariat with President Wickremesinghe and Prime Minister Dinesh Gunawardena.

During the meeting, the TNA had expressed dissatisfaction regarding the lack of progress pertaining to the release of Prevention of Terrorism (Temporary Provisions) Act (PTA) prisoners and the lands originally owned by Tamils that are occupied by security forces.

TNA Spokesman MP M.A. Sumanthiran had said that there had been no progress in addressing the issue of releasing PTA prisoners and lands owned by Tamils. “They are telling us the very same thing that they told us on 21 December 2022. That was discouraging.”

However, Sumanthiran has said that he would submit documents on what needed to be done to implement the current constitutional provisions with regard to power devolution as well as on what needed to be achieved for a permanent political solution.

“They will discuss the issues on 10 January, during which they said they will come to an agreement. If there is no agreement by 10 January and if there is no progress on the immediate issues, then we will have to reconsider our continuous participation in this process. Nevertheless, since we are discussing constitutional issues, I will provide a note that doesn’t require any constitutional amendment regarding the implementation of the current constitutional provisions. Also, another note will be provided with regard to what had been agreed upon previously. When we meet on 10 January, there must be an agreement on that. If that does not happen and if there is no progress on the other matters also, then we will have to reconsider our continued participation.”

Wickremesinghe meanwhile noted that the issue of releasing PTA prisoners was an ongoing process, while there were new developments with regard to the issue of releasing lands owned by the Tamil people. According to the President, the issue of releasing lands in the north is not an issue of the military occupying them; there are now issues with the Forest Department and Wildlife Department that also need to be addressed in order to release them.

He also stated that all parties were in agreement that the 13th Amendment should be fully implemented.

It is in such a backdrop that a three-day All-Party Conference has been called this week from Tuesday (10) till Thursday (12) to discuss and finalise the national question as well as the longstanding issues of the Tamil people. “If the three days are not enough, we are willing to extend the days to sit and discuss until an agreement is reached by all parties,” the President said.

He noted that the target was to reach a consensus to the national question and the issues faced by the Tamil people before the country celebrates its 75th Independence Day. 

Meanwhile, MR had visited TNA Leader R. Sampanthan last week at Sampanthan’s residence to inquire into his well-being and also discussed the Tamil national issue. Sampanthan had raised the issues faced by the Tamils in the north and east and the Tamil national issue and noted that the Government should address the north eastern issue as soon as possible. 

Rajapaksa had reportedly assured Sampanthan that he would discuss the north and east issues with the President and the Government and would look to reach an amicable solution. Rajapaksa had further noted that the SLPP would attend the three-day All-Party Conference, which aims to discuss the concerns of the Tamil political parties and would study its proposals thereafter in a positive manner.