Govt.
seeks $800 mln for poverty work
The United National Front (UNF) government wants to raise between
US $300 to US $ 850 million from the IMF, World Bank and other
donors for a poverty reduction plan in which some of the groundwork
has been done by the former People's Alliance regime.
"We
are hoping to get IMF approval for a US $ 300 million facility
under the poverty reduction and growth strategy (PRGS) policy.
We could then seek further support from the World Bank and
bilateral donors and build on this to about US $ 800-850 million
over a period of three-plus years," noted Economic Reforms
Minister Milinda Moragoda.
Negotiations for the new programme began last year under the
PA government when the IMF in April 2001 agreed to a standby
facility of US $253 million as urgent balance of payments
support and to prop up depleted foreign currency reserves.
The PRGS was to follow on the successful conclusion of the
standby facility, which ends in the two months - in June.
After
an immediate tranche of US $131 million further disbursements
were suspended as budget deficit targets and public spending
limits went haywire with the government unable to keep to
the IMF-government agreed performance criteria. The new reforms-friendly
government has been able to convince the IMF to resume the
programme.
Moragoda
said the suspended facility would come up for fresh review
by the IMF's board of directors on April 15-16. The minister
said he would also be in Washington on April 17-18 for meetings
with the World Bank president, managing director of the IMF
and US treasury officials to lay the foundation for the bigger
and cheaper poverty credit facility.
"Frankly
the standby credit facility is not the cheapest access to
funds. It is like an overdraft and costly. The then government
sought it because of an emergency requirement. We need to
pursue the PRGS which is long-term, cheaper and tied to real
reforms not playing around with the numbers (budget deficit
targets) game," he said.
Meanwhile the development forum or former aid consortium meeting
of donors helping Sri Lanka will be held in Colombo for the
first time, as against Paris which has been the venue for
many years. The meeting is scheduled for June 5 and 6 and
is expected to be opened by Prime Minister Ranil Wickremesinghe,
informed sources said.
Moragoda,
who is also the prime minister's deputy in the ministry of
policy implementation, said donors had agreed to the government's
proposal to hold the meeting in Colombo instead of Paris.
Government economists said that it was more practical to hold
the World Bank-organised meeting in Colombo because the former
aid group parley was no more a pledging conference. They said
the Asian Development Bank (ADB) has now become a much more
important agency than the World Bank as it is the biggest
donor to Sri Lanka.
The agenda
at the Colombo meeting includes the presentation of the government's
poverty and growth strategies and the triple RRR framework
- rehabilitation, reconstruction and reconciliation - for
the north and the east.
"The
government would update the donor community on the peace process,
explain the economic reforms that are taking place and most
importantly, demonstrate our resolve to undertake these tasks,"
Moragoda said.
eRUNWAY
to change its name
eRUNWAY, the Sri Lankan-founded global software company, is
changing its name later this month giving it a new corporate
identity and also because e-based companies are looked at
negatively in the United States.
"We
are looking at a new global corporate identity while the crash
of dot com companies in the US which led to e firms being
perceived in a negative sense, also prompted us to make this
change," said an eRUNWAY spokesperson in Colombo.
She declined to give the new name of the company, saying an
official announcement would be made in the next ten days.
The company
founded in by Sri Lankan couple Kris and Tushara Canekeratne
in 1995 in Colombo, is now headquartered in Boston in the
US.
"We
are changing our name to reflect an important transition in
the company's history.
The new name represents both what the company is and what
we aspire to be - a company that epitomizes engineering excellence,"
said Kris Canekeratne, co-founder chairman and CEO.
The six-year
old company with offices in Colombo, Boston and Hyderabad,
has seen tremendous growth. Tushara Canekeratne, co-founder
and Executive Vice President Technical Operations was in Colombo
recently to provide company staff with an insight into plans
to meet the firm's unparalleled growth.
While
many other service companies are laying off staff, eRUNWAY
recently hired over 100 experienced technology professionals
worldwide, mostly in Hyderabad and Colombo. "We are finding
a tremendous need for our services," said Tushara Canekeratne,
during her Colombo visit.
The company
has a total of 500 staff of which 300 are based in Colombo.
Telecom
IPO in the offing
The Public Enterprises Reform Commission (PERC) plans to list
a small stake in Sri Lanka Telecom on the Colombo bourse shortly.
"We're
seriously looking at a local IPO (Initial Public Offer) of
about a 10-15 percent stake in SLT to increase private sector
participation," PERC director general Dr. P.B. Jayasundara
said. An international IPO, which had been planned earlier
but put off repeatedly because of poor market sentiment, could
follow later.
The telecommunications
industry was being fully liberalised and licenses are to be
issued to other international gateways while the powers of
the regulator are being strengthened.
The privatisation
programme this year includes "big revenue making agencies
with fairly large valuations," Jayasundara said in an
interview.
PERC had
short-listed bids for the bunker supplier Lanka Marine Services
and had started work on the National Insurance Corporation
and Shell Gas Lanka, Jayasundara said. It is also evaluating
bids for Sevanagala Sugar. Finance Minister K.N. Choksy said
last month that the government intends to raise Rs. 21 billion
through privatisation of state enterprises.
Jayasundara
also said the government plans to create "multi-sector"
regulatory agencies for different sectors such as finance,
transport and power because having a regulator for each sector
was not feasible. "The regulator is there to prevent
unfair pricing, ensure quality standards, protect consumer
interest and settle market disputes," he said.
With the
pricing formula being a critical issue, the regulator would
have to ensure "cost-based, reasonable, competitive pricing,"
Jayasundara said. "For privatisation to work well, you
need transparent, debatable pricing formulae," he added.
Although
there have been lengthy delays in setting up regulators, Jayasundara
said that now "a lot of regulatory agencies are surfacing."
Other changes in the regulatory framework include a new Companies
Act and a Consumer Protection Authority.
The whole
process of liberalisation, de-regulation and privatisation
is meant to create competition, Jayasundara said.
Mainly for techies!
Next week's business section will have a special page dedicated
to the IT industry. It will contain news, views, developments
and events connected with the IT sector. The page appears
on the third Sunday of every month. Book your copy now.
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Avurudu
is here and it's time not only for prayer and reunions - but
also for fun, food and games. Gone are the days when the womenfolk,
especially in the towns, got together and prepared the traditional
kavum, kokis and mung kavum at their own hearths. In keeping
with the fast food culture in Sri Lanka, it now an era where
sweetmeats are available in the markets in Colombo and the
suburbs. Here a young mother takes her pick from the spread
laid out by a 'kavum amma' at the Piliyandala market. Pic.
by Athula Devapriya.
