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World Bank, instead of Treasury, as custodian of JM funds
The Government and the Liberation Tigers of Tamil Eelam (LTTE) may agree to make the World Bank the custodian of foreign aid to be disbursed to the two sides for tsunami recovery.

This is in view of the LTTE's reluctance to make the Treasury, a state agency, as the central organ to channel funds. The move stems from the LTTE’s stance that it would neither recognise nor deal with any state agency in the disbursement of tsunami aid or, as claimed by UPFA leaders, accept the Government's sovereignty.

A document titled "Memorandum of Understanding (MoU) for the Establishment of a Post-Tsunami Operational Management Structure," circulated to select Deputy Ministers last Sunday, had designated the Treasury as the arm that will actually allocate and disburse the donor funds. This document had been circulated ahead of last Monday's meeting of SLFP parliamentarians and had caused concern in the Wanni.

The move led to an official at the Presidential Secretariat withdrawing the document from the Deputy Ministers concerned. Reports from Wanni say the LTTE is now awaiting the Government's approved draft Joint Mechanism. The LTTE had given its own approval to the draft on April 29 this year. Thereafter, it is to formally announce its response at a news conference.

Though President Chandrika Kumaratunga has expressed her determination to go ahead with the Joint Mechanism deal with the LTTE, a number of matters are still to be determined. That includes the question on whether a Memorandum of Understanding should be first signed with the LTTE before the document is tabled in Parliament -- a step recommended by the main opposition UNP.

The Tamil National Alliance has expressed the view that the document need not be tabled in Parliament after it is signed. Another matter is the date of signing. Government sources say decisions in this regard will be made by President Kumaratunga tomorrow. She is expected to brief the Government Parliamentary Group about the highlights of the Joint Mechanism and the modalities to be followed.

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