ENB: EELAM NEWS 190807

''பலத்தோடு இருந்தால் மதிப்பார்கள், நிலத்தோடு கிடந்தால் மிதிப்பார்கள்'' புதுவை இரத்தினதுரை

TODAY'S TOP STORY Sunday Island LK

Changes at the top of LTTE hierarchy

The Sea Tiger leader, Thillaiyampalan Sivanesan alias Soosai, is believed to have been replaced by his Deputy Cheliyan consequent to a long running dispute between him and LTTE Intelligence Wing leader, Pottu Amman.The new appointment had been revealed at last Thursday’s funerals of three Sea Tigers including third-in-command ‘Lt. Colonel’ Chandrasekeran Pillai alias Thiyagan killed in a confrontation with the SLN off Pulmoddai three days earlier. Thiyagan’s deputy ‘Lt. Colonel’ Kanniyathamby too had been killed in this battle

The Government’s Case for War

There is surely no case for belittling the achievement of the armed forces in taking Thoppigala. It was no walk-over but something that was fought for over many weeks. I have no military expertise to be able to pronounce on its military significance, but my commonsense tells me that the LTTE being deprived of access to the manpower and economic resources of the Eastern Province is surely a mighty blow against it.

Failing Sri Lanka

The war with the LTTE is far from over. And it cannot be brought to a successful conclusion sans the backing of the international community. To put it baldly, we need Western (and Indian) money, weapons and cooperation to sustain the Eelam War IV, let alone win it. Given this unchangeable reality, the eagerness with which the Rajapakse administration is picking fights with a large part of the international community is as alarming as it is perplexing. There is no attempt to sift antagonistic contradictions from non-antagonistic ones, to differentiate enemies from friends/well wishers.

US helps refurbish Trincomalee, Kinniya markets
[TamilNet, Saturday, 18 August 2007, 10:44 GMT]

Breaking ground for refurbishment of Trincomalee market, Deputy Chief of Mission at U.S. Embassy in Sri Lanka, James R. Moore, said "The U.S. Government is proud to be able to contribute to the refurbishment of this market, which is important to the economic and social life of Trincomalee...The coming months and years will be a decisive and exciting period for Trincomalee and the East. We hope there will be new opportunities for people of all communities," the US Embassy said in a press release issued Wednesday.

Full text of the press release follows:
U.S. Restores Eastern Markets as Economic and Social Centers
Partnership with Hellenic Aid at Anuradhapura Junction
TRINCOMALEE, August 15, 2007: The U.S. Agency for International Development (USAID), in partnership with Hellenic Aid, broke ground this week on a project to rebuild the Anuradhapura Junction Market that promises to restore the market as a center for commerce and a place of social interaction between residents of all social classes and ethnic groups.
U.S. Deputy Chief of Mission James R. Moore (center) breaks ground on the Anuradhapura Junction market reconstruction project accompanied by Government Agent T.T.R. Silva, Trincomalee Urban Council Chairman S.G. Mugunthan, and Matej Novak of People in Need (Photo: US Embassy) Last Saturday, U.S. Embassy Deputy Chief of Mission James R. Moore, along with Trincomalee Government Agent Major Gen. T.T.R. Silva and Trincomalee Urban Council Chairman S.G. Mugunthan, inaugurated the market, which is being restored under a grant to the Czech Republic-based humanitarian NGO People In Need and co-funded by Hellenic Aid, the development arm of the Greek government.
"The U.S. Government is proud to be able to contribute to the refurbishment of this market, which is important to the economic and social life of Trincomalee," Mr. Moore said at the groundbreaking. "The coming months and years will be a decisive and exciting period for Trincomalee and the East. We hope there will be new opportunities for people of all communities - Tamil, Muslim, and Sinhalese - to share in development, exercise their democratic rights, pursue their livelihoods, and build a brighter future."
The project was developed following a consultative process with government officials and local residents who identified the market as a top priority. The project will rehabilitate infrastructure including buildings, electricity and water connections, toilets, drainage, parking lots, composting and garbage collection facilities, as well as build the capacity of the Trincomalee Urban Council staff and the newly revitalized vendors association, which will maintain the market.
Mr. Moore also dedicated a new market in the coastal Muslim fishing village of Kinniya, which was badly devastated by the tsunami. The rehabilitated facility will provide fisher folk a central location to sell their products directly to consumers, improving the monetary yields from their daily catches.
"This market promises to help improve the lives of the people of Kinniya," Mr. Moore said at the dedication. "In addition to being a gathering place where fish can be sold in sanitary conditions, the new market is an attractive building that will serve as a source of pride for the entire community."

LBO >> Transport Natural Harbour 18 August 2007 08:41:47

Sri Lanka's Trinco port to be developed as eco-port

August 18, 2007 (LBO) – Sri Lanka's eastern port of Trincomalee is to be developed as an eco-port with the emphasis on exploiting its value as a marine habitat, an official said. Sri Lanka Ports Authority (SLPA) chairman Saliya Wickramasuriya said Trincomalee will not be developed for industrial activity or to handle containers.
This is because planned developments in Colombo port and the proposed port in Hambantota will generate enough capacity for years to come.
"We are building enough capacity for several generations between Colombo and Hambantota," Wickramasuriya told LBO in an interview.
"It's therefore logical for Trincomalee harbour to be exploited for reasons unique to Trinco. By that we mean developing Trincomalee as an eco-port.
"It has a unique marine habitat and has the potential to attract the highest bracket of global eco-tourists because it's a breeding ground for a variety of different species of mammals with a deep harbour."
Wickramasuriya said the harbour's eco-system is unique but fragile and has potential to generate revenue.
"As such we would like to protect and preserve the bay environment as much as possible and leave room for any leisure activity like cruise ships, whale watching, sailing, diving, sports fishing."
This would mean shifting commercial maritime movements to less environmentally sensitive areas south of Trincomalee by building a common user facility which will abut the proposed heavy industrial belt to come up around the outside of Trinco networked by a ring road.
"We plan to migrate most of the heavy, potentially polluting marine traffic from the inside – the inner, deep bay – and bring it down to the common user facility in the south," Wickramasuriya said.
Currently, the main industries in Trincomalee are the Prima flour mill and the Tokyo Cement plant. "We do not want to move any of the existing heavy industries, simply limit the addition of new ones," Wickramasuriya said.

Viewer Comments

1. Das Samuel Aug 18 [samuel@rogers.com]

The proposed Coal Power Plant will not be eco-friendly. Coal ships will be traversing the Koddiyar Bay continually, gas emissions , waste water and ash from the plant will contribute to environmental pollution. All these will affect the 'unique marine habitat'. The coal power plant should have been ideally sited at Mawella, on a bay near Dickwella which had been long ago identified as the most suitable site in sri lanka due to proximity to southern sea-lanes, plenty of fresh water availability,and a deep water bay providing a natural harbour for coal ships.
But this was vetoed by President Premadasa on political grounds, thus consigning several generations to energy shortage & consequent adverse economic impact. The oil-Lobby mainly influenced his decision through political cronies, who gave him wrong information.

Sunday, 19 August 2007

Polls chief gets greenlight for LG election in East

by Anura Maitipe

The government has called upon the Elections Commissioner to hold Local Government elections in the Eastern Province to elect members for local government bodies, Minister of Local Government Provincial Councils Janaka Bandara Tenakoon told the Sunday Observer.
With the liberation of the people from the LTTE terrorists, normalcy has returned to the Eastern Province. Law and order has already been established and now people should be given the right to use their franchise to elect members to the Local Government bodies in the Eastern Province, to enable them to back the proposals, ongoing rehabilitation and development schemes in the East.
The Minister said over 90 per cent people in the Eastern Province have returned to their permanent houses and there are some families still living in temporary shelters and these families will also be provided an opportunity to cast their votes. Arrangements will be made by the Elections Commissioner at locations close to the camps occupied by displaced families in the Eastern province to cast their votes.
The date of the Local Government election and submitting nominations to the Eastern Province will be announced by the Elections Commissioner within the next few weeks, he said. 28,961 persons at Villaweli, 21,523 persons at Paddipoli and 24,792 persons at Waunawe in Batticaloa district, 71 persons at Upparu, 706 persons at Mutur, 643 persons at Seruvila and 4,076 persons at Verugal in the Trincomalee district have been resettled recently.
In addition 11,572 persons at Vakarai, 742 persons at Kadravali and 2,477 persons at Madurankerni have also been resettled during the past few months.
Law enforcement and public administration institutions have been reactivated in the Eastern Province. The Magistrate Courts, Civil Courts, Police Stations, District Secretariats and Divisional Secretariats have been already set up in the Eastern Province.
Infrastructure facilities such as schools, hospitals, postal services, electricity and drinking water have also been provided for people in the area.

Columns - The Sunday Times Economic Analysis

Bonded by debt: Political controversy and economic implications

By the Economist

The government’s attempt to borrow US$ 500 million from the international money market by issuing government bonds has raised a number of constitutional and political questions. In fact, the economics of such borrowing has been in the background while the political controversy is in the forefront. Nonetheless, it is the economic ramifications of the borrowing that is most significant and perhaps motivates the controversy between the government and the opposition. The massive amount of the loan at commercial rates of interest raises a multitude of economic and financial issues of significance for the long-term economic development of the country.

First, let us focus on the constitutional and political issues raised by the threat of the UNP, that it will not honour the terms of the repayment or more crudely, that it is not bound to repay the debt incurred by the issue of the bonds. The question at issue is whether a government does not have a right to manage the country’s finances that would include the sovereign right of borrowing abroad. Governments have indulged in foreign borrowing for more than fifty years and these debts have been honoured by oppositions that have come into power.
Conversely does an opposition in parliament have a right to threaten the incumbent government that it will not repay? Does not international law provide for an obligation of a successive government to honour the debts incurred by previous governments? Without such an obligation a country would be unable to borrow funds either in the international money market or even from multilateral financial institutions and foreign governments.

What if the UNP’s threat materialises? Would it be possible for governments in the future, including UNP governments to borrow at all? What would be best is a debate in parliament and a vote for such borrowing. In fact the Financial Responsibility Act could be widened to include the requirement for a government to obtain parliamentary approval for borrowing large sums of money from abroad.

Irrespective of whether this threat materialises, it may initially result in a reluctance of financial institutions to lend to the government. This may result in an inability to raise the expected amount of funds. It is also likely that the costs of borrowing may rise as the perceived risks of lending would be higher. This, despite the money being borrowed by a government.
In the past there has been no such serious threats when previous governments borrowed funds from abroad. The country has a good record of repayment of debts. The only concessions have been the moratoria on debt repayment we received at the time of the tsunami.

The economics of the borrowing is a different issue. Foreign borrowing eases the domestic credit market. The anti-inflationary monetary policies of the Central Bank are a definite crunch on credit and therefore investment. The supply of credit and its costs are rising to extents that make investments unprofitable. This is especially so when input prices and energy costs are also rising. This can hurt exports. The foreign loan may ease the tight money policies though the risk of higher inflation remains.

The foreign borrowing would ease the balance of payments. Consequently, it is likely that there would be a significant surplus, easing the strain on the currency and retard the depreciation of the Rupee. These developments may also enable the government to not raise fuel prices any further (good politics but bad economics). Certainly the borrowed funds would make the government feel more comfortable in handling finances. It may lead to the spending of vast amounts on the war and increase the trend of extravagant government expenditure. It could ease some of the inflationary pressures in the economy, but this is not certain.

These are of course temporary palliatives. The long run impacts are serious. There is no doubt that an additional borrowing of US$ 500 million would add heavily to the country’s debt burden. At the end of 2006 the foreign debt had accumulated to Rs. 956,620 million that is approximately US$ 8696 million. At the end of May this year it had risen to Rs. 1,210,900 million that is about 11 per cent higher than 12 months before. Therefore the additional debt alone would raise the debt burden to Rs. 1,265,000 million. In addition the country has a higher domestic debt as well. At the end of May this year the domestic debt had risen to Rs. 1,560.8 billion. Public debt had risen to nearly the amount of last year’s GDP.

Last year the debt servicing costs absorbed about 28 per cent of government expenditure. In the past owing to the most foreign borrowing being from multilateral agencies at concessionary rates the cost of foreign borrowing was manageable. Even at the end of 2006 foreign debt payments absorbed only 12.7 per cent of our export earnings. However, this percentage has been increasing in recent years. The bond issue would raise that as the interest rates are higher than the country has paid in the past when it borrowed little from commercial sources and the period for repayment is much shorter than the borrowings from multilateral agencies. The government has resorted to commercial borrowing as the government can’t meet the conditions of good fiscal management required by these agencies.

There are doubts on what the loans would be used for. The government claims it would use it for infrastructure development. The fact is that infrastructure development at commercial rates of borrowing is not prudent, as such investments pay off over a long period of time. Besides, it is alleged that the infrastructure for which the money is to be spent already have been funded. It is contended that the money is in fact for war expenditure. These questions imply that the borrowing is ill-advised.

The bottomline of the bond issue is that the government is passing on a debt burden for the future. In contrast to the foreign borrowing in the late ’70s and early ’80s, when most of the funds were for development expenditure, with long periods of repayment and even some elements of grants in them, these funds may not contribute to an increase in goods and services and exportable goods in particular. It is likely that these funds would be for the war, generally termed as an “unproductive” expenditure. Consequently the debt burden in real terms would be greater. The only silver lining would be if the funds would lead to an improvement in the security situation that could usher in a period of rapid economic growth. Then the foreign debt serving costs, as well as the total debt burden would be manageable in the long-run.