War of words between Chinese firm and Sri Lanka escalates over Colombo Port City

Debasish Roy Chowdhury and Jing Yang-Tuesday, 31 March, 2015,

The war of words over the stalled Colombo Port City project escalated yesterday as China Communications Construction Company (CCCC) called the Sri Lankan government’s recent statement on the matter “factually incorrect”.

Finance Minister Ravi Karunanayake had told the South China Morning Poston Friday that CCCC had failed to furnish the necessary documents within the two-week deadline set for it by the government.

The new government in Colombo that came to power in January put Port City, a giant real estate reclamation project off the capital, on hold earlier this month alleging irregularities. The government, which maintains CCCC had not obtained the requisite clearance to start the project, gave it two weeks to show all necessary documents to prove otherwise.

“CCCC, upon being issued the temporary suspension of the project via a letter on March 6, 2015 by the Government of Sri Lanka, reiterates that it responded within two working days with all relevant approvals and permits afforded to the Project Company,” the company said in a statement to thePost yesterday.

“They run full-page advertisements in newspapers justifying their actions, but when we tell them to submit documents, they draw a blank,” Karunanayake had said in his interview.

The company reiterated that according to its agreement with the previous government, “the obligation to obtain the necessary permits and approvals for the project is with the Sri Lankan Government and not the Project Company”.

CCCC also maintained that the “agreement was authorised by Sri Lanka’s Attorney General and approved by the Cabinet of Sri Lanka”, contradicting the new government’s stand.

Colombo Port City has become a bone of contention between China and Sri Lanka. In his meeting with the new Sri Lankan President, Maithripala Sirisena, in Beijing last week, President Xi Jingping urged him to protect the legitimate interests of Chinese companies. Xinhua reported that Sirisena had said the current situation is “temporary and the problems do not lie with China”.

Colombo Port City is among the several Chinese-funded projects that have come under the scrutiny of the new government, which alleges large-scale corruption by the previous administration of pro-China Mahinda Rajapaksa, who was ousted in the presidential elections in January.

But unlike most projects by Chinese companies in the South Asian country, Colombo Port City is not bankrolled by Chinese loans. It is financed entirely by equity from CCCC or funds raised through it, with no commitment from the Sri Lankan government. Under the deal for the project, CCCC would reclaim 233 hectares of land. Of this, it would keep 108 hectares

Meanwhile, shrugging off the controversy over Chinese projects and companies operating in Sri Lanka, China Merchants Holdings (International) yesterday said it will make Sri Lanka one of its regional headquarters.

The subsidiary of state conglomerate China Merchants Group is the largest shareholder of Colombo International Container Terminals (CICT), its joint venture with the Sri Lanka Ports Authority (SLPA).

The company has built the Colombo South Container Terminal in the capital under a 35 year build-operate-transfer agreement with the SLPA.

Sri Lanka is an important trade and shipping hub for the Indian subcontinent, and some of its staff there had been relocated to the firm’s other overseas offices “because of the excellent work they had done in building and operating this port”, managing director Hu Jianhua said. He added that CICT was the firm’s first overseas greenfield project and a testing ground for its global aspirations.

The terminal, opened in April last year, handled 0.68 million 20-foot standard containers as of the end of last year. The volume is projected to exceed 1 million this year.

CMHI reported its net profit for last year rose 14.7 per cent to HK$4.6 billion, beating analysts’ estimates.

CCCC’s net profit for last year also unexpectedly rose 11.3 per cent to 14 billion yuan.

In Memory Of My Father- Professor Sucharita Gamlath

By Sharmila Gamlath -March 31, 2015

Sharmila Gamlath

My father, late Professor Sucharita Gamlath was one of the most prolific scholars of his time. During his lifetime, he continuously demonstrated his acumen in a range of fields, fulfilling the roles of author, teacher, literary critic, linguist, and political activist contemporaneously. He certainly needs no introduction among the general public of Sri Lanka. Since his demise on the 30^th of March 2013, there have been many eloquent accounts of his contributions to the fields of Sinhala language and literature, literary criticism and political views. However, on the eve of his second death anniversary, I thought it would be apt to supply an insider’s account of his life to the large number of Sri Lankan whose lives he enriched with his work.

An obvious question that may emerge is why I did not write such a memoir as soon as he passed away or, at least, why I did not write one last year, in conjunction with his first death anniversary. In fact, several friends and family members did urge me to write an appreciation about him earlier. However, during a couple of previous attempts, I had tremendous difficulty dealing with the myriad of emotions that crossed my mind. Recently, when I spoke to a friend about this state of haziness I was experiencing, he reassured me that it is only human to feel that way. So I decided that was best to wait patiently till I was emotionally prepared to get down to this task. Now I am.

Sucharita Gamlath’s work ethic

Professor Sucharita Gamlath

It is worth pondering over what motivated my father to work so hard. I feel now that it was pure passion, the urge to keep utilizing his brilliance for as long as he could. The expected monetary payoff associated with his work was not a critical source of motivation for him. It makes me feel that scholars produce their greatest works when they engage in their activities with the sole intention of producing an outcome which challenges them, rather than treating a scholarly work like a pail of milk which can be sold and many things bought with the money. Engaging in scholarly work simply for extrinsic gains such as monetary rewards, career progress and recognition could sometimes negatively affect the quality of one’s work. The selfless gratification he got from engaging in his work was probably the magic formula for my father’s literacy success.

My father derived the greatest happiness from writing tirelessly. Usually, he organized his working day into three parts: he would generally get some writing -and perhaps reading- done before breakfast. After than he would sit at his writing table till lunch. After than he had a long nap, and after evening tea, he would go back to his writing and only stop at about 9.30pm.

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Government of good governance dethroning rule of force and enthroning rule of law – Central PC chairman jailed

(Lanka-e-News- 31.March.2015, 10.00PM)  Under the newly elected  government of good governance which is committed to dethroning rule of force and enthroning rule of law ,as well as   demonstrating what is independence of judiciary and the paramount importance  of upholding the rule of law, a politico , the prime suspect who was charged with violating election laws in a case that was filed several years  ago  was sentenced to jail today. The politico who was sentenced to two and half years in jail is Mahinda Abeykoon, the chairman of the central provincial  council  cum  SLFP chief organizer Pahathahewaheta .

This verdict was delivered by Kandy high court judge Ms. Menaka Wijesundara on charges filed against the accused of forcibly entering a polling center at Pahathahewaheta and engaging in election violence during the general elections held on 5 th December 2001 – that is 14 years ago .

The case  was filed against Mahinda Abeykoon on charges of  unlawful assembly , criminal trespass ,use of force and engaging in  disruptive activities under the election laws.  Of the 14 suspects against whom this case was filed , two of them died while the case was on going in court . 11 other suspects were discharged on the previous date since there weren’t enough evidence against them .

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by     (2015-03-31 17:34:00)

Police tear gas protesting university students

March 31, 2015

UPDATE: The Galle Road has been closed from Kollupitiya Junction to Galle Face Roundabout due to the protest launched by university students, polcie spokesman ASP Ruwan Gunasekara said.

Heavy traffic congestion was reported along Galle Road, Thunmulla and Bambalapitiya due to a protest march by the university students heading towards Colombo.

Police advised motorists to use alternative routes in order to avoid inconveniences.

The protest march, organized by the Inter University Students’ Federation (IUSF), commenced from the near the University of Sri Jayawardenapura based on several demands.

Police used tear gas to disperse the protestors who were obstructing traffic near the Kollupitiya Junction.

Sri Lanka confronts ex-leader’s extravagant projects in ‘middle of nowhere’

[Hundreds if not thousands of peacocks pose a serious threat to airline traffic at the Mattala Rajapaksa International Airport]

31/03/2015

This remote coastal scrubland, a haven for wild elephants and migratory birds that is several hours away from the nearest city, seems like an odd place to attempt to create a major commercial hub..

Yet such was the whim of former President Mahinda Rajapaksa, a local son who, thanks to Chinese loans, poured immense sums into pet projects during the decade he held this island nation in his grip.

Since he was voted out of office in January, Rajapaksa’s extravagant spending in his home district, much of it named for himself, looks ever more like monuments to folly.

A giant Indian Ocean harbor being blasted out of the island’s southern shoreline has seen costs soar well past $1 billion, and officials say it is unlikely to break even for years. A $210-million international airport built two years ago has hundreds of employees but receives just a handful of passengers a day.

Sri Lankan president admits election defeat; challenger sworn in

The 35,000-seat Mahinda Rajapaksa International Cricket Stadium and a new convention center are rarely used, as are miles of expansive new highways that see little traffic apart from the occasional herd of cattle.

“It’s a crying shame how much money was spent,” said Harsha de Silva, deputy minister for policy planning and economic affairs in Sri Lanka’s new government. “Why is an airport in the middle of nowhere? Why are you building a road to the middle of nowhere?”

It’s not as if Sri Lankans didn’t ask those questions before, but under Rajapaksa’s increasingly despotic administration, dissent was ignored or punished. After his narrow and surprising election defeat, the country of 20 million is waking up to the excesses of his rule with what appears to be a collective hangover.

SriLankan Airlines, the deeply indebted national carrier, announced that it would cease operating from Mattala Rajapaksa International Airport in the town of Mattala, north of Hambantota. The twice-daily flights were losing the airline $8 million a year, company officials said.

New President Maithripala Sirisena has ordered a review of all of Rajapaksa’s projects – and it is a long list. To cement the government’s victory in a 26-year civil war against northern Tamil rebels, Rajapaksa embarked on a $6-billion spending binge on infrastructure projects starting in 2009.

More than two-thirds of the projects, including the port and airport at Hambantota, were financed by Chinese banks at interest rates as high as 6.3% annually, several times what other lenders offered, and did not go through open bidding processes, officials say. Authorities are investigating whether contracts were padded to benefit members of Rajapaksa’s government, which included more than two dozen members of his extended family. No charges have been filed.

“It’s a crying shame how much money was spent. Why is an airport in the middle of nowhere? Why are you building a road to the middle of nowhere?”
– Harsha de Silva, deputy minister for policy planning and economic affairs in Sri Lanka

In the meantime, finance officials are exploring ways to restructure the Chinese loans. Government lawyers are poring over contracts, trying to scale back some projects that haven’t yet begun, such as a 500-acre development on reclaimed land in the capital, Colombo, where the ex-president envisioned luxury high-rises and a Formula One racetrack.

To Rajapaksa, the projects were powerful symbols of Sri Lanka’s expansion from a small, war-ravaged economy to one of the fastest growing in South Asia.

He and members of his family did not respond to requests for comment. In an interview this month with the South China Morning Post, he defended his actions.

“I wanted development for Sri Lanka and China was the only one which had the resources and the inclination to help me,” Rajapaksa said.

Sri Lanka was so unfortunate for not to get the service of Mahinda Rajapakse for a another term being the leader of the country. Had he been there for another 5 years or 10 years, Sri Lanka would have been truly a miracle of South Asia with very high living standards and per capita income for…

Opponents counter that he built by fiat, bypassing environmental studies and economic assessments, and that China, seeking to boost its influence on the doorstep of rival India, took advantage of his haste.

“They were vanity projects for Rajapaksa, plain and simple, and China was quite happy to nurture his vanity,” said Paikiasothy Saravanamuttu, executive director of the Center for Policy Alternatives, a think tank in Colombo.

Business leaders in Hambantota said they were never consulted about the giant structures that began proliferating in their district like mushrooms after a monsoon.

A predominantly fishing and farming area that is still recovering from damage sustained in the 2004 Indian Ocean tsunami, Hambantota historically has been one of the poorer pockets of the country.

Airplane tickets and use of the convention center, as well as a five-star hotel planned for the port complex, are out of the financial reach of most residents, raising questions about their long-term viability.

Suspected war criminal Jagath Dias opens school in Vanni

*What is Good Governance? 

War Crimes in Sri Lanka-genocide

31 March 2015

A new school building constructed at the Roman Catholic College in Puthukkudiyiruppu wasopened by suspected war criminal Major General Jagath Dias earlier this month.

Mr Dias, who is the commander of the Mullaithivu headquarters of the Sri Lankan army, was leading an army division during the armed conflict and is thought to be responsible for mass atrocities committed during the final phase.

The commander was last year refused entry into Australia over his role in the final stages of the armed conflict and allegations of war crimes and crimes against humanity.

Only two days before the opening of the school on March 4, Sri Lanka's Foreign Minister Mangala Samaraweera, told the UN Human Rights Council in Geneva, that the Sri Lankan military had ceased its civilian activities.

"Just days after assuming office, the President replaced the former military governors of the Northern and Eastern provinces of the country with two senior former civil servants. This set in motion the process of strengthening civilian administration in these provinces including the cessation of military involvement in civilian activities, review of high-security zones and releasing land for resettlement of the internally displaced," Mr Samawaraweera had said.

The military's ongoing involvement in Tamil affairs almost 6 years after the end of the armed conflict has been widely condemned by Tamil politicians and activists, with numerous calls for the new president, Maithripala Sirisena to demilitarise the North-East.

Sri Lankan army extends 'welfare projects' in Jaffna (29 Mar 2015)

Continuing militarisation of Tamil school children across North-East (17 Feb 2015)

Sri Lankan military hold prayer service during Jaffna temple festival (14 Feb 2015)Sri Lanka military hands out chickens in Kilinochchi (14 Jan 2015)Military recruits Tamil youths to work in army farm (14 Jan 2015)

Sri Lankan army distribute uniforms to Jaffna school children (14 February 2015)

Sri Lankan army recruits Tamil youth as military tradesmen (31 Jan 2015)Sri Lankan military must be removed from North, Wigneswaran tells UK minister (29 Jan 2015)Sri Lankan military taking livelihoods of Tamils says North's chief minister (27 Jan 2015)

How did Lt. Col. Prasanna Wickramasuriya get money to buy ‘Rivira’?

 Tuesday, 31 March 2015

It is a question being raised in the media field as to how Sri Lanka Army’s retired Lt. Col. Prasanna Wickramasuriya found money to buy the ‘Rivira’ newspaper.

He resigned from active service on 31 December 2001 citing himself as being medically condemned. At that time, a colonel’s monthly salary stood at between Rs. 40,000 and Rs. 50,000. His wife was unemployed. ‘Lanka News Web’ was able to make several revelations when investigating as to how a person of his financial position was able to invest Rs. 100 million.

Lt. Col. Prasanna Wickramasuriya is the brother of former ambassador in the US Jaliya Wickramasuriya. They both are cousins of former president Mahinda Rajapaksa. Anoma Lafir, the widow of Col. Fazly Lafir who laid down his life in Mullaitivu, is their sister, and she had served as a coordinating secretary to the ex-president.

After leaving the Army, Prasanna had gone to live in Atlanta, USA. Then, he assisted his brother Jaliya in marketing products of Royal Ceylon Tea (Pvt.) Ltd., owned by the ex-ambassador. It was a racket in which expired tea was repacked with new dates, for which task, they had used the staffers of the Sri Lankan embassy in the US, who were being paid by the Sri Lankan government. Had the US authorities caught this racket by the Wickramasuriya brothers of repacking third grade and expired tea, Sri Lankan tea could have been banned in the US.

The Wickramasuriyas defaulted Rs. 12 million to Hayleys Shivaro and four other companies that they had used for the shipping of the tea to the US, and when they demanded their payments, the brothers had used the powers of the Rajapaksas, threatened the companies and avoided making the payments. Since the Rajapaksa regime is no more, these companies are going to demand their dues.

The aggrieved parties will soon lodge complaints against the Wickramasuriya brothers with the financial fraud investigation unit led by DIG Ravi Vidyalankara.

The main issue here is as to how Prasanna, who was also chairman of the Aviation Authority, found more than Rs. 100 m to buy Rivira Media Corporation from Sena Yaddehige. According to reports reaching us, Prasanna and his family had fled Atlanta and are reportedly seen in Seattle.

Ajith Nivad Cabraal grilled for 4 long hours ! over illicit hedging deal which entailed many million dollars loss to country

(Lanka-e-News- 31.March.2015, 10.00PM) The former Central bank governor Ajith Nivad Cabraal was grilled  for four long hours by the Colombo financial frauds investigation division located at Kollupitiya in connection with the most controversial and infamous illicit hedging deal agreements (hedging soodhuwa) entered into by the government at that time with international banks and financial  Institutions during the Rajapakse regime , which entailed a loss of many millions of dollars to the country ,owing to  which , the country had to pay these monies through the nose. 

It was Asantha De Mel  , a relative of Rajapakses (as is the case almost always in every racket) an ex cricketer who was the chairman of the Ceylon petroleum corporation (CPC) at the time this hedging deal was signed. It was revealed in court then that this chairman a relative of Rajapakses had not even passed the GCE ordinary  Level examination.

Cabraal who came out after the long interrogation yesterday(30)  ,in keeping with the  characteristic traits of the Rajapakse fraudsters spoke as though his slate was clean and claimed this  was another media display . This hedging deal which bound the government to buy crude oil at a fixed price irrespective of the prices plummeting or rising in the world market necessitated Sri Lanka to buy crude oil at the higher price when the world market oil prices plunged to lowest levels.

Again as is usual with the Rajapakses and their  regime this illegal clandestine  hedging deal was entered into for the most corrupt reasons and none other , which scam included  collection of  illicit commissions orchestrated by the Rajapakse regime and the Central bank of which Cabraal the Rajapakse relative was the governor. It is well to recall and remind that it was Lanka e news always first with the news and best with the views which exposed this traitorous corrupt deal  of the government for  the first time in the same way as it had been exposing the other State scams.

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by     (2015-03-31 17:31:33)

PBJ being grilled over hedging deal

PBJ being grilled over hedging deal

2015-03-31

A statement is being recorded from former Treasury Secretary Dr. P.B. Jayasundara by the officials of the Financial Crimes Investigation Division (FCID) at the moment.

Dr. Jayasundara has been summoned by the FCID to be questioned over the infamous hedging deal that incurred a loss of millions of rupees to the government and to the CPC.

Meanwhile, officials grilled former Governor of the Central Bank Ajith Nivard Cabraal on the same matter for more than five hours yesterday.

Sajin granted bail

March 31, 2015

The Colombo Fort Magistrate on Tuesday (31) granted bail to MP Sajin de Vass Gunawardena on a case filed by the Bribery Commission over failure to declare his assets.

He was released on a Rs 50,000 cash bail and Rs 1 million personal bail while the UPFA Parliamentarian was also prohibited from leaving the country. 

The case will taken up again on September 01.

On March 20, the Commission to Investigate Allegations of Bribery or Corruption filed the case against Mr Gunawardena under section 9 of the Declaration of Assets and Liabilities Law No. 1 on 1975.

Sri Lanka’s anti-corruption body has so far barred the Parliamentarian and former central bank governor Ajith Nivard Cabraal from leaving the country because of corruption complaints.

On January 22, the Bribery Commission issued a directive to the Department of Immigration and Emigration (DIE) to seize the passports of Mr Gunawardena and that of Mr Cabraal.

This came after the The Janatha Vimukthi Peramuna (JVP) lodged a complaint with the Bribery Commission against 12 former governmental members including former President Mahinda Rajapaksa.

Both have rejected allegations they misused public funds.  

Basil to be arrested?

Tuesday, 31 March 2015

A court has today directed the police to arrest former Economic Development Minister Basil Rajapaksa upon his return to the country.

The order was issued by Kaduwela Magistrate, Dhammika Hemapala.

Complaints against Basil Rajapaksa has been received by the Commission to Investigate Allegations of Bribery or Corruption and the financial crimes investigations unit.

The former minister has been accused of being involved in large scale financial fraud during the previous regime.

Counsel appearing for Basil Rajapaksa had presented a motion to court requesting permission for Rajapaksa to be directly presented to the financial crimes investigations unit upon his return to the country without being arrested.

The court has however rejected the motion.

Rajapaksa, who is a US citizen left the country after the Presidential election

Invest in the Global Yuan

March 20, 2015

I am teaching a course on International Business here at Georgetown University. This Spring, we have concentrated on writing editorials on international business and trade issues. All my students have written and handed in one editorial dealing with an issue of their concern. I was very impressed by their work, particularly since these young tigers, as we call them here, are the ones ascending in their societal position. They will be the ones running their families firm, electing the next government, and deciding what their aging parents should do. So to my mind, their opinions matter.

Take a look:

by Kevin Ma

Near the end of this year, the International Monetary Fund’s (IMF) will consider adding the yuan to its in-house basket of currency reserves. The basket, called Special Drawing Rights (SDR), represents claims on reserves that the IMF holds and allocates to member nations. The approval of the yuan would mark a significant step in an ongoing process by China to increase the international presence of its currency, also called the renminbi (RMB), and would put it on par with the other SDR currencies. Currently, the SDR basket consists of U.S. dollars, Euro, pound sterling, and Yen, which the IMF reports as 47%, 34%, 12%, and 7% of the distribution, respectively.

When the IMF reviewed the SDR basket five years ago in 2010, the international organization denied China’s push to include the yuan due to the currency’s lack of convertibility. In other words, it wasn’t widely used enough to be considered freely useable. Since then, China has made substantial efforts to meet the IMF’s convertibility criteria and has resulted in significant internationalization of the currency. Already, China has established 15 offshore clearing centers—in cities including London, Hong Kong, Switzerland, and Sydney—as well as swap agreements with 28 central banks. Last November, the global payment provider SWIFT ranked the RMB 5^th in the list of currencies used most in trade, up from 21^stthree years ago.

The rapid rise of the yuan’s popularity in the global market is hard to ignore, but should you invest in it? For the globally minded investor, the answer is a resounding yes.

Having only opened its economy to international trade four decades ago, China ranks as the world’s second largest economy, which carries with it an abundance of opportunity for investors. These opportunities have typically been restricted to outsiders, international investors have seen an increasing amount of access to Chinese capital markets and direct investment in recent years. Under the country’s Renminbi Qualified Foreign Institutional Investor (RQFII) program, China has already allowed ten countries to purchase RMB-denominated “A-shares,” which represent China-based companies traded on the mainland stock exchanges and had originally been limited to domestic investors only. Last year, China also became the largest recipient of foreign direct investment, with net inflows of $128 billion, while the United States’ inflows fell by two thirds to $86 billion, according to the United Nations international trade body (UNCTAD). As China continues to make the yuan more freely usable over the coming years in hopes of maintaining sufficient convertibility for inclusion in the SDR basket, investors will likely enjoy much wider access to the nation’s markets.

The benefits of a more convertible yuan aren’t restricted solely to investments within China’s borders. The greater prevalence of the yuan in world markets has also enabled Chinese investors to bring their capital abroad. The many Chinese companies that seek investments outside their country are more able to trade in their own currency instead of converting revenues back into the yuan through the foreign exchange markets. Chinese companies would be less susceptible to volatility in foreign exchange prices and thus have more incentive to invest internationally. For other nations, this would mean access to an abundant source of capital. The Chinese government reported that, in the past year alone, outbound direct investment grew more than 14% to $102.9 billion.

The European Union has been a major beneficiary of outbound investment from China. At the peak of the EU debt crisis, while most investors fled the continent and took their money with them, China-based companies surged into some of the hardest-hit countries and provided cash when others would not. Many of China’s European trading partners have benefited from the yuan’s internationalization, which has provided access to China’s mainland markets as well as capital from Chinese investors. As a result, the UK, Germany, and France are all competing to become the European hub for Chinese investment and yuan trading.

Some may worry that globalization of the yuan will lead businesses to be more susceptible to the influence of the Chinese government, which has typically maintained a tight control over its national economy and currency. This concern, however, is why investing in the yuan is all the more important. As international businesses take advantage of the growing accessibility to China’s markets, the nation’s government will be inclined to continue efforts to bolster global confidence in the yuan’s convertibility.

Within the near future, one can reasonably expect the yuan to play an increasingly dominant role in international trade. Should the IMF accept the yuan into the SDR basket later this year, China and its currency will become even larger players in the world market. For the global investor, now is the time to take advantage of this trend and become a part of the rapidly growing yuan market.

Nigeria opposition candidate wins presidency in historic race

Results Tuesday showed former military dictator Muhammadu Buhari defeating incumbent Goodluck Jonathan.

By Kevin Sieff-March 31 at 2:20 PM
KADUNA, Nigeria — In a historic moment for Africa’s most populous country, former military dictator Muhammadu Buhari won Nigeria’s presidential election, the first time in 16 years of democracy that an opposition candidate has defeated a sitting president.

Following his historic win, Muhammadu Buhari will take over a country wrestling with insurgency and financial troubles. (Reuters)
Nigeria Opposition Candidate Wins Presidency in Historic Race by Thavam Ratna