Ravi K’s critique of Central Bank – Part 2: Is the bank responsible for disappointing economic perfo

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The story so far

Monday, 8 January 2018

The former Finance Minister Ravi Karunanayake, in an interview with Daily Mirror, had put the Central Bank’s management on its toes by making some scathing allegations against the bank (available at: http://www.dailymirror.lk/article/Central-Bank-is-absolutely-corrupt-and-inefficient-Ravi-Karunanayake-142963.html). His main charge, among many others, has been that the bank is “absolutely corrupt and inefficient”.

Ravi K’s critique of Central Bank – Part 2 Is the bank responsible for disappointing economic perfo.docx by Thavam on Scribd

Bond Scam & Political Responsibility

By Rusiripala Tennakoon –January 6, 2018

Sri Lanka badly needs at-least a Ministerial Code if not a code of conduct for all our Parliamentarians. Innocent citizens are unaware of what their elected representatives should practice as reasonable good ethical practices on their behalf. Politicians in our country are undivided when it comes to increasing of their perks – be it salaries or other benefits including pension privileges. 

But rather lethargic and indecisive when it comes to declarations involving policy and responsibilities. What we see as ‘happenings’ under good democratic governance elsewhere continue to remain as unfulfilled dreams. It is a pity such a situation prevails even under a so called good governance regime! All the more unpalatable after nearly seventy years of being masters of our own destiny.

Breaking news of the Panama leaks shook the whole world in April 2016. Focus was centered on several leading political figures in addition to giants in the corporate field. We witnessed the response of many in public life immediately following this information leak.

In order to complete the record a few names are mentioned below;

 

On 5^th April 2016, ICELAND’s Prime Minister Sigmundur resigned his post when his name appeared,

Ukrainian Prime Minister resigned on 10^th April, Industrial Minister of Spain relinquished his duties on 15^th April.

Besides the political figures there were several others who resigned on moral grounds such as, Bert Meerstadt, ABN Amro Bank Board Member and FIFA ethics committee member JOHN,  and the President of Transparency International Chile,

President Mugabe of Zimbabwe was forced to resign after impeachment on corruption and mismanagement were threatened,

Theresa May fired  the one time  first secretary of State  and her  minister for the Cabinet Office Damian Green over a PORN cover up incident.

 

Michael Fallon Britain’s Defence Secretary was forced to quit on accusations of sexual harassment leveled against him;

Priti Patel, another cabinet minister of Theresa May’s government was removed for holding unofficial meetings with Israeli government officials during a private holiday.

These are some of the recent actions to uphold democracy and good governance while history records other similar events such as, sudden resignation of Lebanon PM; Richard Nixon, US President who had to quit due to the Watergate scandal and the Japanese PM who resigned a few months after his election to power due to his failure to honour election promises.

Alas!, a pity what we experience today here in our country. Governors of Central Banks refused reappointments are made Prime Ministerial advisers. Ministers virtually sacked for unethical conduct are leading political campaigns with the party leaders and enjoy highly prestigious political patronage! They appear in public platforms too and criticize the performance of high profile officials in extremely vulnerable positions that account for the good image of the country such as Auditor generals’, Attorney Generals ‘   etc. etc. Then we have Ministers who when accused of corrupt deals with facts and figures come out and publicly declare they have huge bank balances and therefore no need for them to rob ! Who cares what they have, the people only want to safeguard public money being misused, wasted and robbed.

We are also witnessing strange interpretations which appear to vivify the morale of degraded comrades by some ministerial characters. Most recent is the statement made by a cabinet minister about the Prime Ministers’ responsibility in the Central bank bond scam. While no one is interested in pinning any responsibility to any one, there are several issues that demand scrutiny and clarification due to facts revealed in the public domain on related matters, in the overriding national Interest. The following issues require specific answers rather than conciliatory whitewashings.

1. Are the following actions viewed in retrospect justified?

• The statement made by the PM in parliament on 17^th March 2015, where he maintained that  CBSL Governor Arjuna Mahendran has not committed any wrong !
• The selection of Mahendran as a suitable person to hold the position of the  Chairman of the Monetary Board of Sri Lanka,

a) While being a non-citizen of Sri Lanka who is not able to take the national oath of allegiance and loyalty.
b) With no proven acceptability for such a high post evaluated at a proper forum,
c) With no proven record of an unblemished previous background
d) Being a person connected/related to persons having dealings with the CBSL with a potential for future conflicts of interest and  insider dealings or access to sensitive information,

• The contradictions yet to be clarified, about the additional excess amounts of funds made out as required immediately one day before the questionable bond auction of 27^th February. Ravi Karunanayake under oath has stated a different amount and the former governor another amount while two cabinet ministers have stated yet a different position. What the PM stated in Parliament as the amount has not been corroborated by other evidence.
• The failure of the PM as the minister in charge of the CBSL to take adequate preventive measures after the 1st Bond scam was reported;

(I) Not sending Arjuna Mahendran at least on compulsory leave to facilitate the ongoing enquiries free of intervention /obstruction

(II) Not monitoring whether the son in law had divested himself of his interests in the primary dealer company licensed by the CBSL

(III) Failure to monitor whether similar events will be repeated as shown in the bond transactions of 29^th march and 31^st march 2016 in particular amidst the commotion already created.
(IV) Failure to obtain a report on the implementation mechanism and the  resulting consequences of the directive given by him personally to the Governor to change the bond auction system

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Early Parliament session to table Bond report

The members of Presidential Commission of Inquiry that probed into serious frauds and abuse of power by the previous regime handed over its report to President Sirisena at his office this week

By Our Political Editor-Sunday, January 07, 2018

• President did not show the report to the PM and did not meet him, but telephoned to brief him on theaddress to the nation
• 
  
• Paradoxically, the SLFP and the UNP agree not to criticise each other during the ongoing campaign for the February 10 local polls
• 
  
• Questions whether Sirisena disclosed the report to boost the SLFP’s chances at elections; the UNP holds 70th convention today

Early Parliament session to table Bond report.docx by Thavam on Scribd

What were revealed in the Bond Commission report ? What were concealed ? What ought to be done now?

-Visal’s analysis

(Lanka-e-News - 07.Jan.2018, 2.00PM)  The report of the Presidential Commission appointed to inquire into the  treasury bonds issue which comprised 1135 pages each of A4 size was handed over to the president . The latter  who  read it for 48 hours hardly sleeping a wink, revealed extracts of it which caught his fancy before the Television cameras . 

He said , while mounting the election campaign  stage as the SLFP leader , that he did not appoint the Commission targeting a particular party (UNP).

However , when the Commission was holding sessions  and based on the media reports after the report of the Commission was  out  , the fact that the UNP was targeted  cannot be concealed . The fact that the UNP was targeted for attack by the SLFP holding media briefings regularly  after allocating long periods of time   specially via the television channels of the state media to give wide  publicity also cannot be concealed.

Sudharshana Gunawardena the Government information official says the election criteria are being followed , yet the State media are favoring the Sirisena group. Gunawardena who is struck dumb over the Lanka e news ban ,  and had been unable to give a suitable reply for two  long months to the letter sent by the lawyer for Lanka e news has demonstrated his incapability instead of  proving his capability. 

Even though the Bond Commission report has not been released to the public , based on the  announcements and insinuations  made by the president , it is necessary to dissect the views which have emerged sans political affiliations. Simply based on the political objective to attack the UNP , misconceptions and misgivings have arisen among the public pertaining to the  Bond Commission. Our fear  that there could be a  danger  of digression in this exercise  while  searching  for the truth , the  fraudsters could be aided  has not been dispelled , neither has our stance changed. 

COPE Committee  report and self seeking opportunism 

What must be mentioned first and foremost  is : While Sirisena was seeking to become the self proclaimed hero in the race , his Bond Commission recommendations have not gone even an inch  beyond those of the COPE report that was appointed in the same  connection. In both these reports there is nothing which says there had been political interference or influence. 

The COPE Committee report on the recommendation of the P.M. to take action action according to the laws was handed over by the speaker to the Attorney General about a year ago. Since the recommendations made in the report of  the presidential commission now by the AG were already made in the COPE report then  , it is only precious time which has been wasted – about a year had been wasted without taking legal action.
 
There is nothing wrong if anybody concludes the Bond Commission which could not investigate anything anew was a project of Sirisena designed to mudsling at the UNP. The charges mounted against Ravi Karunanayake are extraneous matters  as far as the  the Commission is concerned  and facing those are his responsibility. On the other hand if the AG had taken  action duly based on the recommendations contained in the COPE report , by now it would be at trial stage in courts.  If that was the case justice would have been meted out to all parties , and the political mudslinging could have stopped then and there. Sadly, that was not the aim and agenda of Sirisena . Justice is anathema to him  him. Prone to procrastination , he delayed everything until elections are around the corner . That is the innate characteristic of opportunists.  The irony of it is - the unfortunate victims of opportunism are the masses and not the opportunists . 

If the president is not an opportunist and truly loves the  country , in the preliminary  stage itself he should have cancelled  the doubtful  bond transaction  , and exercising his executive powers ordered to  call for bids again. If he had done that none of these empty issues would have cropped up .

On the contrary , what Sirisena wished was , allow the transaction to take place , and if anything had gone amiss to cash in on that to sling mud at the more powerful party of the consensual government , whereby he only drove the entire government into a deep predicament. Finally Sirisena by trying to cut the nose to spite the face became a Sillysena.

It is the view of popular  analysts of the Financial market , there may be unsolved  issues amidst the mudslinging , between  the  COPE report and Bond Commission report .

It is the perception of foreign specialists who have expert knowledge on this subject that the Perpetual Treasuries Co. had acted in a manner to turn the Central bank procedures to its advantage. Such incidents are natural in any financial market in the world, as they are not charity Institutions. Perpetual securities  is a company  whose goal is  to make maximum profit in  the Financial market.

State banks , State funds including about 15 companies  function as primary buyers. It is one group that participates in the treasury bond transactions of the companies. Among those who are in the same sphere , knowing each other and and exchanging information are  something to be  expected. At the same time there can also  be groups who are employed in the Central bank.

The COPE report pointed out that the Central bank activities have been carried out sans transparency , and there are reasonable doubts  that there is a betrayal   of the confidence reposed in the Central bank . This is a good observation and an index signaling what  could happen. 

The COPE Committee report also mentioned that the Perpetual Treasuries, a primary dealer during a short period had been able to earn a massive profit. It is significant to note neither the COPE report nor the Presidential Commission report has  used the word ‘fraud’  or anything that  suggests there has been a fraud. Instead it has gone on saying  ‘ massive profit ‘ and ‘massive gain’ only.

It is the view of some ,because Perpetual Co. purchased the bonds below  the published value there was a loss to the government . Specially the JVP and the Auditor General are of that opinion. The UNP group of M.P.s who added a footnote at the COPE Committee are of the stance fluctuations in the market prices can be anticipated , and owing to that the government can incur losses.

According to Financial experts , the stance of the UNP group is technically not incorrect .  Therefore has the government suffered loss? If that is so how should the transaction be conducted? The COPE Committee had  two standpoints. 

Minister Rajitha Senaratne at a media briefing to reveal the cabinet decisions   said ,  the assistance of foreign financial counselors are necessary . It is the opinion of many analysts that is a most unerring conclusion. 

By this transaction if the State institution, Bank of Ceylon’s  EPF funds have sustained loss , it Is unarguably because of its  wrong decisions taken at the Financial market as the   responsibility of perspicacious  conduct is shouldered by those  Institutions.

The profits made by Perpetual Treasuries in the dual market have been indicated in their 2015/2016 Financial report. Hence these profits are not illicit earnings , and made with transparency, and subject to taxes.

Figures of their own untrustworthy to the Commission …

The figures revealed by the Presidential Commission to a great extent do not portray the true picture and based on assumptions subject to changes , is the opinion of specialists.  As the presidential Commission itself had recommended that a forensic financial audit shall be conducted if the  actual amount is to be  ascertained ,  it is itself  testimony they have no faith in their figures. What actually should be done is enlist the assistance of impartial foreign financial specialists and investigate this with a view to rectify the shortcomings in the present financial  market , and ensure against such  situations   cropping up again in  the future.
 
Those who can speak about the treasury bonds and express views ought to be those who have  specialized knowledge. Not idiots and imbeciles like Wimal who could not even pass the GCE O/L or Mahindananda who was just a clerk . These imbeciles have knowledge  only to enhance their cosmetic appearances with gel on their hair and make up on their faces to look photogenic, but  have  no core values. Just because they have cavernous stinking mouths ( from which a lie never fails to drop each time they open those)  does not mean their loud utterances can express right opinions or impress any sane and sensible individual. 
 
It is because every vagabond , fraudster and scoundrel was  given the opportunity to express their views the true position pertaining to the bond issue was drowned in their idiocy and imbecility , and unwarranted mudslinging was hurled at the UNP. It is very unfortunate  president Sirisena who was propelled to the exalted presidential post by the UNP took undue  advantage of the situation and made it an opportunity to commit villainies against the same UNP - Bit the hand that fed him.

We have only been opposing that. We were never against conducting a probe into the treasury bonds issue to investigate the truth . However except the conjectures and assumptions relating to the bonds , the actual information and statistics had not been revealed yet .All what we can hope is at least those will come to light in a future court proceeding .

By Visal Karunaratne

Translated by Jeff 

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by     (2018-01-07 08:48:20)

Ranil exposes MR-era bond scams

• PM says Rs. 4 trillion bond sales from 2008-2015 without Monetary Board approval 
• Rs. 10 trillion to be paid over next 25 years, allegations to be soon probed by Govt. 
• Instructs ministers to safeguard documents in CB, NSB and Insurance Corporation  
• Ready to debate bond report in P’ment, backs transparency as sign of Govt. openness 
• Insists committed to fighting corruption, over 60 cases either filed or under investigation
• Bashes Rajapaksa over debt, believes UNP can develop villages as it has already stabilised national economy   

Prime Minister Ranil Wickremesinghe addressing the meeting at Campbell Park - Kushan Pathiraja

Monday, 8 January 2018

Kicking campaigning for the upcoming Local Government elections into a new gear, Prime Minister Ranil Wickremesinghe yesterday said the Government would have to pay a whopping Rs. 10 trillion over the next 25 years due to allegedly irregular bond sales of Rs. 4 trillion from 2008 to 2015 without the Central Bank’s Monetary Board approval.

Attending a special Convention at Campbell Park yesterday accompanied by stalwarts of the United National Party (UNP), including Deputy Leader Ravi Karunanayake and General Secretary Kabir Hashim, the Prime Minister spoke in detail about the bond report and its repercussions. As the bond report had recommended an audit on alleged irregularities in bond sales from 2008-2015, Wickremesinghe insisted the Government was committed to beginning investigations into these allegations “as soon as possible.”

The Prime Minister also noted that he had no objection to convening Parliament early to debate the report handed over to President Sirisena and was fully prepared to make the request of Speaker Karu Jayasuriya. He also recounted how he had appointed the Pitipana Commission, which led to the probe by the Committee on Public Enterprises (COPE) chaired by MP Sunil Hadunetti and later the appointment of the Presidential Commission of Inquiry.

“Under what other Government have there been three debates in Parliament about a corruption issue? What other Government saw the Prime Minister and top ministers giving evidence before a Presidential Commission? All those who support good governance should rest assured that we are here to fight corruption and we will take legal action against wrongdoers. We will work with transparency,” he said.

Wickremesinghe stated that he had assisted investigations at every point, making repeated requests to the Attorney General’s Department for advice, and coordinating with the Central Bank and other officials.

He blamed former president Mahinda Rajapaksa for leaving the country with high levels of debt and insisted the parliamentary debate on the bond report would be an ideal occasion to raise questions about the bond transactions during the previous administration.

“I have instructed the Finance Minister and Public Enterprise Development Minister Kabir Hashim to safeguard all documents within the Central Bank, National Savings Bank and Sri Lanka Insurance. Who stole Rs. 10 trillion? Since there has already been talk about the (allegedly) Rs. 10 billion loss then lets debate the Rs. 10 trillion as well.”

“I’m waiting for the media, who reported so assiduously on the Presidential Commission, to also start questioning about the bond sales during the previous administrations. If they do not do so I will ask them if they are afraid,” he said.

Rejecting criticism over the slow progress of investigations, Wickremesinghe said 19 cases had been filed, 40 were still under investigation by the police and 24 files are likely to be probed at the second Presidential Commission, which President Sirisena had earlier announced would be appointed in January.

The Government was also proceeding with plans to set up new courts and a team had been appointed by the Attorney General to focus on cases, but he conceded the process would take time.

“People who destroyed the economy of this country in the past are now asking to be handed the villages. If they cannot take care of the national economy how can they take care of the village? Rajapaksa held elections two years early because he was afraid of the economic plight he had pushed this country into and then he just ran away. We took on the challenge. We stabilised the economy and set it on the path to development. We can do the same at the village level too.”

“You gave us the country in 2015. Now give us the village,” he told the gathering.

Recalling the previous poor record of women’s representation, Wickremesinghe pointed out it was the UNP which had introduced the 25% quota system and thereby given women a stronger chance of getting elected. He therefore called on women to vote for the UNP and pledged to work for more women’s rights in the future.

The Prime Minister also gave a detailed account of the steps taken to develop the economy, highlighting the economic plans, progressive Budget and steps to establish new factories and investment zones as well as attract foreign investment.         

Govt. creates history with first ever Rs. 22 b surplus in Budget Primary Balance 

Due to efficient management of State revenue and expenditure, the Government for the first time in 63 years has been able to achieve a Rs. 21.9 billion surplus in the primary balance of the fiscal accounts during the first 10 months of 2017.

The Finance Ministry said in the post-independence history of Sri Lanka a surplus in the budget deficit was first recorded through 0.5% of the GDP in 1954. Later in 1956 this Budget surplus had increased to 2.2% of the GDP.

The surplus in the current account was registered from 1950-1970 and later from 1973-1994. Since then up to now the overall Budget deficit, deficit in the current account and the deficit in the primary balance were in negative growth continuously.

During the first 10 months of 2017, the surplus in the Budget primary balance was Rs. 21.9 billion. It was in negative by Rs. 37 billion during the corresponding period of 2016. Treasury officials are of the opinion that the favourable situation in the primary balance is a sign of positive growth in economic development and it will further enhance the capacity to manage debt repayment efficiently. Having an excess in State revenue more than the whole state expenditure minus the interest payment is known as the surplus in primary balance.

State revenue, when compared with the first 10 months of 2016, has increased by 10.4% to Rs. 1,473 billion in 2017. It was Rs. 1,333 billion during the same period in 2016. Tax revenue during the same period has increased by 14.2% to Rs. 1,470 billion in 2017.

Furthermore, State expenditure has increased by 9.5% from Rs. 1,881 billion to Rs. 2,060 billion. Interest expenditure during the first 10 months of 2017 alone is Rs. 609 billion apart from the domestic and foreign debt repayment of Rs. 856 billion.

Ravi Must Go From His Deputy Leadership Forthwith

By Shyamon Jayasinghe –January 5, 2018

“Hence, hats off to President Sirisena for constituting a separate Presidential Commission”

Without Choice

Looking at the Bond Commission Report, he has no other choice. In the interests of the Grand Old Party, Ravi Karunanayake has to voluntarily resign. This will earn him the respect of the UNP rank and file and the general political public.

Of course, the matter has to be referred to court for a final justice. That is no reason for Ravi to cling on behind. On more than a prima face basis, he is seriously suspect. Honour and ethics demand he must go. If he does resign without being asked to do so and if eventually the court decision acquits him, then he can get back with a significant portion of honour restored to him on which he can rebuild his broken image.

Rosy Senanayake, the Colombo Mayoral candidate, must gently ask Ravi to get off his back. He now stands as a liability to her probable victory.

President Maitripala Sirisena, who managed to salvage honour by referring this matter to a Presidential Commission, unfortunately cannot weigh on the proposal to get Ravi out because he is, curiously, heading the campaign of another party at the local polls. Under the JR constitution the President’s position as head of State is compromised at elections. This is yet another aspect of the undesirability of this constitution, which everyone except the JO wants to get rid of.

If the resignation does not happen and if he isn’t removed, then firstly, the Party and its leader will suffer debilitating damage and will not be able to deal with subsequent cases of serious misdemeanour on the part of its members. The Yahapalanaya government will take a severe blow and will be unable to talk morality after that.

The party leader has just been left short of getting implicated. The public respect he earned as Mr Clean got almost tarnished; yet for his luck he escaped in a situation that could have been interpreted as complicity. Neglect to monitor the former Central Bank chief and Ravi himself could have possibly put Ranil Wickremesinghe into hot water. For Ranil to say that  that he was the first to forward COPE papers to the AG is neither here nor there. The AG is already saddled with a super load of cases flowing from the unending misrule of the former regime. Even poor old Thajudeen has not yet been avenged and given justice. Gota and Basil are freely on the ride with Gota now morphing  into playing the image of a learned guru on the advice of advertising experts and Basil been given long dates.

Under such circumstances, a case as complicated as the Bond issue would have been an unmanageable burden for the AG. Hence, hats off to President Sirisena for constituting a separate Presidential Commission. Now, we have a complete investigation done following  judicial principles-ready-made for AG to take action. How long will that take is another prayer.

While action is done on Ravi Karunanayake, both the President and Prime Minister  must get on with the job of getting the looters  and murderers of the former regime into court; and from there, possibly, into jail. The neglect to do this has been a source of severe disappointment to the public.

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Citizens’ justice for the mother of all scams

By SANJA DE SILVA JAYATILLEKA-January 7, 2018

There is now little doubt that a scam has been perpetrated with no remorse on Sri Lanka as a whole, by those who were meant to protect its financial integrity. The scam was pulled not once, but twice, within a few months. Incredibly, the second one took place after a Parliamentary committee had established that an unprecedented fraud had taken place and several irregularities that enabled it were identified.

From the many reports in the media, the massive swindle has resulted in a loss to the state of Sri Lanka (read the collective wealth of its citizens) of at least Rs. 11 billion, just for a start. And all this took place in the most sacred precincts of the Central Bank, allegedly at the hands of its guardians.

Thanks to some diligent media interest, on most evenings one got details of how the scam was carried out, as investigations revealed an astounding lack of ethical restraint and shocking disregard for the ordinary citizens who would eventually pay for what was essentially a colossal bank heist. The outrage of the presenters of the evening news as the Presidential Commission report was released was palpable as they hosted a special segment dedicated to this misdemeanor.

The consequences of the whole sorry affair fell on the heads of the innocent citizens, much like the stinking garbage mountain of Meethotamulla, burying them under increased interest rates, the falling value of the rupee, increased cost of staples, more government loans, and a loss of faith in the Parliamentarians who could not credibly explain their own shameful involvement in it.

In a brilliant deconstruction just weeks after the first scam was carried out on the 27th of February 2015, an analysis of the fraud was posted on Groundviews by Prof. Sam Samarasinghe and Dushyantha Mendis. Their analysis is clear enough for an amateur to understand the irregularities. Through the various in-depth analyses on TV and in the newspapers, it has become clear to regular citizens that the country and its people have been robbed by sophisticated financial maneuvers thought to be beyond discovery due to their complexity. It has come to light only due to the courage and integrity of a few officials, a relentless media, concerned citizens, and some Parliamentarians.

The story started with the Central Bank, presumably after due consideration of its experienced officials, offering the figure of 1 billion in Bonds, the lowest offered in the last six auctions. The story ends with The Central Bank accepting 10 times its own original offer, at high interest rates, for a thirty year period, to the unprecedented and vast benefit of some of the dealers and a proportionate and enormously excessive cost to the country. According to the Presidential Commission, crimes have been committed and it recommends criminal proceedings against several of the actors involved including the Finance Minister at the time.

That the President chose to address the nation on the day the report of the Presidential Commission was handed over shows that this was a scam of monstrous scale, in a country that has not been short of them. It is an indelible slur on the slogan on which this government was elected to power. It discredits the very notion of ‘Yahapalanaya’ or ‘good governance’ which will forever be associated with ‘Bond scam’ in the minds of the people.

It is incomprehensible how some officials could go along with suggestions that were so enormously detrimental to the welfare of the people on a scale and in a manner that had never been attempted even in South Asia where corruption is endemic. How could they do this to their own country and its people?

This brings us to the observation that the Governor of the Central Bank was not a citizen of this country, and couldn't be expected to restrain himself on account of patriotism. This makes those involved at all levels who are in fact citizens, a callous group who would use their expertise and their privileged positions to wittingly burden their country and citizenry with long term financial difficulties instead of relieving those burdens.

How is it even possible not to consider the consequences to the people already struggling to survive, who are now burdened much more? How is it that reducing the people’s burden was not an overriding consideration not only for politicians who thrive on their support but for the officials who are in positions of power to do so?

Obviously, a country cannot rely on the integrity of neither its politicians nor its officials. That is why there are systems in place to prevent fraud. It is now clear that in the one place that should be double locked, doors and windows have been left open for theft.

Since the risk is as high as has now been demonstrated, an urgent task has to be the implementation of the recommendations of the Presidential Commission to improve the system of controls at the Central Bank, ensuring its independence, and to introduce similar measures at the other government institutions that have been implicated. For a start, it might be prudent to legislate that the Central Bank’s top official should be a citizen or dual citizen (which is the same thing) of Sri Lanka.

Perhaps, it is providential that an election is at hand, and the people will have an opportunity to respond. There is something right with a country that ensured that such a scam could not be conducted completely in the dark. The retired senior officials who sounded the alarm, those courageous officials who refused to go along, the whistleblowers who risked very real danger to their lives, the decision of the President to appoint the Commission, the outstanding personnel of the Attorney General’s Department who were part of the Commission, a lively media with a social conscience, and some dogged politicians and concerned citizens, brought it out into the full glare of an incredulous but grateful public.

The angry TV presenters of one of the media houses showed their outrage at the extent of the loss that resulted to the country by immediately recounting the unconscionable plight, 70 years after Independence, of school children studying under trees, villages without clean drinking water, desperate farmers without irrigation, and communities isolated for lack of roads that they had encountered during their programs, all of which could have been addressed with the money that was lost to the country. This is in addition to the direct losses to the EPF and Mahapola fund. Their anger is our hope.

These educated professionals, mostly young, are refusing to countenance the contempt displayed by this and other such corrupt practices by a political elite without pity or mercy for the citizens who entrust to them the care of the country and their welfare by voting them into parliament.

The voters who are tempted to stay at home through disappointment, should make the effort to go out and have their say, for in those people who showed courage and integrity, there lies a glimmer of hope. This is a chance to show moral revulsion and administer citizens’ justice to those who tried a scam so monumental and morally offensive, and nearly got away with it.

[The writer was member of the team that applied the Sarbanes-Oxley regulatory framework at GlaxoSmithKline, London, in the aftermath of the Enron scandal.]

Bond Commission report; -orders swift action

DIRECTS GOVERNOR TO CONSULT MONETARY BOARD AND TAKE STEPS TO IMPLEMENT RECOMMENDATIONS

FOREIGN EXPERTISE SOUGHT

Saturday, January 6, 2018

Prime Minister Ranil Wickremesinghe has directed Central Bank Governor Dr. Indrajit Coomaraswamy to discuss with the Monetary Board and take steps to implement the recommendations of the Bond Commission report as soon as it is released.

Prime Minister Wickremesinghe yesterday held discussions with authorities at Temple Trees about measures that need to be taken to implement the recommendations of the Bond Commission.

The Governor informed him that they were looking at getting foreign or local companies to conduct a forensic audit, as recommended by the Commission. As the Commission had also pointed out that investigations need to be carried out with regard to bonds issued between 2008-2015, discussions at Temple Trees also touched on the measures that need to be taken to secure all documentation within the Central Bank during that period.

A committee comprising of the Central Bank Governor, Treasury Secretary and the Secretary to the Ministry of Law and Order were formed for this purpose.

The above discussions with the Prime Minister were held with the participation of Finance Minister Mangala Samaraweera, Law, Order and Southern Development Minister Sagala Ratnayaka, State Minster of National Policies and Economic Affairs Niroshan Perera, State Finance Minister Eran Wickremaratne, Deputy Minister National Policies and Economic Affairs Harsha de Silva, Secretary to the Prime Minister Saman Ekanayake, Treasury Secretary Dr.R.H.S. Samaratunga, Secretary to the Ministry of National Policies and Economic Affairs K.D.S. Ruwanchandra, Secretary to the Ministry of Law, Order and Southern Development Padmasiri Jayamanne and Central Bank Governor Dr.Indrajit Coomaraswamy. 

Leopard attack in Hatton Changing spots to solve the problem Will relocating the animal help?

By Risidra Mendis-2018-01-07

The circumstances leading to the attack on five estate workers from the Panamure Estate in Hatton a few days ago by a male leopard are yet to be established.

While villagers blame the leopard for the attack on the estate workers, environmentalists say that the leopard is not at fault and would have attacked the villagers because it was trapped or threatened.
The five injured estate workers were admitted to the Dickoya Hospital on 2 January. However environmentalists say the video aired on TV of villagers chasing the leopard is a clear indication that the animal was threatened and scared by them and would have attacked in self-defence.

But due to intense pressure by villagers in the area and threats that the leopard will be killed if caught by them, wildlife officers have decided to capture the leopard and relocate it to another area.

Bad press

Trustee, Leopard Trust, President, Wildlife and Nature Protection Society (WNPS) and Director, Environment Foundation Ltd (EFL) Rukshan Jayewardene told Ceylon Today that leopards are an integral part of all natural eco-systems in Sri Lanka.

He explained that when leopards are absent from a jungle area, it means their extirpation happened due to a critical depletion of the prey base that the leopard needs to live on, or the radical conversion of the landscape such as urbanization, to make it habitable for humans but hostile to wildlife.

"Leopards have adapted to live at least partly in certain urban landscapes. Three cities that immediately, come to mind are Nairobi in Kenya, Mumbai in India and Kandy in Sri Lanka. Unfortunately in this adaptation, leopards are often pushed to prey on livestock and pets that replace natural prey in a human dominated landscape.

"When this happens, leopards and humans are on a collision course, where predictably, leopards are vilified and persecuted and all the appalling bad press that leopards have got for over a century of ignorant reportage is repeated by an irresponsible media, looking for sensation," Jayewardene explained.

He added that particularly in an island such as Sri Lanka that has had pre-historic hunter-gatherers for thirty thousand years and a long settlement history involving both urban and rural population centres and large scale agriculture that encompassed much of the island, since pre-Christian times, leopards have learnt how to live with people rather than the other way around.

"Fossil bone evidence for the presence of both tigers and lions since pre-historic times is further proof of the leopards' great adaptability and ability to adjust its own needs to ensure survival where others failed. The incident like that at Panamure Estate is so out of character for known behaviour of wild leopards, a leopard attacking several people at the same time, beggars belief (but it happened).

"When a leopard's or any big cat's 'fight or flight' response is triggered, the fight 'mode,' will be used only as long as flight is not possible. At the first opportunity to break away from the attack, the leopard will choose that option and run away which ensures, lower risk of injury to itself, potentially impairing its ability to hunt prey.

"A leopard's very survival, depends on peak fitness. When injured, there is always the option of scavenging to survive, but that option is not without its own attendant risks, and the ever present challenge from rival leopards cannot be overcome," Jayewardene said.

Outdated views

He said that a leopard does understand these seemingly complex issues, although from our arrogant human standpoint we believe that a leopard can't possibly understand such things, and we have been taught that their seemingly intelligent, behaviour is genetically coded instinct.

"This outdated, anthropocentric viewpoint is one of our greatest stumbling blocks; dare I say as a species? And makes us constantly underestimate other intelligent species that we need to contend with. A cornered leopard, or a leopard mother defending its cubs, will not conform to the known or expected pattern of behaviour, and will display all the fierce courage, immense strength, lightning speed, and resourcefulness, of one of the most successful land mammals that the world has ever seen.

 All of this is backed by a very good understanding of human behaviour," Jayewardene explained.
He added that the tragic irony of what is ongoing in Hatton never needs to happen and that wild leopards are one of this country's great natural assets, and people that live close to leopards, can through proper education and awareness programmes become beneficiaries of the leopard's great attraction to both local and foreign tourists, who would pay well for just a glimpse of a free living leopard, outside of a traditionally protected area.

"These are fast becoming more like zoos than true wilderness areas due to over visitation. A leopard is endowed with many unique abilities that enable it to live as an apex predator. Apart from instincts, super senses, that serve it equally well, day or night and other evolutionary traits, the leopard's greatest asset is its capacity to learn from its mother as well as through its own experience.

"The most important lessons that a leopard will learn during its lifetime will be about people who are their neighbours who live in a landscape similar to their own requirements. We cannot herd wild leopards into National parks and sanctuaries because we now increasingly live and farm in areas which were not long ago, exclusively leopard habitat. This is patently impossible to do, for several good reasons.

"We cannot search and destroy all leopards living near settlements because it is illegal and leopards have a high level of protection under the Fauna and Flora Protection Ordinance (FFPO) and perpetrators are punishable to the full extent of the law," Jayewardene explained.

He added that people deal in myths, anecdotes, horror stories and hype, and are constantly surprised and therefore caught flat-footed, when leopards don't correspond to our beliefs about them.

"Unfortunately; this is true of the Department of Wildlife Conservation (DWLC) in general, that has yet to put into place an excellent protocol for incidents such as what is ongoing in Hatton. Unhelpful and irresponsible references such as the Enemy (Sathura) that are being used in the electronic media only compounds, an already vexed and emotional situation," Jayewardene said.

Losing their habitat

Commenting on the leopard attack in Hatton, Zoologist Dilan Peiris said not much attention is paid towards Up-country leopards in Sri Lanka. "Due to the clearing of tea estate areas to plant new tea bushes, due to the new houses being built and the clearing of forest areas in the Up-country, leopards are losing their habitat every day.

"When the leopards lose their source of food, it is only natural that they will go into villages and prey on dogs and cattle. When people see a leopard in the village they chase it away or try to kill the animal. A leopard will attack a human only if it is threatened or if it wants to escape from being captured. Yala and Wilpattu National Parks are famous for their leopard sightings.

But DWLC has no idea as to how many leopards there are in the country and where these animals are located," Peiris said.

He added that no research has been done recently on the leopard population in Sri Lanka and that for many years he has been saying the leopards have to be protected and awareness programmes should be carried out to ensure their survival in the wild.

"When I complain to DWLC about the danger to leopards in the country, wildlife officers ask me what should be done to solve the problem. When a leopard attacks a person in one area, relocating the leopard is not a solution to the problem.

"It is the people who cause problems for the leopard, but it is the leopard that has to eventually suffer through relocation to another area. The leopard brings in a lot of foreign revenue but is not protected from being injured and killed by DWLC," Peiris explained.

DWLC Director General M.G.C. Sooriyabandara confirmed that plans are underway to capture and relocate the leopard that attacked estate workers in Hatton.

"The leopard is not in this area now but a team of wildlife officers are waiting to catch the animal when it

reappears. Relocation is not the solution to the problem. However when a group of people get together and say they want the leopard out we have no choice but to relocate the animal for the animal's safety.

"Leopards are territorial and relocating is difficult. However once we capture the leopard we will examine the health of the animal and then decide where we are going to relocate it to," Sooriyabandara said.

US and India pressure Sri Lanka over port deal with China

By Saman Gunadasa -30 December 2017

The Sri Lanka government formally handed over Hambantota Port to China Merchant Port Holdings (CMPH) on December 9, after almost two years of negotiations. The port is located on the country’s southern coast, close to some of the world’s busiest sea lanes.

Addressing the ceremonial hand-over, Prime Minister Ranil Wickremesinghe declared that Sri Lanka was “on its way to being the hub of the Indian Ocean.” Its port facilities—in Colombo, Hambantota and Trincomalee—were “part of the modern maritime silk route.”

China’s Xinhua news agency reported that Sri Lanka had “joined China’s Belt and Road Initiative (BRI)” through the Hambantota Port joint venture.

The US and India, its strategic regional ally, are hostile to Beijing’s growing influence in the Indo-Pacific region. The BRI is aimed at connecting more than 60 countries in Asia, the Middle East, Africa and Europe via land and sea, ensuring China’s ongoing access to oil and other energy supplies (see: “China hosts international launch of One Belt, One Road initiative”).

Under the Hambantota deal, Sri Lanka has sold a 70 percent stake in the port to CMPH via a 99-year lease, while retaining a 30 percent share under the state-owned Sri Lanka Ports Authority.

Two Chinese companies established to manage Hambantota Port operations were given a 32-year tax holiday. Prior to the deal, the government retrenched 435 port workers. Colombo is also handing over 15,000 acres of land near the port for Chinese companies to build an industrial zone.

After coming to power in January 2015, President Maithripala Sirisena suspended various Chinese-funded ventures, including the multi-million dollar Port City of Colombo project. Sirisena and his allies said the projects were initiated under former President Mahinda Rajapakse, accusing him of corruption.

The real reason for the suspensions, however, was fierce opposition from the US and India to Rajapakse’s close economic and political relations with China. Beijing provided loans and investments as well as arms to Colombo for its war against the separatist Liberation Tigers of Tamil Eelam (LTTE).

Mounting government debt and falling national export earnings, however, have forced the Sirisena-Wickremesinghe government to turn back to China for financial help. The government revived talks with Beijing and, after modifications to the terms of the China-funded ventures, the projects resumed. This included the Hambantota Port deal, which has been used to reduce Colombo’s debts to Beijing, recently estimated at more than $US8 billion.

At the Hambantota Port ceremony, Wickremesinghe enthusiastically held up a large replica of a $292 million cheque—the first instalment of the $1.12 billon CMPH is paying for its share of the port. “With this agreement,” he declared, “we have started to pay back the loans.”

The US and India oppose the port deal and are stepping up their political pressure on Sri Lanka. Asked about the joint venture on December 14, Indian foreign ministry spokesman Raveesh Kumar declared: “We continue to take up with Sri Lanka issues related to security concerns in the region and expect that our Sri Lankan friends will keep in mind our security concerns and sensitivities.”

In other words, New Delhi regards Colombo’s move as a threat to Indian “security” and will respond accordingly.

Colombo attempted to appease Indian concerns during the Hambantota Port negotiations by offering India a 70 percent stake in Mattala Mahinda Rajapakse International Airport, which is located close to Hambantota, and a share in the development work at Trincomalee’s deep sea port.

Wickremesinghe visited India last month and met with Prime Minister Narendra Modi to discuss these deals. The Indian press reported that talks were also held on Indian investments in the Colombo Port’s eastern terminal.

The Western press has published concerned reports on Colombo-Beijing relations and the Hambantota Port deal. A New York Times article on December 12 quoted Constantino Xavier, a fellow at Carnegie India, who said: “India has been overwhelmed by China’s offensive in its strategic backyard.”

On December 20, Project Syndicate published a hostile critique on the port deal by Professor Brahma Chellaney from the pro-US Centre for Policy Research in New Delhi. Headlined, “China’s Creditor Imperialism,” the article accused China of using state loans to take control of other countries. “[A]s Sri Lanka’s experience starkly illustrates, Chinese financing can shackle its ‘partner’ countries,” Chellaney wrote.

Chellaney ludicrously claimed that Beijing was playing the role of 19th century Britain, which occupied Hong Kong via a 99-year lease, following the Opium Wars. “Now, China is applying the imperial 99-year lease concept in distant lands.”

Referencing a Chinese company’s acquisition of the Mediterranean port of Piraeus from the cash-strapped Greek government for $436 million, he declared: “China has encouraged its companies to bid for outright purchase of strategic ports, where possible.”

Chellaney also noted China’s leasing of the Darwin port in Australia, a military installation in Djibouti, a few miles away from a US naval base, and its activities in Turkmenistan, Kenya and other countries. These countries, he claimed, “have been ensnared in a Chinese debt trap, forcing them to confront agonising choices in order to stave off default.”

In September, US Assistant Secretary of State for South and Central Asia Alice Wells told a congressional committee: “China is providing non-concessional loans that promote unsustainable debt burdens, which I think are increasingly now of concern to the Sri Lankan people in the government.”

The US and Indian response to growing Chinese influence in the region has been to step up their threats. When the Maldives government expressed its support for China’s BRI and signed a Free Trade Agreement with China, India’s Raveesh Kumar declared that New Delhi expected the island nation to be “sensitive to our concerns in keeping with its India first policy.” This was also a warning to the Sri Lankan government, which is currently negotiating a Free Trade Agreement with China.
At the same time as seeking financial assistance from Beijing, the Sri Lankan government is integrating the country into the US-led military build-up against China. The bitter reaction of the US and India to the Hambantota Port deal is a warning to Colombo that it must not deviate from a pro-US strategic agenda.

Schoolchildren trapped in Piliyandala drug racket 

2018-01-07

A well- organised drug racket which has continued for several months targeting schoolchildren in the Piliyandala area has been revealed to the Daily Mirror.

It was revealed the drug menace had completely affected the Batakaththara, Madapatha, L. S.Watte, Kahapola and Makandana areas and is popular among the schoolchildren as “Paspanguwa” due to its distribution in five ways.

Among the drugs found were toxic arecanut (Mawa), tablets, Kerala Cannabis, toxic powder and toxic drinks.

When the Daily Mirror inquired into the matter it was revealed that drug peddling in the entire area had been conducted under the protection of some local politicians.

The drug peddlers are reportedly using a new technique to addict school children into the drugs by introducing the toxic areca nut and toxic drinks from the ages of 10 to 14 for a lesser price.

The toxic powder, Kerala Ganja and tablets are given upper classes students including advanced level students in the area.

Also it had been reveled that the students were attracted to these drugs in Internet Cafes’ in the area, near Sunday Schools and the schools.

When contacted, some residents who wanted to remain anonymous due to threats by drug peddlers said one third of the school children had already addicted and some of them had abandoned school and selling the drugs due to the benefits received by the drug peddlers. (Thilanka Kanakarathna)

Iran in 2018

Why does Iran permit foreign-funded operatives to attempt to destabilize the government as Ukraine did and as Venezuela does today?

by Paul Craig Roberts-Jan 6, 2018

( January 6, 2018, Washington DC, Sri Lanka Guardian) In 1953 Washington and Britain overthrew the democratically elected government of Mohammad Mosaddegh and installed a dictator to rule Iran for the benefit of Washington and the British. In declassified documents, the CIA has admitted its role in overthrowing the Iranian government. The overthrow pattern is always the same. Washington hires protesters, then introduces violence, controls the explanation, and unseats the government.

Ever since the Iranian Revolution that overthrew the Washington-installed dictator in1979, Washington has been trying to regain control of Iran. In 2009 Washington financed the “Green Revolution,” which was an attempt to overthrow the Ahmadinejad government.

Today Washington is again at work against the Iranian people. It is difficult to believe that any Iranian, after watching what Washington-organized protests have done to Honduras, Libya, Ukraine, and Syria, have attempted to do to Iran in 2009, and is attempting to do today to Venezuela, could possibly in good faith go out into the streets against their own government. Are these Iranian protesters utterly stupid or are they hired to commit treason against their country?

Why does Iran permit foreign-funded operatives to attempt to destabilize the government as Ukraine did and as Venezuela does today? Are these governments so brainwashed by the West that they think that democracy means permitting foreign agents to attempt to overthrow the government?

Are governments so intimidated by the Western presstitutes that they find it challenging to defend themselves against foreign-paid provocateurs?

Having succeeded in causing violent protests in Iran, Washington now intends to use an emergency UN Security Council meeting on Iran in order to set the stage for more intervention against Iran. The Washington-incited violence has been turned into a “human rights issue” against Iran. Will Washington get away with it?

Iran’s fate is up to Russia and China. If Washington succeeds in destabilizing Iran, Russia and China are next. Russia seems to understand this. Russian Deputy Foreign Minister Sergei Ryabkov said yesterday: “We warn the US against attempts to interfere in the internal affairs of the Islamic Republic of Iran.”

Just as the Russian government comprehended that Russia could not permit Washington’s destabilization of Syria, Russia understands she cannot permit the destabilization of Iran.

The leader of Turkey has aligned with Russia, declaring “obviously some people from abroad are provoking the situation.”

That is obvious to everyone but Americans, who are constantly lied to by “their” government and by the presstitute lie factories such as CNN, New York Times, Washington Post, BBC.

Trump and Haley are the type of loudmouths who are likely to break Washington’s power and influence over the world. They “take names,” admit that they bribe foreign leaders, and issue insane threats. If this doesn’t wake up the rest of the world, nothing will.