- Cabraal says that reserves were built to weather demanding situation, calls on the non-banking sector to seek funds from capital markets and wants it to target 70% of GDP by 2016
By Uditha Jayasinghe
Central Bank Governor Ajith Nivard Cabraal yesterday defended declining reserves, insisting that they were built up to be used in times of need.
Cabraal, speaking at the Directors Symposium 2011 titled ‘Repositioning the Non-Banking Sector for Sustainable and Inclusive Growth,’ called on the stakeholders to go to international markets to obtain capital investment, much as the Government has done.
He stressed that reserves were being kept at “comfortable” levels and those who talk of reserve loss do not matter because the Central Bank has made allowances for that. Comparing the Central Bank reserves to an ant collecting food for winter, he insisted that they were ready for tough times and that there was no danger as steps had been taken early.
“When you see an ant collecting food for the winter, no one tells the ant that it shouldn’t eat the food to survive the winter because it would decrease the reserve. Sometimes we must learn from ants and not just from people who write books. In these complicated times, we tend to forget these simple tales.”
He insisted that the Central Bank would manage its shocks and not pass them on to the rest of the economy. Sri Lanka’s reserves have declined from a peak of around US$ 8 million in 2011 to around US$ 7.2 million in September; a situation that is not helped by a 3% depreciated rupee.
Cabraal called on the non-banking sector to use the development in the country to foster more growth, commending the contribution made by them. The sector was encouraged to make use of the Investment Account Fund that was established by the Budget 2011 to motivate banks to give long-term loans.
He charged the private sector with being hesitant and slow in getting loans from world capital markets. “We can’t develop the country through money in the country. This is why the Government has gone to international markets, but it cannot just be the Government. Other private sector companies with good balance sheets must raise capital from international markets as well. There is ample opportunity for the private sector for this.”
Repositioning companies and infusion of capital and management techniques were advocated by Cabraal and he predicted that non-banking assets would double within the next five years, with leasing companies having at least Rs. 1 trillion from the current Rs. 450 billion by the end of this period.
“By 2016 the non-banking sector can have a 70% share of the GDP. Since we are aiming for a US$ 100 billion, this means about US$ 70 billion, so you can see that this is a journey.”
“There is a multitude of challenges to control inflation, but it is imperative that this must be done for economic growth. For this we have reduced fiscal deficit and that cooperation has been vital. Government debt to GDP has decreased to 79% but we should aim for 60% in the medium-term. We do not want to go the same way as beleaguered European countries,” he said.
$ 100 m World...
The TSEP will indirectly benefit school communities of about 10,000 schools, the households of four million school children, the contractors of school infrastructure and suppliers of educational equipment, and the academics and researchers who will receive support for research and evaluation activities.
The development initiatives supported by this project are a high priority within the general education sector in Sri Lanka.
“Today peace prevails,” Traveller reported.
Sri Lanka tourism has grown impressively, with a 52 per cent increase in 2010 compared to 2009. An even larger increase is expected for all of 2011.
With those increases, the Sri Lanka Tourism Development Authority has outlined a plan to reach a 30,000 hotel-room capacity by 2015, when the total number of annual tourists is expected to reach 2.5 million. Special focus has also been put on increasing the level of service in tourist-related industries.
Recently, top hotel chains such as Starwood (Sheraton), Marriott, Shangri La and Taj have announced plans for new construction in Sri Lanka. A number of existing hotels are also undergoing renovation.
Sri Lanka offers visitors a wide variety of unique venues, from broad white beaches to mountain vistas, wildlife parks teeming with elephants, leopards and more, rolling tea plantations, spas, adventure tourism, surfing and ancient UNESCO World Heritage sites.
As such, Sri Lanka has received a number of favourable travel reviews since 2010, beginning that year with a New York Times’ ranking as the number one place to visit.
National Geographic also included Sri Lanka on its top trips in 2010, and several popular travel websites, including DailyCandy.com (http://www.dailycandy.com/online/article/79305/DailyCandy-Goes-to-Sri-
Lanka) and Lonelyplanet.comhttp://www.lonelyplanet.com/sri-lanka/travel-tips-and-articles/76501) have also raved about Sri Lanka.
Market heavyweight John Keells Holdings PLC, which saw foreign selling of 114,100 shares, ended 1.00 percent weaker at 168.20 rupees.
Total volume was 83.7 million shares, against a five-day average of 90.6 million. The 30-day and 90-day average trading volumes were 61.2 million and 102.7 million. Last year’s daily average was 67.9 million.
The bourse has fallen 10.26 percent since Oct. 1. It is now Asia’s 12th-best performer with a year-to-date loss of 8.26 percent after being at the top until June. It gave Asia’s best returns in 2009 and 2010.
The bourse saw a net foreign outflow of 49.5 million rupees on Friday, and thus far in 2011, offshore investors have sold 17.8 billion, and a record 26.4 billion in 2010.
On Friday, the bourse was in neutral territory with the 14-day relative strength index at 44.2, above the lower neutral range of 30. Gainers outnumbered losers by 159 to 44 on Friday, Thomson Reuters data showed.
The rupee closed flat at 113.89/90 rupees a dollar for the eighth straight session, dealers said.
The central bank on Friday sold around $10 million to defend the currency, dealers said, extending its total dollar sales to $220 million since the 3 percent devaluation on Nov. 22.
He would report to the Federal Medical Center Devens in Ayer, Massachusetts, about 40 miles west of Boston, people familiar with the matter said. The people declined to be named because the location has not been made public.
Rajaratnam is challenging his conviction, saying wiretap evidence should not have been admitted at his two-month trial.
Patricia Millett, a lawyer who argued Rajaratnam’s appeal, did not immediately return a call seeking comment. A spokeswoman for US Attorney Preet Bharara in New York declined to comment.
The 2nd Circuit did not explain its decision.
At oral argument, judges had questioned whether the Sri Lankan-born Rajaratnam was a flight risk. He has dual citizenship in the United States and Sri Lanka, but has lived most of his life in the United States.
A Manhattan federal jury convicted Rajaratnam of all 14 counts he faced. The Government case was bolstered by trial judge Richard Holwell’s decision to admit wiretapped phone calls, more commonly used in organised crime and drug cases.
Rajaratnam claimed an FBI agent improperly omitted information when seeking another judge’s approval in March 2008 for the wiretaps.
He said this violated his constitutional rights and a requirement the Government show the wiretaps were needed, and could lead to a reversal of his conviction.
The appeals process could take one year or more.
Rajaratnam, whose firm once managed $ 7 billion, is the central figure in a broad federal crackdown on insider trading that has led to roughly 50 convictions and guilty pleas.
Former Goldman Sachs Group Inc Director Rajat Gupta, a former chief of consulting firm McKinsey & Co, has also been charged for leaking tips to Rajaratnam, his long-time friend. Gupta is fighting those charges.
The 11-year prison term is shorter than the 19-1/2 to 24-1/2 years that prosecutors sought. In imposing the sentence, Holwell said Rajaratnam had health concerns and faced imminent kidney failure from advanced diabetes.
The case is US v Rajaratnam, 2nd US Circuit Court of Appeals, No. 11-4416.
A decline in prices of coconut, coconut oil, fresh fish and sea food, chicken, egg, sugar and dhal in November 2011 compared to the previous month was also reported. Meanwhile, the prices in the sub categories of Health; Communication; and Education remained unchanged during the month under reference, the Central Bank added.
The learned Commercial High Court Judge W.A. Jayathilleke by order dated 30 November 2011refused the Interim Injunction preventing the Defendant from interfering with the Plaintiff’s right to lawfully import, offer for sale, sell, use or stock goods in Sri Lanka under the mark GLOBE.
“What makes this copy so special… is it’s the highest graded copy known to exist – it’s a 9.0 on a scale of one to 10,” said Vincent Zurzolo of ComicConnect.
Several reports in the United States said the owner of the comic at the time of the theft was Hollywood actor Nicolas Cage, although there was no confirmation of the identity of the buyer or seller.
ComicConnect held the previous record for a comic sold at auction, for a similar copy of slightly lower quality, which fetched $ 1.5 million in 2010. About 100 copies of Action Comics No.1 are believed to exist.