18^th: BOI approves Rs. 800 million investment projects in April 2001: The BOI has signed 12 agreements in the month of April amounting to estimated investment of Rs. 800 million of which Rs. 250 million consists of foreign investment and with a projected employment for over 1750 people. (Daily News - 18/March/2001).

16^th: IMF grants US$ 500m credit package - The International Monetary Fund (IMF) has granted a US$ 500 million credit package for Sri Lanka that would strengthen the micro - economic stability of the country. Minister of Constitutional Affairs and Industrial Development and Deputy Minister of Finance Prof. GL Peiris told a news conference yesterday that the government has entered in to a Stand-By Arrangement with the IMF Executive Board approving a 14 month stand by credit facility of US$ 253 million for strengthening the micro-economic stability of the country. The Government has already received US$ 131 million which is in the hands of the Treasury and the remainder will be disbursed on four tranches of US$ 35 million each which will be disbursed on August 30, November 30, February 28, 2002 depending on the economic performance of the country. The international donor has also agreed to provide the government with a further US$ 250 million under the poverty reduction and Growth Facility (PRGF), which is a much broader version of the former Enhanced Structural Adjustment Facility (ESAF). (Daily news -16/May/2001)

20^th: No fuel shocks for four months: Sri Lanka’s fuel prices - particularly diesel, which has risen by more than 100 percent in the past year - won’t be revised in the next four to seven months unless overseas crude prices go beyond US$ 30 per barrel which is unlikely to happen, the government assured last week. (The Sunday Times - 20/May/2001).

10^th: Scandles rock the navy once again:
Top brass at the Headquarters of the Sri Lanka Navy are investigating two large scale financial scandals by senior officers with millions of rupees believed to be missing, according to the sources at the Ministry of Defence. The scandals come at a bad time for the navy, which is going through a massive change in strategy to counter the LTTE’s success in bringing arms shipments off the Mullaittiuv coast, one of the weakest points of the armed forces’ struggle against the Tigers.

One inquiry is into Rs. 1.6 million which is missing from the naval sewing centre in Welisara, and the other is on over Rs. 2.8 million which appears to have gone missing from the naval welfare services the sources said.(The Island -  10/June/2001)

10^th: Shock treatment on corruption stuns CEB: Even as the Ceylon Electricity Board teeters on the verge of bankruptcy, its General Manager, Ananda P P Seneviratne has been accused of committing fraud and other malpractices. (Sunday Leader - 10/June/2001).

17^th: According to EU figures, total estimated foreign investment in Sri Lanka last year fell to 14 billion rupees from 37 billion rupees in 1999 with Britain, Japan and the US being the main investors. Figures show that UK investments fell to 5.1 billion from 15 billion, US investment fell 261 million from 7.8 billion and Japan 63 million from 5.6 billion. (Sunday Times - 17/June/2001)

20^th: With a credit balance of 3800 million in 1999, CEB now has unmanageable liability -The Committee on Public Enterprises (COPE) informed parliament yesterday that the Ceylon Electricity Board (CEB), which was an institution with sound financial background with a credit balance of Rs. 3,800 million in 1999, has become an unmanageable liability with an overdraft of over Rs. 8 billion. (The Island - 20/June/2001).

27^th: The Colombo Plan will celebrate its golden jubilee on July 1^st. The Colombo Plan initiated in 1951 aimed at the speedy economic and social development of its member countries. ). (The Island - 27/June/2001)

30^th: The Ceylon Electricity Board (CEB) announced a power cut of one to two hours from July 2 to conserve much needed energy in the wake of a shortfall of hydro generation capacity consequent to the failure of the Monsoon rains. However essential services such as hospitals and water supplies will not be affected by this power cut, the CEB said. (Daily News - 30/June/2001)

AUGUST

10^th: Government Medical Officers will refrain from working overtime if the government fails to increase their overtime rate before August 25^th. Last week they demanded an immediate 100% salary increase to them and all other public servants to meet the rising cost of living. The GMOA's decision to boycott overtime will result in doctors in state hospitals not working after 4:00 pm. Government doctors are paid Rs. 55 per hour for overtime while the maximum payment made to them is for four hours, even if they are on call for 24 hours.(The Island - 10/August 2001)

10^th: Ports Minister Ronnie de Mel accompanied by the Navy Commander is expected to fly over to London on Monday in an attempt to persuade Lloyds of London not to categorise the Colombo Port as a war risk, said the Sri Lanka Shipping Council (SLSC) Chairman at a press conference yesterday.

The SLSC understands that the proposed war risk surcharges ranges from US$ 15,000 (on the basis that some vessels could carry 300 TEU and the surcharge levied say is US$ 50 on a TEU) to US$ 150,000 depending on the size of the vessel. The SLSC also understands that shipping lines intend to impose excessive surcharges ranging from US$ 500 for a TEU(twenty foot equivalent container unit) and US$ 1,000 for an FEU(forty foot equivalent container unit). SLSC feels that this surcharge will have a direct impact on the export/import community of Sri Lanka by way of higher freight costs and in addition, would result in Sri Lanka's produce becoming uncompetitive as well as import being over-priced which would have an impact on the cost of living.

This will also lead to drastic reduction in trans shipment volumes resulting further increase in freight costs.

(The Island - 10/August/2001)

10^th: The recent terrorist attack at the Katunayaka International Airport (KIA) has resulted in a serious crisis for the Apparel Industry which depends heavily on speedy import/export facilitation for imports of essential raw materials and for deliveries of orders, says the Sri Lanka Apparel Exporters Association (SLAEA) in a press release. (The Island - 10/August/2001)

11^th: Employees of Central Mail Exchange (CME) in Colombo yesterday reported sick protesting against the government's attempt to sabotage the postal workers work-to-rule trade union action. The work-to-rule campaign was launched by five postal trade unions demanding that the administration solves current problems in promotions and fill the existing vacancies in the service immediately. The five trade unions have all demanded the abolition of the proposal to recruit postmasters on contract basis and to continue recruiting on permanent basis. They also demand that salary anomalies affecting the minor employees must be corrected and Circular No. PMG 13/2001 which was introduced to limit overtime payments for the postal workers must be revoked.(The Island - 11/August/2001)

11^th: American International Group (AIG), one of the world's largest insurance companies, will maintain its current Marine Cargo insurance premia for Sri Lankan shippers. (Daily News - 11/August/2001)

19^th: There was good news from London yesterday that the crippling war risk surcharges slapped down on Colombo calls by shipping has been eased considerably giving the country's endangered export-import trade some breathing space.

Before the attack the hull and machinery insurance was 0.0025% of the value of the vessel. Immediately afterwards, the premiums jumped 4,000% to 0.1%, with periodic upward revisions as the financial and human toll at the airport minted. On Thursday the underwriters were charging 0.7% for hull and machinery insurance - "a mind-boggling increase of 28,000% of the rate prevailing of July 24^th ", Lloyds List said noting that Sri Lanka was now on an equal footing with countries such as Sierra Leone. (The Island - 19/August/2001).

21^st: Import Bills - Central Bank removes prepayment limits: The Central Bank of Sri Lanka yesterday announced the relaxation of several restrictions on foreign exchange transactions through commercial banks, imposed in January this year. The measures which were imposed following a change in the foreign exchange regime for prudential considerations , are now not necessary because: "Since then the foreign exchange market has continued to be stable, and participants have generally operated with prudence, "Central Bank's Additional Director of Economic Research Dr. D S Wijesinghe told the Daily News last night. (Daily News - 21/August/2001)

22^nd: Port Development Minister Ronnie de Mel, addressing a news conference at the Sri Lanka High Commission in London, said Lloyds have agreed to bring down the surcharge applicable to 0.075% from 10:55am British Standard time on August 20. Following successful talks his delegation had with Lloyd's War Risk Rating Committee and Lloyds Underwriters Association.(Daily News - 22/August/2001)

23^rd: Amidst reports that shipping lines are still charging the full war-risk surcharge despite Lloyd's decision to reduce it, Shippers Council Chairman said that the insurance rates should comedown in a few days. (Daily News - 23/August/2001)

23^rd: President Chandrika Kumaratunga yesterday presided over a meeting to discuss means of providing immediate relief to country's drought-stricken areas. Fifty kilos of rice will be provided for each family per month as soon as the relevant reports are submitted by the divisional secretaries. Other food items will also be provided through World Food Programme. For the Hambantota District, five water bowsers will be provided to supply drinking water to the people. The drought has hit around 150,000 families in seven districts, according to the Social Services and Housing Development for Fishing Community Minister. He said that the highest number of 105,000 had been reported from the Hambantota district. A large number of families in the Moneragala, Hambantota, Ampara, Kurunegala, Badulla, Puttalam and Ratnapura districts have also been affected. (Daily News - 23/August/2001)

23^rd: The purchasing price of paddy has gone up to Rs. 15 a kilogram after the CWE offered to buy paddy from farmers at Rs. 12.50 a kilo, Food and marketing Ministry sources said yesterday. (Daily News - 23/August/2001)

24^th: Many international shipping lines that withdrew operations in Colombo Port have re-commenced services from yesterday following the discussions held with the London based War Risk Rating Committee (WRRC) officials by a delegation headed by Ports Minister last week. The delegation was successful in getting an immediate 75% reduction on the new insurance premia that were being levied by international insurance companies. The revised premium came in to effect from last Monday. (The Island - 24/August/2001)

28^th: Extended power cuts due to severe drought:
Sri Lanka's Ceylon Electricity Board is likely to extend daily 90-minute power cuts as a prolonged drought takes its toll on reservoirs, a government official said on Monday. The Board started nightly power cuts in July. Sri Lanka depends on two annual monsoons to feed its hydropower capacity which meets 60% of the country's electricity needs. (The Island 28/August/2001)

28^th: Operations at the Colombo Port has reached normalcy with 10 vessels berthing at the Jaye Container Terminal (JTC) yesterday. Sri Lanka Ports Authority Additional Managing Director told he daily news last night.

Despite the prohibitive war risk premia affecting the transshipment business at the Colombo Port recently , the port has consistently handled the stipulated average of 5300 TEUs per day since August 6^th and it is very likely that yesterday's cargo handling will surpass this average up to around 6,100TEU's he said. (Daily News - 28/August/2001)

28^th: Hydro power for only twenty days more:
The live storage capacities of the reservoirs generating hydro-electricity had sunk yesterday to 23.6 per cent, sufficient only another 20 days of power consumption. (Daily News - 28/August/2001)

29^th: The International Civil Aviation Organisation (ICAO) team which evaluated preventive security measures at the Bandaranaike International Airport (BIA) will make its final report available to Sri Lanka early next month. (Daily News - 29/August/2001)

29^th: The National Chamber of Commerce of Sri Lanka alleges that manipulation by vested interests has resulted in the reduction in the war-risk premium not being passed to the local import-export industry. The Chamber has accused foreign representatives of shipping lines in Colombo of being the stumbling block in reducing the war-risk premium. (Daily News - 29/August/2001)

29^th: The Sri Lanka Red Cross Society has opened six relief collecting centers to assist over 300,000 drought stricken families in Hambantota and other districts. (Daily News - 29/August/2001)

29^th: The Ministry of Irrigation and Water Resources Management is currently in the process of setting up the institutional arrangements specified in the controversial National Water Resources Policy and the draft Water Resources Authority Act. According to the officials in the ministry, the institutions will be set up on an interim basis.

The proposed policy, drafted on assistance received from the ADB was given cabinet approval on March 28, 2000. There was country wide protest opposing the policy and the draft act as it seeks to privatise the country's water resources. The policy was also brought up as an adjournment debate in parliament earlier this year.(The Island - 29/August/2001)

31^st: Doctors in all general hospital through out the country will join the ongoing strike today, in demand for an increase in their overtime and holiday payments. The General Secretary of the Government Medical Officers Association (GMOA) said that the general hospitals in the North and East had been given the option in deciding whether they wanted to join the rest of the island in their campaign for the two payments. The Health Ministry agreed to issue the two circulars pertaining to overtime and holiday allowance from January 2002. But the GMOA which strongly opposed it demanded it to be issued next month.

The salary revisions which have been done in 1992 were not paid to the doctors. They said that the salary revisions should have been given to them in 1997, but that too did not happen. The Health Ministry is refusing to issue the circular even now. The general secretary of GMOA who said that it would cost the Health Ministry only rupees 10 million blamed the Secretary of Health for the delay of acquiring the money. The Secretary says that it would cost the Treasury rupees 18 million per month to give the doctors a hike in overtime payments and the holiday allowance.

At present the government doctors are not given a special payment for working on holidays, the GMOA said. They receive Rs 55 per hour for working overtime.(The Island - 31/August/2001)

SEPTEMBER

01^st: Netherlands Government has announced a contribution of 1 million Dutch Guilders (approximately Rs. 34 million) to the UN system in Sri Lanka through UNDP for the coordination of the Humanitarian Aid Programs in the country. (Daily News - 01/September/2001)

02^nd: The cabinet has decided to extend the war risk cover to the aviation sector by authorizing a US$ 50 million (about Rs. 4,500 million) bond for the purpose. In a statement the government said that in terms of this provision , the civil aviation authorities would now be able to negotiate with the insurance underwriters to reduce or eliminate the war risk surcharge on operating through Katunayake. After the government delegation headed by Ports Minister held talks with London underwriters and agreed to provide a US$ 50 million cover against any risk at the Port of Colombo, the war risk surcharge was considerably reduced, the statement pointed out. The additional measure adopted on Friday will bring similar relief to the aviation sector. (The Sunday Times - 02/September/2001)

03^rd: Three trade unions have told the government that they vehemently object to the proposed amendments to the termination of Employees Act, Industrial Disputes Act, Factories Ordinance on the issue of Women Workers Overtime and Wages Board Ordinance. In a communiqué to Labour Minister Alavi Moulana, the International Organisations of Geneva, Asia and Colombo, state that the national Labour Advisory Council (NLAC) represents only a selected number of unions, However there are a large number of unions that are represented in the NLAC and there views too should be consulted before arriving at any decision.

"We further condemn the Ministry's attempt to revamp the existing laws , while not enforcing the provisions of the Industrial Disputes Amendment Act No. 56 of 1999, where the government has domesticated the principles of International Conventions87 and 98 of the International Labour Organisation as of December 1999. This is a strict violation of International Laws and a falsifying credibility on the part of the government in carrying out International Obligations". The unions stated that actions such as these based on partial consultations with lack of proper dialogue will lead to unwarranted disruptions in the worker community. (The Island - 03/September/2001)

11^th: The Permanent Commission to Investigate Bribery and Corruption will shortly file in the Magistrate's Court a complete report on the investigations conducted in respect of the overseas bank accounts of Thilan Wijesinghe, the former Chairman of the Board of Investment in Sri Lanka.

The Commission recently told the magistrate's Court, that they are awaiting, information from the Interpol, to draft the report. (The Island - 11/September/2001)

12^th: The Ceylon Electricity Board Engineers Union (CEBEU) in a memorandum to Presient Kumaratunga has said that the CEB in conjunction with the Treasury is negotiating to procure emergency power from a Monaco Company which will cost a minimum of Rs. 17 billion. The CEBEU memorandum said that they have called on president Chandrika Kumaratunga to ensure that public funds are not wasted yet again.

They also have urged the president to verify legitimacy and experience of the company Infrastructure Development and Investment Limited and Aggreko Plc in power related activities.

The offered tariff of US$ 0.048/kwh plus fuel costs works out to Rs. 9.82 per unit at the present exchange rate which is very expensive considering present market prices. The CEB/Treasury will need a minimum of Rs. 17 billion to maintain the purchase of 200Mw for one year.

The Engineers Union also adds that the country cannot afford to procure emergency power from any source with current economic conditions within the CEB and the Government. Therefore, there is no option but to continue power cuts until we receive enough rains in the catchment areas. They also state that 115Mw will be introduced to the grid with the commissioning of the simple cycle operation of the OECF funded Combined Cycle Power Plant. (The Island - 12/September/2001)

12^th: The Elections Department is expected this week to issue an order to destroy all documents printed for the previously scheduled national referendum on constitutional change.

The ballot papers printed by the government at a cost more than Rs. 22 million. (The Island - 12/September/2001)

16^th: Sri Lanka was slammed Saturday with its longest blackout ever. Power interruptions wee raised from three and half hours to eight hours. (The Island - 16/September/2001)

17^th: A plan to augment the national grid power supply with generators manufactured in the USA had to be put on hold after the Tuesday's terrorist Attacks on New York and Washington, the Prime Ministers office stated yesterday. The airlifting of the generators from the US had to be postponed as the movement of the people and goods to and from the US has virtually come to a stop., it said.

It was disclosed that an alternative possibility of bringing equipment from the United Arab Emirates had to be shelved as this equipment was not suitable for use in Sri Lanka due to voltage differences. (Daily News - 17/September/2001)

17^th: Non academic staff of the universities will go on a continuous strike starting from October 3^rd this year, if the Ministry of Higher Education and the University Grants commission (UGC) does not take action to pay their two year salary arrears. Island wide university non-academic staff numbers around 14,000. (The Island -17/September/2001)

18^th: Emirates Air Lines will pull out of Sri Lanka on Wednesday, dealing another crippling blow to the sagging tourist industry in Sri Lanka, airline sources said yesterday. The decision to pull out has been taken in the light of surcharges imposed on all airlines originating from the Middle East from the global insurance companies.

The surcharges, similar to what are being imposed on flights to and from Sri Lanka, have been clamped on Middle East air lines as they are said to be vulnerable to terrorist attacks after the devastation of the World Trade Center twin towers in New York last week. (The Island - 18/September/2001)

18^th: The Pre-Intern Association, Colombo which consists of medical graduates, yesterday threatened to take legal action against the Ministry of Health over the issue of giving internship appointment letters to eleven foreign graduates, which they claim violated the set procedures. (The Island - 18/September/2001)

19^th: The total Foreign Direct Investment inflow into Sri Lanka was US$ 217 million during the year 2000, an increse of US$ 30 million compared to the previous year according to the World Investment Report 2001 published yesterday by the United Nations Conference of Trade and Development (UNCTAD). The report stated that Sri Lanka was among the top 20 economies in the developing Asia and Pacific. However, the FDI inflows into Sri Lanka as well as the other South Asian countries were still below the 1997 peak. Sri lanka recorded US$ 435 million FDI inflows into the country during that year. (Daily News - 19/September/2001)

20^st: Over Rs. 2.6 billion has been allocated to provide relief assistance for over 365,560 families in drought stricken areas, Minister of Health, Indigenous Medicine and Social Services Nimal Siripala De Silva told a news conference yesterday.

Over 82,000 acres of paddy and other cash crops have been affected by this drought of which 59,000 acres are in the Hambantota District, 8,500 acres in the acres in the Ampara District and 15,000 acres in the Moneragala district. The drought has also had its deleterious impacts in the Putalam, Kurunegala and Badulla districts where over 35,000 acres of paddy and other cash crops have also been badly affected, he said. Apart from crops animal husbandry has also been badly affected. (Daily News - 20/September/2001)

21^st: The Ceylon Electricity Board will reduce its power cut duration in two segments to six and four hours from today. (The Island - 21/September/2001)

21^st: The Sri Lankan High Commissioner to London has on Wednesday, successfully negotiated with the Lloyds War Risk Committee to remove the additional war risk premia imposed on Colombo. Additional premia were re-imposed by Lloyds after the terrorists attacks in the United States and resulted in Gulf Air and Emirates suspending flights to Colombo. During the negotiations earlier this week with the War Risk Committee, there had been consideration of a guarantee of US$ 100 million for aircraft, in addition to the earlier guarantee of US$ 50million given for the port. This is because the incidents in the United States has increased the Lloyds risk assessments on civilian aircraft, greater than the risk to merchant ships. However, successful negotiations between the Sri Lankan High Commissioner and Lloyds withdrawing the increased premia without any guarantees of US$ 100 million. (The Island - 21/September/2001).

21^st: The Government will decide on the implementation of key power generation projects using natural gas with the involvement of foreign investors within the next week, Land Irrigation and Power Minister and the Deputy Defence Minister said. The Minister said a Cabinet Sub Committee appointed to evaluate the proposals by several foreign companies to install these power plants will decide on a suitable company.

(Daily News - 21/September/2001)

27^th: Commercial Bank, the strongest among the quoted private banks in the country, announced last week that the initial share issue of the 50 million cumulative redeemable Preference Share Issue was over subscribed within hours of opening and further subscriptions up to Rs. 406 million have been received making up a total subscription of Rs. 906 million at the time of closing on the 19thSeptember. (Daily News - 27/September/2001)

27^th: The total storage of the hydro reservoirs rose to 215.3 Gwh by yesterday with heavy rainfall in the Laxapana complex catchment areas increasing the total storage capacity to 17.1 percent, CEB sources told the Daily News yesterday. The total storage capacity of the power station stood at 20per cent when the CEB decided to enforce power cuts in July. (Daily News - 27/September/2001)

29^th: President Chandrika Bandaranaike Kumaratunga, who is also the Finance Minister yesterday directed the Ministry Secretary to write off all farmer cultivation loans up to Rs. 20,000 granted in 1999, 2000 and Yala season this year.

In the Memorandum of Understanding (MoU) reached between the government and the JVP on Sept 5^th 2001, clause 9 read: "In the same manner as after the 1994 General Elections, Her Excellency The President wrote-off cultivation loans amounting to Rs. 6000 million given to farmers and repayment of which had gone into arrears, The People's Alliance Government will take action before 30.09.2001 to write -off loans given to farmers from the Maha Season 1999/2000 to Yala season of 2001 at rates ranging up to Rs. 20,000 to each (inclusive of the full amount of Rs. 20,000) for paddy and plantain cultivation". (Daily News - 29/September/2001)

29^th: ADB to help uplift the poor:
The Asian Development Bank's (ADB) Japan Special Fund has granted US$ 550,000 to Sri Lanka to conduct a study to develop rural finance system targeted at improving the quality of life in the rural areas. (Daily News - 29/September/2001)

29^th: CHOGM Postponed:
The Commonwealth Heads of Government Meeting Scheduled to take place in Brisbane, Australia between October 6 and 9 has postponed "due to unforeseen circumstances", the Commonwealth Secretariat said in a statement issued here Friday. (Daily News - 29/September/2001)

29^th: The national career, Sri Lankan air lines, has negotiated with underwriters to cover their war risk of US$ 1.5 billion to US$ 50 million, leaving the airline to bridge the gap with an alternative cover for the balance US$ 1.45 billion. (Daily News - 29/September/2001)

29^th: Delegations of the PA and the JVP are to meet shortly to finalise next week's establishment of a powerful anti-corruption panel to supervise all major purchases, mainly heavy defence equipment. The Panel must be established on or before October 4^th, 2001 under the PA, JVP MoU reached on September 5^th, the JVP said yesterday. The independent panel's objective will be the purchase of appropriate equipment under best possible terms negotiated with the Sri Lanka arms suppliers. (The Island - 29/September/2001)

15^th: PA's basket of goodies to offset COL - The Cabinet on Friday granted a number of concessions ahead of the general election, including allowances to public servants and pensioners and a cut in the defense levy. The public servants will be given an allowance of Rs. 1200 monthly as an interim allowance with effect from October 1pending the implementation of recommendations of the Salary Commission. Pensioners will be given a monthly allowance of  Rs. 750. But Minister Samaraweera was unable to quantify the cost of these allowances. (The Island)

28^th: October a Glory Month for Colombo Stock exchange - Many brokers did not discount the possibility of the All Share Price Index (ASPI) topping the 500 point mark after the first two days of the bull run. They were proved right. (The Island) 

1^st: Power cut causes Rs. 12-24 billion losses (1-2 per cent of the GDP) - Energy Expert Prof. Mohan Munasinghe. (The Island)

5^th: Defence eating into education, health allocations. (The Island) 

7^th: Stock Market rebounds on the election day - net foreign inflow of Rs. 10m (Daily Mirror)

22^nd: ADB approves 86 million dollar aid package to Sri Lanka. (Daily News)

23^rd:

• Economy in Crisis - GDP growth near zero, budget deficit zooming. (The Island)

• Ceasefire stirs hope at stock market. (Sunday Times)

26^th: Central Bank cuts lending rates. (Daily Mirror)