“We will finally have only friends. Not politics” – President tells Mangala

Sunday, 21 April 2013

President Mahinda Rajapaksa had telephoned former Foreign Minister Mangala Samaraweera today (21) on his 57th birthday to wish him and said, “Mangala, you are one of my oldest friends. We have our differences in politics. But what will finally have will be our friendship and not politics.”

Since wishing people for their birthdays is one of the President’s key daily tasks, he had made several attempts to contact Mangala from morning to wish him for his birthday. The President had though that Mangala was avoiding his telephone calls due to the difficulty in getting through to him.

Not willing to give up, the President had the telephoned former UNP Chairman, Malik Samarawickrema. It was the President who had informed Malik that today is Mangala’s birthday.

Malik had then telephoned Mangala and said the President had been trying to contact him from morning. The President had telephoned Mangala a few minutes after Malik’s call. Mangala’s telephone battery had died soon after the President had wished him for the birthday. Mangala had then re-fixed the battery and returned the President’s telephone call. The President had said, “I thought you disconnected the line because you are angry with me.”

The President after having a brief chat had asked Mangala, “So, who is coming for your party today?” Mangala had responded saying there was nothing special and that his good, old friends would be visiting him today.

“I’m your oldest friend Mangala. Although we are now distant due to politics, our friendship will remain till the end, not politics,” the President had said. Mangala had remained silent and not responded to the President’s comment.

Banks give govt. Rs. 95bn in new loans, private sector gets only Rs. 17.4bn

April 21, 2013, 

Latest data released by the Central Bank shows that government crowding out of the private sector has eased in February with the government borrowing Rs. 95 billion during the first two months of this as against Rs. 17.4 billion by the private sector.

New private sector loans from the domestic banking sector grew by Rs. 12.1 billion in February 2013, as against Rs. 5.3 billion in January, while government borrowings from domestic banks grew by Rs. 39.6 billion in February, as against Rs. 55.4 billion the previous month.

New private sector borrowings from the domestic banking sector amounted to Rs. 17.4 billion during the first two months of this year, as against a massive Rs. 95 billion borrowed by the government.

The Central Bank cut monetary policy rates in December 2012, unchanged since then, but this has failed to bring down interest rates in money markets and spur private sector led economic growth because of the government’s high domestic borrowings.

"…with expected adjustments to administratively determined prices and continued fiscal consolidation, the reliance of the public sector on bank financing is expected to decline in the coming months," the Central Bank said last week releasing the Monetary Policy Review for April 2012.

"The resulting availability of funds, together with foreign capital raised by the banking sector in recent months would provide the necessary stimulus to strengthen private sector activity," it added.

Government borrowings from the Central Bank fell by Rs. 21.2 billion in February after falling by Rs. 12.5 billion the previous month.

Total outstanding private sector credit from the domestic banking sector grew by 14.2 percent year-on-year to Rs. 2,189.5 billion as at end February 2013, falling from a 16.4 percent growth rate a month earlier and 37.2 percent a year earlier.

Total outstanding credit from foreign banking units amounted to Rs. 196.6 billion, up 4.2 percent from a year earlier.

Total outstanding credit of public corporations from the domestic banking sector surged 73 percent year-on-year to Rs. 95.2 percent as at end February, while credit from foreign banks grew 25.4 percent to Rs. 204.8 billion.

Total outstanding credit to the government grew by 15 percent year-on-year to Rs. 1,115.4 billion: outstanding credit from domestic banks grew 35.9 percent to 729 billion; credit from foreign banking units fell 24.6 percent to Rs. 141.3 billion while Central Bank credit fell 23.4 percent to Rs. 245.1 billion.

Economists and analysts have said easing monetary policy would be challenging this year with growth not expected to near 7 percent this year despite the 7.5 percent forecast issued by the Central Bank.