Sri Lanka guarantees Rs50bn in new credit to state entities in 2009

Sri Lanka's Prime Minister Ranil Wickremesinghe arrives with flowers to receive blessings at the Gangaramaya Buddhist Temple, Colombo, Sri Lanka on Wednesday 4 April 2018. On wednesday (4), Wickremesinghe survived a no-confidence motion in the Sri Lankan parliament with a 46 vote majority after a 12-hour debate with 122 MPs voted in his support while 76 MPs voting to remove the prime minister. (Photo by Tharaka Basnayaka/NurPhoto via Getty Images)

Mar 04, 2010 (LBO) – Sri Lanka has guaranteed 52 billion rupees in credit to state entities in 2009 from state-run banks with loss making energy utilities and airlines getting tens of billions in new loan facilities, a finance ministry report said. State-run Ceylon Petroleum Corporation (CPC) has been supported with a 25 billion rupee guarantee to borrow from state-run Bank of Ceylon and Ceylon Electricity Board has been backed with an 8.0 billion rupee guarantee to borrow from People’s Bank.

A fuel pipeline project by Ceylon Petroleum Storage Terminal, a common user facility, has been given guarantees of 4.6 billion rupees to borrow from Peoples’ Bank. A further 437 million in guarantees had been given to CPC for the same project.

Borrowings of Mihin Lanka, a controversial loss-making state airline, from the Bank of Ceylon had been covered by a 1,552 million rupee guarantee in December.

Sri Lankan Airlines, which was earlier managed by Emirates airlines has been issued a ‘letter of comfort’ to cover 1,152 million rupees in loans from the Bank of Ceylon in December.

State Trading General Company, a trading firm, has been helped by a 2.5 billion guarantee for c