Mar. 04 (LBO) – Punters in Sri Lanka’s stock markets have not yet priced in the full benefits of the re-started peace talks between the government and the Tamil Tiger rebels, a peace advocate has said. The benchmark All Share Price Index, dipped 29 percent from November 16 till January 18 this year, when a new hawkish government was elected.
The market started to recover after Norwegian peace envoy Erik Solheim brokered talks between both parties last month, but remains below levels recorded till November 15.
“Despite two-hectic and sometimes heated days of discussions, both parties agreed to meet in April and set firm dates and a venue. That’s good news, shows commitment. But the stockmarket failed to react,” Jehan Perera, head of the National Peace Council told businessmen and fund managers at a seminar organized by the Chartered Financial Analysts Sri Lanka chapter.
“Perhaps investors are aware that things can change dramatically overnight,” he said, outlining three possible scenarios that could happen in Sri Lanka before both sides meet in Geneva next month.
In the best case scenario, which carries a 10 percent likely chance, Perera says a joint mechanism and an interim administ