Sri Lanka govt opposes no-confidence motion on derivative losses

ComBank MD S. Renganathan (Centre) introducing the app to CB Governor Indrajit Coomaraswamy in the presence of (from L) ComBank Manager - Card Centre Seevali Wickramasinghe, Head of Card Centre Thusitha Suraweera, Deputy GM – Marketing Hasrath Munasinghe, CB Assistant Governor Ananda Jayalath and CB Director - Payments & Settlements Dharmasri Kumaratunge

Dec 08, 2008 (LBO) – Sri Lanka’s ruling party has opposed an opposition attempt to move a no-confidence motion on an oil hedging deal saying it related to matters in court and the country’s president was named. The main opposition United National Party said documents submitted to parliament were separate from those in court and the president’s name was only mentioned in connection with naming the current administration.

However, the speaker said the matter had to be studied further.

The UNP had handed over to the parliamentary secretary general the motion on a deal involving exotic oil hedging derivatives that brought hundreds of millions of dollars in losses to the state-run oil firm Ceylon Petroleum Corporation (CPC).

Party leaders had earlier agreed to hold the debate in January.

The no-confidence motion came at a time of speculation that a group of opposition members who are now backing the ruling coalition of President Mahinda Rajapaksa may return to the opposition.

The supreme court, hearing a public interest petition, last week halted payments in the derivatives deal pending an inquiry by the Central Bank.

The deal involves three foreign banks – Citibank, Standard Chartered