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Message: <blockquote data-quote="Dharatha" data-source="post: 8277401" data-attributes="member: 14094"> පච නෙමෙයි බන් මෙන්න Forbes කියන අලුත්ම ඇත්ත කතාව<img src="/styles/default/xenforo/smilies/default/dull.gif"  class="smilie" loading="lazy" alt=":dull:" title="Dull    :dull:" data-shortname=":dull:" /> <a href="http://blogs.forbes.com/meghabahree/2010/09/13/is-sri-lanka-taking-a-turn-for-the-worse-again-watch-the-stock-market/" target="_blank">http://blogs.forbes.com/meghabahree/2010/09/13/is-sri-lanka-taking-a-turn-for-the-worse-again-watch-the-stock-market/</a> Sep. 13 2010 - 6:23 pm | 2,474 views | 0 recommendations | 1 comment Is Sri Lanka Taking A Turn For The Worse Again? Watch The Stock Market After being the best performing market globally for the past two years, the sentiment on the Sri Lankan economy may be beginning to turn and the country has no one to blame for that but its own president. Last week Sri Lanka’s Parliament passed an amendment scrapping presidential term limits. In addition, the amendment gives the president the sole discretion to appoint people to key institutions including the police, elections commission, human rights commission and the judiciary. In the past, the appointments were made by the president but on the recommendation of a 10-member multi-party constitutional council that spanned political parties and ethnic groups. “Given that this is the first constitutional amendment after the defeat of the LTTE, this sends a negative message to minorities,” says Rohan Edrisinha, a specialist in constitutional law at the University of Colombo. “As the first amendment [the government is saying] the priority is not to address the grievances of the minorities, but rather to consolidate power…. This amendment is extremely retrogressive from the point of view of checks and balances and it will have a bearing on governance and the rights of minorities and rights of the Tamil people.” The government had announced earlier this year that foreign investment was welcome in several sectors, but clearly some investors too are now concerned by this consolidation of powers. Benjamin Griffith, an analyst at Caravan Capital Management, a global frontier fund for high net worth individuals, says the fund has been reducing its weight in Sri Lanka. He is now looking at Sri Lanka as a long term risk. If, he says, the government over the next few years fails to bring in economic development in the war torn areas of the north and the east or refuses to give the Tamils some kind of semi-autonomy, the country could experience a renewed insurrection. In the shorter term, however, the plight of the Tamils could re-express itself in the form of renewed terrorist attacks in Colombo. The latter has always resulted in investor jitteriness, visible in the stock market. Griffith examined a Bayesian Network model (a probabilistic model which uses historical data to identify relationships between variables) on the impact of bombings on the stock market. He found that historically, in periods of intense violence, including past LTTE bombings in Colombo, annual average stock market returns were reduced by a bit more than 17%.  “You can see that if renewed violence were to correspond with lower foreign direct investment (as a proxy for foreign investor sentiment), the declines could be even larger,” he says. Last week’s amendment ushered in by President Mahinda Rajapakse was introduced as an urgent bill on Monday. Because it was marked urgent, it was automatically presented to the Supreme Court the next day and was approved by Wednesday with little public consultation or notice. Now, says Edrisinha, nothing can be done. But Abhijit Kukreja, an analyst with Auerbach Grayson, a New York City brokerage for institutional investors, disagrees. “This could be a good thing from an economic, and thus a  market perspective because it means if the president is reelected, there won’t be any change in policies for a while,” he says. “This helps in investor certainty as investors are comfortable with what the president is doing now.” Kukreja cites a slew of investments that Rajapakse has announced for the country including $4 billion to rebuild the war torn north, loans for self employment and housing targeting the poor in the troubled  areas of the north and the east, plans with India to build 50,000 houses for the internally displaced people in the same region, among other initiatives. Others are not as confident about peace.</blockquote>

Verification: Hathara warak wissa keeyada? (Hathara wadi karanna 20)

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