Economic & Market Bulletin
[October 24, 2005]

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	President and Wickremesinghe agree on the importance of working together for peace
	60th United Nations Day
	FEATURE: Caring humane democratic governance
	FEATURE: Economic & Market Bulletin

A weekly publication of the Economic Affairs Division of the Ministry of Foreign Affairs
Volume 2:Issue 32 
21^st October, 2005 

EU Unit to offer support for Sri Lankan projects

• The European Initiative for Democracy and Human Rights Programme (EIDHR) of the European Commission (EC) is to grant an amount of Euro 490,000 (approximately Rs.60 million) to support human rights and conflict resolution in Sri Lanka with financial assistance.

• The objective of the EIDHR micro projects programme is to strengthen local civil society and back their contribution to human rights by supporting small scale initiatives from local Non Governmental Organizations (NGOs).

• Sri Lankan NGOs are invited to submit applications for funding of project responding to specific thematic priorities and in accordance with specific procedures outlined in two separate EIDHR calls for proposals. Grants range from Euro 10,000 to 75,000.

• Grant may cover up to a maximum of 90% of project costs and will finance projects lasting up to 36 months. The deadline for submission of proposals is 21^st December 2005.

Italian aid to revive fishing in Tsunami hit areas

• The Government of Italy has provided a $5.6 million grant through the Food and Agriculture Organization. According to the statement of Ministry of Finance, this grant is for the rehabilitation of the fisheries sector in the tsunami affected districts of Hambantota, Ampara and Batticaloa.

• The project activities will include immediate assistance for the replacement and repair of small traditional craft, 17 foot, 20 foot and 22-foot fibreglass boats with outboard motors, 28-foot fibreglass boats with inboard motors, 40-foot multi day boats and the replacement of lost fishing gear.

• Approximately 1800 fisher families will directly benefit through this project. This project will also provide funds for community capacity building and repair of fishing infrastructure such as slipways, administrative offices and equipment, ice plants and cold stores. 

Air Arabia First Airline to Nagpur 

• Air Arabia LLC, the first and only low fares airline in the Middle East and North Africa region, is the first International airline to fly to Nagpur, India.

• Flights to Nagpur are operate 3 times a week, on Wednesday, Friday and Sunday from Sharjah. The operation will also connect major cities around Nagpur to the Middle East.

• Air Arabia currently flies from Sharjah to 18 destinations, Aleppo and Damascus (Syria) Alexandria, Assiut, Luxor and Sharm El Sheikh (Egypt) Bahrain, Beirut (Lebanan) Colombo (Sri Lanka) Dammam, Jeddah and Riyadh (KSA), Doha (Qatar) Khartoum (Sudan) Kuwait, Mumbai and Nagpur (India) Muscat (Oman) and Sana’a (Yemen).

Sri Lankan Apparel Export Earnings Increase in First Half of 2005

• Sri Lanka’s apparel export earnings for the first six months of the year 2005 increased by 9% over the corresponding period of 2004.This has been achieved despite the ending of the Multi Fiber Agreement (MFA) in December 2004.

• According to the Sources, the duty free status for exports of garments with fabrics made in Sri Lanka or other SAARC countries to the EU nations also helped Sri Lanka’s export this year.

Southern Expressway to be completed by end of 2007

• With an estimated cost of Rs.21,104million, the Southern Transport Development Project (STDP), is expected to be completed by 2007. The project involves the construction of a 128km expressway from Colombo to Matara with a design to cater to speeds of over 100kmph.

• According to the National Council of Economics Development (NCED), this project is jointly funded by the Japan Bank for International Cooperation (JBIC) and the Asian Development Bank (ADB). The expressway is expected to reduce travelling time from the city of Colombo to southern city of Matara by two hours. It will also provide access to the Galle Port.

• According to the sources work has already started in the ADB section from Kurundugahahetekma to Matara while the tender has been awarded for the road from kottawa to Dodangoda.

• In addition to this, another road network improvement project is supported by the ADB. The cost for this project is Rs. 10,500 million. It covers rehabilitation of over 274km of A and B class roads and 42 bridges covering 29 electorates in the Western, Central, Southern, North-Western and Sabaragamuwa Provinces.

• Similar road network improvement projects supported by the JBIC at a cost of Rs. 3,550 million will help to improve 70km of A and B class roads as well as 2 bridges in Kandy and Nuwara Eliya districts.

Record Export Earnings in August

• According to the recent report of the Central Bank of Sri Lanka, export earnings of the island has recorded an increase of 21.2% in August 2005 reaching the highest ever value of US$ 584 million.

• Industrial exports for headed by textile and garments amounted to 86% of this growth. Cumulative exports for the first eight months of the year grew by 12.7% from US$ 3,594 million to US$ 4,052 in 2005.

• Imports increased at a rate of 19.4% to US$ 787.5 million in August 205 with petroleum amounting to US$ 157 million. Cumulative imports for the 8month period grew by 11.3% to US$ 5,626 million from a figure of US$ 5,056 in the previous year.

• Despite the widened trade deficit of the island, the overall balance of payment position was further strengthened. The surplus improved from US$ 134 million in July to US$ 191 million by end August 2005 due to an increase in private remittances and other inflows, during the eight month period.

• Consequently, the official international reserves increased from US$ 2,196 million in December 2004 to US$ 2,369 million in August 2005.