The Government Raised US$ 100 Million
Syndicated Loan in the International Market

The Government has raised a syndicated loan of US$ 100 million in the international market. Several leading international banks in the Middle Eastern and Asian financial markets participated in the syndicated loan. The Citigroup acted as the facility agent. The selection of Citigroup was done after evaluating competitive proposals submitted by several banks. The loan agreement was concluded with the Citigroup on 14th November 2006 and the funds were obtained on 21st December 2006. The loan proceeds will be utilised to meet the general development expenditures including infrastructure projects. It will also help to further stabilize domestic interest rates since these funds were raised in the international market.

The Syndicated loan is for a maturity period of 3 years and it carries an interest margin of 75 basis points per annum (all inclusive margin of 1.035%) over USD LIBOR which is highly attractive compared to interest rates prevailing in the domestic market for the same maturity period. In addition, this transaction favourably compares with the syndicated loan of US$ 100 million (3 year maturity) raised in 2005 which carried a margin of 95 basis points per annum.

The successful conclusion of this transaction at this rate of interest reflects the confidence of foreign investors on the Sri Lankan economy.

A bulk of essential goods including food items, infant milk powder and drugs required for the people in Jaffna was despatched to Jaffna on 23rd December 2006 by air.
According to a decision taken during the discussion held by the team of government representatives who recently visited Jaffna on the direction of H.E. the President, with government officials and civil organizations of the area, this bulk of food was dispatched to Jaffna.

Arrangements have been made to provide electricity during 24 hours for the people in Jaffna and a bulk of items including generators required for that purpose have been dispatched to Jaffna by yesterday. Development of infrastructure facilities such as transport, highways and communication already being initiated under the “Jathika Saviya” programme.

The food items dispatched today included 2800 tins of Nestomalts, 10000 Eggs, 2800 bottles of Marmite, 300 tins of Sustagen, 1000000 tablets of Panadol for adults and children, biscuits etc.

A special programme has been already implemented to transport agrarian products of the people in Jaffna such as tobacco, red onions to Colombo.