Top economists call for halt to Sri Lanka debt repayments after Cyclone Ditwah
A group of the world’s top economists – including the Nobel prize winner Joseph Stiglitz – have called for Sri Lanka’s debt payments to be suspended as it tackles the devastation caused by Cyclone Ditwah,More than 600 people were killed and hundreds of thousands of homes destroyed across the island, in what Sri Lanka’s president, Anura Kumara Dissanayake, called the “largest and most challenging natural disaster in our history”,The country’s $9bn (£6,8bn) national debt was restructured last year, after lengthy negotiations with creditors after the government defaulted on repayments in 2022,But development campaigners warned at the time that the burden on Sri Lankan taxpayers remained unsustainable.
Before the cyclone hit, annual repayments were expected to total 25% of government revenues – a high level by international and historical standards,In a statement, the group of 120 global experts called for fresh debt restructuring to restore the country’s repayments to a manageable level, given the scale of environmental destruction,Alongside Stiglitz, the signatories include Jayati Ghosh, a renowned Indian development economist at the University of Massachusetts Amherst in the US, the inequality expert Thomas Piketty, the former Argentinian economy minister Martín Guzmán, and Kate Raworth, the author of Doughnut Economics, a widely read book about capitalism and the environment,“Sri Lanka is now confronting a severe economic shock triggered by the recent cyclone, extensive flooding and landslides, which has inflicted extensive damage to infrastructure, livelihoods, and key sectors of the economy,” they said,“This environmental emergency is poised to absorb – and potentially exceed – the extremely limited fiscal space created by the current debt restructuring package.
Additional external debt is already being taken on from the [International Monetary Fund (IMF)], and more lending to deal with the impacts of the disaster is likely,”They called for the “immediate suspension of Sri Lanka’s external sovereign debt payments, and a new restructuring that restores debt sustainability under the new circumstances”,Research by the campaign group Debt Justice found that after the 2024 debt restructuring deal, which involved some investors accepting a “haircut” on expected repayments, private sector creditors were still on course to make 40% more profit lending to Sri Lanka than to the US government,Since the cyclone hit last month, the Sri Lankan government has asked for a $200m emergency loan from the (IMF to help it through the immediate crisis, but disbursements under this “rapid financing instrument” are usually expected to be repaid within three to five years,Scientists at World Weather Attribution, a coalition of climate experts, found that global heating was likely to have exacerbated the severity of Sri Lanka’s flooding, as well as that of other Asian countries, including Indonesia and Malaysia, that have also been badly affected in recent weeks.
A UK government spokesperson said it recognised the devastating impacts of Cyclone Ditwah on the people of Sri Lanka.“This is why we are committed to supporting Sri Lanka’s recovery through humanitarian assistance and international coordination.We have already provided £1m of humanitarian support via the Red Cross, UN partners and civil society organisations to deliver emergency supplies and life-saving care.”
UK aid cuts take 40% from funds to counter Russian threat in western Balkans
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‘It’s rather rude’: Truss accused of trying to poach members of rival Tory club
For Tory grandees licking their wounds and plotting their return after their disastrous 2024 general election performance, the opulent, fire-lit rooms of the exclusive club 5 Hertford Street are a sanctuary.But in recent weeks, their long lunches have been rudely interrupted by Liz Truss, who has been accused of wandering the premises in search of members to poach for her own rival operation, just one street away, which asks “founding members” for an eye-watering £500,000.The former prime minister’s alleged headhunting is understood to have irritated those who run the Mayfair club, including its owner, Robin Birley, the entrepreneur and son of Annabel Goldsmith and the nightclub owner Mark Birley. A friend of his said: “It is rather rude, but at £500k, we are rather better value.” Membership of 5 Hertford Street is a relative snip at less than £2,000 a year
UK politics: ‘Not clear’ who was behind FCDO hack, says minister, amid reports of China link – as it happened
Good morning.The UK’s Foreign, Commonwealth and Development Office was hacked in October, according to trade minister Chris Bryant.Details of the hack emerged on Friday in a report by the Sun that claimed a Chinese hacker group was behind the cyber-attack.The Sun named Storm 1849 as the Chinese cyber gang responsible for the breach, which it said was understood to possibly include tens of thousands of visa details.The group has been “accused of targeting politicians and groups critical of the Chinese government”, the newspaper said
UK Foreign Office victim of cyber-attack in October, says Chris Bryant
The UK’s Foreign, Commonwealth and Development Office was hacked in October, a minister has said.Chris Bryant, a trade minister in Keir Starmer’s government, told Sky News there was a low risk to “any individual” from the cyber-attack.Details of the hack emerged on Friday in a report by the Sun that claimed a Chinese hacking group was behind it.But Bryant told broadcasters it was “not clear” who perpetrated the attack and cautioned against speculation. “There certainly has been a hack at the FCDO and we’ve been aware of that since October,” Bryant told Sky News
Society of Editors decries Starmer’s plan to reduce media scrutiny of No 10
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Reform-run Kent council accused of blocking scrutiny of claim it saved £40m
Reform-run Kent council has been accused of trying to block scrutiny after it refused, for more than five months, to produce evidence that it had saved more than £40m by cancelling two environmental projects that did not exist yet.Polly Billington, a Labour MP in Kent, first requested background to the claim via a freedom of information (FoI) request in July. She said the subsequent delay had not been explained and seemed to show the council was embarrassed at what the documents would show.Kent county council said it rejected any suggestion of a cover-up, and that it planned to release the information to Billington, the East Thanet MP, later this week.The saga began when the Kent leader, Linden Kemkaran, told a council meeting on 10 July that the authority had saved £32m by scrapping a programme to make properties more environmentally friendly, and £7
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