By: Staff Writer

February 13, Colombo (LNW): In a promising sign for Sri Lanka’s economy, tourism earnings soared to a pre-pandemic peak of US$ 341.8 million in January 2024 tourism ministry announced. .

This resurgence indicates a significant recovery for the industry, which faced a prolonged downturn since the onset of the pandemic four years ago.

This milestone marks the first time since February 2020, when earnings reached US$ 391.1 million.

The industry was then rebounding from the aftermath of the 2019 Easter attacks and bracing itself just weeks before the country reported its first locally transmitted Covid-19 case, triggering nationwide lockdowns.

In the recent past, Sri Lanka experienced a surge in arrivals, grabbing daily headlines and signaling a promising outlook for the tourism industry in 2024.

This expansion, potentially leading to the highest number of arrivals and trade earnings since the record highs of 2018, is a notable development.

Thai Airways resumes direct flights to Colombo with MAC Holdings as sales agent.  

Expanding its subcontinent profile, Thailand’s national carrier Thai Airways has announced resumption of direct flights to Colombo, connecting the Far-east and Southwest Pacific towards Sri Lanka.

Thai Airways International has also signed the General Sales Agency (GSA) Agreement with MAC Holdings Ltd. MAC to be the Airline’s forefront as their General Sales Agent within the region for Sri Lanka and Maldives.

Thailand as a famous leisure destination in the region with Bangkok its capital city is well known for night life, excellent cuisine and an oasis of history and culture. Bangkok being a vital hub is not only popular for tourism but also for religious, economic and trade activities.

The operation of Thai Airways marks its re-entry to the Sri Lankan market after three years of absence due to the COVID-19 pandemic and brief 20-day operation, due to the Sri Lankan economic issue during May last year and the lack of fuel.

Nevertheless, throughout the pandemic Thai Airways continued to play a pivotal role in maintaining essential air cargo services with P2C charter flights to Sri Lanka.

By: Staff Writer

February 13, Colombo (LNW): Google.org, Google’s philanthropic arm, is providing US$ 15 million to The Asia Foundation to launch the APAC Cyber security Fund in partnership with CyberPeace Institute and Global Cyber Alliance to bolster cyber capabilities of 300,000 underserved micro and small businesses including 5000 nonprofits and social enterprises in Sri Lanka .

Working with implementing organisations and universities across the region, The Asia Foundation aims to equip local communities and students via up skilling tools and cyber clinics to protect against online risks.

The initiative will span 13 locations, including Bangladesh, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Pakistan, Philippines, Singapore, Sri Lanka, Thailand, and Vietnam.

Asia and the Pacific has become ‘ground zero’ for cybercrimes, recording the highest number of cyber incidents worldwide in 2023. The threats and impacts are more alarming for small businesses.

Research shows that more than half of small businesses in the region have experienced a cyber-incident in the past years, with malware attacks being the most common.

Incidents like this threaten operations, result in revenue loss, and negatively impact a business’ reputation. More than 70% of small business owners express fears that serious cyber incidents could potentially end their business.

In Sri Lanka, which ranked 81st out of 175 countries in 2020’s National Cyber Security Index, scoring especially low in protection for digital and essential services, the program aims to reach up to 5,000 Micro, Small and Medium Enterprises (MSMEs) covering 10,000 individuals.

Country Representative for The Asia Foundation in Sri Lanka, Dinesha De Silva highlights the essential nature of the program.

“In the context of Sri Lanka’s rapidly evolving digital landscape, it is imperative to recognise the critical role of Micro, Small, and Medium Enterprises as both the drivers of innovation and economic growth, and as prime targets for cyber threats.

The alarming rate at which a significant number of MSMEs are falling victim to malicious cyber-attacks cannot be overlooked, highlighting the urgent necessity to enhance their cyber defences.

 It is not just a strategic necessity, but a critical national investment to empower these enterprises with comprehensive cyber security education and awareness,” De Silva said.

Small Enterprises Development Division Director Sudheera Jayarathne, a local implementing partner of the program, also shared his thoughts on the potential impact of the program on MSMEs.

“The Small Enterprises Development Division is making constant efforts to develop businesses by applying modern digital technology for businesses and have identified the need to provide knowledge on Cyber Hygiene and Cyber Security to Small and Medium Businesses.

The opportunity to work in partnership with The Asia Foundation, supported by Google.org under this project will empower us to achieve our goal.”

With cyber threats on the rise, it is important for entrepreneurs and internet users to have the skills to understand and assess potential risks, and protect themselves and their business against malicious activities and other threats in the cyberspace.

Seeking to build a digital ecosystem that is inclusive and safe for all, the APAC Cyber security Fund, through The Asia Foundation, will connect small businesses and vulnerable groups to local training opportunities and resources to build and strengthen their digital defence. 

By: Staff Writer

February 13, Colombo (LNW): India’s Petronet will supply liquefied natural gas (LNG), to Sri Lanka, beginning 2025, which will be utilised to run power plans with 300 megawatt (MW) capacity.

Initially, the LNG will be supplied through containers, and later the state run company, will establish a floating storage re-gasification unit (FSRU), in the island nation.

Petronet LNG CEO A.K. Singh said, “They, (Sri Lanka), have already installed about 300 MW of gas based, power plants, and still they don’t have gas. Sri Lanka approached us to set up an LNG terminal which is going to take more time, about three to four years, to set up an FSRU based terminal.”

Singh was speaking on the side-lines of the India Energy Week (IEW)in New Delhi .As a stop gap arrangement, Singh explained that Petronet is working out to supply LNG through containers loaded on ships.

About 850 tonnes of gas per day will be supplied to the island nation in containers of 17 tonnes each. The supply will begin by 2025.“Probably Sri Lanka requirement is almost 50 containers per day, Singh said.

The supplies would be for five years, during which the company, will also build a FSRU at Colombo port.

The FSRU will take around one and a half years of time, because the unit will require 12-15 acre of land.

“We have worked three years for setting up the terminal. The capex for FSRU based terminal will be around INR 2,500 crore,” he added.

Indian Petronet recieved a letter of intent from the Sri Lankan government to set up LNG terminal near Colombo in Sri Lanka, the company announced on Wednesday.

‘The two countries in their efforts to strengthen relations have been in discussions on this issue since last more than one year [sic].

The Sri Lankan Government issued a Letter of Intent to the Govt. of India during the visit of External Affairs Minister to Colombosime times back ,’ the company explained.

Petronet LNG Limited, India’s largest LNG importer, will soon form a joint venture with Japanese and Sri Lankan companies.

A joint venture of Petronet LNG Limited along with Japanese and Sri Lankan companies will develop an LNG Terminal in Sri Lanka to provide regassified natural gas to various power plants, domestic and transport sectors in Sri Lanka.

The capacity of the LNG Terminal will be decided upon the gas demand in Sri Lanka and is expected to be developed in 1 year after completion of initial formalities.

The LNG terminal would be set up on the western coast of Sri Lanka in close vicinity of Colombo where most of the power projects operating mainly on costly liquid fuel are located.

As of now, 82 percent of the primary energy consumption is met through petroleum products and biomass in the country.

‘It’s a giant step towards energy security of Sri Lanka and underscores the ‘neighbourhood first’ policy of Prime Minister Modi. It shall pave the way for further cementing primeval bonds,’ the company noted.

By: Staff Writer

February 13, Colombo (LNW): “Businesses enter February with a sense of trepidation, uncertain about what the near term holds. This uncertainty is reflected in the latest LMD-PEPPERCUBE Business Confidence Index (BCI) survey,” business magazine LMD notes, in its February edition.

It explains that a quarter of BCI survey participants “express optimism about the economy ‘improving’ in the next 12 months,” marking a four-point increase from December (21%),” and 19% anticipate the economy to ‘stay the same,’ reflecting a 3% point reduction from the previous month.

But a majority of 56% anticipate the economic situation to ‘get worse,’ which is a 1% drop from December, LMD adds.

The magazine also reports that in relation to sales volumes, there’s a sense of optimism about the next 12 months’ outlook with 29% of respondents expecting sales to ‘get better,’ which reflects a two-point increment compared to the preceding month.

Looking ahead to the next three months, LMD reports that there’s pessimism regarding sales volumes ‘getting better’ with 22% saying so – that’s a marginal decline from the 26% recorded in the previous month.

“On the other hand, over a quarter (28%) believe that sales volumes will ‘stay the same,’ which represents an increase of 3% points from December,” it adds, noting also that “overall sentiment remains subdued with half (50%) of those polled expecting their sales to ‘get worse’ in the next three months.”

LMD’s publisher, Media Services, says the latest edition of the magazine has been released. And its digital edition has been shared on WhatsApp and the publisher’s social media platforms.

The magazine’s Cover Story features the ADB’s Sri Lanka Country Director Takafumi Kadono, who says: “I take this opportunity to reaffirm our support for Sri Lanka.” The full story has been uploaded on LMD’s website (www.LMD.lk).

In 2023, Sri Lanka faced significant economic and political challenges including a contraction in GDP and a rise in taxes, yet improvements were noted later in the year including reduced inflation, currency appreciation and increased remittances.

Politically, the country dealt with a decline in civil liberties, allegations against former presidents,an elusiveness of popular support for the current president and a pivotal upcoming election in 2024.

The World Bank later revised its forecasts, noting Sri Lanka’s progress in reducing inflation and benefits accruing from tourism revenue and currency appreciation.

 The Bank now expects a 1.7 per cent economic expansion in 2024, up from its earlier 1 per cent forecast. In the last six months of 2023, Sri Lanka experienced reduced inflation, a 12 per cent currency appreciation, improved foreign reserves and increased remittances.

February 13, Colombo (LNW): During the World Government Summit in Dubai, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), expressed high confidence in the global economy’s trajectory towards a soft landing, Reuters reported.

Georgieva remarked on Monday (12) that following significant interest rate increases in recent times, the world economy is now on track for the long-awaited stabilisation.

“We are very confident that the world economy is now poised for this soft landing we have been dreaming for,” Georgieva asserted, acknowledging the impact of some of the most substantial interest rate hikes witnessed in decades.

Addressing the potential adjustment of interest rates in major economies such as the United States, Georgieva noted, “I expect to see by mid-year interest rates going in the direction inflation has been going on for the last year.”

While expressing optimism, Georgieva also cautioned against unforeseen circumstances, particularly in the aftermath of the COVID-19 pandemic. She highlighted the potential economic repercussions of prolonged conflicts, citing the ongoing tensions between Israel and Hamas as a significant concern.

“I fear most a longevity of the conflict because (if) it goes on and on the risk of spillovers go up,” Georgieva emphasised.

She further noted the current risk of spillover from incidents like the recent attacks on ships in the Red Sea, particularly mentioning the Suez Canal, and underscored the potential for wider ramifications if conflicts escalate unpredictably.

February 13, Colombo (LNW): The Central Bank of Sri Lanka (CBSL) has augmented its Governing Board by appointing two new members, enhancing the composition of the island nation’s monetary regulator.

In an announcement made yesterday (12), the CBSL disclosed the addition of Rajeev Amarasuriya, effective from January 30, and Manil Jayesinghe, effective from February 01, to its Governing Board.

Joining the existing members, the Governing Board is chaired by CBSL Governor Nandalal Weerasinghe and includes A.N. Fonseka, Dr. Ravi Ratnayake, Anushka S. Wijesinha, and Vish Govindasamy.

Rajeev Amarasuriya brings a wealth of legal expertise to the board, having served as the Immediate Past Secretary of the Bar Association of Sri Lanka. His extensive appellate court practice encompasses various branches of civil litigation and public law. Additionally, he holds positions on several state and private sector institutions, contributing significantly to legal education and governance.

Manil Jayesinghe, a seasoned financial expert, is a Fellow Member of multiple prestigious professional bodies and actively engages in various committees related to accounting and finance. With his diverse experience and leadership roles in esteemed organisations, Jayesinghe brings valuable insights to the CBSL Governing Board.

February 13, Colombo (LNW): Sri Lanka’s dairy industry stakeholders are urging the government to reconsider its decision to increase the Value Added Tax (VAT), cautioning that such a move could have severe repercussions on the dairy sector and the nation’s overall health.

The All Island Dairy Association (AIDA) emphasised that the VAT hike, aimed at broadening the tax base, could negatively impact the dairy sector, a crucial contributor to the country’s GDP and rural livelihoods.

AIDA highlighted the precarious situation facing the dairy sector, which saw significant growth in milk production from 2017 to 2021 but now faces profitability threats due to the VAT increase.

Previously, fresh milk production and related products were VAT-exempt, supporting around 300,000 small-scale farmers and over two million dependents.

However, the proposed VAT hike could exacerbate the sector’s vulnerability, leading to declines in production and income losses for farmers, they pointed out.

Over the past decade, the cost of milk production surged by 174 per cent due to rising input costs, with retail prices increasing by 168 per cent.

The additional burden of increased VAT could further strain the affordability of dairy products, potentially affecting public health, particularly among vulnerable groups.

While not entirely against the VAT, AIDA suggests a gradual rollout of the increase with support measures to allow the sector to adjust while ensuring relief for essential inputs.

Recommendations include facilitating the import of feed ingredients to reduce production costs and promoting value-added dairy product production to enhance profitability.

AIDA emphasises proactive monitoring, consumer awareness initiatives, and policy adjustments to mitigate the impact of the VAT hike. The association also calls for the Animal Production and Health Department’s involvement in tracking the VAT’s impact and conducting consumer awareness campaigns.

AIDA’s members play a significant role in Sri Lanka’s dairy sector, contributing to the processing of nearly 60 percent of the nation’s daily milk production.