By: Staff Writer
September 07, Colombo (LNW): In a decisive step to ease the burden on public finances, the government has announced plans to liquidate 33 state-owned enterprises (SOEs) that have long been deemed non-functional and financially unsustainable. The decision, unveiled by Cabinet Spokesman Dr. Nalinda Jayatissa, reflects Colombo’s growing urgency to restructure a bloated public sector that continues to drain resources while delivering little economic value.
Dr. Jayatissa explained that most of these entities were established decades ago to serve specific public purposes or strategic economic goals but have since lost relevance in the current market-driven environment. “Many of these enterprises exist today only by name boards, without any meaningful contribution to the economy or society,” he said. The liquidation process will be conducted in two stages under the supervision of the Special Liquidation Unit of the Finance Ministry.
Among the institutions set for closure are Asian Games Ltd., Thurusaviya Fund, Selendiva Investment Ltd., Lanka Logistics Ltd., Commonwealth Games Hambantota Ltd., Magampura Management Company, Mihin Lanka Ltd., Technopark Development Ltd., and Media Training Institute. A full list is expected to be published soon.
Importantly, the national carrier SriLankan Airlines has been excluded from the liquidation list, with Rs. 20 billion already allocated for restructuring efforts to stabilize operations. The government hopes that a rebound in tourism will help revive the airline’s fortunes.
The move comes amid stark evidence of the financial drain caused by SOEs. Data obtained through the Right to Information Act and the Department of Public Enterprises show that, between 2018 and 2022, 20 state-owned companies incurred combined losses of Rs. 851.7 billion.
The Ceylon Petroleum Corporation (CPC) alone accounted for Rs. 817 billion in losses, despite generating over Rs. 3.6 trillion in revenue during the same period. Meanwhile, the Ceylon Electricity Board (CEB), employing more than 23,000 workers, recorded losses of Rs. 125 million in 2022 while spending Rs. 1.7 billion on salaries and allowances.
Overall, the Treasury has been compelled to pump billions into these failing entities to keep them afloat, even as the country battles to stabilize its fragile post-bankruptcy economy. Critics argue that much of the income generated by SOEs is consumed by employee salaries and benefits, leaving little room for operational improvements or investments.
Sri Lanka Moves to Shut Down Non-Functional State Enterprises
Japan’s JICA Expands Support with New Healthcare Waste Initiative
By: Staff Writer
September 07, Colombo (LNW): Japan’s ongoing support for Sri Lanka’s health sector reached another milestone this week, with the Japan International Cooperation Agency (JICA) reinforcing its decades-long partnership to strengthen public healthcare and environmental safety.
As part of its broader assistance program, JICA officially handed over a modern incinerator to the Trincomalee District General Hospital, a step aimed at addressing the country’s mounting medical waste challenges while safeguarding communities and healthcare workers.
The official handover ceremony was attended by a high-level delegation, including Health and Mass Media Minister Dr. Nalinda Jayatissa, Eastern Province Governor Prof. Jayanthalal Ratnasekera, Deputy Minister of Foreign Affairs and Foreign Employment Arun Hemachandra, and Trincomalee District MP Roshan Akmeemana. The Japanese delegation was led by Ambassador of Japan to Sri Lanka Akio Isomata and JICA Sri Lanka’s Chief Representative Kenji Kuronuma.
The incinerator was supplied under JICA’s Grant Aid Project for the Improvement of Infectious Waste Management, valued at JPY 503 million. This initiative was conceived in response to the spike in infectious waste during the COVID-19 pandemic, which exposed both frontline health workers and the wider public to heightened risks, while also creating environmental hazards.
Under this project, 15 modern incinerators are being distributed to public hospitals across nine provinces, providing Sri Lanka with a more resilient healthcare waste management system. The newly installed equipment features advanced temperature controls and emission treatment systems, ensuring that waste disposal is both safe and environmentally sound.
Speaking at the event, JICA’s Chief Representative Kuronuma stressed that the project represents more than just infrastructure investment. “The installation of medical infectious waste treatment facilities at 15 hospitals, including Trincomalee General Hospital, marks a new chapter in Japan’s cooperation in the healthcare sector,” he noted, adding that the initiative symbolizes the “enduring friendship” between the two nations.
The project also aligns with the Sri Lankan government’s “Clean Sri Lanka” initiative, which promotes sustainable waste management practices nationwide. Beyond providing equipment, JICA has rolled out a comprehensive training program for hospital staff and health officials, ensuring that the new technology is properly operated and maintained to deliver long-term benefits.
For over four decades, JICA has been a central partner in Sri Lanka’s healthcare journey, supporting projects that range from hospital development to infectious disease control. By addressing the pressing issue of medical waste, JICA not only contributes to safer healthcare delivery but also strengthens environmental safeguards.
Reaffirming its commitment, JICA pledged to continue assisting Sri Lanka in achieving higher standards of healthcare and environmental safety, underscoring its vision of building sound, healthy livelihoods for all Sri Lankans.
Credit Surge Threatens Sri Lanka’s IMF Reserve Target
By: Staff Writer
September 07, Colombo (LNW): Sri Lanka’s fragile foreign reserve recovery is under fresh pressure as private credit expansion accelerates, threatening the Central Bank’s ability to meet the USD 7 billion IMF year-end reserve target. Despite gross reserves edging up to USD 6.166 billion in August 2025, analysts warn that reserve collection could stall or even reverse unless deflationary monetary policy is re-applied to neutralize liquidity injections that accompany rising credit.
Reserves: Modest Gains, Lingering Vulnerabilities
Gross official reserves climbed USD 19 million in August, maintaining coverage above USD 6 billion.
However, this is still USD 306 million below October 2024 levels, when the Central Bank began operating an “abundant reserve regime” that injected liquidity to stabilize rates. Net reserves tell a more worrying story: in June 2025, they dropped from USD 1.541 billion to USD 1.414 billion, the sharpest fall since stabilization began in 2023. The decline coincided with faster private credit growth, raising concerns that reserve accumulation is being undermined by domestic lending booms.
Credit Expansion: Fuel for Growth, Risk for Stability
Private credit has expanded steadily in 2025 as interest rates were trimmed, giving businesses and households easier access to loans. While credit growth supports short-term economic activity, it injects liquidity into the banking system, weakening the Central Bank’s ability to purchase dollars and sterilize rupee flows. Without offsetting deflationary operations such as selling down government securities rising credit could push the exchange rate down and limit reserve build-up.
In the first half of 2025, the Central Bank also transferred USD 770 million to the government through unsterilized transactions. While necessary for fiscal financing, such outflows further constrained the space for genuine reserve accumulation.
IMF Target: A Narrow Window to Deliver
The IMF has set a USD 7.0 billion gross reserve target by December 2025, higher than the original USD 5.6 billion benchmark. With only USD 834 million still to accumulate, the target is technically achievable but only if credit expansion is restrained and fiscal authorities step in to purchase dollars directly. Treasury-led dollar buying, funded by market borrowings or tax revenues, would provide neutral reserve inflows without inflationary side-effects.
Tourism inflows (USD 401 million in January alone) and steady worker remittances continue to offer support, while IMF disbursements have provided a crucial cushion. Yet, analysts stress that these inflows are insufficient if domestic liquidity remains unchecked. Rate cuts, implemented through “signalling” rather than tight operations, risk undoing earlier stabilization gains.
Outlook: Tightrope between Growth and Reserve Security
Sri Lanka’s economy is forecast to grow 4.5% in 2025, with inflation stabilizing near 5% by mid-2026. Growth momentum has eased social tensions, but the danger lies in repeating past cycles: stimulating credit at the expense of external stability. Unless the Central Bank re-applies deflationary tools and coordinates closely with the Treasury on dollar purchases, the USD 7 billion reserve goal could slip beyond reach.
Sri Lanka Expands Horizons with Antigua and Barbuda Ties
By: Staff Writer
September 07, Colombo (LNW): In its first move to broaden foreign relations since the United States imposed a 20 percent tariff hike on Sri Lankan exports, the new government has approved the establishment of formal diplomatic relations with Antigua and Barbuda, a small but strategically positioned Caribbean nation.
Cabinet approval for the initiative, announced by Foreign Minister Nalinda Jayatissa, marks Colombo’s 14th formal diplomatic engagement in the Latin American and Caribbean region. The decision reflects a wider strategy to diversify Sri Lanka’s global partnerships, particularly as the island nation navigates shifting trade dynamics and external economic pressures.
Antigua and Barbuda, despite its modest size, holds significant clout within multilateral forums. As a member of the Commonwealth, the United Nations, the Organisation of American States, and the Alliance of Small Island States (AOSIS), the country offers Colombo an avenue to build solidarity with other small island economies facing similar vulnerabilities from climate change and global economic shifts.
Analysts note that strengthening ties with Antigua and Barbuda could also boost Sri Lanka’s presence in the Caribbean trade bloc CARICOM, opening the door for new commercial, tourism, and investment opportunities. “While trade volumes between the two countries remain negligible today, diplomatic recognition is the first step toward expanding networks in the Caribbean and Latin America,” one senior trade expert observed.
Tourism is expected to be an area of early collaboration. Both nations rely heavily on international tourism revenues and are keen to explore knowledge exchange in hospitality management, sustainable island tourism, and direct marketing in non-traditional markets. Aviation linkages, although presently indirect, could also be developed through codeshare agreements, creating new travel routes for Sri Lankan travelers heading westward and Caribbean visitors looking east.
Beyond economics, diplomatic ties are likely to enhance cooperation in climate diplomacy. With Antigua and Barbuda frequently voicing concerns over rising sea levels and natural disasters in global forums, Colombo stands to gain an ally in pushing for international climate finance and technology transfer to safeguard vulnerable island states.
The timing of the initiative is notable. Following Washington’s tariff hike, Sri Lanka has been under pressure to reduce dependence on traditional Western markets. Establishing ties with Antigua and Barbuda signals Colombo’s intent to hedge risks by engaging with emerging and geographically diverse partners.
As Sri Lanka charts its post-tariff course, the move underscores a pragmatic shift: cultivating allies wherever mutual benefit can be found, regardless of size. If effectively pursued, ties with Antigua and Barbuda could serve as a gateway for Sri Lanka into the wider Caribbean—opening fresh diplomatic, trade, and tourism prospects while strengthening the island nation’s global bargaining power.
Suspected Methamphetamine Chemicals Uncovered in Tangalle Raid Following Public Tip-Off
September 07, Colombo (LNW): A fresh stockpile of suspicious chemical substances believed to be linked to the illicit production of crystal methamphetamine—commonly referred to as ‘ICE’—was uncovered early this morning on a property in Netolpitiya, Tangalle.
The discovery was made during a targeted police operation prompted by information received from concerned local residents.
The raid, carried out by officers attached to the Tangalle Police, focused on a secluded property located near the Welivenna crossroad. Upon inspection, law enforcement personnel found several containers holding an unidentified white powder, which investigators suspect may be precursor chemicals commonly associated with the manufacture of methamphetamine.
Initial assessments suggest that the substances bear a close resemblance to those recovered just a day earlier in Middeniya, Thalawa, where police previously raided a separate property suspected of being linked to a broader narcotics operation.
In that instance, the presence of explosives alongside drug-making materials raised serious concerns regarding the scale and nature of the operation.
According to police, the chemicals discovered in Tangalle appear to have been stored at the site for an extended period—possibly as long as four months—without detection. Investigators are currently exploring whether the location served as a storage point within a wider network or if it was intended for future use as a production site.
The materials have since been secured and are being transferred to Tangalle Police Headquarters for detailed analysis.
Explosives Unearthed in Middeniya Following Ongoing Probe into Suspected Drug Operations
September 07, Colombo (LNW): In a significant breakthrough linked to an ongoing investigation into illegal narcotics activity, police have discovered a hidden cache of explosives and ammunition at a rural property in Middeniya Thalawa, Hambantota.
The site, previously under scrutiny for the presence of chemicals believed to be used in the production of methamphetamine, has now yielded further evidence pointing to possible links with organised crime or paramilitary activity.
The discovery was made during a joint operation involving officers from the Western Province North Crimes Division and the elite Special Task Force (STF). Acting on intelligence gathered during earlier raids, the team combed through a section of agricultural land adjacent to a manioc plantation, where they uncovered a recently disturbed patch of soil.
Buried within the site was a sealed container holding five hand grenades believed to be of foreign origin, along with 17 rounds of T-56 assault rifle ammunition and three 12-bore shotgun cartridges. Forensic teams have since secured the materials for further analysis, and bomb disposal experts were called in to ensure safe handling and transportation of the explosives.
Major Expansion Underway at Colombo Port to Boost Cargo Capacity and Regional Competitiveness
September 07, Colombo (LNW): Construction has officially commenced on the fifth phase of development at Colombo Port’s Jaya Container Terminal (JCT), marking a strategic move to elevate Sri Lanka’s position as a key player in South Asia’s maritime sector.
This latest phase of expansion, overseen by the Sri Lanka Ports Authority (SLPA), aims to transform an additional 31,000 square metres of land into high-efficiency operational space, significantly boosting the terminal’s cargo-handling potential.
Once completed, the facility is expected to accommodate an additional 450,000 twenty-foot equivalent units (TEUs) each month—a substantial increase in throughput that will enhance the port’s ability to serve larger volumes of transshipment traffic.
An investment of Rs. 750 million has been earmarked for the project, which is projected to be completed by the end of 2026. Officials have described this development as vital to meeting growing demand from global shipping lines and regional trade routes.
Phase 4 of the terminal’s upgrade was completed earlier, but operational bottlenecks—particularly with regard to berthing space for larger vessels—remain a pressing concern. The ongoing Phase 5 works are intended to resolve these constraints by extending the port’s infrastructure to accommodate new-generation container ships, which require deeper berths and longer quay lengths.
The SLPA has stated that the improvements will not only streamline vessel turnaround times but also make Colombo Port more attractive to global shipping alliances looking for efficient, reliable regional hubs.
Speaking on the broader significance of the development, port authorities emphasised that the JCT expansion fits into a long-term vision to position Sri Lanka as a leading logistics and maritime services centre in the Indian Ocean region. With regional competitors also upgrading their ports, SLPA officials believe the timely completion of this project will be critical in maintaining Colombo’s edge in international shipping.
Heat Index expected up to Caution Level in several districts (Sep 07)
September 07, Colombo (LNW): The heat index is expected to increase up to ‘caution level’ at some places in North-Central and Eastern Provinces and Vavuniya, Monaragala and Hambantota Districts, the Natural Hazards Early Warning Centre of the Department of Meteorology said in a warning statement today (07).
The public is advised to stay hydrated and take breaks in the shade as often as possible, check up on the elderly and the sick, never leave children unattended, limit strenuous outdoor activities, find shade and stay hydrated, and wear lightweight and white or light-coloured clothing.
Island-Wide Operation to Tackle Dangerous Vehicle Modifications and Reckless Driving
September 07, Colombo (LNW): Beginning tomorrow (08) law enforcement authorities across Sri Lanka will embark on a comprehensive national operation targeting unlawful vehicle alterations and hazardous behaviour on the roads.
The initiative is being undertaken to improve road safety and uphold long-neglected vehicular regulations, announced Deputy Minister of Transport Dr Prasanna Gunasena.
The operation will see intensified roadside inspections, with police officers instructed to crack down on a range of violations that compromise both public safety and the integrity of the country’s transport laws.
Particular focus will be placed on vehicles operating in a dangerous or unroadworthy condition, as well as those featuring unauthorised alterations.
Modifications under scrutiny include loud aftermarket exhaust systems, multi-coloured LED lighting, and unapproved changes to vehicle bodywork or paint schemes. Additionally, authorities will be taking action against vehicles displaying commercial advertisements, symbols, or images not permitted under current regulations.
According to officials, these changes—often intended to enhance aesthetics or performance—frequently result in reduced vehicle safety, increased noise pollution, and confusion on the roads, particularly at night. In some cases, such modifications have been linked to accidents involving visibility issues or aggressive driving.
The operation is expected to involve coordination between the police, the Department of Motor Traffic, and other relevant agencies. Authorities have also hinted at possible legal reforms aimed at tightening loopholes and strengthening enforcement powers.
Four Fatalities in Separate Road Tragedies Across the Island
September 07, Colombo (LNW): Four individuals lost their lives in separate road incidents reported from various parts of the country yesterday (06).
The accidents, which occurred in the regions of Maradankadawala, Vellaveli, Kadawatha, and Pudukuduirippu, have prompted renewed concern over road safety and reckless driving.
In the first incident, tragedy struck at Thawalanhalmillewa junction along the A11 route when a car travelling in the same direction collided with a bicycle. The impact left both the cyclist and a pillion passenger injured. They were swiftly taken to Maradankadawala Hospital, but the cyclist—a 37-year-old local resident—succumbed to his injuries shortly after admission.
Elsewhere, along the Vellaveli–Chavalakade road, a motorbike travelling at speed reportedly veered off its path and ploughed into two pedestrians. All three individuals were rushed to Kalmunai Hospital with multiple injuries. Sadly, one of the pedestrians, a 58-year-old from Pandiruppu, was later pronounced dead, despite medical efforts.
A third fatality was recorded on the Dalupitiya–Ragama road, where a pedestrian was struck by a car believed to have lost control while en route to Ragama. The victim, aged 51 and a resident of Ramboda, was immediately transported to the Ragama Hospital. Unfortunately, he was declared dead upon arrival.
Meanwhile, in a particularly chaotic scene in the Pudukuduirippu area, a motorcyclist attempting to turn onto a by-road at Udayarkattuwa was rear-ended by another motorcycle. The initial collision sent the first rider into the path of an oncoming cab. Both riders sustained serious injuries and were taken to Dharmapuram Hospital. The 22-year-old man who initiated the turn, hailing from Mulliyawalai, did not survive the crash.
Authorities have since launched separate investigations into each of these incidents.