By: Staff Writer

April 13, Colombo (LNW): Sri Lanka is facing a significant downturn in agricultural output during the first two months of 2025, with key crops such as paddy, tea, coconut, and rubber experiencing notable declines. The Central Bank of Sri Lanka revealed that these setbacks—largely driven by unfavorable weather conditions and structural inefficiencies—are already impacting both food availability and the income of farming communities across the island.

The drop in production has serious implications for the country’s rural economy, which depends heavily on agriculture for employment and sustenance. With thousands of families reliant on farming and related industries, the dip in crop yield and fisheries output raises concerns about rising food prices, reduced export earnings, and mounting financial pressure on vulnerable households.

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According to the Central Bank’s latest statistics, paddy cultivation for the 2024/2025 Maha season is expected to drop by 4.2%, reaching 2.61 million metric tons, compared to the previous season. This decline follows an otherwise positive trend in 2024’s Yala season, which saw an 8.8% increase in output, bringing the total annual paddy production for 2024 to 4.7 million metric tons—up 4.1% from the year before.

Fish production has also shown a troubling pattern, decreasing by 15.1% in January 2025 compared to January 2024. Although February saw a slight 1.0% year-on-year increase, the overall output remains weak, particularly due to a fall in inland fishery activities, which form a significant part of rural food supply and employment.

Tea, one of Sri Lanka’s most crucial export commodities, recorded a dramatic 22.0% year-on-year drop in February 2025. The primary cause is attributed to prolonged dry weather conditions affecting plantation zones. Adding to the pressure, global tea prices saw a general downturn, with only the Mombasa auction reflecting a modest increase, while Colombo and Kolkata auctions posted lower average prices.

Coconut yields also fell sharply, with a 31.6% decrease year-on-year in February 2025. Similarly, the rubber sector showed a production slump during the same period, as per provisional figures from the Rubber Development Department. While the international price of natural rubber saw a rise due to supply disruptions from adverse weather in major producing countries, domestic producers may not benefit equally, given the local production drop.

Spice exports offered a glimmer of hope, with higher revenues in February 2025, particularly from products like pepper, cinnamon, and cloves. However, other spices, including turmeric, ginger, clove, and cinnamon, saw price declines, reflecting market volatility and uneven performance across crop categories.

In summary, Sri Lanka’s agricultural sector is facing multiple challenges at the start of 2025, threatening both economic stability and the well-being of those who rely on it. Unless corrective measures are taken to mitigate the impact of climate variability and strengthen support for farmers and fisheries, the country may face further hardships in food security and rural livelihoods.

By: Staff Writer

April 13, Colombo (LNW): Sri Lanka is exploring measures such as energy imports and tariff reforms in response to the 44 percent tariff imposed by former US President Donald Trump, according to Deputy Economic Minister Anil Jayantha. Energy remains one of the country’s largest imports, and a shift in this area could yield significant change.

Before the suspension of the tariff, Sri Lanka had held two virtual meetings with US officials. Although the US does not directly engage in government-to-government transactions, Minister Jayantha indicated that private firms in the US could become potential partners for Sri Lanka. A mission to Washington or Colombo to negotiate details was also discussed, with the goal of resolving tariff-related issues.

In an effort to address the matter, President Anura Kumara Dissanayake sent a letter to President Trump, while the Treasury submitted a more comprehensive document to the US Trade Representative and the White House.

Regarding tariffs, Sri Lanka’s highest rate was 20 percent, with some goods already exempt. However, the country also imposes additional charges through para-tariffs, such as the CESS and Port and Airport Levy, which contribute to overall import costs.

Sri Lanka’s trade policies have faced criticism over the years. In 2004, the country embarked on a ‘de-liberalization journey’ by issuing a gazette that imposed taxes on various products without parliamentary approval, resembling a move similar to Trump’s executive orders. This shift toward protectionism led to the emergence of oligarchs who hindered free trade agreements by financing political figures.

Economic experts often resort to measures like interest rate cuts or refinancing bank credits when foreign exchange shortages arise. These actions have historically prompted Sri Lankan politicians to impose trade or exchange controls. The US Trade Representative (USTR) noted that Sri Lanka had reversed its course and was moving toward self-sufficiency rather than embracing global free trade policies.

In a 2005 report, the USTR expressed concern over Sri Lanka’s abandonment of the trade liberalization strategy that had been championed by previous governments. The government’s new approach focused on protecting small and medium-sized enterprises and agriculture, which led to the introduction of a new import tax on specific items. Despite improvements in foreign reserves, the government did not repeal the tax.

The shift toward protectionism also resulted in controversial policies, such as restricting maize imports, which drove up prices for chicken and eggs, according to critics. This move was perceived as a way to favor certain political interests. Critics also pointed out that the taxation of dairy products benefitted a single company, further raising concerns about the impact on the public.As the country navigates these economic challenges, the USTR continued to highlight the negative effects of such protectionist measures, particularly on apparel and food products. During the Yahapalana era, when Sri Lanka faced forex shortages due to increased money printing and flexible inflation targeting, the USTR flagged further trade controls that hindered economic stability.

By: Staff Writer

April 13, Colombo (LNW): In 2024, Kaspersky’s cybersecurity solutions detected and blocked 2,803 ransomware incidents targeting businesses in Sri Lanka. This represents a 6% increase from the previous year, highlighting the ongoing and escalating threat of ransomware across various sectors. Experts emphasize the need for businesses to enhance their IT security measures to combat the increasingly sophisticated nature of these attacks, which can have devastating financial and reputational consequences.

Notably, in November 2024, Sri Lanka experienced significant cyberattacks targeting major corporations and government entities. These breaches exposed vulnerabilities and led to unauthorized access to sensitive data, underscoring the urgency of strengthening the nation’s cybersecurity infrastructure.

Kaspersky’s Sam Yan, Head of Sales for Asia Emerging Countries, stressed that while the number of ransomware attempts may seem manageable, the impact of even a single successful attack can be catastrophic. He urged businesses to invest in effective cybersecurity solutions that offer comprehensive protection against ransomware, as not all security products provide the same level of defense.

Kaspersky’s cybersecurity tools, including Kaspersky Endpoint Security for Business, Kaspersky Small Office Security, and Kaspersky Standard, have demonstrated perfect ransomware protection in real-world testing scenarios, according to assessments by AV-TEST. This performance reinforces the effectiveness of Kaspersky’s solutions in safeguarding businesses from ransomware threats.

To support victims of ransomware and aid in global efforts to combat cybercrime, Kaspersky continues its partnership with Europol, the Dutch National Police, and other cybersecurity organizations through the No More Ransom initiative. Launched in 2016, this initiative provides free decryption tools and resources to help ransomware victims recover their data. By the end of 2024, the initiative had expanded to cover 42 ransomware families, helping over 2.3 million victims worldwide.

Kaspersky’s contribution to the No More Ransom initiative highlights its dedication to fighting ransomware and strengthening global cybersecurity. The company encourages businesses to adopt best practices for protecting themselves from ransomware attacks, such as avoiding exposure of remote desktop services to public networks, using strong passwords and two-factor authentication, and ensuring software is regularly updated.

In addition, Kaspersky advises businesses to focus on detecting lateral movements and data exfiltration during cyberattacks and to regularly back up data, particularly offline backups. Companies should also be cautious of downloading pirated software or software from untrusted sources and assess the security of their supply chain and managed services.

Furthermore, educating employees about cybersecurity risks is vital. Kaspersky offers training courses via its Automated Security Awareness Platform to help businesses bolster their defenses. By staying informed through resources like the Kaspersky Threat Intelligence Portal, organizations can gain valuable insights into the tactics, techniques, and procedures (TTPs) used by cybercriminals.

In conclusion, as ransomware threats continue to evolve, businesses in Sri Lanka must prioritize cybersecurity and adopt comprehensive protection strategies to safeguard their operations and data.

By: Staff Writer

April 13, Colombo (LNW): Despite mounting global trade pressures, Sri Lanka is holding firm on its $18.7 billion export target for 2025. The government’s stance comes amid a 44% tariff hike by the United States and the possible suspension of the European Union’s GSP+ trade benefits due to concerns over human rights practices.

The Generalised Scheme of Preferences Plus (GSP+), which allows Sri Lankan exports reduced tariffs to the EU, has been vital for key sectors such as apparel, seafood, and rubber. Any withdrawal of this preferential access could severely damage export competitiveness and lead to job losses, especially in the apparel industry—one of the country’s largest employers.

While the EU’s concerns are centered on human rights compliance, the U.S. tariff hike, announced by former President Donald Trump, forms part of a broader global trade strategy and is not exclusively aimed at Sri Lanka. However, the Ministry of Trade, Commerce, and Food Security acknowledges the potential fallout, as Sri Lanka exports nearly $3 billion worth of goods to the U.S., with apparel alone contributing $1.8 billion.

“We believe this tariff may be related to our trade imbalance with the U.S., where we import only about $300 million,” a ministry spokesperson stated. “But we remain optimistic and are seeking a diplomatic resolution.”

Officials further confirmed that even if no exemption is reached, Sri Lanka is preparing to diversify its export markets. Early discussions are underway to boost trade with Europe and Asia, ensuring resilience in case U.S. access becomes more restricted.

The Export Development Board (EDB) has projected $14.54 billion from merchandise exports and $4.16 billion from services by 2025. Despite the expected increase in competition due to rising costs, the government maintains that the U.S. market won’t be entirely lost.

Meanwhile, Colombo-based think tank Verité Research has urged a multilateral approach through the World Trade Organization (WTO) rather than isolated bilateral deals. They warn that unilateral moves like Trump’s tariff hikes weaken global trade norms. Verité recommends a “Cooperative Common Response” to defend the integrity of the international trading system.

 Diplomatic efforts are ongoing. While the U.S. typically avoids direct government-to-government trade negotiations, Sri Lanka has initiated virtual discussions. Deputy Economic Minister Anil Jayantha said energy imports and tariff reforms may be used as bargaining tools during these talks.

With no plans to adjust its 2025 export ambitions, Sri Lanka is navigating the complexities of global trade with a dual strategy: defending its current markets while actively pursuing new ones. Whether through diplomacy or diversification, officials remain committed to shielding the economy from external shocks.