By: Staff Writer

September 12, Colombo (LNW): The government is set to establish a Financial Stability Fund aimed at boosting under the financial crisis management program led by the Central Bank of Sri Lanka (CBSL).

To kick start the Financial Stability Fund, an initial nominal amount of Rs. 1 billion will be allocated by the Finance, Economic Stabilisation, and National Policies Ministry, finance ministry sources revealed.  

“The fund will be gradually built up through annual budgetary allocations, adhering to financial limitations,” Cabinet Spokesman and Minister Bandula Gunawardena said at the weekly post-Cabinet meeting media briefing yesterday.

Cabinet of Ministers on Monday approved the establishment of this Financial Stability Fund tostrenthen the country’s bank resolution framework.

The Financial Stability Fund, is a key measure under Section 15 of the Banking (Special Provisions) Act No. 17 of 2023, is designed to ensure the smooth resolution of financial institutions in crisis, safeguarding financial stability in the country.

Under Section 15(2) of the Act, the Financial Stability Fund will be managed independently, separate from the other assets held and regulated by the CBSL.

The urgency of establishing the Financial Stability Fund stems from its inclusion as a priority policy procedure in the second subprogram of the financial sector stability and reform program.

This initiative is also supported by a US$ 200 million loan from the Asian Development Bank (ADB) to implement effective resolution procedures, backed by comprehensive guidelines.

Gunawardena said the Financial Stability Fund is expected to play a crucial role in enhancing Sri Lanka’s financial crisis management framework, ensuring the stability of the banking sector.

The proposal was presented by President Ranil Wickremesinghe in his capacity as Minister of Finance, Economic Stabilisation, and National Policies.

By July 31, 2024, indicators tied to the second subprogramme of the financial sector’s stability and reform programme will guide the implementation of the fund.

 The Ministry of Finance will provide comprehensive guidelines for the fund’s operation, using the initial allocation to ensure an effective resolution framework.

The program adopts a programmatic policy-based loan (PBL) modality with two subprograms of $200 million each to properly sequence reforms and ensure the needed flexibility while implementing multi-year policy reforms in a crisis period.

Subprogram 1 prioritizes immediate reforms to enhance the crisis management regulatory framework and stabilizing the financial sector while subprogram 2 prioritizes follow-on reforms to build a resilient and inclusive financial system.

It will be supported by an attached transaction technical assistance (TA) for subprogram 2 and post-program partnership framework (PPPF) activities. 

A programmatic approach that combines policy-based loans, TA, and knowledge support was selected as it allows complex and challenging reforms to be addressed comprehensively.

By: Staff Writer

September 12, Colombo (LNW): Port City Colombo is set to transform into a leading regional financial center, driven by the recent enactment of Offshore Banking Regulations in parliament. This development is expected to attract significant Foreign Direct Investments (FDI) into the city with effective management and investor confidence.

Currently, discussions are underway with seven local banks and three international banking corporations to establish offshore banking branches in the Colombo Port City Special Economic Zone. Six prominent local banks, including Commercial Bank of Sri Lanka, Sampath, HNB, DFCC, NDB, and NTB, have already been authorized by the Colombo Port City Economic Commission (CPCEC) as official “Authorized Persons” (APs) to operate within this zone.

The operations of these offshore banking branches will be governed by regulations first gazetted on July 26, 2024. They will also be under the supervision of the Central Bank of Sri Lanka and the Financial Intelligence Unit, enhancing investor trust in the Port City as a regional investment hub.

These offshore banking regulations form the foundation of Port City Colombo’s financial ecosystem.

They offer a wide range of benefits to potential investors looking to establish their businesses, such as the ability to conduct transactions in designated foreign currencies with other offshore units or non-residents.

Banks can accept savings and time deposits from both Authorized Persons and non-residents, further enhancing the business environment in Port City.

Additionally, these regulations cover the extension of loans to non-residents, borrowing foreign currency, and conducting other approved financial transactions.

The offshore banking framework is expected to foster a thriving international banking ecosystem, paving the way for other financial products, including stock trading and fund management.

By enabling higher transactional efficiency and strengthening the exchange of securities, businesses can leverage their capital to expand.

 Companies focused on exporting services will also benefit from enhanced foreign currency transaction flexibility, helping retain more foreign currency within Sri Lanka.

The presence of international offshore banks will boost financial stability and create opportunities for large-scale investments. The increased flow of foreign currency within Port City will help establish a circular financial economy, further contributing to the city’s economic growth.

The offshore banking system will complement the existing incentives of the Colombo Port City Special Economic Zone, which includes tax exemptions for over 25 years, 100% capital and profit repatriation, and full foreign ownership.

These benefits reinforce Port City Colombo’s ambition to become a competitive offshore economy and a premier business destination in the region.

September 12, Colombo (LNW): Sri Lanka has witnessed a strong influx of nearly 1.4 million tourists so far this year, reflecting a robust recovery in the country’s tourism sector.

The Sri Lanka Tourism Development Authority (SLTDA) announced that, from January 1 to September 8, a total of approximately 1,395,773 visitors arrived on the island.

February saw the highest number of arrivals, with 218,350 tourists recorded, while both January and March also exceeded 200,000 visitors.

This steady stream of tourists highlights Sri Lanka’s appeal as a destination despite global economic uncertainties and challenges in the travel industry.

Tourists from India, Britain, Russia, Germany, and China constituted the majority of international visitors, showcasing a diverse mix of arrivals from both neighbouring and distant countries.

Sri Lanka has been actively promoting its rich cultural heritage, scenic landscapes, and hospitality to attract these key markets, leading to the encouraging numbers recorded this year.

In comparison, the previous year saw a total of 1,487,303 tourists, and 2024 is on track to potentially surpass that figure.

The island nation’s tourism sector, a critical contributor to the economy, has been recovering steadily after years of disruption caused by the pandemic, and these latest figures signal a positive outlook for the rest of the year.

September 12, Colombo (LNW): The Sri Lankan Rupee (LKR) indicates slight depreciation against the US Dollar today (12), in comparison to yesterday, as per the official exchange rates released by the Central Bank of Sri Lanka (CBSL).

Accordingly, the buying price of the US Dollar has increased to Rs. 296.41 from Rs. 296.08, and the selling price to Rs. 305.69 from Rs. 305.36.

The Rupee has also appreciated against a basket of foreign currencies, including Gulf currencies.

September 12, Colombo (LNW): President Ranil Wickremesinghe officially launched the Times School of Higher Education (TSHE), a cutting-edge educational institution developed in partnership with three international universities.

The inauguration ceremony was held at the iconic Galle Face Hotel, marking the beginning of a new chapter in Sri Lanka’s higher education landscape.

The Times School of Higher Education offers a wide range of academic programmes, including Certificates, Diplomas, Higher Diplomas, Bachelor’s Degrees, and Postgraduate Degrees.

Many of these courses are conducted in collaboration with foreign universities, providing students with globally recognised qualifications.

The institution aims to meet the growing demand for diverse educational pathways, with an emphasis on both local and international standards.

In addition to academic degrees, TSHE also offers vocational training opportunities through programmes endorsed by Sri Lanka’s Tertiary and Vocational Education Commission (TVEC) and TQUK, a leading British awarding organisation.

This dual focus ensures students can pursue both academic and practical qualifications, catering to a wide range of professional aspirations.

As part of its forward-thinking approach, TSHE’s Digital Academy continues to prioritise online education, particularly in the realm of Continuous Professional Development (CPD).

By partnering with established online educational platforms, the Digital Academy offers flexible learning options for professionals seeking to enhance their skills in an increasingly digital world.

During his address, President Wickremesinghe emphasised the importance of international collaboration in education, highlighting how partnerships with foreign institutions can contribute to Sri Lanka’s development by producing a globally competitive workforce.

He also stressed the need for adaptable learning models, particularly in light of the technological advancements shaping the future of education.