October 12, Colombo (LNW): The Central Bank of Sri Lanka (CBSL) has announced that the country’s financial system has stabilized in the first quarter of 2024, despite challenges from various factors. Key contributors to this stabilization include efforts to reduce high loan interest rates, expand credit facilities for the private sector, and reduce public sector borrowing.

The CBSL, in accordance with the new Central Bank Act No.16 of 2023, issued its first annual financial system stability report, covering data up to June 2024. The report highlights the risks and vulnerabilities in Sri Lanka’s financial system while showcasing the positive outcomes of policy measures implemented by both the Central Bank and other regulatory bodies.

A notable development is the reduction in loan interest rates, which has led to increased borrowing by the private sector and a reduction in non-performing loan (NPL) ratios. Additionally, deposit interest rates have risen, contributing to a more favorable financial environment.

The report also indicates that the Sri Lankan Rupee appreciated against the US Dollar during the first eight months of 2024, buoyed by an increase in foreign remittances, tourism revenue, and export earnings. The CBSL expects this trend to persist.

Furthermore, the government’s absorption of credit facilities obtained by public enterprises has eased pressure on market interest rates and NPL ratios. The domestic debt restructuring process and enhanced risk management in the banking sector have further strengthened the resilience of the financial system.

While the CBSL remains optimistic about continued economic growth and improvements in asset quality and risk management, the report stresses that the success of these outcomes depends on the consistent and effective implementation of policy measures and reforms across all institutions.

October 12, Colombo (LNW): Sri Lanka’s poverty rates continued to rise for the fourth year in a row, with an estimated 25.9% of Sri Lankans living below the poverty line in 2023. Labor force participation has also seen a decline, particularly among women and in urban areas, exacerbated by the closure of micro, small, and medium-sized enterprises (MSMEs). 

Households are grappling with multiple pressures from high prices, income losses, and under employment. This has led to households taking on debt to meet food requirements and maintain spending on health and education.

“Sri Lanka’s economy is on the road to recovery, but sustained efforts to mitigate the impact of the economic crisis on the poor and vulnerable are critical, alongside a continuation of the path of robust and credible structural reforms,” emphasized Faris Hadad-Zervos, World Bank Country Director for Maldives, Nepal and Sri Lanka. 

“This involves a two-pronged strategy: first, to maintain reforms that contribute to macroeconomic stability and second, to accelerate reforms to stimulate private investment and capital inflows, which are crucial for economic growth and poverty reduction.”

Lower-income households in Sri Lanka spend 10% of their income on value-added tax (VAT), while the wealthiest contribute 95% of pay-as-you-earn (PAYE) and personal income tax (PIT), according to the Institute of Policy Studies (IPS). 

At the launch of the state of the economy report 2024, IPS Research Economist Priyanka Jayawardena highlighted ongoing issues with tax evasion, noting that only 48 billion rupees of the expected 131 billion PIT revenue for 2023 was collected.

Jayawardena pointed out that recent VAT hikes and exemption removals have disproportionately affected the poorest households, with the bottom 10% paying about 10% of their income on VAT compared to 6% for the wealthier. Macroeconomic policies have further hit the poor through inflation and currency depreciation.

In contrast, excise taxes on alcohol and tobacco are more progressive, with the wealthiest paying nearly half of these taxes. The poorest households consume less legal alcohol due to high excise duties.

Reforms were suggested to balance VAT with increased excise taxes to create a fairer tax system. The discussion also noted that public service pensions favor wealthier households, with a proposal to shift towards a contributory pension scheme.

October 12, Colombo (LNW): Cinnamon Air, Sri Lanka’s leading domestic airline, announces the launch of two new daily flights connecting Kandy and Sigiriya to South Coast destinations, Koggala and Hambantota. 

Starting from November 1, 2024, to April 30, 2025, these flights are designed to cater to the rising number of foreign travelers visiting Sri Lanka during the winter season, offering enhanced convenience and reduced travel times.

These new routes aim to meet the growing demand for quick, luxurious travel across Sri Lanka. Passengers can now reach the South Coast from the Cultural Triangle (via Sigiriya) or Central Hill Country (via Kandy) in just 40 to 50 minutes, compared to the lengthy 6 to 7-hour road journey, providing more time to enjoy the coastal beauty and attractions.

The new routes provide quick access to key destinations like Hambantota, a gateway to Yala National Park, and Koggala, ideal for exploring coastal towns such as Galle, Weligama, Mirissa, Dickwella, and Tangalle. These direct connections enhance the overall travel experience for tourists exploring Sri Lanka.

Cinnamon Air will operate these flights using its fleet of Cessna 208 aircraft, including an amphibian variation on the Kandy route. This setup promises a unique travel experience with the thrill of water takeoffs and expansive views of Sri Lanka’s stunning landscapes.

Sean Dwight, CEO of Cinnamon Air, emphasized that these new routes enhance access to popular destinations and align with changing tourist preferences for more focused travel within Sri Lanka. He reaffirmed the airline’s commitment to making Sri Lanka’s beauty accessible while providing memorable journeys for its passengers.

Cinnamon Air, operated by Saffron Aviation (Pvt) Limited, is a joint venture between John Keells Holdings PLC, MMBL Leisure Holdings, and Phoenix Ventures. Besides scheduled flights, the airline offers charter services across all airports and water aerodromes in Sri Lanka.

The cross-country flights are designed to enhance convenience and reduce travel time while ensuring an unparalleled experience for those who wish to explore Sri Lanka’s South Coast after visiting the Cultural Triangle or the Central Hill Country.

With these flights, passengers can easily journey from any part of the Cultural Triangle (through Sigiriya) or the Central Hill Country (through Kandy) to the serene South Coast in 40 to 50 minutes, compared to 6 to 7 hours on the road.

October 12, Colombo (LNW): Sri Lanka’s scenic beauty has long attracted visitors from India, with tourists flocking to its picturesque landscapes. Recently, an Indian film crew has taken over a section of Sri Lanka’s railway tracks to shoot a movie, temporarily halting train services on this iconic route. The filming is taking place on the rail track near the Nine Arch Bridge, situated between Ella and Demodara.

Currently, the train journey from Colombo Fort to Badulla has been interrupted, with trains only running up to the Ella Railway Station. The Sri Lanka Railways has announced that the track section from Ella to Badulla will remain closed from October 9 to 15. 

This closure has been implemented to facilitate the filming of a joint Indo-Sri Lankan cinema project, produced by NE Commercial Group of Companies (Pvt) Ltd., a leading film production company in Sri Lanka.

The production company has paid Rs. 23 million to the Sri Lanka Railway Department for the use of the railway track, according to Railways Deputy General Manager (DGM) N.J. Indipolage. 

The project has received approval from Sri Lanka’s Transport Ministry, with the intention of boosting tourism to the island once the film is released.

Sri Lanka’s geographical allure has always been a point of attraction for India, and this film project is seen as another step in strengthening the tourism bond between the two nations. 

However, the diplomatic relationship between India and Sri Lanka has often been marked by complexities, including disputes over fishing rights, proposals for infrastructure projects like the Adam’s Bridge, and the controversial Seethusamudram Shipping Canal Project. These issues have occasionally strained the ties between the two countries.

Despite the promising objective of promoting Sri Lanka’s tourism through this film, questions arise about India’s motivations. The project may undoubtedly spotlight Sri Lanka’s breathtaking landscapes, but it’s essential to scrutinize whether India stands to gain something more substantial in return.

 The project’s true impact on tourism remains to be seen, and many in Sri Lanka are cautiously observing how the film’s narrative will depict the island.

The film in question features the Odyssey Train, which typically offers travelers a seven-hour, 20-minute scenic journey from Colombo to Badulla. 

The storyline and theme of the film have yet to be disclosed. Comparisons have been made to Hollywood films like “Rambo,” which have historically reshaped narratives for various ends. In a similar vein, it remains uncertain how this movie will present Sri Lanka’s culture and landscape.

For the time being, train passengers between Colombo and Badulla must adjust their travel plans. During the filming period, train services will be restricted to the Ella station, and a bus service will be provided for passengers traveling between Ella and Bandarawela. These adjustments will remain in effect from 7:30 a.m. to 5:30 p.m. daily until October 15.

 While the collaboration between India and Sri Lanka on this cinema project has stirred curiosity, it has also highlighted the challenges of balancing development initiatives with the convenience of local communities.

The final judgment on this project’s value to Sri Lanka will depend on the film’s success in attracting tourists and how it portrays the island nation on the global stage. Until then, Sri Lankans and tourists alike will have to make do with temporary changes to one of the country’s most scenic train routes.

October 12, Colombo (LNW): Sri Lanka’s workers’ remittances amounted to USD 555.6 million in September 2024, reflecting a slight decrease compared to the USD 577.5 million recorded in August 2024. Despite the monthly decline, this figure marks a significant improvement from September 2023, when remittances stood at USD 482.4 million, showcasing year-on-year growth. The continued inflow of remittances remains crucial for the country’s foreign exchange reserves and economic stability.

October 12, Colombo (LNW): The Sri Lanka Police have introduced a special hotline, ‘1997,’ for the public to report any misuse or neglect of government-owned vehicles. In a statement issued by police headquarters, citizens are urged to provide information about government vehicles unlawfully hidden or abandoned in various locations, leading to their deterioration.

The hotline is operational 24/7, and the police assure complete confidentiality for those who provide tips, with the option to remain anonymous. However, the police emphasize the importance of accuracy, warning that legal action will be taken against individuals who provide false information.

1. President Anura Kumara Dissanayake has instructed officials of the Ministry of Finance to take necessary action to provide a monthly interim allowance of Rs. 3,000 to all pensioners, from next week. After reviewing the delay in adding the Rs. 3,000 allowance to the October pension, the President directed that this amount be credited to the pensioners’ accounts within the next week.
2. The nominations from 690 recognised political parties and independent groups were accepted nationwide for the 2024 General Election, the National Election Commission announced. According to the Election Commission, 74 nomination papers were rejected due to various reasons.
3. A consignment of canned fish, containing the toxic heavy metal ‘Arsenic’, has been found from the Customs storage complex in Orugodawatte. The Department of Government Information said in a statement that the consignment of five containers is valued at USD 215,000.
4. President Anura Kumara Dissanayake said that he had a productive virtual discussion today with USAID Administrator Samantha Power, exploring future cooperation and how USAID can support Sri Lanka’s development initiatives.
5. The Deputy Inspector General of Police (DIG) in charge of the Criminal Investigations Department (CID), DIG Rohan Premaratne has been transferred to serve as the DIG of Western Province (North). At the same time, DIG P. Ampavila has been transferred to the CID Range to serve as its new DIG.
6. Sri Lanka Police are requesting the public to call the special hotline ‘1997’ to provide any information regarding the misuse of the government-owned vehicles. The police headquarters requests the public to report any information related to the vehicles issued by the government for various official purposes that may have been unlawfully concealed in certain locations or have been neglected after being parked in certain places and left to dilapidate.
7. Sunil Keerthi Nanayakkara, Operations Director of Consumer Action Network Mental Health Lanka (CAN MH Lanka), presented a butterfly logo to the Prime Minister in honor of World Mental Health Day, which falls on October 10, 2024. CAN MH Lanka, established in 2012, advocates for mental health awareness and education. This year’s World Mental Health Day, themed “Mental Health at Work,” focuses on promoting mental well-being in the workplace.
8. Two Sri Lankan peacekeepers stationed with the UN peacekeeping force in Lebanon have been injured after a nearby village was targeted by an Israeli airstrike, Sri Lanka’s Military Spokesperson confirmed. He stated that the two Sri Lankan Army personnel attached to the UN peacekeeping mission in Lebanon sustained minor injuries when Israeli tanks fired at a watchtower in Naqoura, Lebanon
9. Workers’ remittances amounted to USD 555.6 million in September 2024, reflecting a slight decrease compared to the USD 577.5 million recorded in August. However, the figure marks an improvement from September 2023, when remittances stood at USD 482.4 million.
10. The Premier Hockey League (PHL) Sri Lanka 2024, an exciting new addition to the nation’s sports calendar, organized by the Next Generation Development Hockey Society, will begin today (Saturday) at the newly renovated Polytan blue artificial Astro Turf in Reid Avenue, Colombo. The opening ceremony will take place at 5:30 p m, with the tournament running until November 10.

October 12, Colombo (LNW): The current showery conditions are expected to continue over the south-western part of Sri Lanka, as a result of an atmospheric disturbance in the vicinity of the island.

Showers or thundershowers are forecasted at times in the Western, Sabaragamuwa, Southern, North-western, and Central provinces. Heavy rainfall, approximately 100 mm, is likely in some areas of the Western and Sabaragamuwa provinces, as well as in Galle and Matara districts.

Other areas of the island may experience showers or thundershowers during the evening or night, with fairly heavy rainfall exceeding 75 mm expected in certain locations.

Additionally, strong winds ranging from 30-40 km/h can be anticipated in the Western, Sabaragamuwa, Southern, North-western, and Central provinces.

The public is advised to take necessary precautions to minimize damage from localized strong winds and lightning during thundershowers.