ACP Asset Management’s launch of a Europe-regulated Sri Lanka Opportunity Fund raises a pivotal question: is this a calculated entry into a mispriced recovery story  or a high-risk wager on a still-fragile frontier economy?

Marketed as the first UCITS-compliant vehicle dedicated exclusively to Sri Lankan assets, the Fund provides European investors with a regulated and liquid channel into a market that only recently exited economic crisis. The UCITS label carries weight in institutional circles, signalling adherence to stringent governance, transparency, and risk management standards.

ACP executives highlight past performance to bolster credibility. Their earlier Sri Lanka-focused strategy reportedly generated strong USD returns across 2023, 2024, and 2025, significantly outperforming the MSCI Frontier Markets Index. While historical returns can attract flows, frontier markets are notoriously cyclical and past outperformance does not insulate against renewed volatility.

The firm’s immediate $ 10 million seed capital and projected $ 35 million near-term inflow suggest early confidence among European investors, including delegates from German-speaking wealth management networks overseeing tens of billions in assets. The target of $ 100 million in assets within a year reflects expectations of sustained international interest.

The underlying thesis rests heavily on valuation compression. At roughly 11x price-to-earnings ratios, Sri Lankan equities are priced below many Asian peers. ACP argues this discount reflects crisis-era pessimism rather than forward-looking fundamentals. Reforms to taxation, energy pricing, and State-owned enterprises  along with improving tourism and export manufacturing — are presented as evidence of structural correction.

However, skeptics point to lingering vulnerabilities. Sri Lanka’s recovery remains dependent on external financing discipline, currency stability, and consistent policy execution. Political shifts or reform fatigue could erode investor sentiment quickly. Frontier liquidity constraints also amplify market swings, even within a UCITS wrapper.

The Fund’s diversified strategy  blending listed equities with sovereign and corporate bonds in both USD and local currency  attempts to mitigate concentration risk. A mandated 30% liquidity buffer offers daily redemption capacity, though actual market depth in stressed conditions could still be tested.

Comparisons have been drawn to frontier success stories such as Vietnam, where early-stage regulated funds helped channel foreign capital during periods of structural transformation. ACP Corum’s leadership suggests Sri Lanka could follow a similar trajectory if reform momentum persists.

ACP Asset Management’s broader footprint across emerging and frontier markets lends operational credibility. Nevertheless the Sri Lanka Opportunity Fund ultimately represents more than an investment product it is a referendum on the island’s reform durability.

If macro stability holds and growth reaccelerates, early entrants could reap outsized gains. If instability resurfaces, even European regulatory safeguards may not shield investors from frontier turbulence.

A growing body of evidence suggests Sri Lanka’s higher education system is unintentionally exporting its most valuable resource: skilled human capital. A 2025 analysis by Ceylon Public Affairs, drawing on research from the University of Peradeniya, reveals that more than 50 percent of state university graduates are migrating permanently. In high-demand sectors such as medicine, engineering, and agriculture, that figure soars to between 80 and 90 percent.

The scale of the investment underscores the gravity of the issue. Sri Lanka allocates Rs. 87 billion annually to maintain its free university system, educating roughly 42,000 students each year. Fields of study range from arts and humanities to management, engineering, and medicine. Yet the system’s most academically accomplished graduates particularly those with science and technical degrees are departing at unprecedented levels.

Observers argue that the country’s free education framework is inadvertently subsidizing developed nations. While Sri Lanka struggles with a poverty rate exceeding 24 percent, its publicly funded graduates are bolstering health systems, infrastructure projects, and research institutions abroad. The imbalance raises difficult questions about sustainability and national return on investment.

Economic realities largely explain the migration wave. Following a severe financial crisis marked by sovereign default and compounded by the COVID-19 pandemic, domestic employment prospects have weakened. High inflation, stagnant wages, and limited professional advancement create strong incentives to seek stability overseas. Both public and private sector employers in Sri Lanka find it difficult to match international salary standards, particularly in globally competitive industries.

This pattern has broader structural implications. Experts warn that sustained outflows of highly educated workers can entrench what economists describe as the “middle-income trap,” where countries fail to transition to high-value innovation-driven economies. Without sufficient engineers, medical specialists, researchers, and academics, Sri Lanka’s capacity for technological progress and institutional strengthening may erode further.

The consequences are already evident in strained public services. Healthcare facilities report doctor shortages, and universities struggle to recruit and retain qualified lecturers. Remaining professionals face mounting workloads, increasing the risk of burnout and diminished service delivery.

In response, researchers have floated contentious policy solutions aimed at recovering public investment. One proposal calls for migrants to reimburse the government between USD 10,000 and 15,000 per graduate. Another suggests mandating remittances totaling USD 50,000. Yet implementation would likely prove complex, particularly given international mobility rights and enforcement limitations once individuals settle abroad.

As Sri Lanka navigates recovery and reform, policymakers confront a stark dilemma: how to preserve the principles of free education while ensuring that the nation retains enough of its brightest minds to drive domestic growth.

The Government plans to release a portion of land following a systematic study in line with new economic strategies, while safeguarding land required for national food security and agriculture, President Anura Kumara Dissanayake said.

The President made these remarks yesterday (27) while attending the inauguration of the national programme to distribute ‘Himikama’ freehold title deeds at the North Central Provincial Council Auditorium in Korakahawewa, Anuradhapura.

He stated that the Government’s objective is to attract industries built on modern technological and scientific advancements as Sri Lanka moves towards economic transformation. Countries that achieved development success did so by absorbing the technologies available at the time, he said, adding that Sri Lanka is now facing the consequences of failing to adapt to global technological shifts in the past.

President Dissanayake stressed that opportunities must be created for industries based on contemporary science and technology, noting that subordinating land to an outdated inherited economic structure is not a scientifically sound approach.

Under the Land Development Ordinance No. 19 of 1935, lands were granted to farming communities and the public under permits and conditional grants. However, the absence of absolute ownership has created practical difficulties in utilising such lands for development and economic purposes.

Accordingly, steps are being taken to remove conditions attached to permits and grants issued under the Land Development Ordinance and to issue freehold title deeds in accordance with Section 2 of the State Lands Ordinance No. 8 of 1947. Under the islandwide ‘Himikama’ programme, freehold titles will be granted for lands voluntarily surrendered to the State.

At the ceremony, 500 ‘Himikama’ freehold title deeds were distributed to beneficiaries in the Anuradhapura District, with the President symbolically handing over deeds to 50 recipients.

Addressing the gathering, the President said land in Sri Lanka is deeply connected to culture, ancestry and livelihood, particularly in an agriculture-based economy. However, he noted that Sri Lanka’s limited land area and population density of around 350 persons per square kilometre require a forward-looking land management policy to prevent future conflicts and economic setbacks.

He emphasised the need for a scientifically grounded land-use plan based on statistical data and economic requirements, adding that funds have been allocated in the current Budget for this purpose.

While highlighting the benefits of granting freehold titles, the President also cautioned recipients against selling their land, noting that freehold ownership allows sale and mortgaging. He assured that the Government would work to address citizens’ economic needs so that land would not be sold out of necessity.

Referring to future economic planning, he said that while land required for food security and agriculture would be protected, a certain extent would be allocated for new economic ventures. He cited examples such as establishing AI centres or green energy parks, stating that allocating land for such initiatives is essential to align the country with global technological progress.

“If we fail to attract industries based on science and technology during this era of rapid advancement, the gap between our country and others will widen further,” he said.

The President also underscored the Government’s broader goals of ensuring economic stability and eradicating poverty, describing poverty as a social tragedy that must be addressed collectively. He said the country’s economic stability had enabled it to respond effectively to the challenges posed by Cyclone Ditwah without halting development projects.

Minister of Housing, Construction and Water Supply H.M. Susil Ranasinghe said the ‘Himikama’ programme is being implemented under a systematic plan, resolving shortcomings in previous land deed distribution initiatives. Deputy Minister of Land and Irrigation Aravinda Senarath stated that land ownership is now being granted free from political motives.

Members of Parliament, other public representatives, ministry secretaries, the Commissioner General of Lands, state officials and beneficiaries were present at the event.

Colombo’s year-on-year inflation slowed to 1.6 percent in February, down from 2.3 percent recorded in January, according to the latest data released by the Department of Census and Statistics.

The figures, based on the Colombo Consumer Price Index (CCPI), indicated a sharp moderation in food inflation, which declined to 0.2 percent in February from 3.3 percent the previous month.

However, non-food inflation rose to 2.3 percent in February, compared to 1.8 percent in January, reflecting price increases across several non-food categories.

Former US President Bill Clinton told lawmakers on Friday that he “saw nothing that gave me pause” during his past interactions with Jeffrey Epstein, as he delivered closed-door testimony before the House of Representatives Oversight Committee.

The appearance marked the first time a current or former US president has been compelled to testify before Congress.

Clinton and current President Donald Trump both had social connections with Epstein prior to his 2008 conviction for soliciting prostitution from a minor. Both have repeatedly stated they were unaware of any sex trafficking and neither has been accused by authorities of criminal wrongdoing related to Epstein.

In his testimony, Clinton said he would not have flown on Epstein’s private plane in the early 2000s if he had known about the alleged abuse of underage girls and would have reported him if he had been aware.

“We are only here because he hid it from everyone so well for so long,” Clinton said, speaking near his home in Chappaqua, New York.

Clinton flew on Epstein’s aircraft several times after leaving office. Recently released Justice Department documents include photographs of Clinton with women whose identities were redacted. “I saw nothing, and I did nothing wrong,” he told the committee.

House Oversight Committee Chairman James Comer described the session as cordial and said Clinton had been cooperative.

Clinton also said the committee should not have subpoenaed his wife, former Secretary of State Hillary Clinton, who testified a day earlier. She told lawmakers she did not recall meeting Epstein and had no information regarding his crimes. She also said she was questioned about unrelated topics during the session.

Comer indicated that some of Hillary Clinton’s responses would be reviewed for possible inconsistencies but did not provide details. He also did not rule out the possibility of subpoenaing other public officials connected to Epstein.

Democratic members of the committee argued that the investigation would lack credibility if it did not examine Trump’s past association with Epstein. Trump’s name appears in documents related to the case, and he previously socialized with Epstein before reportedly cutting ties prior to the 2008 conviction. Authorities have not accused Trump of criminal wrongdoing in connection with Epstein.

At the White House, Trump expressed sympathy for Clinton, saying he did not like seeing him deposed but noted that investigations into himself had been more extensive.

The Clintons agreed to testify after the House threatened to hold them in contempt of Congress for failing to cooperate. They have accused Republicans of conducting a politically motivated inquiry, noting that others involved in the investigation were permitted to submit written statements instead of appearing in person.

Epstein died in jail in 2019 while awaiting trial on federal sex-trafficking charges. His death was officially ruled a suicide.

A three-month memorial almsgiving ceremony was held yesterday (27) at Pamunupura, Batamulla, in remembrance of those who lost their lives in the landslide that devastated over five kilometres of Nelummala village in the Minipe Divisional Secretariat Division of the Kandy District.

President Anura Kumara Dissanayake participated in the ceremony, according to the President’s Media Division (PMD).

The landslide, triggered by Cyclone Ditwah, claimed the lives of 31 individuals from 13 families in Nelummala village.

The almsgiving was conducted in honour of all those who perished in the disaster, with the participation of 70 members of the Maha Sangha. A Bodhi Pooja and a Pirith chanting ceremony had also been held the previous evening (26).

During the ceremony, the President joined in offering alms to the Maha Sangha and later engaged in a brief conversation with the relatives of the victims, conveying his deepest condolences, the PMD stated.

The event was attended by the Anunayake of the Asgiri Chapter of the Siyam Maha Nikaya, Venerable Narampanawa Ananda Anunayake Thero, members of the Maha Sangha representing the three Nikayas, Minister of Buddhasasana, Religious and Cultural Affairs Dr. Hiniduma Sunil Senevi, public representatives of the area, Kandy District Secretary Indika Udawatta, government officials and residents.

Showers or thundershowers are likely at a few places in Kaluthara, Rathnapura, Galle and Matara districts after 2.00 p.m.

Mainly fair weather will prevail over the other areas of the island.

Misty conditions can be expected at some places in Western, Sabaragamuwa, Central, Southern and North-western provinces and in Anuradhapura and Monaragala districts during the early hours of the morning.

By Adolf

Sri Lanka’s national carrier is once again at the centre of controversy — not merely because of losses, but because of what increasingly appears to be a serious conflict of interest at the highest level of governance. For several months, the most profitable route for SriLankan Airlines has been Australia. The airline operates near full capacity to Sydney and Melbourne, often running double daily frequencies during peak periods. Demand is strong. Load factors are high. Yields are robust. By every commercial measure, Australia has become the airline’s top-performing long-haul market. In any commercially run airline, the response would be straightforward: add capacity, increase frequencies, optimise fleet deployment, and lock in market share.

That proposal, notably, did emerge from within the airline itself. However, Chairman Sarath Ganegoda reportedly rejected calls to expand Australian operations. Instead, strategic focus was diverted toward launching direct services to a different destination — a move that industry observers say carries higher risk and uncertain returns. While SriLankan hesitated, a competitor moved decisively.

The Entry of Jetstar

This week, the aviation industry confirmed that Jetstar Airways will commence direct flights between Melbourne and Colombo from August 27, 2026. The logic behind the move is clear: strong, unmet demand between Australia and Sri Lanka. Jetstar’s entry is not speculative — it is demand-driven. Where capacity gaps exist, markets respond. And in this case, the gap was left open by SriLankan Airlines itself.

Under normal competitive circumstances, this would simply be market dynamics. But the surrounding governance context raises troubling questions.

The Hayleys Connection

The General Sales Agent (GSA) for Jetstar’s Sri Lankan operations is Hayleys Aviation, part of the Hayleys Group controlled by businessman Dhammika Perera. Being a GSA is not a minor administrative role. It is commercially powerful. A GSA:

• Sells tickets and manages local distribution

• Earns overriding commissions (ORC)

• Typically holds ticket revenues before remittance

• Provides crew services and logistical support

• Benefits from ancillary commercial arrangements

Every seat sold on the Jetstar route generates revenue streams for the local agent. Given expected demand, this is potentially a multi-million-dollar annual business. Here lies the critical issue: Sarath Ganegoda, Chairman of SriLankan Airlines, also serves on the board of Hayleys. This dual position creates the appearance — at minimum — of a significant conflict of interest.

Governance Breakdown

Jetstar is entering precisely because SriLankan did not expand to meet demand. The national carrier left revenue on the table. A private competitor has now stepped in. And the commercial beneficiary of that competitor’s local operations is a company whose board includes the sitting Chairman of SriLankan Airlines. Even if all actions were technically compliant, governance is not only about legality — it is about fiduciary duty and perception. A Chairman’s primary obligation is to maximise value for the entity he leads — particularly when that entity is state-owned and funded bymassive grants from taxpayers. When strategic decisions appear to benefit a private affiliate over the national carrier, serious questions arise. Did SriLankan forgo expansion because of fleet constraints? Were formal conflict disclosures made? Was the Board fully apprised? Did the shareholder — the Government of Sri Lanka — review the implications?These questions demand transparent answers.

The Commercial Risk

Jetstar is a low-cost carrier. Its reported introductory fares of around AUD 339 significantly undercut SriLankan’s pricing. While product positioning differs, price elasticity on migrant and leisure traffic is substantial. If Jetstar captures a meaningful share of the Australia–Sri Lanka market, SriLankan’s yields will compress. Load factors may fall. Revenue could decline on what has been one of its strongest routes.This comes at a time when the Government has already injected approximately LKR 20 billion in budgetary support, with additional assistance under discussion. Taxpayer exposure remains significant. If the airline loses its most profitable corridor, recovery becomes far more difficult.

Capitalism or Cronyism?

True capitalism rewards efficiency, innovation, and prudent risk-taking. It does not rely on influence within state institutions to manufacture commercial opportunity. Markets function best when competition is transparent and merit-based. However, when public assets appear to be weakened while parallel private interests stand to benefit, the line between healthy competition and cronyism becomes dangerously blurred.

SriLankan Airlines is not merely a balance sheet entry or a struggling state-owned enterprise. It represents national connectivity, skilled employment, tourism access, bilateral air service rights, and a measure of sovereign aviation presence. A national carrier carries more than passengers; it carries economic strategy and national branding.If governance standards at board level are compromised — whether through conflicts of interest, weak oversight, or misaligned incentives — no restructuring plan, financial engineering exercise, or operational turnaround strategy will succeed. Governance is the foundation. Without it, even the strongest routes and most capable management teams cannot deliver sustainable results. The Australian route, by most industry assessments, has been one of the airline’s strongest-performing sectors in recent times. In a competitive aviation environment, profitable long-haul routes are strategic assets. They should be strengthened, frequency-optimised, and commercially leveraged — not diluted or surrendered through questionable strategic decisions. Any shift in route strategy must be justified transparently on clear commercial grounds, not obscured by opaque decision-making.The issue is not competition. Sri Lanka benefits from greater connectivity and increased international carrier presence. The concern arises when policy decisions, regulatory discretion, or governance failures create asymmetric outcomes that weaken the national carrier while advantaging select private interests.With British Airways set to operate direct services to Sri Lanka — reportedly with local support from Hayleys PLC — competitive pressure on SriLankan Airlines will intensify further. Competition in itself is not the problem; indeed, it can stimulate efficiency and service quality. But if the national carrier enters such competition structurally weakened due to internal governance failures, the outcome may not be market-driven efficiency — it may simply be decline. What remains to be seen is whether regulators, shareholders, and Parliament will examine this matter with the seriousness it warrants. The stakes are not ideological. They concern accountability, transparency, and the integrity of public institutions.Sri Lanka must decide whether it wishes to uphold genuine capitalism — where success is earned through performance — or tolerate a system where influence shapes outcomes. The difference will determine not only the future of SriLankan Airlines, but also the credibility of economic governance in the country. Before irreversible damage is done to the national carrier, that distinction must be confronted clearly and decisively. The President needs to wake up and look at this problem with a fresh lens . Start by appointing an Independent Chairman with no conflicts .