July 14, Colombo (LNW): President Ranil Wickremesinghe reaffirmed his dedication to establishing a robust economic framework for Sri Lanka, emphasising the importance of long-term stability over short-term solutions that could lead to economic collapse.

His remarks were made yesterday (13) during the inauguration of a state-of-the-art swimming pool at Anuradhapura Central College.

Reflecting on past economic and political crises, President Wickremesinghe stressed the need for a national-level political structure capable of strategic governance beyond five-year electoral cycles.

He advocated for governance that focuses on sustainable national development rather than short-term power dynamics.

At the ceremony, President Wickremesinghe inaugurated the swimming pool and interacted with students engaged in various activities.

He formally handed over the pool premises to Anuradhapura Central College and acknowledged students who excelled in the 2023 GCE Advanced Level Examination, personally congratulating them on their achievements.

Principal Mr Percy Mahanama presented a donation of Rs. 10,000 to the President’s Fund, contributed by the students of Anuradhapura Central College, as a token of appreciation.

The President highlighted the government’s and the Alumni Association’s contributions to constructing the swimming pool, recognising the school’s historical significance as the first Madhya Maha Vidyalaya in the North Central Province, where educational reforms initiated by Mr C. W. W. Kannangara began.

President Wickremesinghe mentioned that the principal had requested a three-storey building, and he would personally notify the Ministry of Education to facilitate its construction.

Additionally, he announced plans to establish a fully-equipped fitness centre for the college, marking its 77th anniversary and the completion of the swimming pool.

During a student’s speech, the aspiration for a better future was prominently expressed, aligning with the President’s vision for sustainable development.

He warned that continuing on the current economic trajectory could lead to unsustainable debt and a severe economic crisis within 15 years unless a sustainable course is charted.

The President emphasised the need to transform the economy from one reliant on imports to one driven by exports, necessitating a fundamental overhaul of existing economic structures.

He introduced the Economic Transformation Act as part of this initiative, with agricultural modernisation being central to revitalising the economy.

Acknowledging the dedication of farmers who achieved successful harvests in recent years with essential fertiliser support, President Wickremesinghe announced the launch of the inheritance tax exemption programme for farmers in the North Central Province.

He highlighted the global population’s projected increase by 2050, underscoring the importance of modern technology in maximising agricultural output and ensuring food security.

The President also noted the potential for solar energy projects and tourism development in the provinces. He mentioned the ambitious Trincomalee port development project in collaboration with India, benefiting Anuradhapura.

In line with a forward-thinking approach, plans are underway to establish three new technological universities with foreign institutions offering technical expertise. Embracing advancements in artificial intelligence, the government aims to chart a new course towards a prosperous future.

President Wickremesinghe criticised politicians who focus solely on gaining power or ousting rivals, leading to economic and political crises.

He emphasised the importance of collaboration across political divides to prioritise the nation’s well-being and urged representatives to focus on the future for collective national success.

State Minister of Finance Shehan Semasinghe highlighted the significance of the swimming pool’s completion, noting the challenges faced during recent turbulent conditions. He credited President Wickremesinghe’s economic stabilisation efforts for securing the necessary funding.

The government, through effective decision-making and partnership with the International Monetary Fund, swiftly restored the economy and livelihoods.

Minister Semasinghe noted that President Wickremesinghe continues to lead reforms to safeguard the economy from future collapses, with new legislation and programmes underway.

He praised transformative initiatives enhancing infrastructure across education, healthcare, and the broader economy, fostering a brighter outlook for the nation’s future.

The ceremony was attended by North Central Province Governor Mahipala Herath, Members of Parliament S.M. Chandrasena, Duminda Dissanayake, Rohana Bandara, former Minister P. Harrison, former Chief Minister S.M. Ranjith, Anuradhapura Central College Principal Mr Percy Mahanama, staff members, parents, alumni, and students.

July 13, Colombo (LNW): Sri Lanka is  now set to implement Digital Public Infrastructure (DPI) initiative towards building a comprehensive and inclusive digital future paving the way for social and economic development across the nation, former finance minister and president’s national organiser Ravi Karunanayake divulged.  

It is aimed at providing secure and accessible digital services to citizens and businesses in achieving development goals its increasing efficiency in the public sector and unlocking innovation in the private sector.

More broadly, digital transformation of the government can improve policy implementation and widen the range of policy options.

The government has taken a significant step towards in its DPI initiative in partnership with the World Bank on the directions of President Ranil Wickremasinghe   with a vision for a brighter digital future, he claimed. .

This digital leap is not digitalization of specific public services, but rather building minimal digital building blocks that can be used by government as well as private sector to enable society-wide transformation. 

The DPI includes a digital identification layer including a unique identification and social security number a payments system running as a unified payment interface; a data exchange layer and other services.

Sri Lanka’s digital economy, projected to be worth US$3.47 billion, is developing, with more than 60 percent of the population owning mobile phones and an increasing number of internet users

 Mr Kraunanayake noted that the ambition of the President is to create a technology-driven society, with a concentration on digital based governance, economy, and society at least by the year 2030. .Sri Lanka may not be able to compete immediately in artificial intelligence (AI) and autonomous vehicles, but it shows potential in e-commerce and fintech he said adding that   the government is gearing up to incorporate effective ways to meet digital economy goals.

Foundational digital public infrastructure (DPI), which includes unique digital identification, a payment system, and a data exchange layer, has the capability to transform the economy and promote inclusive growth.

Sri Lanka’s foundational DPI, has been utilised to encourage innovation and competition, expand markets, address financial inclusion gaps, increase government revenue collection, and enhance the efficiency of public spending, he revealed. .

The government will make use of DPI to efficiently manage social welfare programme which is being implemented to alleviate poverty in the island, he added.

Poverty rates continued to rise for the fourth year in a row, with an estimated 25.9 percent  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, aggravated by the closure of micro, small, and medium-scale 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. Poverty rates are anticipated to remain above 22 percent until 2026

In the first four months of 2024, the Government has incurred Rs. 152.8 billion on Social welfare and social security including household subsidies of Aswesuma, and other social welfare activities, finance ministry data showed.

 Social security expenditure on Aswesuma and cash grants provided to low-income families in the first four months of 2024 amounted to Rs. 46 billion. An allocation of Rs. 205 billion is made for the expenditure for the Aswesuma and other categorical household cash grants for 2024

Apart from the using of DPI to efficiently manage social security expenditure, customs inland r revenue and excise department’s revenue collection, it helps Sri Lanka build an equitable tax system by streamlining filings, improving data collection, and enhancing transparency, he added.

July 13, Colombo (LNW): Sri Lanka’s Lumbini Aquaria International Ltd., a leading exporter of ornamental fish, has launched a new venture into fish feed production with its brand ‘Gobble’. 

This initiative aims to tap into the global market for aqua nutrients, showcased recently at Interzoo 2024 in Germany. 

The company has invested Rs. 150 million in a new factory in Madurankuliya, Puttalam District, operated by its subsidiary Deep Blue Sea (DBS) Aquatic Nutrients.

The factory, operational from July 1, 2024, will produce six product ranges under the Gobble brand, using 100% locally sourced Sri Lankan ingredients.

 These include specialized feeds for Goldfish, Cichlids, Discus fish, Live Bearers, Koi, and Betta fish. Each product range is designed to enhance health, color, and disease resistance in their respective fish species, fortified with natural ingredients, vitamins, minerals, and probiotics.

Kapila Thisera, Chairman of Lumbini Aquaria, emphasized that the launch of Gobble marks a significant milestone in Sri Lanka’s aquaculture sector, opening new avenues for export revenue. 

The company, renowned for its ornamental fish farming and aquaculture research facilities, aims to leverage its expertise to become a global leader in aqua nutrients.

Lumbini Aquaria, founded over 70 years ago and now owned by Forsyth Capital, exports a wide range of aquatic species and plants to 25 countries. 

The company’s commitment to sustainability and innovation drives its efforts in developing high-quality nutrition solutions for aquaculture, ensuring optimal growth and performance of aquatic species.

“Extensive research has gone into the development of these products exclusively for the discerning export market,” Perera added. “DBS Aquatic Nutrients is dedicated to providing high-quality nutrition solutions for aquaculture. With a commitment to sustainability and innovation, DBS Aquatic Nutrients will continue to develop feeds that optimise growth, health, and performance of aquatic species.”

Lumbini Aquaria’s entry into fish feed production with Gobble underscores its dedication to diversification and excellence in the global ornamental fish industry, supported by robust research and development capabilities.

This synopsis encapsulates Lumbini Aquaria’s strategic move into aqua nutrient production, positioning itself as a key player in the global market with its Gobble brand, poised to enhance Sri Lanka’s export portfolio in aquaculture.

July 13, Colombo (LNW): International Monetary Fund (IMF) is still assessing Sri Lanka’s agreement with creditors regarding the restructuring of its sovereign bonds whilst Barclays, the multinational universal bank based in Britain maintaining “overweight” rating on SL ISBs

The Bank advises investors to consider purchasing those with higher past due interest (PDI) following recent developments in the restructuring of International Sovereign Bonds (ISBs).

The International Monetary Fund (IMF) is currently evaluating Sri Lanka’s agreement with investors regarding the restructuring of its sovereign bonds, according to Julie Kozack, Director of Communications. 

Kozack mentioned to reporters in Washington that the IMF team is reviewing the terms of the debt restructuring to determine if they align with the program’s criteria.

 Once this evaluation is finished, the IMF will share its perspective. Additionally, the Official Creditor Committee must approve the agreement with private bondholders.

According to Barclays’ latest research in Fixed Income, Credit, Currency, Commodity, Futures and Macroeconomic (FICC), they affirm their positive stance on Sri Lanka bonds, projecting a recovery of approximately 62 at a 12% exit yield, aligning with their fair value estimate ranging from 60 to 65. 

They anticipate potential upside from improved exit yield estimates and recommend buying bonds with significant PDI claims such as SRILAN 25/28/29/30.

Referring to their recent reports titled “Sri Lanka: Finish line?, 25 June 2024” and “Sri Lanka: Tick tock, tick tock, 14 Jun 2024,” Barclays highlights key developments indicating progress in the restructuring process throughout late-May and June. 

These include governmental recognition of the restructuring’s critical importance for timely disbursements from the IMF, the IMF’s recent disbursement under the Extended Fund Facility (EFF), approval of debt agreements with bilateral creditors, and finalization of a Memorandum of Understanding (MoU) with the OCC.

Barclays anticipates that the restructuring could conclude in the coming months, noting that subsequent steps are likely to be procedural formalities.

 Prior to the Joint Working Framework, Barclays’ model assumed a starting coupon of 4%, rising to 8% over the new bonds’ lifespan. 

They projected a 10-year maturity extension with principal amortization beginning in 2028 and anticipated principal haircuts of 20-30%, resulting in recovery values around the mid-50s at a 12% exit yield.

The bank’s analysis incorporates features like a consent fee of 1.8% payable upfront during the exchange, an 11% haircut on past-due interest with accrual starting from March 2024, and macro-linked bonds triggered by USD nominal GDP, adjusted by real GDP cumulative growth from 2024 to 2027. Barclays estimates a recovery value of 64.8 under the IMF baseline at a 12% exit yield.

 Looking ahead, Barclays estimates the fair value for bonds at 62 with a 12% exit yield, potentially rising to 75 at a 9% exit yield, contingent upon these factors and GDP thresholds for macro-linked bond payouts.

July 13, Colombo (LNW): The Ceylon Motor Traders Association (CMTA) recently voiced serious concerns about the motor industry’s viability due to the latest tax increases proposed by the Government. 

The Government initially imposed a complete import suspension on all types of vehicles in March 2020, intending it to last six months, but the suspension has now extended for over 31 months. 

This extended ban, along with limitations in establishing Letters of Credit (LCs) for the past few months, has also reduced the import of genuine spare parts, negatively impacting the after-sales business, the remaining key revenue line for motor companies.

Before the import ban, CMTA members employed over 30,000 individuals and managed over 6,300 island-wide SMEs as dealers, which significantly contributed to the rural economy with over Rs. 2 billion in dealer incentives. T

The CMTA members also paid over Rs.6 billion for outsourced services and facilitated vehicle finances of over Rs124 billion, sustaining many jobs in trades like leasing and insurance. 

In 2019, the motor trade’s excise duty contribution was Rs.130 billion, accounting for 6.8% of government revenue.

At the CMTA’s 104th Annual General Meeting (AGM), Virann de Zoysa of AMW Manufacturing was elected as Chairman, with Andrew Perera of Kia Motors Lanka appointed as Senior Vice Chairman and Lakmal de Silva of David Pieris Motor Company as Vice Chairman.

 Addressing the AGM, de Zoysa highlighted the challenges faced due to the prolonged import restrictions and inconsistent policy changes, which negatively impacted the sector’s attractiveness to the Government. 

He emphasized the need for sustainable policy and regulation, urging collaboration with stakeholders to address these issues.

Outgoing Chairman Charaka Perera of Stafford Motor Co Ltd. discussed CMTA’s efforts to regulate vehicle importers before reopening the market. 

He proposed subjecting vehicles to an additional 140% duty with a 20% quarterly reduction to discourage overstocking and mitigate forex outflow.

 He also noted that CMTA had been involved in several Ministerial and Cabinet Appointed committees to work on regulations and industry development, expressing his efforts to guide the association through challenges over the past two years.

The AGM, attended by over 140 dignitaries from the Government sector, diplomatic missions, and private sector, featured Chief Guest and Keynote Speaker Duminda Hulangamuwa, Chairman of the Ceylon Chamber of Commerce.

 Hulangamuwa emphasized the need for the motor vehicle industry to rethink its business strategies and highlighted the unlikelihood of future Governments adopting a liberal approach to vehicle import permits. 

He also stressed the importance of strict regulation to prevent malpractice in the motor vehicle industry, citing issues such as the foreign migrant worker scheme for electric vehicles.

 Established in 1919, the CMTA is one of South Asia’s oldest automotive associations and has significantly contributed to Sri Lanka’s economy by creating employment opportunities both locally and internationally.

July 13, Colombo (LNW): The Asian Development Bank (ADB) today approved a $100 million policy-based loan to support and facilitate reforms aimed at enhancing the financial sustainability of the power sector in Sri Lanka.

The Power Sector Reforms and Financial Sustainability Program will complement the International Monetary Fund’s Extended Fund Facility arrangement and bolster the operational efficiency and competitiveness of country’s power sector. 

The program will help create a conducive environment for private investments, boosting renewable energy development, and modernizing power grids.

“Developing cost-competitive renewable energy and providing reliable and affordable electricity supply—with a transparent and independent power sector regulatory framework—will help Sri Lanka drive economic growth and address the current financial and economic crisis,” said ADB Principal Energy Specialist Jaimes Kolantharaj. 

“This program will support reforms in the power sector introduced under the Electricity Act, including institutional and regulatory reforms and improve operational sustainability of the electricity sector, he said. . 

The program will also support the development of renewable energy to accelerate the country’s transition to clean energy as envisaged under Sri Lanka’s nationally determined contributions.”

The program will help the government undertake institutional reforms in the electricity sector by establishing independent companies with defined functions and support strengthening their corporate governance and financial sustainability.

 It will support regulatory reforms with the implementation of the new national tariff policy that will improve financial sustainability of the sector through cost-reflective tariffs.

To help accelerate investments in renewable energy, the program will assist multiple initiatives under the renewable energy expansion plans for 2023–2030. 

The key initiatives include implementing a periodic revision of feed-in tariffs for small power plants and rooftop solar users, facilitating integration of renewable energy projects into the national grid, and effective application of a competitive procurement framework for renewable energy projects. 

The program will support increased women’s participation in the power sector by developing policies to promote equitable participation of female customers, female entrepreneurs, and women and disadvantaged community groups.

ADB will provide an additional $1 million technical assistance grant from its Technical Assistance Special Fund to support program implementation, capacity building of electricity companies, the development of their business plans and overall power system development plans.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.

1. President Ranil Wickremesinghe stated that a robust economy can be established by enhancing the export economy, manufacturing, tourism, technology sectors, and modern agriculture. He highlighted that the government has already laid the foundation for this vision.
2. A group of Members of Parliament from the opposition have sent a letter to the Election Commission, requesting that the Presidential Election be held on the earliest possible date in order to prevent any attempts to delay polls. Accordingly, the parliamentarians urged the commission to exercise its maximum legal authority to ensure the election is conducted in a free and fair atmosphere.
3. The Sri Lanka Railway Station Masters’ Union says its trade union action was called off yesterday following the intervention of former Speaker Karu Jayasuriya to convene a discussion with the relevant authorities. Speaking to local media, the Chairman of the Union Sumedha Somaratne said the former Speaker had convened a meeting with the Minister and State Minister of Transportation.
4. President’s Counsel Mr. K.A. Parinda Ranasinghe has been appointed as the new Attorney General of Sri Lanka by President Ranil Wickremesinghe. He was appointed in terms of Article 61E (b) of the Constitution of Sri Lanka at the Presidential Secretariat, a short while ago, the President’s Media Division said.
5. Former Health Minister Keheliya Rambukwella and six others, arrested over the alleged importation of substandard human immunoglobulin vials, have been further remanded until July 25.
6. Minister of Justice Wijeyadasa Rajapakshe has slammed the Police for releasing video footage on the interrogation of a suspect arrested in connection to the recent shooting in Athurugiriya in which businessman ‘Club Wasantha’ was killed. Addressing the Parliament, the Justice Minister said in the video the Police were seen questioning a suspect in public and with access to media. Stating that it is a violation of the law, he said under such circumstances, the services of the Police officers involved in such interrogation must be suspended.
7. The Asian Development Bank (ADB) approved a $100 million policy-based loan to support and facilitate reforms in Sri Lanka, aimed particularly at enhancing the financial sustainability of the power sector in the island country.
8. Attorney-at-Law Aruna Laksiri has filed a Fundamental Rights (FR) petition before the Supreme Court, seeking an order to prevent holding of the Presidential Election as the 19th Amendment to the Constitution has not been properly passed in Parliament.
9. President Ranil Wickremesinghe inaugurated the second and third phases of the Bingiriya Export Processing Zone, aiming to transform Bingiriya into a major economic hub. The expansion is set to generate an estimated USD 2,600 million in export revenue and create 75,000 job opportunities.
10. India is highly unlikely to travel to Pakistan for the Champions Trophy 2025 which is scheduled to take place in Feb-Mar next year. The Sri Lanka cricket team will replace India cricket team if the latter decide to pull out of the Champions Trophy 2025. Rohit Sharma and co. are highly unlikely to travel to Pakistan which is scheduled to host the marquee tournament next year. As per reports, Sri Lanka who did not qualify for CT 2025 owing to their 9th placed finish in the 2023 ODI World Cup will replace India.

July 13, Colombo (LNW): The Agriculture Ministry announced that the government has saved millions of rupees by merging two fertilizer companies, which previously operated with separate chairmen, boards of directors, and staff. This significant cost-saving move was celebrated at a ceremony held at Water’s Edge Hotel on Thursday, attended by Agriculture and Plantation Industries Minister Mahinda Amaraweera.

The event saw the presence of State Ministers D.B. Herath, Kader Masthan, Mohan Priyadarshana Silva, Ministry Secretary Janaka Dharmakeerthi, and State Fertilizer Company Chairman Dr. Jagath Perera.

Minister Amaraweera noted that many institutions under the ministry dealt with similar subjects, resulting in unnecessary expenditures. Following President Ranil Wickremesinghe’s instructions, the Cabinet initiated a process to merge institutions with overlapping scopes. As a result, the two government-owned fertilizer companies have now been combined into one entity. Out of the 400 former employees of these companies, 273 retired voluntarily, receiving compensation ranging from Rs. 900,000 to Rs. 8.9 million based on their length of service and position.

The merger is part of broader efforts to strengthen the fertilizer program, which was crucial following the 2021 fertilizer crisis that led to widespread farmer protests. Minister Amaraweera highlighted that Sri Lanka has achieved self-sufficiency in rice production due to the reinstatement of chemical fertilizers, preventing rice prices from soaring. He emphasized that no rice has been imported since 2023.

State Fertilizer Chairman Dr. Jagath Perera announced that the merged company now produces 30 types of mixed fertilizers for various crops, including tea, cinnamon, rubber, and coconut. Efforts have been made to significantly reduce the prices of these fertilizers compared to market rates.

July 13, Colombo (LNW): The People’s Republic of China has provided a financial grant to upgrade the digital education infrastructure of 900 smart classrooms in 500 schools, marking a significant change in Sri Lanka’s education sector.

The agreement for this financial grant was signed between Finance Ministry Secretary Mahinda Siriwardena and Vice President of the International Development Agency of the People’s Republic of China Yang Weiqun in Beijing, China.

Finance Ministry Secretary Siriwardena stated that this financial grant is a major boost to the digitization program in Sri Lanka’s education sector. The funds will be used to develop state-of-the-art educational infrastructure, including a modern educational data center, multimedia distance learning, and conference facilities. The Sri Lankan government has introduced several reforms in the education sector, with digitization becoming a leading task. The support from the People’s Republic of China is highly appreciated and welcomed.