By: Staff Writer

April 10, Colombo (LNW): Sri Lanka Small and medium scale enterprises (SMEs), comprising trade, service, and manufacturing, put in a large proportion of revenue, employment, and innovation to the economy are to be reinvigorated through capacity building.

SMEs make up for 52 percent of the GDP and 45 percent of national employment, contributing, perhaps, the largest portion to the economy.

While more effective Government involvement is required, the SME sector entrepreneurs continuously insist that such State backing is not satisfactory for their survival and growth

Therefore the National Chamber of Commerce of Sri Lanka (NCCSL) and KPMG Sri Lanka have officially signed a Memorandum of Understanding (MOU) aimed at fostering knowledge sharing and collaborative endeavors for the benefit of this sector.

This landmark agreement marks a strategic collaboration between two influential organizations, poised to catalyze numerous joint initiatives.

The primary objective of this MOU, where KPMG Sri Lanka will be onboard as a Knowledge Partner, and to strengthen the services to the MSME sector through capacity building and training initiatives which would facilitate trade and investment activities within the respective business communities.

Additionally, both entities are committed to nurturing commercial and industrial linkages among their members, thereby fostering a conducive environment for sustainable growth.

By recognising the importance of SMEs and implementing targeted policies and interventions, Sri Lanka can unlock the full potential of these enterprises and harness their contributions to national development.

Through improved access to finance, streamlined regulations, enhanced skills development, and expanded market opportunities, SMEs can thrive and play a transformative role in driving inclusive growth and prosperity across the country

This MoU contains a detailed framework for mutual cooperation with a view of supporting Sri Lankan entrepreneurs in their efforts towards accelerating sustainable economic growth.

However, the common view of the banks is that they are releasing as many as loans possible for SMEs under the guidance of the bank supervision department of the Central Bank.

However, the temporary suspension of the “Parate Executions” until December 2024 has met with stiff resistance from the banking sector. This can further complicate loan processes and the lenders are most likely to enforce stricter measures on collateral.

Addressing this challenge requires the development of specialised financial products tailored to the needs of SMEs, as well as initiatives to promote alternative sources of funding such as venture capital and promoting angel investors.

Regulatory burdens are another challenge SME sector often confronts, particularly at the start-up stage. SMEs often face these regulatory inconveniences, including complex licensing procedures, cumbersome compliance requirements, and more severely bureaucratic red tape.

Hence, the authorities must seriously consider the ongoing difficulties and introduce more business-friendly and streamlined regulatory processes, reducing administrative barriers, and enhancing regulatory transparency.

By: Staff Writer

April 10, Colombo (LNW): The world’s first Cinnamon Museum was recently inaugurated at the Mirissa Hills Estate in Henwalle, Mirissa, promising an immersive journey into the fascinating history, production, and symbolism of cinnamon.

The Museum was ceremoniously declared open on 06th April 2024, in the esteemed presence of Hon. Harin Fernando, Minister for Tourism and Miles Young, Chairman of Mirissa Hills.

From its ancient roots in Egyptian embalming rituals to its modern-day applications in cuisine and medicine, the museum offers visitors a unique opportunity to delve into the origins of cinnamon, bridging the gap between its production and consumption.

Located amidst the scenic beauty of the Mirissa Hills Estate designed by renowned architect C. Anjelandran, the museum functions as a fully-fledged visitor centre, offering tours and demonstrations of cinnamon peeling, as well as the opportunity to savour local cuisine while staying amidst the lush surroundings.

Miles Young, in his remarks, emphasized the museum’s role in not only showcasing the difference between true cinnamon and its substitutes but also in celebrating the spice’s inherent romance and legendary allure.

He remarked, “Cinnamon is an underexploited asset for tourism in Sri Lanka. Many visitors crave to know what it looks like but have nowhere to go. We will reveal the difference between true cinnamon and poor-quality substitutes.

But we also reveal the world of romance and legend which makes this spice unique. The museum is a celebration of cinnamon but also a tribute to all those who work in the trade and sustain the agricultural economy of Sri Lanka.,”he said.

The world’s only Cinnamon Museum provides a totally unique encounter with the spice which has been associated with Sri Lanka for thousands of years.

In the hart of plantation, it is purpose-designed to provide comfortable accommodation, and set within a secluded courtyard, four air-conditioned bedrooms cater for two persons each.

Each furnished in classic style, and with cheerful contemporary fabrics. Bathrooms with showers (hot and cold running water) and wc’s are en-suite. The rooms are air conditioned.

At night the courtyard is designed to transform into an attractive candle-lit dining area, with an atmospheric bar at one end where one can “chill out” to one’s heart content.

The building is furnished with specially commissioned paintings and sculptures, including a magnificent statue of a Phoenix, symbolizing the legend which describes how the dying Phoenix gathered branches of cinnamon on his last night to create a pyre – which, after his immolation, allowed his successor to be born from within the ashes.

The Museum itself will occupy a space on the upper floor of the building. Contents for it are being gathered from all over the world, and it will be opened to the public in the course of 2010

By: Staff Writer

April 10, Colombo (LNW): A.P. Moller – Maersk (Maersk) today inaugurated its brand new warehouse in Sri Lanka at Wattala, spread over 100,000 sq. ft.

Present at the inauguration were Vikash Agarwal, Managing Director, Maersk South Asia, Biju Ravi, Head of Maersk Sri Lanka and Dr Parakrama Dissanayake – Deputy Chairman & Managing Director, Aitken Spence PLC and other leaders.

This new facility is a testament to Maersk’s commitment to providing integrated supply chain solutions, offering a strategic advantage for various global customers and local suppliers in the retail and lifestyle sector.

“Our new warehouse in Sri Lanka represents a strategic milestone in our commitment to strengthen our operations in the country.

By leveraging Sri Lanka’s growing prominence as a logistics hub and investing in infrastructure that our customers have shown interest in, Maersk aims to deliver unparalleled value to its clients while contributing to Sri Lanka’s economic growth and development.”

Strategically located in Wattala, a mere 11 km from the seaport, Maersk’s new facility is poised to leverage Sri Lanka’s advantageous geographical position as a vital hub for trade routes connecting Asia, Africa, and Europe.

With the country’s thriving trade sector and government initiatives to improve infrastructure and ease of doing business, Sri Lanka presents an ideal environment for Maersk to strengthen its presence in this strategic market.

The 100,000 sq. ft. warehouse offers export consolidation and 3PL services, with 50,000 sq. ft dedicated to each. Maersk’s new facility will provide end-to-end supply chain solutions, including storage, inventory management, and distribution, serving global and local customers.

The 3PL facility allows suppliers to store their cargo and move quickly to consolidation points without losing time.

Maersk’s next-door empty yard provides faster movement of containers into the consolidation point and then to the port. This new warehouse will be able to serve almost the entire Colombo market within four hours.

Further, the facility features rainwater harvesting, LED lighting, and solar module compatibility for environment-friendly operations.

Meanwhile Maersk introduced its online shipping facility named Twill to participants at an online webinar recently conducted in collaboration with the Sri Lanka Export Development Board (EDB).

Twill aims to offer small and medium-sized enterprises (SMEs) with a simple, reliable, and easy-to-use online platform to manage their logistics efficiently.

The objective of the webinar was to provide information on easy online shipping methods available for SME exporters in Sri Lanka, according to a joint press release by the EDB and Maersk.

Twill is a tailor-made, end-to-end customer experience built to serve SMEs, and has over 5,000 active customers. The platform provides greater control of shipments by offering instant price quotes and booking, transparency and tracking services, simplified paperwork, and proactive customer care.

By: Staff Writer

April 10, Colombo (LNW): The Inland Revenue Department is set to investigate undue profits by traders underscore the Government’s commitment to ensuring fair pricing and availability of essential commodities.

Trade, Commerce and Food Safety Minister Nalin Fernando revealed these measures which are underway, including potential intervention by The Inland Revenue Department to probe profiteering traders

The Minister reiterated efforts to curb profiteering by middlemen including issuing estimated price ranges and publicising price differentials from importation to retailing with the support of Sri Lanka Customs and the Finance Ministry through the Consumer Affairs Authority (CAA) every Tuesday.

The Minister apparently responding to the Parliamentary Committee on Ways and Means last week revealed the glaring disparities between essential goods market prices and import costs, shedding light on significant profits ranging from Rs. 100 to Rs. 1,000 per kilogram

The Committee on ways and means disclosed that since 2018, there has been a consistent decline in tax revenues generated from imported goods, attributed to a mismatch in the Special Commodity Levy (SCL) in accordance with the fluctuating value of the US dollar.

It also directed the IRD to take swift action to recover the Rs. 188 billion in tax arrears. Minister Fernando also said that special enforcement actions are also underway to curb price hikes, ensure product quality and deter market irregularities during festive seasons.

Minister Fernando also shed light on the economic challenges faced by Sri Lanka and measures undertaken to mitigate the impact on consumer prices.

He highlighted that despite economic challenges, the Government has effectively ensured an uninterrupted supply of essential goods to consumers, fulfilling its goal of averting shortages.

Fernando assured consumers of ongoing efforts to stabilise prices, highlighting successful interventions in the egg market where prices have been fixed between Rs. 35-40 per egg.

He admitted that the country witnessed a sharp increase in commodity prices in 2022, positioning it among the countries with the highest price levels globally.

Illustrating the inflationary pressure, Fernando cited examples of price hikes in essential food items.

“The price of bread skyrocketed from Rs. 85 per kilo in 2019 to Rs. 485 in 2022, before stabilising between Rs. 195-200 at present. Similarly, the cost of dhal surged from around Rs. 120 per kilo in 2019 to Rs. 585 in 2022, now retailing at around Rs. 295,” he explained.

He attributed the past price hike to the appreciation of the dollar and reduced bank interest rates. Explaining the reasons behind the recent onion shortage, the Minister revealed diplomatic efforts to resume imports from India, Sri Lanka’s primary onion supplier.

By: Staff Writer

April 10, Colombo (LNW): Sri Lanka is the only country in South Asia that does not recognise engaging in corrupt and fraudulent activities during procurement as a valid reason for blacklisting and it has not blacklisted contractors that have defaulted on contractual obligations despite having the

According to a study by Verité Research, a Colombo-based think tank, the main issue can be attributed to gaps in the procurement guidelines of 2006, which govern almost all public procurement in Sri Lanka — except in a few instances such as pharmaceutical procurement.

“The second issue – not blacklisting defaulting contractors – shows a lack of compliance with existing regulations. Sri Lanka has provisions not only to blacklist defaulting contractors, but also to publish their names in a public, online database.

However, this database, maintained by the Department of Public Finance has failed to update it. The research report disclosed.  

Verité Research indicates that the amount lost on public contracts due to corruption can amount to 10–25 percent of a public contract’s value on average.

The procurement process is fragmented among three layers in the government: departmental, ministerial, and cabinet levels with no mechanisms for ensuring procedural consistency, efficiency, or integrity.

Sri Lanka currently operates a highly decentralised procurement system. The responsibility for executing procurement is vested with secretaries of respective line ministries. Technical and bid evaluation committees are set up per the delegation of authority at the line ministry and Cabinet level.

New public regulatory frame work with clear transparency, accountability, and oversight rules will come into effect this year once the new legislation is passed in parliament to limiting corruption opportunities and mal practices in current public procurement process.

The reports of the Ministry of Finance, the Auditor-General’s Department, and the Department of Management of Audit indicate malpractices have led to inefficiencies and waste of scarce resources of the Government in the context of tight fiscal space.

In this context new Public Procurement Law that reflects international good practices will be enacted this year providing provisions to set up a new regulatory authority

The Procurement Management Information System (PROMISe) is being developed but is currently in a pilot phase.

PROMISe has the potential to be a key tool for improving the integrity of public procurement by enabling better processing, tracking, recording, reporting, and publicising procurement actions and outcomes. Sri Lanka currently lacks a formal legislative basis for procurement and it has contributed to high-levels of political engagement in the selection of procurement winners, poor contract management, limited transparency and a lack of oversight 

April 10, Colombo (LNW): The Ministry of Education has announced the schedule for the first term of the academic year 2024. For all government and government-approved Sinhala and Tamil private schools, the first phase of the term will conclude on April 10. Following this, the second phase of the first term will commence on April 24.

However, Muslim schools will have a slightly different schedule. The second phase of the first school term for Muslim schools will begin on April 17.

This schedule provides clarity and structure for students and educators across various types of schools, allowing for effective planning and implementation of educational activities throughout the academic year.

April 10, Colombo (LNW): Lanka Sathosa, a leading retail chain in Sri Lanka, has announced significant price reductions for eight essential commodities, aiming to alleviate the financial burden on consumers and enhance accessibility to basic necessities. The price reductions cover a range of staple items vital for households across the nation.

The prices of Dried Chilli, Imported Chinese Onions, Imported Indian Onions, Imported Pakistan Onions, Garlic, Potatoes, Dhal, and White Kekulu Rice have been reduced.

April 10, Colombo (LNW): Presidential DG (Community Affairs) Rajith Keerthi Thennakoon has provided insights into the Sri Lankan government’s substantial relief efforts to mitigate the impact of the economic crisis, particularly on vulnerable populations. Speaking at a special media statement, Thennakoon outlined the significant expenditures and initiatives undertaken to address the hardships faced by the populace.

In 2023 alone, the government disbursed nearly Rs. 200 billion (approximately USD 1 billion) to provide relief to those affected by the economic downturn. This aid encompassed various forms of assistance, including aids, loans, and allowances under the Samurdhi program, targeting seniors, disabled individuals, patients with kidney disorders, and others in need.

The total expenditure on social welfare initiatives in 2023, including appeals and outstanding payments, amounted to approximately Rs. 189.6 billion. Notably, additional disbursements totaling Rs. 13.7 billion were earmarked following the review of appeals, further aiding impoverished individuals.

Since President Ranil Wickremesinghe assumed office in July 2022, the Samurdhi Development Department has disbursed Rs. 129.93 billion, with substantial allocations for subsidies benefiting the underprivileged. The government has also initiated nutritional schemes for schoolchildren, support initiatives for expectant mothers, and distributed free rice to impoverished families.

Thennakoon emphasized the government’s commitment to eradicating corruption, mismanagement, and bureaucracy in social welfare programs, aiming to establish a transparent and accountable social security framework. Plans are underway to introduce over 30 distinct social security initiatives nationwide, focusing on transparency and accountability.

In support of these relief efforts, the World Bank has extended a loan of USD 200 million, structured for repayment over 30 years, with a grace period of five years. As of March 31, 2024, the total number of beneficiaries under the relief program is projected to reach 1,854,308, highlighting the scope and impact of the government’s relief measures.

Overall, Thennakoon’s statement underscores the government’s concerted efforts to provide essential support to vulnerable populations and alleviate the socioeconomic challenges posed by the economic crisis.