May 16, Colombo (LNW): Calls for Indian travellers to boycott the Maldives are “absolutely” benefiting Sri Lanka’s travel industry, CNBC reported citing comments from Tourism Minister Harin Fernando.

“The Maldives issue is … helping us,” Fernando told CNBC, referring to a social media dispute in January that led to a significant drop in Indian visitors to the Maldives this year.

India was the Maldives’ largest source market in 2023 but has now fallen to sixth place, behind China, Russia, the United Kingdom, Italy, and Germany, according to Sri Lanka’s Ministry of Tourism.

In contrast, nearly 34,400 Indian travellers visited Sri Lanka in January, more than double the 13,759 who visited in January last year, according to the Sri Lanka Tourism Development Authority.

Arrivals in the first quarter of 2024 surpassed the same period in 2023, despite a temporary visa price increase in April.

Fernando also highlighted the strong relationship between Sri Lanka and India in both business and tourism.

“Sri Lanka is a significant market for Indian travellers,” he said, adding that his country offers more value when it comes to India.

He mentioned the country’s beaches, casinos, shopping, and the Ramayana Trail, a series of sites referenced in the ancient Hindu epic.

Additionally, the two countries are well connected, Fernando explained, further elaborating that the connectivity between the two nations is the trigger factor.

Previously, Fernando fell under public’s scrutiny for commenting at a conference that Sri Lanka is ‘a part of India’.

May 16, Colombo (LNW): President Ranil Wickremesinghe has mandated the immediate construction of the “Ashraf Memorial Museum” in Kalmunai, in honour of the late M.H.M. Ashraf, founder of the Sri Lanka Muslim Congress (SLMC) and former Minister.

M.H.M. Ashraf, a distinguished politician celebrated for his dedicated service to the Muslim community, will be memorialised through this museum.

This initiative arises from a request made by H.M.M. Haris, Digamadulla District Member of Parliament, alongside the local Muslim community, marking the 24th anniversary of Mr. Ashraf’s death.

The President has allocated Rs. 25 million for the project and has instructed officials to begin construction without delay, the President’s Media Division (PMD) said.

Ashraf, remembered as an eloquent lawyer and legislator, significantly contributed to the welfare of the Muslim population in the Eastern Province.

He garnered respect across various ethnic communities, including Sinhala, Tamil, and Muslim groups in the country.

May 16, Colombo (LNW): Sri Lanka is in the process of establishing a small arms ammunition manufacturing unit within the country, Defence State Minister Premitha Bandara Tennakoon announced.

The announcement was made yesterday (16), addressing reporters at the President’s Media Centre (PMC), where the Minister revealed that discussions are ongoing with India to set up a small arms manufacturing unit.

The Indian defence manufacturing sector has seen significant growth over the last two decades, Tennakoon explained, adding that it is a model Sri Lanka can learn from, and there is nothing wrong with adopting their practices.

He expressed confidence that it is time for Sri Lanka to enter the manufacturing sector as well.

When queried about whether Sri Lanka intends to purchase military equipment from India, the Minister clarified that the government is not trying to procure anything at the moment.

The connectivity between the two nations’ military forces is excellent, and Indian and Sri Lankan military-to-military relations are very strong, and Sri Lanka, therefore, aim to maintain the ties, he explained.

However, this does not imply that Sri Lanka is planning on purchasing military equipment from anyone, Tennakoon concluded.

May 16, Colombo (LNW): The Sri Lankan Rupee (LKR) is anticipated to depreciate to a range of Rs. 310 – 320 against the US Dollar by the end of the year, driven by increased import demand and the resumption of foreign loan repayments following the completion of the External Debt Restructuring (EDR), First Capital Research (FCR) disclosed.

In the first half of the year, the LKR is expected to appreciate to around Rs. 295, as higher taxes dampen rising consumer demand in the short term amidst escalating living costs.

The USD/LKR spot exchange rate was Rs. 300.83 as of yesterday.

Reduced consumer demand may lead to a decrease in imports, whilst the peak tourism season in the first quarter of 2024 and increased worker remittances could further strengthen the LKR, and subsequently, some stabilisation is anticipated as consumer demand improves and tourism income moderates,” according to a FCR report.

The Rupee’s appreciation is also supported by improving tourism earnings and higher remittance inflows.

FCR projects a 46.3 per cent year-on-year increase in tourism earnings to US $3 billion this year.

Similarly, worker remittance inflows are projected to rise to US $6.6 billion, up from US $6 billion last year.

The notable reduction in consumer-driven imports in the first quarter, due to front-loading of imports at the end of last year, also contributed to the Rupee’s appreciation.

Additionally, the efforts by the Central Bank of Sri Lanka (CBSL) to bolster foreign reserves through US Dollar purchases have played a significant role in the Rupee’s appreciation this year.

FCR expects Sri Lanka to conclude the year with US $6.3 billion in foreign reserves.

However, reserve accumulation is expected to moderate later this year as the government resumes loan repayments post-EDR.

Although bilateral and multilateral inflows are expected immediately after EDR completion, complemented by a potential sovereign credit upgrade, FCR noted that anticipated import relaxations and the resumption of loan repayments might partially offset the currency’s appreciation in the fourth quarter.

“We anticipate that the GDP turnaround, coupled with the relaxation of import restrictions, may slow the currency’s appreciation trend,” FCR remarked.

Sri Lanka faces an annual external debt repayment obligation of nearly US $6-7 billion until 2029, potentially declining to US $3-4 billion post-EDR.

Therefore, the CBSL is likely to build up its foreign reserve buffer in the coming months, which may exert downward pressure on the exchange rate.

In May, the CBSL relaxed cash margin deposit requirements on specific imports.

Continuing this initiative, the government is expected to gradually remove existing import restrictions, including those on vehicle imports, which may further impact the Rupee exchange rate.

May 16, Colombo (LNW): The Joint Apparel Association Forum (JAAF) has highlighted that the official minimum wage for garment workers does not accurately reflect their total earnings.

Responding to a recent article published on Just-Style, JAAF General Secretary Yohan Lawrence explained that the current two-tiered wage system includes a fixed basic wage supplemented by productivity-based payments and various non-cash benefits.

The Clean Clothes Campaign, an international alliance of labour unions and non-governmental organisations, has criticised Sri Lanka’s garment industry minimum wage, claiming it fails to meet workers’ family needs due to high inflation.

In March this year, the government increased the national living wage by 40 per cent, from Rs. 12,500 (US $42) to Rs. 17,500 (US $59) per month, along with a Rs. 3,500 budgetary relief allowance, bringing the total minimum monthly pay to Rs. 21,000 (US $70).

The apparel sector’s industry-agreed minimum wage, including the government allowance, stands at approximately Rs. 24,000 (US $80).

According to Lawrence, the article refers to the national minimum wage, which covers the fixed monthly component of employee earnings (the employee’s basic wage).

Whilst the national minimum wage was increased after a couple of years, companies will review the basic wage every year and, depending on their ability to pay, increase this basic wage annually, he clarified.

He pointed out that the article fails to mention the variable components of total earnings, which are paid in cash, or the non-cash benefits provided to employees.

Cash benefits include production bonuses, attendance allowances, annual bonuses, skill-based payments, and overtime.

The two-tiered system of a fixed basic wage, complemented by productivity-based payments, is standard in all manufacturing industries, both locally and globally, Lawrence emphasised.

In addition to cash payments, the industry provides non-cash benefits such as subsidised meals and transport.

Several companies also offer subsidised or free dry rations, a practice that began during the economic crisis and continues today, to help alleviate the cost of living for employees.

Lawrence argued that it is unfair to assess employees’ actual earnings based solely on the basic wage.

He also noted that inflation has decreased to single digits since early 2023, reducing its impact on real wages.

Despite these challenges, JAAF remains confident in achieving US $4.5 billion in apparel export earnings this year.

May 16, Colombo (LNW): The Colombo District Court yesterday (15) granted permission to Sri Lanka Freedom Party (SLFP) MP Duminda Dissanayake to present arguments concerning an injunction order challenging the appointment of Justice Minister Wijeyadasa Rajapakshe PC as the SLFP Chairman.

The court’s decision on whether to issue an enjoining order will be delivered today (16).

Romesh de Silva PC, appearing for Rajapakshe, raised objections, questioning the maintainability of the plaint since the Kaduwela District Court has already issued an order preventing any faction from interfering with the Justice Minister’s role as the party Chairman.

Chandaka Jayasundere PC appearing for Dissanayake countered that the Kaduwela District Court’s order would not impact this particular case.

Accordingly, Colombo District Court Judge Sandun Vithana announced that the decision regarding the enjoining order will be delivered today morning.

The plaintiff, Dissanayake, is seeking an enjoining order to prevent Minister Wijeyadasa Rajapakshe PC and Attorney-at-Law Keerthi Udawatta from functioning as SLFP Chairman and Acting General Secretary, respectively.

Additionally, the plaintiff seeks a declaration that all decisions taken during an executive committee meeting held on May 12 this year are invalid.

By: Isuru Parakrama

May 16, Colombo (LNW): The low-level atmospheric disturbance still persists in the vicinity of the island, and therefore, the prevailing showery condition is expected to be continue further, the Department of Meteorology said in its daily weather forecast today (16).

Showers or thundershowers will occur at several places in most provinces of the island after 1.00 p.m., with heavy showers about 100mm being likely to occur at some places in Western, Central, Sabaragamuwa and Uva provinces.

Showers may occur in Western, Southern and Eastern coastal areas during the morning as well, the statement added.

General public is kindly requested to take adequate precautions to minimise damages caused by temporary localised strong winds and lightning during thundershowers.

Marine Weather:

The 10th World Water Forum provides a unique platform where the water community and key decision makers can collaborate and make long term progress on global water challenges.

The preparation of the 10th World Water Forum has now entered its active phase. On February 15 and 16, nearly a thousand members of the world water community will meet in Jakarta at the initiative of the highest authorities of the Republic of Indonesia. 

Sri Lankan President Ranil Wickremesinge is expected to head to Bali, Indonesia next week to attend the World Water Forum, said Minister Jeevan Thondaman on Monday (13).

The 10th World Water Forum will take place from the 18th to the 14th of May, and is hosted by the Government of Indonesia.

“On the 19th of this month, the President and myself, we will be attending the World Water Conference that’s to take place in Bali, Indonesia,” said Minister Thondaman.

He also said that President Ranil Wickremesinghe is expected to do bilateral discussions with the Indonesian President.

The Minister for Water Supply and State Infrastructure will take part in a panel discussion organized by the World Bank Group.

Dozens of Indonesian National Armed Forces (TNI) armored tactical vehicles (Rantis) and electric escort motorbikes arrived at Military Sealift Command Pier, Tanjung Priok, North Jakarta, on Saturday, 11 May to depart for Bali.

These vehicles were deployed to provide security for the 10th World Water Forum in Nusa Dua, Bali, from 18 to 25 May.

Dozens of Rantis and escort motorbikes were transported to the Island of the Gods using four Indonesian Navy ships, namely KRI Banjarmasin-592, KRI Makassar-590, KRI Banda Aceh-593, and KRI Teluk Bintuni-520. All Rantis were expected to arrive at the Port of Tanjung Benoa Bali on 14 May.

Head of the Indonesian Military Information Center who is also the Commander of Information Task Force of the 10th VVIP World Water Forum Joint Integrated Security Command, Major General Nugraha Gumilar, said that apart from preparing soldiers and support vehicles, his party was also preparing the Main Equipment and Weapon System (Alutsista).

Ten hotels in Nusa Dua area, Badung Regency, Bali will be the accommodation for VIP and VVIP state guests of the 10th World Water Forum slated to be held on 18–25 May in Bali.

“To date, there are seven hotels for VVIP guests and three hotels for VIP guests and delegates,” said the General Manager of PT Indonesian Tourism Development Corporation (ITDC), I Made Agus Dwiatmika, in Nusa Dua, Badung Regency, Bali, on Wednesday, 8 May.He continued that all confirmed hotels were improving their facilities and security systems, including X-ray scanners and security check portals

In the past 20 years of market leadership, Ceylinco Life insurencec omany has achieved the highest premium income every year since 2004. This is no mean feat by local or international standards., Ceylinfo Life Chairman R. Renganathan claimed. 

However,the company  believes that in determining the market leader in life insurance, there are other factors that must also be considered. 

These are capital adequacy, profitability, and Life Fund and Reinsurance arrangements. It would also be good if factors like claim settlement, gender equality in employment and good citizenship are assessed.

Capital adequacy in life insurance refers to the sufficiency of an insurer’s capital to cover its risks and obligations effectively.

 Life insurance companies hold capital to ensure they can pay policyholders’ claims, meet regulatory requirements, and remain solvent in adverse situations. 

The capital adequacy ratio compares an insurer’s available capital to its required capital, based on the risks inherent in its business. The risks include market risk, credit risk, concentration risk, liability risk, operational risk and reinsurance risk. 

The minimum capital adequacy required by the regulator is 120% while the regulator has the right to intervene when the capital adequacy is 160% or less. 

Notably, Ceylinco Life’s Risk-based Capital Adequacy Ratio improved to 344% at the end of 2023, well above the minimum requirement of 120%.

The size of a life insurance company’s Life Fund combined with Capital Adequacy is an indicator of the ability of the company to meet future obligations. Ceylinco Life’s Life Fund stood at Rs 157.5 billion as at 31st December 2023, after a transfer of Rs 1.97 billion to the Shareholders Fund in respect of the year.

The profitability of a life insurance company is important because it is possible for companies to sell some products in their portfolios at breakeven levels or at a loss, to show premium growth. 

Finally, any life insurance company should have reinsurance arrangements with a rated insurer. This is the process of sharing its risk and enables transfer of knowledge.

Success in life insurance can be equated with trust. Life insurance is a product that is far more intangible than a straightforward investment in an interest-earning bank deposit where the dynamic between the management of risk and return is clear, CEO of the company Thushara Ranasinghesaid The significance of our market leadership, in that context, is that it affirms that Ceylinco Life is the most trusted life insurance company in the country, and has been the most trusted company for the past 20 years, he added

In a bid to alleviate the ongoing challenges faced by micro, small and medium-scale entrepreneurs (MSMEs) and industrialists amid the economic turmoil triggered by the COVID-19 pandemic and the Easter Sunday attack, the Industries Ministry has announced a comprehensive plan.

To kick start the initiative, the Finance Ministry, upon the recommendations of the Industries Ministry, has devised a working capital loan scheme featuring a concessionary interest rate. 

The scheme seeks to inject renewed vigour into entrepreneurs and industrialists burdened with non-performing bank loans.

Against this backdrop, the Industries Ministry aims to gather crucial information about entrepreneurs and industrialists to better understand and address their lingering issues, a top official said. 

“For those grappling with non-performing loans (NPLs), the Industries Ministry has streamlined the application process for the working capital loan scheme. Interested parties can access the official website of the Ministry to download the application form,” he added.

Entrepreneurs and industrialists are urged to promptly submit information about their enterprises or industries to the Industries Ministry. 

“This can be done conveniently through the provided QR code or Google Link,” the official said, adding that alternatively, individuals can fill out the form and provide the required details to National Enterprise Development Officials at their respective Divisional Secretariats, Vidatha Officers, or Small Enterprise Development Officers affiliated with nearby Divisional or District Secretaries. 

Additionally, officials from the Ministry’s Regional Industrial Service Centre or Regional Industrial Development Board are available to assist in this process.

Submissions can be made via email to the Ministry or through the designated officials mentioned earlier.

“Entrepreneurs and industrialists are encouraged to take advantage of these resources to revive their businesses and contribute to economic recovery,” he added.

 Successful MSMEs usually evolve into large organisations, and such organisations contribute to economic growth immensely. 

MSMEs make an important contribution to the economy as a breeding ground for large firms, an employment provider, and a facilitator of innovation, thereby leading to inclusive and balanced growth.

Most successful economies comprise a healthy mix of both large and small firms. Large firms typically are more productive, have the capacity to invest in capital intensive projects, facilitate research and development on a larger scale, and in turn facilitate the creation of new knowledge contributing to yield growth episodes.