April 12, Colombo (LNW): The Asian Development Bank (ADB) released its Asian Development Outlook (ADO) for April 2024, projecting that Sri Lanka will experience moderate economic growth of 1.9 percent in 2024 and 2.5 percent in 2025 after enduring two consecutive years of economic downturn.

According to the ADB report, Sri Lanka is beginning to see the early signs of economic recovery. “In the latter half of 2023, the economy showed green shoots of recovery. Inflation has slowed to single digits, foreign exchange reserves are being replenished, and the national currency has appreciated,” stated the ADO.

The report highlights strong rebounds in tourism and remittances as key factors supporting the recovery. The outlook for continued economic growth is dependent on Sri Lanka’s adherence to ongoing reforms and improved sentiment among consumers and businesses. Effective completion of external debt restructuring is also vital to enhance the country’s debt sustainability.

ADB Deputy Country Director for Sri Lanka, Utsav Kumar, remarked on the nation’s progress: “Sri Lanka has achieved notable success in implementing challenging policy reforms and stabilizing its economy throughout 2023. We are encouraged by the emerging signs of recovery. However, it remains crucial for the country to mitigate the socioeconomic impacts on its poorest and most vulnerable populations and to persist with reforms that tackle the root causes of the crisis to support a sustainable recovery and growth.”

The ADO also underscores the challenges of addressing poverty and inequality exacerbated by the COVID-19 pandemic and subsequent economic issues. As the economy gains stability, Sri Lanka is tasked with supporting the most impacted and vulnerable communities, thereby reducing high poverty rates and income disparities. This necessitates the establishment of effective social protection systems with better targeting, alongside efforts to create job opportunities and promote sustainable livelihoods to alleviate poverty.

April 12, Colombo (LNW): Showers or thundershowers will occur at times in Eastern and Uva provinces and in Hambantota district. Showers or thundershowers will occur at most places elsewhere over the island after 1.00 p.m.

Heavy showers above 100 mm are likely at some places in Western and Sabaragamuwa provinces and in Galle and Matara districts.

Misty conditions can be expected at some places in Western, Central, Sabaragamuwa and Uva provinces and in Galle and Matara districts during the morning.

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

On the apparent northward relative motion of the sun, it is going to be directly over the latitudes of Sri Lanka during 05th to 15th of April in this year. The nearest areas of Sri Lanka over which the sun is overhead today (12^th) are Vanchiyankulam, Omanthai, Eramadu and Thiriyai at about 12:11 noon.

By: Staff Writer

April 11, Colombo (LNW): The government’s plan to lease vehicles on five year contracts instead of purchasing vehicles outright for use by state agencies and state enterprises has become a headache for the presidential secretariat following the defaulting of leases of over 60 super luxury vehicles used by three former presidents. 

According to this plan, the state institutions including the Presidential secretariat had obtained vehicles on ‘operating leases’ to support leasing companies and the system was expected to be more efficient and cost-effective than maintaining a large state vehicle fleet.

The vehicles were to be returned after 60-months and leasing companies had to bear the cost of insurance and maintenance.

Lease payment of over Rs 2 billion for 60 super luxury vehicles procured on lease basis for the use of three former presidents had been defaulted up to now, Convenor of the Voice Against Corruption Wasantha Samarasinghe disclosed.    

He noted that two of these vehicles gone missing and some of the vehicles valued at over Rs 80 million  

Former secretaries of the president were responsible for these vehicles as chief accounting officers and the presidential secretariat had filed a case in courts relating to this matter, he said.   

Therese over 60 super luxary vehicles had been used by three former presidents since 2006, he revealed adding that names of these persons and details of vehicles will be divulged in the near future

The relevant motor trading companies have already taken measures to recover the total dues for these vehicles including the accumulated interest of 3-4 percent per month as surcharges, he added.

More than 50 state-owned vehicles were not returned after former President Mahinda Rajapaksa was toppled in elections

The 53 vehicles, said to include bullet-proof limousines recovered by the police , are thought to be among 128 missing vehicles.

Among the vehicles was an armour-plated BMW destroyed in a mine attack in Colombo in 2006. Inside was the then defence secretary Gotabhaya Rajapaksa, the president’s younger brother, but he escaped without injury.

Although Gotabaya Rajapaksa as the then Defence Secretary used a fleet of Defence Ministry vehicles, he was allegedly allocated five Defender Jeeps and a High-Security vehicle from the Presidential Secretariat.

The former Defence Secretary was given a Range Rover High – Security Jeep bearing registration number KC-8511 and five Defender Jeeps bearing registration numbers WPKX-2439, WPKX-2352, WPKX- 2440, WPKX- 2415 and WPKX- 2454, news reports and information in the pubic domain revealed.

By: Staff Writer

April 11, Colombo (LNW): SriLankan Airlines, the exclusive ground operator at Bandaranaike International Airport (BIA), has initiated a phased upgrade of airport ground support equipment to accommodate the rising influx of flights and travellers transiting through the airport.

 SLA is authorized by Airport and Aviation Services Sri Lanka Pvt Ltd (AASL) for ‘ground handling’ is a profitable going concern.

Although SLA has made profits through catering and ground handling, SLA has incurred severe losses.

 Despite the losses incurred, Sri Lankan Airlines made an operating profit for the year ending 31st March 2023

Recently, the airline acquired three state-of-the-art passenger apron coaches, ensuring optimal comfort for passengers during transfers between the terminal and remote stands.

With airport traffic steadily increasing and nearing pre-pandemic levels, acquiring modern ground support equipment has become an urgent priority for SriLankan Airlines. This investment aims to ensure a seamless end-to-end travel experience for customers.

“It is an exciting time for Sri Lanka’s tourism industry; the number of visitors has doubled over the past year. We are delighted to introduce these modern apron coaches, along with other new ground support equipment, to our services at Colombo airport during this pivotal point.

SLA’s commitment to providing our passengers and the passengers of our customer airlines with a reliable and effortless travel experience remains steadfast, as does our dedication to supporting the national tourism strategy.

With these incremental advancements, we anticipate substantial transformation in our operations,” stated Senior Manager Airport and Ground Services of SriLankan Airlines, Deepal Pallegangoda.

The passenger apron coaches, and ground support equipment were procured following a comprehensive and transparent competitive bidding procedure, consistent with all procurement exercises of the airline.

The coaches, sourced from China International Marine Containers, represent the latest in comfort and technology. These operational enhancements will empower SriLankan Airlines to elevate both the standard of ground support services and the comfort of passengers at the airport.

The International Air Transport Association (IATA) urged Sri Lanka to develop an aviation blueprint so as to generate greater economic growth and prosperity through having a stronger aviation industry.

 “Aviation connectivity can play a much bigger role in Sri Lanka’s economic development and social advancement. But this will not happen by chance. Government support will be critical to growing a strong airline sector and developing Colombo as an aviation hub.

IATA urged the government and all industry stakeholders to collaborate on developing an aviation blueprint to strengthen the aviation industry’s competitiveness and bring greater prosperity to Sri Lanka. 

By: Staff Writer

April 11, Colombo (LNW): The Colombo Port City Economic Commission has achieved a significant milestone in its journey, to transform the Colombo Port City into a globally competitive special economic zone (SEZ).

The parliament of Sri Lanka recently approved a comprehensive incentives programme proposed by the Commission in consultation with the Minister of Investment Promotion, in relation to the guidelines for granting exemptions or incentives to businesses designated as Businesses of Strategic Importance (BSI).

The Cabinet of Ministers approved designating several companies as Secondary Businesses of Strategic Importance under the Colombo Port City Economic Commission Act.

The decision aims to provide exemption or incentives to the designated companies from specific Acts outlined in Schedule II of the aforementioned Act.

Additionally, the Cabinet has authorised the publication of orders for the same through gazette notifications.

The companies approved for designation include; Port City – To carry out business as a service provider of Outsourcing of business processes for the overseas entertainment industry.

Iviva Pte – For running a business as an Information Technology service provider that creates products and solutions powered by Smart City Information Technology to support the various tasks of global clients in transitioning to a low carbon economy

Echelon Trade – Running a trading business in textiles, apparel, luxury watches, gold and gems, electrical appliances and cosmetics across multiple global markets

99x Technology As – To run a service providing business to global independent software businesses for crafting digital solutions for real user issues by production, engineering and innovation as well as website development, and by improving mobile applications.

“By providing exemption or incentives from specific regulatory Acts, the Government aims to create a conducive environment for these businesses to thrive and contribute to the development of key sectors such as information technology, trade, and outsourcing services,” Cabinet Co-Spokesman and Minister Bandula Gunawardena said.

‘To offer a competitive value proposition to potential investors, the Commission engaged with top international advisory firms such as PricewaterhouseCoopers, Ernst & Young, KPMG, and Boston Consulting Group for international benchmarking of selected factors.

These collaborations resulted in a proposed framework that establishes Colombo Port City as a globally competitive SEZ with transparent regulations and good governance principles, along with proposed sector incentives.

‘Businesses of Strategic Importance in Colombo Port City are classified into two groups: “Primary Businesses of Strategic Importance” and “Secondary Businesses of Strategic Importance”. Primary businesses involve the development of physical infrastructure of USD 100 million per land plot or USD 25 million in the Marina or Social Infrastructure.

Secondary businesses encompass sectors such as international trade, shipping logistics, banking and financial services, information technology, and tourism, among others.

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.