March 19, Colombo (LNW): The Criminal Investigation Department (CID) has launched an probe into an incident involving former Minister Keheliya Rambukwella, who is currently in remand custody, being transported to court utilising a bus designated by UNICEF for the conveyance of children belonging to female inmates.
A complaint received by the CID alleges that prison authorities utilised this bus for transporting the ex Minister, notwithstanding UNICEF’s explicit directive that it should be exclusively allocated for the welfare of children of female inmates.
While it is noted that other individuals remanded alongside Rambukwella were transported via a standard prison bus, concerns have been raised regarding the preferential treatment extended to the former Minister in this matter.
March 19, Colombo (LNW): Over the weekend, Sri Lanka’s tourism industry reached a significant milestone as tourist arrivals exceeded 500,000 within the first three months of the year, with March alone surpassing the 100,000 mark.
This notable surge underscores the sector’s robust momentum towards recovery and growth, marking the first time since the onset of the pandemic that the country has achieved such levels of tourism activity within just two and a half months.
Last year, this milestone was reached in the second week of May.
Provisional data released by the Sri Lanka Tourism Development Authority reveals that from January 1 to March 14, the island nation welcomed a total of 517,808 international visitors.
Notably, the daily average arrivals for March rose to 6,500, culminating in the crossing of the 100,000 arrival threshold on March 16.
If this momentum persists, Sri Lanka is poised to achieve over 200,000 arrivals for the third consecutive month this year, a feat unprecedented since the onset of the Covid-19 pandemic.
However, a closer examination of weekly arrival data suggests that March may see a lower overall number of tourists compared to February.
In February, the weekly arrival average stood at approximately 55,000, whereas for March, it hovers around 45,000.
In terms of tourist demographics, the Russian Federation emerges as the leading contributor, constituting 15 per cent (13,699) of total arrivals, followed closely by India at 15 per cent, with 13,492 tourists.
Key source markets also include Germany, the United Kingdom, France, and China.
Notably, the tourism sector generated a cumulative revenue of US $687.5 million in the first two months of the year, marking a substantial 118.2 per cent growth compared to the same period in 2023.
In February alone, Sri Lanka recorded US $345.7 million in tourism revenue from 218,350 visitors, significantly contributing to the country’s foreign income and economic stability, particularly amidst ongoing challenges in global markets.
This figure represents a notable increase from the US $161.6 million recorded in February of the previous year.
March 18, Colombo (LNW): Showers or thundershowers may occur at a few places in Western and Sabaragamuwa provinces and in Galle and Matara districts in the evening or night, and mainly dry weather will prevail elsewhere of the island, the Department of Meteorology said in its daily weather forecast today (19).
Misty conditions can be expected at some places in Sabaragamuwa and Central provinces and in Galle and Kalutara districts during the morning, the statement added.
Marine Weather:
Condition of Rain:
Mainly fair weather will prevail in the sea areas around the island.
Winds:
Winds will be north-easterly or variable in direction and wind speed will be (15-25)kmph. Wind speed may increase up to (35–40) kmph at times in the sea areas off the coasts extending from Puttalam to Kankasanthurai via Mannar and from Hambantota to Pottuvil.
State of Sea:
The sea areas off the coasts extending from Puttalam to Kankasanthurai via Mannar and from Hambantota to Pottuvil can be moderate at times.
Meanwhile, Heat index, the temperature felt on human body is expected to increase up to ‘Caution level’ at some places in North-western, North-central, Eastern provinces and Mannar, Vavuniya, Monaragala, Rathnapura, Colombo and Gampaha districts.
The public is urged to stay hydrated and takes breaks in the shade as often as possible, check up on the elderly and the sick, never leave children unattended, limit strenuous outdoor activities, find shade and stay hydrated, wear lightweight and white or light-colored clothing.
The history and performance of Litro Gas Lanka Ltd demonstrate that privatizing this national pro ider of LPG in Sri Lanka is not a prudent course of action. This report aims to present a comprehensive analysis of the key reasons why the privatization of Litro Gas Lanka Ltd is unwarranted. The company’s historical background. current status. and proposed solutions for its growth will be examined.
Historical Background
The history of Litro Gas Lanka Ltd can be summarized as follows:
• Prior to 1995, the company was 100% owned by the Government of Sri Lanka (GOSL). • Tn 1995/96, 51% of the shares were sold to Royal Dutch Shell. leading to the establishment of Shell Gas Lanka Ltd. • ln 2010, Royal Dutch Shell sold back its 51% shares to the Government of Sri Lanka, which subsequently led to the creation of Litro Gas Lanka Ltd. • Since 2011, Litro Gas Lanka Ltd has been 99.9% owned by the Sri Lanka Insurance Corporation.
Current Status of Litro Gas Lanka Ltd
Litro Gas Lanka Ltd is a significant player in the Sri Lankan energy industry, operating one of Asia’s largest filling plants with the capacity to process I 00.000 domestic cylinders· refills per day. The Litro Gas Lanka network comprises 42 distributors. approximately 12,000 point-of-sale locations, and 1,500 home deli very hubs, serving over 4 million households and various commercial and industrial sectors.
Litro Gas Terminal Lanka (Pvt) Ltd
Litro Gas Terminal Lanka (Pvt) Ltd, the leading LPG storage facility in the country, is responsible for storage and filling facilities for LPG distribution. It was established in 201 O when the Sri Lanka Insurance Corporation acquired the Shell-owned LPG Storage Terminal in Kerawalapitiya. The terminal has a current capacity of 8,000 Mt and is fully automated. It is also the only company in Sri Lanka with a Central Mooring Facility.
Key Points
Several key points highlight the reasons for not privatizing Litro Gas Lanka Ltd.
Economic Contribution: In July 2022, the company received a long-term loan of USO 70 million from the World Bank to aid the government during a foreign exchange crisis. This loan, equivalent to Rs. 25.8 billion, was expeditiously repaid by December 30, 2022, in order to address the government’s pressing financial needs.
Resilience: Litro Gas Lanka Ltd swiftly recovered its business in a short period following an economic crisis, demonstrating its ability to adapt and thrive.
Revenue and Profitability: The company’s current average annual revenue stands at Rs. 75 billion, with an average annual profitability of Rs. 4-5 billion.
Dividends and Taxes: Since 2015, the company has paid a total of Rs. 13.4 billion in dividends and Rs. 27.6 billion in taxes.
Debt Management: Litro Gas Lanka Ltd obtained short term loan facility around Rs. 10 billion from commercial banks in 2022 and efficiently cleared all outstanding amounts. Presently, the company holds no outstanding loans and has no financial obligations to the national treasury or any commercial bank.
Financial Health: Litro maintains a current cash equivalent of Rs. 8.1 billion. ensuring its financial stability.
Labor Relations: The absence of trade unions within the company is a positive factor in maintaining operational efficiency.
Volume and Sales Data
Summary of Financials for 2015 – 2023
Proposed Solution
instead of privatization, a Joint Venture (JV) approach is recommended to enhance Litro Gas Lanka Ltd’s capacity and competitiveness.
Establishing a joint venture (JV) with a qualified credible management team that can safeguard employees’ rights and ensure the smooth and effective operation of the company
Infusion of advanced technology and systems by the JV can optimize operational efficiency
The JV can explore opportunities to introduce the Litro brand to new markets outside Sri Lanka and develop new products like LNG and CNG
Conclusion
The data presented supports the notion that privatizing Litro Gas Lanka Ltd may not be in the best interest of Sri Lanka. The company has a proven track record of contributing significantly to the government’s finances while maintaining financial stability. A JV approach offers a more favorable path to capitalize on the company’s potential for growth and innovation.
March 18, Colombo (LNW): The Asian Development Bank (ADB) has approved a $100 million loan to provide small and medium-sized enterprises (SMEs) in Sri Lanka more access to finance and build their resilience to external shocks, such as the economic crisis and climate change.
“SMEs play a critical role in Sri Lanka’s economy, contributing 52% to the country’s gross domestic product and employ 45% of the population,” said ADB Senior Financial Sector Specialist Manohari Gunawardhena.
“It is therefore important to provide SMEs, particularly women-led enterprises, with the necessary support to sustain and grow the sector’s contribution to the economy.
This project will provide working capital and improve SMEs’ access to finance, helping them expand operations and prepare for the changing environment.”
This sum will be received in December and disbursed as capital through the National Credit Guarantee Institution and distributed via 13 banks within the national banking system.
This approach will facilitate the implementation of a loan guarantee program for SMEs industrialists in the country. Additionally, it will enable a program that provides loans with subsidised interest rates.
ADB, through participating financial institutions, will open a $50 million line of credit for underserviced SMEs in the export, tourism, technology, agriculture, and manufacturing sectors.
It will establish a $500,000 special facility to cover guarantee subsidies for women-led SMEs. A gender gap assessment will be conducted with a view to improving women’s access to finance.
The project will build on the government’s equity contribution through the National Credit Guarantee Institution Limited (NCGI), which provides partial credit guarantees on loans to SMEs.
ADB will help the NCGI adopt procedures to effectively support SMEs including underwriting guarantees, risk management and risk-based pricing, and guarantee recovery operations.
The project will incorporate green finance elements through climate adaptation and mitigation measures for SMEs.
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.
The project will help SMEs by enhancing access to finance and strengthening their capacity to adapt their business models to external changes, including those caused by climate change.
It is designed to particularly support women entrepreneurs who are often disadvantaged, as well as promote climate adaptation and mitigation activities. The implementation of both components is supported by ongoing technical assistance (TA), which was approved in January 2022.
March 18, Colombo (LNW) After a four-year hiatus prompted by the COVID pandemic, Thai Airways is set to resume its flight operations between Thailand and Sri Lanka from next month.
The move will boost the tourism industry, which has seen substantial growth in international tourist arrivals during the first two months of 2024. In January and February, the airport handled a total of 207,182 and 218,350 visitors, respectively.
Travellers will have the opportunity to enjoy top-notch service and connectivity with Thai Airways and explore over 60 cities in 28 countries from Bangkok.
MAC Holdings Ltd., is appointed as the General Sales Agent (GSA) representing the airline in Sri Lanka and the Maldives. Thai Airways operates flights to key destinations across Europe, Australia, Asia, and within Thailand.
Airport and Aviation Services (Sri Lanka) Ltd., expressed its delight in welcoming Thai Airways back to its main gateway.
As of February 2024, Sri Lanka’s airports had served 36 esteemed airlines conducting scheduled international operations, further solidifying their pivotal role in the aviation industry.
The decision to restart the service was announced by Royal Thai Airways at a ceremony held at Hilton last Friday, attended by several dignitaries, including Ports, Shipping and Aviation Minister Nimal Siripala De Silva, Foreign Affairs Minister Ali Sabri, Thailand Ambassador to Sri Lanka Paitoon Mahapannaporn, and representatives from Thai Airways’ senior management.
The inaugural flight is scheduled to touch down at Bandaranaike International Airport (BIA) from Bangkok on 1 April.
With daily flights scheduled between Bangkok and Colombo, Thai Airways aims to provide convenient and reliable air travel options for passengers, further strengthening the economic and cultural bonds between the two nations.
Minister de Silva expressed his delight at the return of Thai Airways to Sri Lanka, heralding a new chapter in bilateral air connectivity between Thailand and Sri Lanka.
He highlighted the longstanding friendship and cultural ties between the two countries such as Buddhism, trade and agriculture occupying a major place among them. He also underscored the significance of the renewed air link in strengthening closer relations and facilitating increased travel between Thailand and Sri Lanka.
Highlighting the quality of service provided by Thai Airways before the pandemic-induced downturn in the aviation industry, the Minister acknowledged the challenges faced by the sector and welcomed the airline’s return amidst efforts to revitalise the Sri Lankan economy under the leadership of President Ranil Wickremesinghe.
March 18, Colombo (LNW): Sri Lanka’s manufacturing and services grew strongly last month partly helped by seasonal factors, based on a Purchasing Managers’ Index compiled by the Central bank.
“Further, Employment and Stock of Purchases also increased on a month-on-month basis in line with the improvements in New Orders and Production.”
Manufacturing sector recorded remarkable recovery in its performances on February 2024, indicating a continued expansion in production activities, Central Bank report revealed. .
The expansion in New Orders and Production was mainly driven by the manufacture of food & beverages sector.
Many respondents mentioned that they are preparing for the upcoming festive demand. However, New Orders and Production in the manufacture of textiles& apparel sector decreased on a month-on-month basis he report added.
Meanwhile, Employment and Stock of Purchases expanded during the month in line with the New Orders and Production. Further, Suppliers’ Delivery Time continued to lengthen in February, on par with the expansion in manufacturing activities and prolonged shipping disruptions caused by the Red Sea crisis
Expectations for the manufacturing activities for the next three months remain positive, mainly due to the upcoming festive season, Central Bank claimed.
Services sector indicated an expansion in services activities in February 2024 as reflected by the Business Activity Index, which recorded an index value of 53.0.
The continued expansion in Business Activities was driven by the improvements observed across several sub-sectors.
Accordingly, business activities in financial services sub-sector increased further aligning with the prevailing low market interest rates.
Further, positive developments were also recorded in transportation and education sub-sectors during the month. Meanwhile ,accommodation, food and beverage sub-sector continued to grow amid tourist arrivals recording the highest since January 2020.
New Businesses increased in February, particularly with the increases observed in transportation and financial services sub-sectors. Employment increased due to new recruitments made by several companies ahead of the festive season. Meanwhile, Backlogs of Work continued to decline during February. Expectations for Business Activities for the next three months continued to rise in February due to upcoming New Year and Ramadan season, Central Bank disclosed.
March 18, Colombo (LNW): A fully fledged Development Bank is to be set up in Sri Lanka mainly for the serving of SME/Manufacturing and Tourism sector.
It is being considered by President Ranil Wickremasighe as the finance minister to kick start the economy, according to official sources.
The proposed Development Bank will have a minimum Rs. 500 billion Tier 1 capital, total assets of around Rs. 1 trillion, a rationalised branch network of around 150 – 200 and a staff of around 2,000 and governed by an independent board comprising professionals and FDI partners.
State Minister of Finance Shehan Semasinghe will lead the initiative according to ministry sources.
“A committee of experts will propose the way forward. The Government will look at the stakes in several private banks and Government banks in structuring the development bank. Several international funds have shown interest,” a senior official added.
The new Development Bank’s business profile reflects the elevated vulnerability to heightened risks in the domestic market, which continue to affect its ability to generate and defend business volumes.
The finance ministry expects the new DB’s earnings and profitability to remain challenged by asset quality, loan growth prospects, sharp downward adjustment of interest rates and any potential impact to earnings from the proposed domestic debt optimisation strategy.
It believes that the bank’s overall funding and liquidity position is prone to sudden changes amid already weak creditor sentiment, similar to peers.
However stress on foreign-currency liquidity has somewhat eased. Even so, the bank’s access to foreign-currency wholesale funding remains as its strength the bank’s local-currency funding and liquidity position is also susceptible to any setbacks to the domestic debt restructuring.
Forthcoming laws and commissions would enhance market access, foster trade and investment and ensure the competitiveness of the island’s economy becessating the importance of a development bank.
President Ranil Wickremesinghe sought to reassure foreign investors by mentioning the removal of restrictions and ongoing economic reforms.
He pointed out the country’s ongoing and pending FTAs with Singapore, Thailand, India and China, its initiatives to join the Regional Comprehensive Economic Partnership (RCEP), and the benefits of GSP Plus for access to European markets.
with an affirmation could be driven by our view that risks from funding and capital stresses have abated, at both the individual bank and the sector level, to the extent that the bank’s ability to service its obligations in local and foreign currency is not hindered and/or banks are able to continue as a going concern and avoid failure.
March 18, Colombo (LNW): The Sri Lankan Rupee (LKR) indicates slight appreciation against the US Dollar today (18) in comparison to last week’s Friday, as per the official exchange rates released by the Central Bank of Sri Lanka.
Accordingly, the buying price of the US Dollar has dropped to Rs. 300.05 from Rs. 300.60, and the selling price to Rs. 309.67 from Rs. 310.20.
The Sri Lankan Rupee also appreciated against several other foreign currencies as well.
March 18, Colombo (LNW): Tamil Nadu Chief Minister M.K. Stalin criticised Prime Minister Narendra Modi on Saturday, questioning the Union Government’s apparent lack of assertiveness in pressuring the Sri Lankan government to restore traditional fishing rights for Indian fishermen in the Palk Straits, contrasting it with the vigorous defense of business interests involving Gautam Adani.
Stalin’s remarks were prompted by Prime Minister Modi’s recent statements attributing the plight of Tamil Nadu fishermen to the ‘sins’ of the Dravida Munnetra Kazhagam (DMK).
He demanded clarity on the steps taken by the Union Government over the past decade to address the issue, as reported by the Deccan Herald.
“The Prime Minister, who proclaims himself as a ‘vishwa guru’ (world teacher), remains silent when questioned about his government’s actions to prevent atrocities against Tamil Nadu fishermen by Sri Lanka,” Stalin asserted in a strongly-worded statement.
The Chief Minister’s response followed Modi’s comments during a public address in Kanyakumari, a BJP stronghold, on March 15, where he indirectly linked the challenges faced by Tamil Nadu fishermen to the historical cession of Katchatheevu island to Sri Lanka in 1974, which occurred during the tenure of the DMK and Congress.
Stalin underscored the fact that Katchatheevu was handed over to Sri Lanka despite opposition from the then DMK-led state government headed by M. Karunanidhi, dismissing the notion that a state government could unilaterally transfer territory to another nation.
He further pressed the Union Government, particularly the BJP-led administration, to outline efforts made in the past decade to reclaim Katchatheevu and to safeguard Tamil Nadu fishermen from imprisonment by Sri Lanka.
Stalin pointedly questioned the absence of official condemnation from the Indian government regarding the seizure and nationalisation of Indian fishing boats by Sri Lanka, highlighting the lack of substantive action on critical issues affecting Tamil Nadu fishermen.
“The unanswered questions and the silence of the Prime Minister, who presents himself as a ‘vishwa guru,’ raise serious concerns,” Stalin concluded.
