Thursday, December 7, 2017

SEIC 2017 kicks off in Colombo: An investment seminar to highlight Sri Lanka’s investment opportunities

The Government yesterday encouraged more than 200 forthcoming financial specialists from China, Wall Street, London, Geneva, Dubai, Hong Kong, Singapore and Amsterdam on the perpetual venture openings in Sri Lanka at the inaugural Sri Lanka Economic and Investment Conclave (SEIC) 2017 which commenced in Colombo yesterday.

Conveying the keynote address, Megapolis and Western Development Minister Patali Champika Ranawaka focused on that the Government was quick to support foreign investors and technology contributors to invest in Sri Lanka's significant projects and available investment opportunities, which were fundamentally connected with the nation's modern smart city concept.

"The global private sector will be considered as our key accomplices. The Government will just put resources and investments into the most essential areas without a doubt to  the fundamental territories. We have arranged the foundation to suit cutting edge necessities on account of an advanced perspective and promoting a public-private partnership (PPP) model,” he included.

Noticing that Sri Lanka is blessed with a highly literal population, strong legal system and a holding a key position in the strategic location in South Asia, the Minister welcomed all investors to leave their impression in Sri Lanka, which he portrayed as the hub of the Indian Ocean.

The minister also acknowledged China's longstanding companionship and said China today was the biggest investor to Sri Lanka.

The Central Bank Governor Dr. Indrajit Coomaraswamy said the worldwide economy had various tailwinds for Sri Lanka and considering all the macroeconomic variables, it furnishes the nation with an awesome chance to assist financial and economic success.

“The global economy has a number of tailwinds for Sri Lanka. The macroeconomic fundamentals are being strengthened through clear frameworks which have been put in place to provide consistent and predictable policies, while a growth framework has been improved for the investment climate. We have the location and we have excellent international relations with all the countries in the world. So when you take all of that together Sri Lanka provides you with a great opportunity,” he included.    

SEIC 2017 Organizing Committee Chairman Dr. Palitha Kohona said it is the first in a progression of gatherings that will be facilitated by the arranging board of trustees to feature Sri Lanka's rich potential as an investment destination.

“Our goal is to introduce this land of endless opportunities to the world and hope that mutually beneficial prosperity will follow. We aim to use this conclave to methodically and in detail explain what Sri Lanka has to offer by way of opportunities to the wide range of participants at SEIC 2017,” he included.

Dr. Kohona said the keen interest of Chinese businesses in SEIC 2017 clearly suggested that Sri Lanka has something special to offer to a lot of investment opportunities in Sri Lanka and, further, to create and strengthen investment partnerships with China, USA, Netherlands, Switzerland, Dubai, Japan and Hong Kong.

The two-day conclave will feature a range of in-depth analytical presentations on topics of world economic potential placing special emphasis on Sri Lanka as an investment destination, The future of private investments together with corporate/ institutional investments in Sri Lanka and will examine the protection of foreign investments, repatriation of profits, dividends, wages, taxation, etc. The hosts of the even are Hairong Investments International, Trive International and Opportunity Sri Lanka.

Monday, November 13, 2017

Budget Analysis 2018

  •  Liberalisation, promoting entrepreneurship, attracting FDI, boosting exports, helping SMEs
  •  Excise, Customs, Rent, Paddy Lands, Shop and Office acts and bankruptcy laws to be revamped
  •  Aims for 5% growth, 6% inflation, 4.5% deficit
  •   Electrical vehicle prices slashed by Rs.1 million, fuel vehicles to be phased out by 2040, carbon tax
  •    Development Bank for SMEs, angel fund for IT, 1,200 para-tariffs to be phased out
  •   Restrictions of foreign ownership in shipping to be removed, online travel agents to be charged 1% on commissions, VAT refunds for tourists, rationalisation of liquor licenses and taxes
  • PPP guidelines to be issued soon, housing, roads and education go rural, urban hub for Colombo.                                     
Delivering on his promise to keep the Budget speech concise, Finance Minister Mangala Samaraweera yesterday unveiled a slew of proposals to liberalise restrictive laws, promote exports, expand tourism, maintain fiscal consolidation, foster start-ups and open Sri Lanka to investment to achieve 5% growth in 2018.
The Budget also aimed to achieve medium-term targets such as per capita income of $ 5,000, one million new jobs, FDI inflows of $ 5 billion and doubling exports to $ 20 billion, as outlined in V2025. The Excise and Customs Ordinance, Rent Act, Paddy Lands Act, Agriculture Lands Act, Shop and Office Employees Act and bankruptcy laws were among the list of laws the Government plans to either repeal or amend.
“In 2018, we envisage GDP growth of 5%, inflation of around 6%, and we hope to achieve for the first time in almost six decades primary surplus of 1% of GDP and a Budget deficit of 4.5% of GDP,” Samaraweera said before launching into proposals for a “Blue-Green” economy that plans to introduce environmental safeguards.
On vehicle imports the Budget proposed to phase out all fossil fuel vehicles by 2040, encourage imports of electric buses and three-wheelers, slash prices on electric vehicles by at least Rs. 1 million, establish charging stations, introduce a carbon tax, excise duty of Rs. 10 per kilo of plastic and Rs. 3 billion to fast track the Aruwakkalu waste disposal site.
An allocation of Rs. 3 billion was proposed to set up an insurance scheme for farmers. During a natural disaster a minimum of Rs. 40,000 per acre for six crops including, paddy, maize, soya, big onion, potato, and chilli, will be paid under the propose scheme. This will be a contributory scheme with the premium being borne by both the farmer and the Government.
Credit and capital for Small and Medium Enterprises (SMEs) will be provided by the establishment of a Development Bank at a cost of Rs. 10 billion with an “EXIM window”. Eight new credit schemes are to be introduced to disburse a total of Rs. 15 billion with all existing and new schemes to be gathered under the “Enterprise Sri Lanka Credit Scheme”. As much as Rs. 2.2 billion will also be spent under the Grama Shakthi initiative to provide capital to small businesses and reduce poverty.
“IT and the IT related sectors have the potential to reach $ 5 billion in export earnings in the next five years. As such, to support this industry, specially the SME IT companies, we will launch, the ‘IT Initiative’, which is in effect the Government’s angel fund for the IT industry. This initiative will be operated through the EDB and we will invest Rs. 3 billion.”
At the outset the IT Initiative will finance 50% of the rent expenditure for 24 months on the Hatch Incubator and similar support to any private ventures, Colombo, Moratuwa and SLIIT universities will conduct training courses in Artificial Intelligence, Robotics, Data Science, Machine Learning and Python Development in collaboration with the industry.
A proposed SME Guarantee Fund will enable SME Exporters who are in the CRIB but have the potential to export, yet have no access to finance its operations, to access financing from banks utilising the SME guarantees.
Moving on to tourism, the Finance Minister said Online Travel Agents (OTAs), both resident and non-resident, which derive their commission from the businesses carried out in Sri Lanka, will face a tax of 1% on the commission derived from local reservations.
In keeping with the vision to make Sri Lanka a shopping hub, a VAT refund scheme for foreign passport holders will be implemented at the Airports and Sea Ports with effect from 1 May 2018.
The Board of Investment, the relevant line agencies and the newly-established Public-Private Partnership (PPP) Unit will collaborate in facilitating such ventures with an allocation of Rs. 2.5 billion. PPP guidelines are to be issued shortly, the Minister assured.

Friday, October 20, 2017

South Korea to sign economic cooperation agreement with Sri Lanka

  • ·         Agreement will cover the fields of investment partnership, trade relations, tourism promotion, and industrial cooperation

Sri Lanka will sign an economic cooperation agreement with South Korea during the state visit of President Maithripala Sirisena, which is scheduled for next month, the government said. The economic cooperation agreement will cover the fields of investment partnership, trade relations, tourism promotion, and industrial cooperation.
The Cabinet, this week, approved a proposal made by Development Strategies and International Trade Minister Malik Samarawickrama to sign this agreement. In March this year, South Korea’s then Foreign Minister Yun Byung-se visited Sri Lanka as the first South Korean top diplomat to visit Sri Lanka in 31 years. He held bilateral discussions with his Sri Lankan counterpart during which both sides agreed to further strengthen economic ties.

South Korean Foreign Minister said that they want to expand economic cooperation with Sri Lanka from 300 million dollars to 500 million dollars over the next three years. Over 30,000 Sri Lankan workers are officially employed in Korea in fisheries, manufacturing and construction sectors under a special employment quota. Two countries also mark the 40th anniversary of diplomatic relations this year.

Wednesday, October 11, 2017

CEB to purchase 100 Mw of emergency power

Sri Lanka’s cabinet has approved a proposal to procure 100MW of electricity from private power producers for a period of 6 months with the option of extending it by further 6 months. The Power Ministry said cabinet approval has been obtained to purchase electricity in the short term at competitive prices through international bidding.
Island’s power regulator earlier warned of serious consequences to be expected if the timely implementation of long term generation plan is not ensured. Public Utilities Commission said due to planned plants not being built as per the timeline, unforeseen power procurement and change of power mix have resulted the increase in the average unit cost of electricity.
In 2016, actual power purchases from oil based plants have increased by 6 times than planned for 2016. Power Minister Ranjith Siyambalapitiya, releasing a statement, however, said that it is not a problem of state policy and planning.

“Hydropower generation is challenged due to the lack of sufficient hydropower during Southwest and Northeast monsoon rainfall in 2017,” “In this backdrop, the CEB is taking measures to ensure the continuous power supply in the country.” Siyambalapitiya said these emergency power purchases will not result in an extra expenditure to the end consumer. He added that this additional electricity purchase will be less than the cost of some of the gas turbines used by the CEB during the night between 6.30am and 10.30pm, which will be the highest daily electricityrequirement of the system.

Tuesday, October 3, 2017

National Agency for Public Private Partnership

                                                  Thilan Wijesinghe – Chairman of the NAPPP
Former BOI Chairman Thilan Wijesinghe to head the new body: Wide range of legal, financial and administrative authority: A high-powered ‘National Agency for Public Private Partnership’ was appointed to fast-track Sri Lanka’s economic development agenda.
The Cabinet granted approval to appoint former BOI Chairman and business professional Thilan Wijesinghe as the head of the new agency. The Cabinet paper with regard to the establishment of the new agency was jointly submitted by Finance and Media Minister Mangala Samaraweera and Development Strategies and International Trade Minister Malik Samarawickrema.
The NAPPP (National Agency for Public Private Partnership) will be undertaking the ongoing and potential PPP Project Pipeline that includes:
  •              Transport Sector Projects – Inland Water Transport, highway projects & inland airline system.
  •        Ports – Trinco economic corridor & East terminal through ADB Funding.
  •      Power & Energy projects – LNG Kerawalpitiya, 100Mw Solar Project & Waste to energy project.
  •       Petroleum Sector – Sapugaskanda & Hambantota refinery.
  •       Water – Welivita & Jaffna desalination.
  •       SEZ/Industrial Zone – Hambantota SEZ & Horana industrial zonand – New buildings to be constructed on PPP basis.
  •     Healthcare – 24 Projects related to import substitutions for healthcare.
  •     Education – Berkley University project
  •    Mineral Sector – Graphite & Phosphate extraction
  •      Millenium Challenge Corporation Project

It will also have additional powers to identify suitable projects based on feasibility studies and maintain a ‘project pipeline’ in consultation with government ministries. The board of directors of the new agency will consist of eight professionals with vast experience in the public and private sectors namely:
                      1.       Mr. Thilan Wijesinghe, Chairman of the Board
                      2.       Mr S. R. Attygalle, Deputry Secretary to the Treasury
                      3.       Dr. Sarath Rajapathirane, Economic advisor to H.E. the President
                      4.       Mr. Mangala Yapa, Director of BOI
                      5.       Mr. Mano Tittawella, Senior advisor to the Finance Minister
                      6.       Mr. Deshal de Mel, Advisor to the Finance Minister
                      7.       Mrs. Dhara Wijethilake, CEO  Ceylon Chamber of Commerce
                      8.       Mr. Duminda Hulangamuwa, Tax Partner, EY

The new agency has replaced the division which operated under the Finance Ministry to handle certain areas with regard to Public Private Partnerships (PPP). Under the new NAPP, PPP agreements will be carried out by this national agency with adequate legal, administrative and financial authority.

Monday, October 2, 2017

USD125 Mn loan from World Bank for Transport Connectivity and Asset Management Project

  • $125 million dollar loan from the World Bank for the new Transport Connectivity and Asset Management Project

Sri Lanka’s government signed an agreement to get a 125 million dollar loan from the World Bank for the new Transport Connectivity and Asset Management Project, Friday. The loan for this project is provided by the International Development Association (IDA), the World Bank’s grant and low-interest arm, with a maturity of 25 years that includes a grace period of five years.
“The Road Development Authority will monitor the contractor and make payment based on the delivery of safe roads free of pot holes, water logging, with shoulders, drainage, and lighting that are well maintained and comfortable for the road users,” said Amali Rajapaksa, World Bank Senior Infrastructure Specialist and Task Team Leader.
“These types of contracts will benefit the Government, contractors and the general public by saving costs and serving as a model that could be adopted by many other sectors in the future.” The project also supports a program financed by the Asian Development Bank (ADB). The RDA is the lead implementing agency.
A dense network makes roads the preferred mode of transportation in Sri Lanka, carrying 95 percent of passenger traffic and 98 percent of freight. Building on the lessons from the World Bank-supported Roads Sector Assistance Project, the new project will help strengthen the RDA by focusing on the institutional and system changes that can transform the authority from a provider of infrastructure to a service provider.
The contracting approach to be piloted in the project aims to improve construction quality, minimize delays and costs, and address the issue of poor-performing contractors. The project will be implemented on the section between Ja-Ela and Chilaw on National Road A003. The contractor will carry out the design, upgrading, rehabilitation, and maintenance under a long-term contract.
“Maximizing quality and minimizing costs of the island-wide road network will no doubt become a model project of the Road Development Authority,” said Pswarayi-Riddihough. “Better and safer roads will benefit all Sri Lankans and contribute to the country’s prosperity and poverty reduction.”

Tobacco Control Project in Sri Lanka

  •        $20 Million is allocated for this project from the UK Health Department

The British government’s Department of Health is committing £15 million ($20 million) to bolster international support for a tobacco control project in Sri Lanka, which is believed to have the world’s highest rate of oral cancer among men.
The new project will promote accelerated implementation of the World Health Organisation Framework Convention on Tobacco Control (FCTC) in low- and middle-income countries, with Sri Lanka one of just 15 priority countries. British High Commissioner to Sri Lanka James Dauris said 60 countries applied for support from the WHO.
“Priority countries weren’t selected on the basis only of need, but also on level of commitment,” he told a news conference, a statement said. Tobacco use is one of the principal causes of oral cancer and in Sri Lanka oral cancer is the most common form of male cancer, Dauris said. “I understand that Sri Lanka is the only country in the world where this is so.
This alone is a good argument for investing in change.” Evidence from around the world confirms that effective measures reduce the burden of tobacco related death and disease, freeing up money and resource to be spent and invested in more productive ways, he said.

Wednesday, September 27, 2017

Tender floated for 50,000 houses in Northern Province

opportunity Sri Lanka
  •           GoSL has floated tenders for  construction of 50,000 permanent brick and mortar houses
  •      The project is to be executed by the Ministry of National Integration and Reconciliation together with other relevant line ministries and agencies.                                                                           
The Government has floated tenders for the construction of 50,000 permanent brick and mortar houses for the north and east as part of resettlement and reconciliation initiative.
The move follows Cabinet approving a Memorandum submitted by Prime Minister Ranil Wickremesinghe, to construct 50,000 brick and mortar houses for conflict-affected families in the Northern and Eastern provinces.
The project is to be executed by the Ministry of National Integration and Reconciliation together with other relevant line ministries and agencies. The project was formulated under the guidance of the Northern and Eastern Provinces Development Committee and recommended by the Cabinet Committee on Economic Management headed by the Prime Minister and gained the endorsement of Cabinet. The Ministry of National Integration and Reconciliation directly comes under the purview of President Maithripala Sirisena. Action was taken to call for the tenders with financing arrangements on soft terms, revealed Ministry of National Integration and Reconciliation Secretary V. Sivagnanasothy.
Already invitations for proposals have been advertised and will be open to eligible bidders and financiers.Bidders who submit proposals should also get confirmed financing arrangements from donors or financing institutions. Members of the Parliament, district officials and civil society organisations welcomed the initiative as the proposals were acceptable to the social context of the provinces and address the long-felt needs of conflict-affected families.

Tuesday, September 26, 2017

You can now score up to $1m seed funding in Sri Lanka. These co-founders show how.

  •        Medtech app oDoc – score US$1 million seed funding
  •       This is the largest seed investment round for any startup in Sri Lanka.

The island nation south of India with its gorgeous beaches, rainforests, and ancient Buddhist ruins just saw one of its startups – medtech app oDoc – score US$1 million seed funding.
This is the largest seed investment round for any startup in Sri Lanka. The country’s startup ecosystem is still very young with over 50 percent of its entrepreneurs using their personal savings to fund their companies. The seed funding round for oDoc comes at an opportune time as the island’s mass market is embracing tech through new ride-hailing options.
ODoc isn’t going after the mass market though – at least not yet. The app connects patients with doctors for video consultation. Say you wake up in the morning with a nasty rash and fever. 
Three taps on your smartphone and you can submit your pre-consultation notes, take a picture of your rash, and get a doctor to review those. A doctor will call you and send his prescription with the doctor’s seal and signature right to your phone. All done in 10 minutes.
Many startups around the world have been at it but oDoc’s four founders – with their diverse backgrounds – approached it more from a design perspective than as a tech problem to solve.

Thursday, September 21, 2017

Sri Lankan born Venture Capitalist – Chamath Palihapitiya raises $600 Mn in IPO for Tech Investments

  •          Chamath had raised 600 million dollars in its IPO to invest in private tech companies
  •          There are about 150 private tech startups valued at over $1 billion

Chamath Palihapitiya, founder of the venture-capital firm Social Capital, has launched a new “blank-check” company in partnership with the London-based VC firm Hedosophia, named Social Capital Hedosophia Holdings Corp.
Social Capital Hedosophia said it had raised 600 million dollars in its IPO to invest in private tech companies, Business Insider reported. Blank-check public companies, or special purpose acquisition companies, which raise money first and then figure out how to invest it, are in vogue, according to The Wall Street Journal’s Maureen Farrell.
Social Capital Hedosophia estimates there are about 150 private tech startups valued at over $1 billion, compared with about 200 public technology companies with a market cap of $1 billion. Private tech startups can now hold out from going public indefinitely because of money available to fund growth from private investors.

Twenty-two blank check funds have been launched on US exchanges so far this year, raising 6.9 billion dollars, Farrell reports, citing Dealogic data. Tony Bates, a Social Capital partner and former CEO of Skype, is on the holding company’s board, while Palihapitiya will be the CEO.

Wednesday, September 20, 2017

MCC Grant from USA Soon

  •       This is going to be the biggest grant ever by any country

Economic Affairs Deputy Minister Dr. Harsha de Silva yesterday said that Sri Lanka would receive several hundreds of millions of dollars in grant assistance from the US as a result of signing the Millennium Challenge Cooperation Compact.
Noting that it will be the largest grant Sri Lanka is to receive, he was however unable to disclose the amount. “We don’t know what the amount is. It is being processed now. We are confident it will be several hundreds of millions of dollars of grant assistance to Sri Lanka.
The Deputy Minister said that this is a grant "to the Sri Lankan people by the American people" and that it is "the biggest grant ever by any country". Dr. De Silva said the grant money would go into a number of sectors. “We will utilize those kinds of funds in most urgent areas including land reforms, transport and agriculture logistics.”

EDB forecasts $ 13 billion export revenue for 2017

EDB Chairperson Indira Malwatte
·         FTAs with Singapore, China and India will boost export-oriented investments and trade
Capitalising on the impending trade and economic partnerships of the Government, the Export Development Board (EDB) is optimistic of achieving export revenue of over $ 13 billion by the end of this year.
“With the regaining of GSP+ and different trade agreements the Government is planning to sign, in 2017 we are expecting to achieve around $ 13.8 billion worth of export revenue,” EDB Chairperson Indira Malwatte
She pointed out that free trade agreements (FTAs) and economic partnerships with Singapore, China and India will no doubt boost export-oriented investments and trade.

In the first half exports grew by 5.2% to $ 5.4 billion as a result of high income received from exports of tea, transport equipment, petroleum products and machinery and mechanical appliances. However, export earnings from textiles and garments, gems, diamonds and jewellery and leather, travel goods and footwear declined during the period under consideration. In June export earnings rose 9.6% to $ 987 million marking the fourth consecutive month of gain.

Sri Lanka records 4% Economic Growth in Q2

  •     The country’s economy grew by 4% in the second quarter from a year earlier
  •         The industrial activities have recorded a considerable growth rate of 5.2%
  •          Services activities recorded a positive growth rate of 4.5% during Q2 of 2017.

The country’s economy grew by 4% in the second quarter from a year earlier and slightly better than the 3.8% improvement in the preceding three months.
The Department of Census and Statistics said the GDP for Sri Lanka for the second quarter of 2017 at a constant (2010) price reportedly reached up to Rs. 2,211,612 million and the GDP reported for the second quarter of 2016 was Rs. 2,125,848 million
The 2Q growth was despite a setback faced by agriculture due to adverse weather conditions. The Industrial and the Services activities recorded higher growth rates of 5.2% and 4.5% respectively whilst agricultural activities reported a negative growth rate of 2.9%.
The four major components of the economy, Agriculture, Industry, Services and Taxes less subsidies on products, have contributed their share to the GDP at the current price by 8.2%, 25.9%, 56.6% and 9.4% respectively in the second quarter of 2017.
Among the sub-activities of agriculture, the value added ‘Growing of rice’, ‘Growing of oleaginous fruits including Coconut’, ‘Growing of Cereals (except rice), ‘Growing of vegetables’ and ‘Growing of Spices’ declined by 32.9%, 20.2%, 15.3%, 5.9% and 3.8% respectively during this quarter, when compared to the same quarter of the previous year.
The industrial activities, which shared the GDP by 25.9% at current price, have recorded a considerable growth rate of 5.2% in the overall industrial activities of this quarter. Among the industrial activities, the Construction activity, which corresponds to the highest share within the industry sector, grew by 9.3% during this quarter when compared to the second quarter of 2016.
In parallel with the construction activity ‘Mining and quarrying’ has also reported a significant growth rate of 18.4%. Overall manufacturing activities have grown by 0.9% during the second quarter of 2017. The major proportion of manufacturing activities is shared by the ‘Manufacture of food, beverages and tobacco’ and the ‘Manufacture of textile and wearing apparel’ activities which have reported a 2.2% negative growth rate and 2.5% positive growth rate respectively during the quarter.
In addition, the ‘Manufacture of furniture’ and ‘Manufacture of rubber and plastic products’ activities have reported significant positive growth rates of 12.4% and 8.4% respectively.
Among the three major activities, the Services activities, which gave the highest contribution (56.6%) to the GDP, recorded a positive growth rate of 4.5% during the second quarter of 2017, when compared to the same quarter in 2016. The performance of the Services sector was underpinned specially by the sub-activities of ‘Financial service activities’, ‘Human health activities’ and ‘Telecommunication’ which reported significantly higher growth rates of 16.4%, 13.2% and 12.4% respectively.

Nine New Investment Zones in Pipeline - Prime Minister Ranil Wickremesinghe

  •         Says major investment and export plans already drafted
  •        About nine new investment zones in pipeline
Hailing the Board of Investment (BOI) celebrating four decades, Prime Minister Ranil Wickremesinghe yesterday said his Government together with President Sirisena was preparing for a great leap forward in investment and exports to catapult Sri Lanka towards stronger growth.
Wickremesinghe, who took part in the BOI 40th Anniversary celebrations with President Maithripala Sirisena, Development Strategies and International Trade Minister Malik Samarawickrama and the latter’s State Minister Sujeewa Senasinghe at the Katunayake Free Trade Zone recalled how he had been present at its opening with former President J. R. Jayewardene.
“At the time, our biggest challenge was finding jobs. The country had just faced an uprising and we understood that government institutions were insufficient to create the jobs that youth so desperately wanted. That is why we decided to establish investment zones,” he said.
The Katunayake Export Processing Zone was the first of its kind in South Asia, the Prime Minister noted, which served as the blueprint for many other similar ventures in India, China and Vietnam. Unfortunately, the early advantage of an open economy was lost to Sri Lanka a few years later when the war began and lucrative investment opportunities drifted to other countries.
“Now we have an even bigger opportunity than we did in 1977. Now we have a chance to regain all that lost opportunity. This is why we formed a coalition Government; and we must support President Sirisena so that together we can implement the economic plan we have drafted for the next three years.”
As many as nine new economic zones are in the pipeline, the premier said, as part of the Government’s efforts to take development to the provinces. An investment corridor from Kandy to Wellawaya as well as other zones up to Paranthan is under discussion, he said. Former President Ranasinghe Premadasa opened over 200 apparel factories outside the zones, Wickremesinghe stated, which also pushed forward development, but in the present, advancements in technology has meant businesses can be established anywhere around the country.

Friday, September 15, 2017

“Invest Sri Lanka Forum 2017” to be held in New York

  •    Invest Sri Lanka Forum to be held on October 16, 2017 at the Sofitel New York.
  •       The Forum is organized with the objective of promoting investment in the Sri Lankan capital market among US based institutional investors                                                                             

The “Invest Sri Lanka Investor Forum” organized by the Colombo Stock Exchange (CSE) and the Securities and Exchange Commission of Sri Lanka (SEC) in association with CSE Member Firms and leading Listed Companies will be held on October 16, 2017 at the Sofitel New York.
The Forum is organized with the objective of promoting investment in the Sri Lankan capital market among US based institutional investors and a strong interest among the investor community in the US is expected.
The Invest SL Forum hosted in New York in 2014 drew the participation of over 200 investment professionals and contributed to the year 2014 recording the highest annual purchases in the Sri Lankan stock market from the US.
The Forum will feature a keynote address by the Governor of the Central Bank of Sri Lanka Dr. Indrajit Coomaraswamy while SEC Director General Vajira Wijegunawardene and CSE CEO Rajeeva Bandaranaike will present on capital market regulation and the opportunities in the capital market respectively.
The event will also feature a speech by CSE Chairman M Ray Abeywardena and a presentation on the experience of investing in Sri Lankan equities by Senior Portfolio Manager at Times Square Capital Management Caglar Somek.
The presentations will be followed by a panel discussion moderated by NASDAQ OMX Group Vice Chairman Meyer “Sandy” Frucher and a series of pre-scheduled one-on-one-group discussions between fund managers and Sri Lankan listed companies on October 16-187, 2017. John Keells Holdings PLC, Commercial Bank PLC, Sampath Bank PLC, Tokyo Cement (Lanka) PLC, Teejay Lanka PLC, Dialog PLC, People’s Leasing & Finance PLC, MTD Walkers PLC and Sunshine Holdings PLC will attend the Forum.
The decision to host the Invest SL event in New York, comes on the back of a considerable level of foreign activity in the stock market in 2017, where a net foreign inflow of Rs 40 billion has been recorded year-to-date in the primary and secondary markets.
Foreign purchases during the first half of 2017 also established a record for the highest foreign purchases recorded in the first half of a calendar year. The year-to-date figure amounts to over Rs. 80 billion. Investors from the UShave consistently been the leading contributors to foreign turnover in the Sri Lankan stock market, and have contributed to 40% of the total foreign turnover since the year 2013.
Commenting on the initiative, Chairman of the SEC Thilak Karunaratne said “Every country’s stock market has its own mix of investors. This mix will have an impact on the efficiency of the stock market.
This year in particular it is the foreign investors who have driven the stock market and to date there is a net foreign inflow of Rs. 28 billion to the CSE. This is the second highest yearly net foreign inflow on record. The US is ranked as the number one contributor to this record figure and we are confident that this Road Show will further strengthen the inflow of funds from the US to our stock market”.
The Chairman of CSE Ray Abeywardena commenting stated “Numbers related to foreign activity indicate that foreign investors have identified an opportunity in the Sri Lankan stock market.
Considering such interest and activity, a forum of this nature in what is largely regarded as the largest Fund Hub in the world would help make a strong case for the Sri Lankan capital market, at a time when we have the attention of foreign investors.”
“I invite Stockbroker firms, Unit Trust Companies, Listed Companies and other stakeholders to join in this effort to make a collective case for the Sri Lankan capital market as an investment destination”, Abeywardena added.
The forum follows successful Invest SL forums conducted in Australia this year, which have contributed to 2017 establishing an all-time high in foreign purchases originating from Australiain a calendar year.

Sri Lanka is the second fastest growing market in South Asia for VISA

  •                  Sri Lanka has become the 2nd fastest growing market for VISA South Asia.
  •          Sri Lanka’s mobile phone penetration is at 92% and there are over four million internet users with mobile internet via smart phones, registering phenomenal growth

Last year Visa, the global leader in payments technology, saw a 22% volume growth in Sri Lanka and a higher growth momentum is continuing so far in 2017. As per Central Bank data, last year nearly 70,000 transactions were conducted by the country’s base of debit and credit cards, as against 57,000 in 2015. In terms of value, these cards did Rs. 290 billion worth of transactions, up by 22% from Rs. 237 billion in 2015.
Visa Sri Lanka and Maldives Country Manager Anthony Watson told the Daily FT that the biggest volume growth was coming from the travel and airline sector, which has reported a 30% increase year-on-year in June. This momentum in fact prompted Visa to partner SriLankan Airlines and Standard Chartered Bank to unveil the national carrier’s biggest ever promotion of up to a maximum of two free tickets for online bookings.
Last year, payment volume on Visa credit cards increased 23%, while Visa debit cards were up 21%. There has also been a significant increase in the overall number of Visa transactions (22%), with a 61% increase in ecommerce transactions, of which half is via mobile phones, and there is a 39% increase in international transactions. Overall cards in force saw a 12% growth.
The overall number of credit and debit cards in the market is estimated at around 17 million.
According to Anthony Watson - ‎Country Manager Sri Lanka and Maldives at Visa, the impressive growth comes on the back of a number of initiatives and investments made by Visa in developing acceptance infrastructure and driving awareness over the benefits of electronic payments in the country.
He said that with the increased security provided and smart phones being affordable and gaining popularity, more Lankans are making digital payments. Sri Lanka’s mobile phone penetration is at 92% and there are over four million internet users with mobile internet via smart phones, registering phenomenal growth.
“Initiatives and investments made by Visa in developing the acceptance infrastructure and driving awareness around digital payments have helped fuel growth,” Watson added. “More people are taking advantage of the convenience to shop online,” he added.

Monday, September 11, 2017

New Inland Revenue Bill passed in Parliament

  • Tax exemptions offered for investments made in Northern Province
  • Individuals with a monthly salary of LKR 100,000 will be tax exempted 
  • SMEs and identified sectors will get a tax reduction from 28% to 14%
  • PAYE tax will be enforced at end October, new act enforced from 1 April 2018
  • Monthly interest income of senior citizens up to Rs. 125,000 will be tax exempted. 

The Inland Revenue (IR) Bill was passed in Parliamentyesterday, allowing the Government to scrap the complicated tax system and establish a “fair but transparent” tax policy for Sri Lanka with plans to increase Government revenue from direct tax.
Minister of Finance and Mass Media Mangala Samaraweera stated, “The Government will reduce the gap between direct tax and indirect tax by 2020, enabling the nation to move forward”. According to the Minister, state revenue has declined drastically during recent past. In 1990 state income stood at 19% of the GDP but has declined continuously to 10% by the end of 2014.
Summing up the debate, State Minister of Finance Eran Wickramaratne stated that people will be taxed based on the income they receive from the respective activities they are engaged in. “We will not tax the beggars, but if a beggar is engaged in a business, yes that business will be taxed. But if a businessman is making an investment, proper accounting will help him to enjoy capital allowance within a specified period. This will allow them to recover the investment and encourage him to make more investments. SMEs will have 14% tax. Exporters will also have 14% tax, which is the lowest tax percentage under the new Act. Tax policies were made by not looking at large businesses,” he said.

Thursday, August 31, 2017

Sri Lanka among the Global Investing Hot Spots

  •          Sri Lanka has seen a notable increase in investor confidence
  •          Policy consistency, ease of doing business and the expansion of trade are key to attract FDI

Standard Chartered Bank’s Global Research economists said Sri Lanka is “quite hot” to attract foreign investors due to its extremely high yields followed by the Government’s recent policy reforms where it expressed confidence that 2017 would see the economy doing well.
Standard Charted Bank Chief Economist Asia Global Research David Mann said foreign investor confidence in Sri Lanka has seen a notable increase, especially in investing in fixed income channels including sovereign bonds and local currencies as the yields were quite attractive compared to other countries.
“There are extremely high yields compared to other economies, which had a lot more foreign participation. More gains are in store for Sri Lanka bonds due to their performance. You can say it is partly because of the IMF program and the path of travel,” he told journalists in Colombo yesterday.
Despite the speculation of a gradual depreciation, he said it was impossible to ignore the attractiveness of Sri Lanka’s yields. In terms of the global perspective, Mann said the big focus for the next few months was to see if US President Donald Trump would deliver actions rather than words, which is threatening a Government shutdown and the start of a war where markets will be put on shakier ground.
It was pointed that there is a lot of money on the sidelines still waiting to enter emerging markets for either better value or for some major event driven sell-off which will then trigger the offering of the opportunities they are looking for. “They are still spending the whole time waiting, meanwhile everything keeps climbing stronger and you actually see a lot of foreign investors starting to be obliged to get more adventurous. That is exactly somewhere behind why we have seen a surge of interest for markets like Sri Lanka, amongst all our foreign investor clients.
Further, it was highlighted that policy consistency, ease of doing business and the expansion of trade agreements were key factors to attract much-needed foreign direct investment (FDIs) to Sri Lanka, while admitting FDI per capita was low compared to other countries from the region.
“Tax changes have been ad hoc in the past. The investor needs to be assured that the tax policies will not be changed and getting the whole Inland Revenue Bill is critical at this point. Sri Lanka needs to attract FDIs that can bolster exports as most of the FDIs that have come to the country are in non-tradable sectors like construction.”
While acknowledging that the Government was working on these issues to smoothen the inflow of FDIs, he noted that the revamping of the Board of Investment (BOI) and Customs Department were time consuming. However, he expressed optimism over non-tradable FDIs once the Colombo Port City Project commences towards the second half of next year.

Wednesday, August 30, 2017

GoSL call bids for the hybrid renewable energy park in Pooneryn

Sri Lanka is setting up a 'hybrid renewable energy park' in Pooneryn 
GoSL to call bids for 170MW wind and 100MW solar plants
Another tender for two 10Mw plants are also currently open for bids.

The Government of Sri Lanka is planning to call tenders for 170 MegaWatts of wind and 100 MW of solar in the northern part of the island nation, Deputy Minister Ajith Perera said.
The Deputy Minister said a hybrid renewable energy park that would generate 1040MW from solar and wind power is proposed to be constructed in Pooneryn in the Northern Province. “Within the next couple of months, we will call tenders for 170MW of wind power and 100 MW of solar power in this park. At the same time, 220KV transmission lines will be constructed to distribute power generated in the park. This will be a priority project of the Government,” he said.
Competitive bids will be called 'in a few month' for the plants, he told parliament.
 Another tender for two 10MW plants are currently open, Perera said. Sri Lanka has received bids of 12.29 rupees a unit for two wind plants in the Jaffna peninsula from privately owned Ceylex Engineering, but the project has delayed following public protests because state-run Ceylon Electricity Board was expected to provide land.
Sri Lanka is also planning to float a tender for 90 units of 1MW solar plants. An earlier tender for 60 x 1 MW solar plants had generated bids for an average 17.01 rupees a unit. Sri Lanka wants to have 410MW of wind power and 410MW of solar power by 2020, Perera said.

Tuesday, August 29, 2017

Net foreign inflows surpass Rs 28 Bn – Colombo Stock Exchange

  •  Foreign inflows tops Rs 28 Bn
  •    This is the 2nd time in history the hurdle of Rs 28 Bn mark has surpassed

      Colombo stock market reported that Net foreign inflows to the island nation have crossed the Rs. 28 billion mark year to date, reinforcing strong growing confidence by non-nationals and further boosting investor confidence.
It was the second time in the history of CSE that the Rs. 28-billion mark was surpassed. The first time was in 2012. The record net inflows so far this year is a phenomenal achievement considering the fact that last year the figure was only Rs. 400 million whilst in 2015 there was a net outflow of Rs. 5.4 billion.
The surpassing of the Rs. 28-billion mark too was within three months since as of 9 June the year to date inflow was Rs. 20.3 billion. Total year to date net foreign inflow for both the primary and secondary market amounted to Rs. 40.6 billion, as against Rs. 2.2 billion last year, and an outflow of Rs. 5.4 billion in 2015 and a net inflow of Rs. 21.7 billion in 2014.
The all time high net foreign inflow is Rs. 38.6 billion achieved in the Bull-run 2012. Capital market analysts opined sustained foreign craving for listed Lankan equities continue to expose the fickle ‘wait and see’ attitude and relatively low confidence on the part of locals.
However, some analysts have been heartened by a renewal in local interest following the decision by the Finance Ministry not to impose additional taxation on share trading though foreign optimism far outweighs that of Lankans. Turnover however hit a five and half month low of Rs. 210 million yesterday.

Thursday, August 24, 2017

Government Of India Offers Financial Aid Of Rs. 300 Million

  • The Government is to construct 600 houses in 25 districts with the assistance of India
  • The housing requirement Survey 2016 has revealed that 216,197 families in Sri Lanka have no house, or a land to build a house.

 Sri Lanka plans to construct 600 houses across the island for low-income families with Indian assistance.
A proposal by Housing and Constructions Minister Sajith Premadasa to sign an MoU to obtain 300 million rupees in financial aid to implement the programme covering all 25 districts was approved by the Cabinet of Ministers.
According to a government statement, the housing requirement Survey 2016 has revealed that 216,197 families in Sri Lanka have no house, or a land to build a house.
To address this need, the Indian Government has agreed to provide financial aid to construct houses for 600 families, Minister Premadasa informed Cabinet.

Colombo among five biggest improved cities – Global Livability Report


  •         The City of Colombo has been selected among the five biggest improved cities during the last five years in terms of livability by the Global Livability Report 2017.
  •          Out of 140 cities, Colombo is ranked at 124th with an overall rating of 51 out of 100 points.

Sri Lanka’s main commercial city Colombo has been selected among the five biggest improved cities during the last five years in terms of livability by the Global Livability Report 2017. Out of 140 cities, Colombo is ranked at 124th with an overall rating of 51 out of 100 points. The Economist Intelligence Unit says that Colombo has showed relative improvement during this period, especially after the end of a separatist war.
According to the report by The Economist Intelligence Unit (The EIU is the research and analysis division of The Economist Group,) Colombo has showed relative improvement during this period, especially after the end of a separatist war. Nevertheless, out of 140 cities, Colombo is ranked at 124th with an overall rating of 51 out of 100 points. The report says that cities moving up the ranking are located largely in countries that have enjoyed periods of relative stability after previously reported falls in liveability. These include Kiev in Ukraine, Tripoli in Libya and Colombo in Sri Lanka.

                                                                                        “Unfortunately, the improvements have been marginal and have not seen liveability recover from previous levels or resulted in large shifts up the ranking.” the report said. For the seventh consecutive year, Melbourne in Australia is the most liveable urban centre of the 140 cities surveyed, closely followed by the Austrian capital, Vienna. In fact, only 0.1 percentage points separate the top two cities, and just 0.2 and 0.3 percentage points separate Canada’s Vancouver and Toronto (ranked 3rd and 4th, respectively), from Melbourne.

Another Canadian city, Calgary, shares joint fifth place with Adelaide in Australia. Although the top five cities remain unchanged, the report highlights that the past few years have seen increasing instability across the world, causing volatility in the scores of many cities.

SEIC 2017 kicks off in Colombo: An investment seminar to highlight Sri Lanka’s investment opportunities

The Government yesterday encouraged more than 200 forthcoming financial specialists from China, Wall Street, London, Geneva, Dubai, H...