Economic
The Central Bank (CB) yesterday urged calm and to avoid fuelling undue speculation over the country’s foreign reserves or debt servicing commitments, saying both issues were being satisfactorily addressed.
The Sri Lanka Association of Inbound Tour Operators (SLAITO) and the One Industry One Voice partners yesterday endorsed The Hotels Association’s (THASL) statement urging Opposition politicians not to vilify tourism, whose success benefits three million livelihoods with baseless allegations.
Headline inflation based on the National Consumer Price Index (NCPI) in May was 6.1% up from 5.5% in April.
SS Equity Holdings Ltd., linked to high net worth individual investor Shankar Somasundaram, has acquired the BreadTalk franchise for Rs. 245 million.
Sri Lanka, under the new Government, has attracted nearly $ 1 billion worth of investment proposals to the tourism sector given its future prospects, despite the COVID-induced challenges, Tourism Minister Prasanna Ranatunga said yesterday.
The National SME Forum organised by the Ceylon Chamber of Commerce will be held today (28 June) via the Zoom platform from 9.00 a.m. to 5.00 p.m. under the theme ‘Accelerating economic growth through creation of a dynamic SME sector’.
The Committee on Public Finance granted approval yesterday to issue Rs. 1,000 billion Treasury Bills, under the Local Treasury Bills Ordinance which is scheduled to be presented to Parliament for approval shortly.
The country’s tea crop in January to May has hit a three-year peak whilst select elevations have reached new recent highs, but the industry is concerned over future production owing to the fertiliser crisis.
Private sector borrowing has risen by Rs. 331 billion in the first five months of this year with the cumulative figure crossing the Rs. 6.5 trillion mark.
The Free Trade Zone Manufacturers Association (FTZMA) yesterday expressed concern over the recent resolution passed by the European Parliament and warned that the loss of GSP+ benefits will have a major impact.
The sole trade chamber representing manufacturers in the country’s free trade zones, FTZMA in a statement said it is quite perturbed by the EU resolution adopted, which includes a measure to temporarily suspend the GSP+ preferential tariff concession afforded to Sri Lanka.
“The impact of losing the EU GSP+ this time around is also expected to be immense.
Especially at a time when the global COVID-19 pandemic has had a debilitating impact on the Sri Lankan economy resulting in weakening its balance of payments and increasing the unemployment rate,” it said, given the fact EU is Sri Lanka’s second biggest export market.
FTZMA also warned of the potential loss of FDIs by export enterprises which could potentially move their operations elsewhere.
“The economy of our country is majorly driven by SMEs but due to the pandemic those enterprises are already being hit badly. The GSP+ withdrawal will throw them from the pan into fire, as not only textile but about 7,500 tariff lines, which cover almost all the industrial exports from Sri Lanka to Europe, will suffer in the event GSP+ is withdrawn. Therefore, unlike previously, with the cascading effects of the pandemic it will cause a catastrophic impact to our economy. This will prevent industries from achieving the set future export goals. This will be a major setback,” FTZMA said.
Whilst urging the Government to review its position on the implementation of mandatory legislative measures, FTZMA on behalf of its members urged the EU to reconsider its position and work with the Sri Lankan Government to reach an amicable solution.
FTZMA said that, as a part of the business community, it could support the approach of the Government in regaining GSP+ by:
1) Monitoring how enterprises fulfil treaty obligations
2) Advocating for improvements and
3) Acting as a partner to communicate the views of the Sri Lankan public
As a major stakeholder of the export business, FTZMA said that, in helping the Government achieve the scheme’s conditions, together with its members it will continue diligently to uphold labour and human rights and safeguard its workforce from the negative impacts of the pandemic.
FTZMA firmly believes the removal of the GSP+ preferential trade concession will have serious and negative consequences on the Sri Lankan export industry. The EPZs of Sri Lanka, with about 280 enterprises in all zones employing over 150,000 employees, generate a significant portion of the export revenue of the country.
Softlogic Stockbrokers claims that losing GSP+ from European Union “will not create a major vacuum” but perhaps only lose a strong trade surplus.
REUTERS: Sri Lankan shares ended higher on Friday, recording their fifth straight weekly gain, helped by a surge in financials stocks.
The tourism industry is set to press for new relief from the Central Bank Governor Prof. W.D. Lakshman on 29 June at a key discussion arranged on the request of Minister Prasanna Ranatunga.
An SLPP-linked trade union is demanding immediate vaccination of all bank employees and warned failure would lead to protest.
The Hambantota International Port Group (HIPG) has partnered with Shenzhen Xinji Group to set up a plug and play ‘Park in Park’ manufacturing facility within the port’s industrial zone.
State-owned industry giant Bank of Ceylon (BOC) is slated to get $ 115 million worth of overseas funding (over Rs. 23 billion) by next week, a move which is expected to boost the country’s foreign exchange base.
Reuters: Shares settled higher on Friday, powered by gains in financial stocks with lender LOLC Development Finance extending gains for a fourth straight session.
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