Business
Economic stakes of the 2024 presidential election
As Sri Lanka gears up for elections, policymakers must avoid rash economic promises that risk a decade of lost growth and an era of relative decline.
As too often in the past, Sri Lanka appears not to have broken its damaging tendency towards ‘competitive populism’ ahead of elections. Fiscally profligate promises ranging from wage increases to loan write-offs and welfare handouts are being made in a bid to win votes. Such pledges often come with a hefty price tag that the country can ill afford, especially given its still fragile economic recovery.
The choices for Sri Lanka on the economic front are starkly clear: a) proceed along the agreed International Monetary Fund’s Extended Fund Facility (IMF-EFF) programme fiscal targets and timelines; b) rehash tax and spending at the margin without materially altering EFF targets and commitment; and c) discontinue the current EFF programme and renegotiate afresh. The choices made will determine what the enduring effects of the 2022 economic crisis will be.
Even the fact that such options are a matter of discussion points to an irrefutable fact: harsh austerity in the midst of a deep economic crisis hurts, and it hurts the neediest most.
The austerity measures – tax increases, wage freezes, subsidy removals – implemented so far have helped rebuild fiscal buffers, restore monetary stability and revive economic growth. In the process, though, both policymakers and the public have been called on to make sacrifices. For the former, implementing unpopular economic measures is never easy. The latter, despite a decline in incomes and living standards, have been mostly resigned in the hope of seeing their economic conditions improve over time. Those improvements have partly materialised, albeit rather slowly. Those who fell into poverty have been offered welfare support, and jobs are being generated. But for those on low to middle incomes – the ‘squeezed middle’ – the cost-of-living crisis has left lasting damage.
Elections can galvanise promises to speed up the recovery process via various policy solutions. In normal times, these will not invite intense scrutiny. However, these are not the typical ‘business-as-usual’ times for Sri Lanka. It is a country still tagged as ‘in default’ with very limited access to international finance, either for the government or the private sector.
This very limited access hinges on the continuation of the IMF programme. Any extended interruption to the current EFF could result in the drying up of that scarce funding, and the only way to keep essential services running will be to print new rupees and make the currency nearly worthless as inflation spirals. This time around, therefore, Sri Lanka’s habit-forming past practice of ‘muddling through’ crises is no longer an option.
Electoral policy agendas will inevitably focus on alleviating economic hardships, tackling distributional concerns, and boosting output growth. Sri Lanka’s current economic context, though, demands that these should not be addressed haphazardly. Shortcomings on tax and spending can be redesigned through targetted measures without damaging fiscal credibility. In turn, continued stability around the fiscal framework will help to focus policy more intently on deeper structural factors that impede durable growth. If managed well, Sri Lanka’s post-election path could usher in an era of self-sustaining economic recovery, driving rising living standards towards a more prosperous and fairer society.
The Institute of Policy Studies of Sri Lanka (IPS) provides robust analytical evidence on these and other critical issues through its ongoing research on the economic crises and its aftermath. These include assessments on the distributional impacts of recent tax and spending policies, the effectiveness of the Aswesuma programme, impacts on education and the labour market, the gains and risks of entering into regional trade agreements to boost growth, amongst others, using an array of latest data and research methods.
Drawing on these insights, IPS’ annual flagship report, Sri Lanka: State of the Economy 2024, scheduled for release on 8 October 2024 examines who has lost out from the economic crises, how they have been supported, and what needs to change. As economic policy competes for space in Sri Lanka’s post-election agenda setting, the report with its thematic focus on ‘Economic Scars of Multiple Crises: From Data to Policy’ offers analytical evidence designed to help secure the necessary degree of consensus required for an economic strategy that will take the country from stabilisation to growth and prosperity.
By Ifham Nizam
Australian High Commissioner to Sri Lanka Matthew Duckworth described Omega Traders’ latest investment in a modern dhal-processing facility as a strong example of how cross-border supply chains can translate into productive investment, local value addition and new business opportunities in Sri Lanka.
The investment, which adds a 150-metric-tonne-per-eight-hour-day processing capacity to Omega Traders’ operations, marks a significant expansion of the company’s manufacturing footprint as it celebrates 45 years in Sri Lanka’s food commodity industry.
Speaking at the inauguration of the new Lentil and Orid Dhal Processing Factory in Wattala, last Friday, H.C. Duckworth said the facility represented more than an increase in production capacity, pointing to the wider economic value created when Australian agricultural production is connected with Sri Lankan processing and distribution.
‘This facility is not operating on its own. It is part of a long supply chain and a trade partnership between Sri Lanka and Australia, Duckworth said.
His comments placed the Omega Traders’ investment within a broader commercial context: Australia brings agricultural production and established export capabilities, while Sri Lanka provides processing capacity, labour, market access and opportunities for further value addition.
The investment comes as Sri Lanka continues to look towards greater domestic processing and value-added manufacturing rather than relying solely on the import and distribution of finished commodities.
Dr. (Mrs.) Siddhika G. Senaratne, Director General/CEO of the Sri Lanka Standards Institution (SLSI), who attended the inauguration as Guest of Honour, highlighted the importance of quality assurance in food processing and the role of standards in maintaining confidence across the supply chain.
The facility is equipped with new-generation cleaning, processing, sorting and quality-control machinery, including advanced colour-sorting technology, automated systems and an in-house quality-control laboratory.
The additional capacity will support Omega Traders’ three principal Mysoor Dhal brands — Rainbow Jumbo Dhal, Komas Dhal and Rozanna Dhal — which serve different segments of the Sri Lankan market.
But the investment also has a distinctly local agricultural dimension.
Through its Orid Dhal operation, Omega Traders plans to source locally grown black matpe from Sri Lankan farmers and process it at the new facility.
That creates a domestic value chain linking farmers to industrial processing and consumers, while potentially increasing demand for locally produced agricultural commodities.
Duckworth said this type of business partnership could generate benefits for both countries.
‘Australia produces some of the world’s best agricultural products and we are very efficient and very capable at trading them. But that alone is not going to bring success to Australia. Just as building a factory like this is not going to bring success to Sri Lanka, he said.
‘It’s when we bring these entities together that our products produced in Australia can be processed in excellence here in Sri Lanka that enables this to be a success, the H.C. explained.
The investment therefore combines two complementary supply streams: imported agricultural commodities, including Australian-origin products, and locally produced black matpe for the Orid Dhal operation.
For Sri Lanka, the business significance extends beyond Omega Traders itself. Increased processing capacity creates demand for logistics, packaging, distribution, services and agricultural inputs, while supporting employment within the food-processing ecosystem.
HR-led transformation places people, culture and business performance at the heart of the organisation
Ideal Motors (Pvt) Ltd,has achieved a significant milestone by securing multiple prestigious workplace and organisational culture accolades in 2026, reinforcing its position as an employer of choice in Sri Lanka’s automotive sector.
Among its latest achievements, Ideal Motors has been recognised as one of the 20 Great Workplaces for Young Talent in Sri Lanka 2026, ranked No. 1 and awarded the Gold Medal in the Small and Medium category of Best Workplaces™ in Sri Lanka 2026, and ranked No. 18 among Best Workplaces™ in Asia in the Medium Scale category—the highest-ranked Sri Lankan organisation in the category. The company also received Industry Excellence for Workplace Culture – Trading Industry.
The Young Talent recognition was presented at the Great Place To Work® CXO Forum 2026 held on 10 September 2026 at Cinnamon Life, Colombo. The recognition followed an evaluation of more than 100 certified organisations and highlights workplaces that create meaningful opportunities for employees under 35 to develop, contribute and grow.
At the Best Workplaces™ in Sri Lanka Awards Gala 2026, held on 11 September 2026 at Cinnamon Life, Colombo, Ideal Motors achieved another historic milestone by entering the Best Workplaces Sri Lanka list for the first time and securing the No. 1 Gold Medal in the Small and Medium category. The company also achieved No. 18 in Best Workplaces™ in Asia, reflecting the strength of its workplace culture beyond Sri Lanka.
These achievements represent more than a collection of awards. They reflect the transformation taking place within Ideal Motors, where people, culture and business performance are increasingly viewed as interconnected drivers of sustainable growth.
Over the past few years, the organisation’s HR function has evolved from a predominantly administrative role into a strategic business partner, with greater emphasis on employee experience, capability development, engagement, performance, communication, wellbeing, diversity and inclusion, and data-driven HR practices.
The Automobile Association of Ceylon (AAC) conducted a seat belt safety awareness programme in front of its headquarters and along Galle Face Centre Road, encouraging motorists and passengers to make seat belt use a habit on every journey.
AAC staff, working alongside officers of the Sri Lanka Police Traffic Division, distributed specially designed hanging tags and stickers to drivers. The material carries a clear reminder that seat belts protect drivers as well as passengers in both the front and rear seats.
The public awareness drive was held ahead of the requirement taking effect on 20 September 2026, under which seat belt use becomes mandatory for every occupant of a vehicle travelling on an expressway.
AAC emphasized that the regulation should be understood as a life-saving measure rather than only a legal obligation. Wearing a seat belt can help prevent occupants from being thrown inside or from a vehicle during a collision and can lessen the severity of injuries.
The Association said road safety legislation must be supported by sustained public education, visible enforcement and responsible behaviour by all road users. The participation of the Traffic Police helped the campaign reach motorists directly in a busy part of central Colombo.
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