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Stopping subsidies, refraining from funding SOEs seen as essential for economic recovery

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Prof. Grant Spencer

By Hiran H. Senewiratne

The main elements of any market-based financial system are to restore confidence in it by correcting current imbalances, reducing the vulnerabilities of the financial system to further shocks and implementing finance and economic reforms. However, it is most crucial that the government stops providing subsidies and refrains from funding state-owned enterprises, former Acting Governor of the Reserve Bank of New Zealand Prof. Grant Spencer said.

“Apart from that other key elements would be to remove short-term emergency restrictions and improve the long- term economic performance of Sri Lanka, Prof. Spencer said during a special lecture titled, “Key Elements of a Market-based Financial System”, conducted on November 1, at the Central Bank of Sri Lanka auditorium.

Prof. Spencer added: ‘At this juncture a simplified and uniform tax system is important by targeting the most needy segments in the country, which system is now being slowly and steadily implemented by the Sri Lankan government as a recommendation of the IMF.

‘It is necessary to put public sector finances on a sustainable footing, while restructuring the external debt. An independent Central Bank is a prerequisite. This is needed for improving the resilience of the banking system. Because the Central Bank must earn trust and confidence from the government and financial markets.

‘To put public sector finances on a sustainable footing, it is required to reform the tax base, particularly for direct income taxes, thereby simplifying the tax rules by removing exemptions.

‘Moreover, it is important to stop subsidies and cheap loans to favoured sectors, restrict growth in government spending with targeted assistance to the most needy and set clear and achievable fiscal objectives.

‘International creditors must agree to a haircut and lengthened debt maturities, whilst clearing the way for the IMF programme with money going to current uses rather than repayment of existing loans.

‘There is a need to commit to an independent accountable Central Bank. To this end, it is essential to pass the new Central Bank Act which will help to ensure price and financial stability over the long- term.

‘An Independent CBSL with government agency functions removed, will help to ensure that public finances remain in balance.

‘It is essential for vulnerable banks to bolster their balance sheets potentially through mergers and the Central Bank needs to prepare contingency plans for potential banking sector stress.

‘Correcting the fiscal imbalance, stabilizing the external debt, creating an independent CBSL and ensuring resilience of the banking system will help to restore international and domestic confidence in Sri Lanka’s future.

‘It is important to reduce the risk premium in Sri Lanka’s interest rates and exchange rate, encourage a recovery of remittances and return of capital into the country and encourage the re-opening of capital markets.’



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SLT-MOBITEL driving Sri Lanka’s economic resilience through digital infrastructure

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SLT-MOBITEL marks its triple triumph at the National Business Excellence Awards 2026

Corporate accolades underscore the alignment between its operational excellence and national development

In an era where national competitiveness is intrinsically tied to digital connectivity, strengthening the country’s digital backbone has become an urgent priority. Within this context, the evolving role of Sri Lanka’s leading telecommunications provider, SLT-MOBITEL, offers valuable insight into how technological infrastructure can underpin broader economic resilience.

Telecommunications and digital networks are foundational to economic transformation. By expanding high-speed broadband access, upgrading enterprise cloud capabilities, and bridging the urban-rural connectivity divide, SLT-MOBITEL helps reduce business transaction costs, streamline supply chains, and enable micro, small, and medium enterprises to reach global markets.

Recent corporate accolades further underscore this alignment between operational excellence and national development. SLT-MOBITEL’s triple triumph at the National Business Excellence Awards 2026 – winning in the Infrastructure and Utilities sector, Performance Management, and ICT Services categories – highlights its growing impact. Notably, the recognition of eChannelling’s contributions to digital healthcare reflects a broader strategic pivot toward integrated technology solutions.

“Institutional efficiency of this nature is critical for attracting foreign direct investment, as global partners increasingly assess a country’s digital maturity and systemic stability before committing capital,” noted industry observers.

Moreover, the company’s transition from a conventional telecom utility to a comprehensive digital solutions provider aligns seamlessly with Sri Lanka’s national digitalisation agenda. As the country pursues public sector modernisation, enhanced e-governance, and a competitive knowledge economy, the private sector must step up to deliver secure, scalable, and future-ready networks. Investments in data centres, cybersecurity frameworks, and advanced ICT infrastructure act as strategic buffers, ensuring that Sri Lanka’s economic apparatus remains agile and resilient amid future global uncertainties.

However, industry experts caution that while these achievements are commendable, SLT-MOBITEL still has a considerable distance to cover in fully enabling a truly digital economy.

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Port City Colombo strengthens Gulf investment ties at Dubai diplomatic engagement

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The panel discussion at the engagement

Port City Colombo (PCC) took a prominent role as Platinum Sponsor at the second edition of Sri Lanka Beyond Your Dreams, a high-level diplomatic and investment engagement hosted by the Consulate General of Sri Lanka in Dubai and the Northern Emirates. The event, held on 2nd September 2026 at the Hilton Dubai Al Habtoor City, brought together over 400 senior UAE-based business leaders, investors, diplomats, and institutional stakeholders, alongside Sri Lanka’s most senior government representatives.

The gathering was graced by Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister of Foreign Trade, as Guest of Honour, and Vijitha Herath, Sri Lanka’s Minister of Foreign Affairs, Foreign Employment and Tourism. A high-level Sri Lankan delegation – including the Secretary to the Prime Minister, the Chairman of the Board of Investment, the Chairman of the Export Development Board, and the Director General of Commerce – underscored the government’s strong commitment to deepening economic diplomacy with the UAE.

In his keynote address, Minister Herath reaffirmed the centuries-old ties between Sri Lanka and the Arab region, emphasising the UAE’s vital role as a key economic partner. He stressed the urgency of finalising a Comprehensive Economic Partnership Agreement (CEPA) with the UAE, which would establish a robust framework to elevate trade, investment, and bilateral cooperation. Declaring Sri Lanka “open and ready for business,” he positioned Port City Colombo as the physical embodiment of this economic mission – a modern Special Economic Zone (SEZ) with a dedicated legal framework and competitive incentives, offering UAE investors a natural gateway to South Asia while maintaining strong Gulf connectivity.

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American Premium Water strikes Gold at Dragons of Sri Lanka 2026

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The achievements are particularly significant given that the company’s debut at the Dragons awards has resulted in four Dragons across four categories.

American Premium Water has secured four wins at Dragons of Sri Lanka Awards 2026, including three Gold Dragons and one Black Dragon, marking a significant milestone for the brand following its relaunch last year.

Part of the prestigious Dragons of Asia awards, Dragons of Sri Lanka brings the program’s regional platform to the local market, celebrating creative and effective marketing communications, with entries evaluated on strategic thinking, creativity, execution and impact. Established in 2000, Dragons of Asia is one of Asia’s premier results-driven marketing awards programs.

For American Premium Water, the achievements are particularly significant given that the company’s debut at the Dragons awards has resulted in four Dragons across four categories. In the distinction of Gold Dragons, American Premium Water was recognized across three categories including Product Launch or Re Launch, Cause, Environment or Sustainability and Creative Excellence while the Black Dragon was awarded in recognition of Small Budget.

Competing alongside leading brands and agencies in Sri Lanka, American Premium Water’s four wins demonstrate the strength and effectiveness of its recent work. Winning three Gold Dragons across three distinct categories highlights the breadth of the brand’s achievements, while the Black Dragon for Small Budget further emphasizes its ability to create meaningful impact through focused and efficient investment.

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