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Growing concerns about rapidly increasing government securities held by Central Bank

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by Sanath Nanayakkare

The Central Bank was again forced to pump massive amounts of liquidity into the government, as the state coffers were running dry as the authorities reimposed travel restrictions and state tax revenue took another beating, analysts say.

According data, the Central Bank holdings of government securities or the printed money stock had surged by Rs.34.51 billion since travel restrictions came into effect on May 21 through June 18, 2021, bringing the total outstanding printed money stock to Rs.896.24 billion, they say.

“Now there is serious concern about growing holdings of government securities by the Central Bank, which is also referred to as printed money in the system by certain quarters as excessive liquidity has the effects of destabilising economy by stoking inflation, balance of payment crises and asset bubbles. However, the proponents argue that the economy, which is significantly battered by the virus, can and should be supported through easy money, until it reaches its equilibrium as the economy still remains subdued. And the Central Bank has repeatedly said it was willing to take its foot off the gas if it saw significant excesses as a result of the current monetary policy.”

“As the government will continue to have to rely on the Central Bank liquidity amid depleted tax revenues, it could keep the domestic interest rates low to support the government financing as well as to support lending to the private sector.”

“On the other hand, the government, which has limited options to raise foreign currency funding to bridge its budget gap, could also resort to the banking sector for borrowings, potentially leaving less money for the private sector – a scenario known as ‘crowding out effect’, albeit the possibility remains less of that happening, they said.

Sri Lanka is bracing for back-to-back years of blow out budget deficits in 2021, potentially reaching double-digit levels as a percentage of its gross domestic product (GDP) as it crimped its revenues through lockdowns while confronting with unexpectedly high expenditure on virus containment measures. 

The fiscal deficit can also look higher than it actually appears when the output gets compressed as authorities have lost nearly a trillion rupees in GDP since April 23, 2021. they say.

 

 



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IIHS expands global nursing pathways

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Dr. Renuka Jayatissa and Dr. Kithsiri Edirisinghe speaking to the media

The International Institute of Health Sciences (IIHS) Multiversity is expanding its international education programmes with the aim of creating overseas employment opportunities for Sri Lankan nurses and allied health professionals while contributing to foreign exchange earnings.

Speaking to the media during a conference at IIHS Multiversity in Kerawalapitiya, Dr. Kithsiri Edirisinghe, CEO, Co-Founder and Dean of IIHS aid that the institute has established academic partnerships with overseas universities and higher education institutions, including the University of Surrey in the UK, Deakin University in Australia, Metropolia University of Applied Sciences in Finland, Asia e University in Malaysia and SUNY Canton in the United States.

Under its ‘Study in Sri Lanka, Graduate to the World’ model, students can complete foundational and diploma-level qualifications locally before progressing to international top-up degrees or overseas employment.

Dr Edirisinghe said the model could substantially reduce the cost of obtaining internationally recognised qualifications. It estimates that completing a four-year bachelor’s degree at the University of Surrey in the UK would cost about USD 145,700, including tuition and living expenses, compared with about USD 27,750 through the IIHS pathway in Sri Lanka.

Dr Edirisinghe said the institute’s focus on overseas deployment addressed both Sri Lanka’s economic needs and the growing global demand for healthcare workers.

“Our winning model is producing job-ready, registration-ready healthcare professionals who can seamlessly enter foreign healthcare systems,” he said.

IIHS, which began operations in 2002 as the American College of Health Sciences, established its institutional base in Welisara in 2008 and launched its purpose-built greenfield multiversity campus in 2023.

The institute said it has upgraded the qualifications of more than 5,000 government nurses, supported over 2,500 youth on international employment pathways and trained more than 1,000 allied health professionals. It has also carried out over 250 community health projects.

The institute has identified Germany and Japan among its target markets, with pathways planned for 2,000 nurses for Germany and a one-year preparation programme linked to around 4,000 healthcare positions in Japan.

Dr. Renuka Jayatissa, Vice-Chancellor and a specialist medical doctor, said demographic changes and the growing burden of non-communicable diseases were changing healthcare requirements in Sri Lanka.

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Sampath Bank launches Sri Lanka’s first community-powered book discovery platform at Colombo International Book Fair

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Sampath GPay customers can enjoy 25% cash back on Book Fair purchases

Sampath Bank PLC has launched Sampath Book Finder, Sri Lanka’s first community-powered book discovery platform, giving visitors to the Colombo International Book Fair a faster and more seamless way to find the books they are looking for across the fair’s 150+ stalls, while also opening up new opportunities to discover titles recommended by fellow readers.

Introduced on the opening day of the Colombo International Book Fair on 25 September, Sampath Book Finder brings together digital innovation and the collective knowledge of readers to address a familiar challenge at one of Sri Lanka’s largest literary gatherings, where the scale of the fair can make locating a particular title a time-consuming exercise. When a book proves difficult to locate, visitors can access bookfairtracker.com or scan the designated QR code and submit a request to the community, allowing readers who have already spotted the title to share its location and help others find it without having to search stall after stall.

Commenting on the initiative, Milinda Weerasinghe, Chief Marketing Officer, Sampath Bank PLC, said, “At Sampath Bank, we believe meaningful innovation begins by identifying everyday challenges and creating solutions that make a real difference. Sampath Book Finder brings this thinking to the Colombo International Book Fair by turning the collective knowledge of readers into a real-time digital solution, empowering them to find what they are looking for, discover something new and help others do the same, while making the overall experience more convenient and connected.”

The platform also turns book discovery into a shared experience, allowing visitors to recommend books they encounter by sharing the title, publisher, hall and stall number, which enables fellow readers to discover sought-after titles and recommendations while making it easier to locate them within the fair.

Sampath Bank’s longstanding association with the Colombo International Book Fair also continues in 2026, marking more than 20 years of partnership, with the Bank serving as the Official Banking Partner for this year’s fair. As part of its presence at the event, SampathCards offer 25% cashback for Sampath GPay customers on their purchases and 3 months 0% instalment plans for book purchases via Sampath credit cards, while visitors can also access banking services through the Bank’s physical presence at the fair. Customers registering to open selected Fixed Deposits at the premises will receive an additional 0.25%, adding further value and convenience for visitors.

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CEAT expands premium retail network with Kurunegala outlet

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Senior management representatives of CEAT Kelani and Sumidag at the opening of the new outlet

CEAT Kelani Holdings has expanded its premium retail network with the opening of a new Shop-in-Shop (SIS) outlet, Sumidag Prime, on Negombo Road, Kurunegala.

Located near Welagedara College in Malkaduwawa, the outlet is the company’s 14th SIS premium outlet in Sri Lanka and is aimed at providing customers in the North Western Province with access to CEAT’s tyre range and professional vehicle servicing.

The new outlet marks an expansion of the longstanding partnership between CEAT and Sumidag, which was established by Ajith Karunarathna in 1986. The business joined CEAT soon after the tyre brand entered the Sri Lankan market and has since become a leading dealer and two-wheeler tyre distributor in the Kurunegala region.

The outlet, led by the next generation of the Karunarathna family under Chamod Karunarathna, features dedicated CEAT branding, upgraded interiors, tyre display racks and a customer lounge.

Customers can access a range of CEAT tyres as well as services including nitrogen and air inflation, wheel alignment and balancing, camber and caster adjustment. The outlet also offers alloy wheels and batteries.

CEAT Kelani said the SIS concept was part of its strategy to strengthen its regional retail presence while helping dealer partners provide a more professional and convenient customer experience.

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