Business
National planning comes centre stage at Gamani Corea Foundation forum
By Lynn Ockersz
‘Sri Lankans are very good at writing plans but nothing very positive has resulted from these efforts over the years. Nevertheless, the country needs a new system of planning and an essential requirement for this is a sound institutional framework coupled with good governance, chairman of the Gamani Corea Foundation (GCF) and a former Director of National Planning Dr. Lloyd Fernando said.
Dr. Fernando was addressing a GCF-initiated and organized symposium on national planning at the BMICH on March 19 titled, ‘Discourse on Lessons Learned through National Planning – The Past, the Present and the Future.’ The wide-ranging and well attended forum brought together policy planners, decision-makers, senior public servants, prominent politicians and thought leaders, among others, who count vitally in national affairs.
A principal aim of the forum was to impress on political parties and their leaders the crucial importance of including national planning in a major way in their manifestoes, now that they are gearing-up for elections expected to be held sometime this year. It was hoped that national planning would underpin all efforts at developing the country.
Among other things, the following matters were mentioned by Dr. Fernando: ‘The 9cs are the backbone of good governance, without which national advancement is unthinkable. Figuring among the Cs are: Participation, Consensuality, Accountability, Transparency, Equity and Inclusiveness, Rule of Law and Strategic Vision.
‘Sections, such as the state, the public sector, the private sector and civil society must work together to bring about economic growth and development, based always on good governance.
‘We need a planned, disciplined approach in taking the country forward. It is crucial that state actors work closely with each other. This applies in particular to the Cabinet, the Planning Council and the Defence establishment. At the end of the day, we need an Administrative Reforms Council. The latter will need to bring under its purview: recruitment policies, minister-Secretary relations, training of public cadre, performance appraisal of state agencies and rewards for performance by public officials.’
‘It is hoped that political leaders would take cognizance of these needs, going forward.’
Speaking on the subject of ‘National Planning Yesterday’, former Governor of the Central Bank of Sri Lanka (CBSL), Dr. Indrajith Coomaraswamy stated the following, among other things: ‘The most comprehensive national development plan to date was formulated under Dr. Gamani Corea in the early fifties. In 1965, the Ministry of National Planning was launched. It discussed all operational aspects in national planning. While a 5 year development plan was initiated in the early seventies to essentially address the issues raised by the youth insurrection of 1971, national planning went out of vogue, as it were, with the liberalization of the economy in 1977. However even in those times, the Dept. of National Planning played a key role.
‘We need to get back to the Committee of Development Secretaries of the seventies which played an important function in development. Besides, it must be ensured that development projects are always in keeping with national priorities.’
Some key points made by CBSL Governor Dr. Nandalal Weerasinghe in his presentation, ‘A Macroeconomic Framework for the Future’, were as follows: ‘In some past times, monetary policy was allowed to be dominated by fiscal policy. This played a role in precipitating our current economic woes.
‘We have a stronger Central Bank now but a huge problem arises when national policies change with the changing of governments. Debt sustainability is crucial, going forward.
‘We need to independently assess the election manifestoes of political parties with regard to their financial feasibility. Likewise, we need a framework for public financial accountability. An institution with proper skills needs to be set up for this purpose. A debt management unit too is a crucial need.’
Director General of National Planning, R.H.W.A. Kumarasiri making an initial and comprehensive presentation titled, ‘National Planning Today’, drew the attention of the audience, among other issues, to the vital importance of a ‘Public Financial Bill’. This is central to state financial discipline.
During Q&A, Eran Wickremeratne M.P. made the following points: ‘Over the past 40 years, the local public sector has been destroyed. This sector must be independent of politicians. Recruitment to the public sector must be in the hands of public servants. We need to invest heavily in the training of public officials. Politicians should not decide on capital expenditure but we need a robust planning process.’
Business
Industry and Entrepreneurship Development Minister Handunneththi’s visit to Lumala highlights key industrial concerns
With the aim of assesing the current challenges faced by local industrialists and explore avenues for government support, Minister of Industry and Entrepreneurship Development Hon. Sunil Handunneththi visited City Cycle Industries Manufacturing (Pvt.) Ltd., widely known as Lumala, on March 24 at its factory in Panadura.
During the visit, Minister Handunneththi engaged with senior officials and employees to understand their concerns and operational difficulties. In a statement shared on social media, the Minister acknowledged the pressing challenges affecting Sri Lanka’s manufacturing sector and emphasized the government’s commitment to providing swift and effective solutions.
Minister Handunneththi further reiterated the government’s intent to position local manufacturers as key stakeholders in Sri Lanka’s economy by addressing regulatory hurdles, market imbalances, and supply chain constraints.
The visit comes amid growing concerns from Lumala employees and management regarding the state of Sri Lanka’s bicycle manufacturing industry, in the backdrop of facing significant challenges, including an influx of imported bicycles and components that circumvent regulatory checks. In addition, the high taxes on raw materials used in local manufacturing has further exacerbated production costs, making it difficult for domestic manufacturers to remain competitive.
Earlier this year, Lumala employees called for urgent government intervention to address these challenges, warning that ongoing financial strain could lead to further shutdowns of critical production units, job losses, and setbacks to the broader industrial ecosystem. With a local value addition of 50-70 percent verified by the Ministry, its workforce remains hopeful that government action will help achieve an ethical manufacturing industry.
Lumala, a household name in Sri Lanka’s bicycle industry, has been a key player in sustainable mobility solutions for over 35 years. The company was recently honored with the Best National Industry Brand award under the Large-Scale Other Industry Sector category at the National Industry Brand Excellence Awards 2024.
With a production capacity of 2,000 bicycles per day and a workforce of 200, Lumala continues to cater to both domestic and international markets, producing a diverse range of bicycles, electric bikes and light electric vehicles. In line with Sri Lanka’s goal to expand forest cover to 32 percent by 2030 and cut GHG emissions by 14.5%, Lumala is actively contributing to this mission—both as a company and through its diverse range of products.
As Sri Lanka works towards strengthening its local manufacturing sector, Minister Handunneththi’s visit signals a crucial step toward addressing industrial concerns and reinforcing government support for sustainable and competitive domestic production.
Sri Lanka’s country rating was upgraded from ‘Restricted Default’ to ‘CCC’ following the successful exchange for the new International Sovreign Bonds (SL ISBs) during December 2024. The three types (03) of exciting new sovereign bonds have restored foreign investor confidence.
The Central Bank of Sri Lanka (CBSL) has performed a remarkable role in guiding the economy out of default status and restored economic stability, and gained Sri Lanka a non-default Country Rating of ‘CCC’. Among the key achievements of CBSL, have been to reduce treasury interest rates under 9% and stabilize the currency while rebuilding foreign reserves to $ 6Bn.
SL offers four Macro Linked Bonds (MLBs) linked to GDP growth, a Governance Linked Bond (GLB) and a short term, Fixed Coupon Bond for unpaid Past Due Interest (PDI). The MLBs offer variable returns depending on SL’s GDP growth from 2024 to 2027, (e.g. haircuts can vary between 16% to 39%). The GLB interest can vary depending on meeting 15.3% and 15.4% of Total Revenue/ GDP thresholds in 2026 and 2027 respectively. The PDI bond offers a fixed coupon of 4% until 2028 and trades at around $94.
This combination of unique, variable returns offers global investors an exciting opportunity to capitalize on SL’s economic revival and US interest rate movements. Sri Lanka’s economic resurgence in 2024 was promising, with a 5% GDP growth rate. With improving investor confidence, SL ISB daily turnover now exceeds $10mn.
The Ceylon Dollar Bond Fund (CDBF) is the only USD Sovereign Bond Fund that is exclusively invested in SL ISBs with Deutsche Bank acting as the Trustee and Custodian Bank. The Fund reported returns of 53% in 2023 and 39% in 2024.
We invite foreign investors to enter CDBF while Sri Lanka is rated at ‘CCC’ and consider realizing their investment upon SL reaching a Country Rating of ‘B- ‘. Other advantages of CDBF are, the ability to withdraw anytime and being tax exempted.
Ceylon Asset Management (CAM), the Fund Manager, has commenced an advertising campaign to promote the CDBF to the Sri Lankan Diaspora, South Asian, Middle Eastern and Australian Investors. CAM is an Associate Company of Sri Lanka Insurance Corporation (SLIC) and licensed under the Securities and Exchange Commission of Sri Lanka Act, No. 19 of 2021.
Meanwhile, the Ceylon Financial Sector Fund managed by CAM emerged as the top performing rupee fund in Sri Lanka during 2024, with a return of 64%. Investors can find out more on www.ceylonassetmanagement.com or write to us on info@ceylonam.com.
Past performance is not an indicator of the future performance. Investors are advised to read and understand the contents of the KIID on www.ceylonam.com before investing. Among others investors shall consider the fees and charges involved.(CAM)
CSE plunged at open, falling for the second consecutive day yesterday, down over 300 points in mid- morning trade.US President Donald Trump has imposed a 44 percent tax on Sri Lanka’s exports in an executive order which he claimed, spelt out discounted reciprocal rates for about half the taxes and barriers imposed by the island on America.
As a result both indices showed a downward trend. The All Share Price Index dropped 300 points, or 2.32 percent, to 15,294.94, while the S&P SL20 dropped 101 points, or 2.71 percent, to 4,517.37.
Turnover stood at Rs 3.1 billion with six crossings. Those crossings were reported in Sampath Bank which crossed 1.6 million shares to the tune of Rs 181 million and its shares traded at 109, JKH 4.1 million shares crossed to the tune of 80.5 million and its shares sold at Rs 19.5.
Hemas Holdings 400,000 shares crossed for Rs 45.6 million; its shares traded at Rs 114, CTC 25000 shares crossed to the tune of Rs 32.2 million; its shares traded at Rs 1330, Commercial Bank 200,000 shares crossed for 27 million; its shares traded at Rs 135 and TJ Lanka 157,000 shares crossed for Rs 20 million; its shares traded at Rs 46.
In the retail market top six companies that have mainly contributed to the turnover were; Sampath Bank Rs 296 million (2.9 million shares traded), JKH Rs 220 million (11.2 million shares traded), Haylays Rs 195 million (142,000 shares traded), HNB Rs 151 million (519,000 shares traded), Commercial Bank Rs 138 million (1 million shares traded) and Central Finance Rs 129 million (735,000 shares traded). During the day 218 million shares volumes changed hands in 22000 transactions.
It is said the banking sector was the main contributor to the turnover, especially Sampath Bank, while manufacturing sector, especially JKH, was the second largest contributor.
Yesterday, the rupee opened at Rs 296.75/90 to the US dollar in the spot market, stronger from Rs 296.90/297.20 on the previous day, dealers said, while bond yields were up.
A bond maturing on 15.10.2028 was quoted at 10.35/40 percent, up from 10.25/30 percent.
A bond maturing on 15.09.2029 was quoted at 10.50/60 percent, up from 10.45/55 percent.
A bond maturing on 15.10.2030 was quoted at 10.60/70 percent, up from 10.30/65 percent.
By Hiran H Senewiratne
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