Business

Price-gouging, a double whammy to consumers

Published

5 years ago

2021/12/17

By Claude Gunasekera

The prevalent Price Gouging of almost all the goods in the country has created a double whammy to the citizens of Sri Lanka despite their hardship with Covid-19 pandemic. Price gouging is illegal during a state of emergency in the laws of consumer protection. Some countries even without laws, issue executive orders to prohibit the action during times of emergency or during a pandemic.

Consumer prices hiked at a faster pace than never before. Except for very few locally produced food & household items and some pharmaceutical, all the other prices have increased. Despite the import restrictions, all items that are permitted to import are in unaffordable prices, including products that are locally manufactured with imported raw material. Even the 100% local produce have increased their prices due to the price increase of Petroleum, Gas and other production overheads add on to it keeping additional margins on the increased cost of living.

“30 percent of Fast Moving Consumer Goods (FMCG) in a retail store is complete direct imported products and 35 percent of local products dependent on imported raw material and the rest of 35 percent only considered complete local produce. The Price Crisis is mainly with the first and second categories consisting most demanding essential goods, which is 65 percent of regular day to day consumer needs. Meanwhile prices are increased for at least another 20 percent of local produce in the complete local produce category. It is estimated that around 85 percent of consumer goods are increased in price” said Charitha Subasinghe, President- Retail at John Keells Holdings PLC, Head of Keells Super Retail Chain. He said Inflation is a biggest challenge globally and Sri Lanka has its own foreign exchange issues and import restrictions thus creating a spike of price and product shortages.

Glenfrey De Mel, Chairman Star Media Network, a graduate of the Colombo Law Faculty who is engaged in Human Rights claimed that “It is a democratic right of the masses to have a purchasing power over essential commodities while human life and the price of essentials are closely related. When prices of essentials become incompatible with the financial well-being of the people, there is no end to the agony of the poor and under privileged families”.

“The present government failed to take right decisions, at right time, to control the existing price gouging. The government failed to implement appropriate policies to balance the economy and control the cost of living of the masses. A few Big Traders dominate the entire imports of essential commodities and control the whole national market with unethical influence of the government. The government supports them for political gains without even considering the majority of their voters who elected them. Therefore, the government is solely accountable for this stern blunder” said Dinusha Sampath Liyanage, Chairman / Managing Director of Sampath Group of Companies, the holding entity of ‘Sampath Food City’ Supermarket Chain. He told ‘The Island’ that people’s elected government is responsible to provide necessary needs of the citizen especially the essential foods and services at an affordable price and create a balance between income and purchasing power while maintaining an acceptable inflation rate.

Liyanage further told ‘The Island’ that instead making allegations to the government or to the big trader, as an entrepreneur engaged in the retailing business, he could offer maximum possible discounts at all 20 outlets of the ‘Sampath Food City’ Supermarket chain at this crucial juncture as a concession to all walk in customers. He said profits are required for survival of a business, but profitability is not the prime aim at this moment since he realizes the anguish of the innocent consumer. Sampath Supermarket chain is the leading retail network in the Kalutara District with a large customer base over 250,000 patronizing their outlets. He said certain fruits and vegetables that are sold in his supermarkets are direct from his own farms and since there is no intermediary trade margins involved they could pass on that price benefit to the customer under the theme ‘Direct from Farm to the Consumer Hands’. “We are unique compared to other retail chains, since we offer discounts to all the products available in house. We offer 25% discount on fruits & vegetables and many other special discounts time to time on main essential goods such as rice, wheat flour, sugar, dhal, onion, potato, milk powder, biscuits etc.

A. B. Wijesinghe, Chairman ‘Lion Super’ retail chain, functioning 7 supermarkets in the outskirts of Kandy told ‘The Island’ “We pitch a different customer segment than the national supermarkets does. Our primary concern is the low and middle income ordinary consumer in the neighborhood simply the ‘villagers’ with a focused brotherhood relationship approach with a personalized service. He said they are catering to them with much understanding of their purchasing power and offer the best possible prices even less than the neighboring retail store. He also said the lowest price theory began not during this crisis period, but the core objective of setting up the original ‘Singhe’ retail chain was to offer the lowest price in the market. He continues to move on the same mission under the new brand of Lion Supermarkets.

“We operate 7 supermarkets in the outskirts of Kandy and launched a ‘Double Discount’ offer at all our outlets as a special concession to deprived customers during this hard time, offering extra discounts for many products through the support of our supply chain. We were able to negotiate additional discounts from most of the suppliers and offered the whole chunk direct to our customers. We are able to make our customers much satisfied and appreciated with this massive price decrease concept” said Indika Sampath, Head of Operations ‘Lions Super’.

In addition it was found all the modern trade retailers such as Lanka Sathosa, Cargills Food City, Keells Super, Laugfs Supermarkets, Arpico Super Centers, Glomark, Spar, Salinda Supermarkets, Hewage Supermarkets and many others are offering attractive discounts to their customers. Some may look at it as they do a business promotion but yet ultimately customers will benefit by their offers resulting in some what a concession at this crucial time.

“We service number of retail outlets in the country with a range of local consumer food products. We don’t produce or distribute a single imported product, but the sales turnover is dropped by 40 percent during the month of November. Products that were supplied in the previous months were still lying at retail shelves as never before. This clearly shows the inability of consumers to spend. We see the people are buying only the most important items to survive the day. Most people have reduced their usual consumption due the high cost of living. We are even struggling to operate our factories and it’s a question how we could continue to run the business and remunerate our factory workers and it’s time to retrench staff and cut down our overheads” said Jayantha Perera Chairman ‘Jayz Kitchen’ a leading manufacturing venture of spice food.

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Business

‘First major legal reset on environmental protection in 38 years’

Published

15 hours ago

2026/06/25

Sahan Weerasooriya

Prof. Tilak Hewawsam: ‘Milestone reached.’

Parliament yesterday took up for debate and vote a sweeping overhaul of Sri Lanka’s main environmental law, in what the Central Environmental Authority (CEA) hopes will become the country’s first major legal reset on environmental protection in 38 years.

The National Environmental (Amendment) Bill, taken up for its final reading in the House, is being seen by environmental officials as a critical attempt to modernise an outdated legal framework that has struggled to keep pace with mounting pollution, hazardous waste, ecological degradation and the environmental fallout of unplanned development.

In a sign of the importance attached to the Bill, senior CEA officials remained in parliament throughout the day as the debate unfolded, amid growing expectations within the environmental sector that the revised law would strengthen the Authority’s hand in regulation, enforcement and environmental planning.

CEA chairman Prof. Tilak Hewawasam described yesterday as a “very special day” for the Authority and said the proposed amendments were long overdue.

“Yesterday was a very special day for the Central Environmental Authority. The Bill to amend the National Environmental Act was read in parliament for the final time, debated and voted on. This was the third revision of the Act and came 26 years after the previous amendment. While the 2000 revision was only a minor one, the 1988 amendment was a comprehensive reform that provided the legal framework and tools such as the EPL and EIA for environmental protection and environmental management in Sri Lanka. After 38 years, another comprehensive revision has now been proposed to Parliament, Hewawasam told The Island Finacial Review.

He said the CEA leadership and senior staff had closely followed the proceedings, hopeful that parliament would clear the Bill and pave the way for a stronger legal framework for sustainable development.

“We were very eager to see this revised Act passed and enacted by parliament, as it will provide the legal framework needed to drive and accelerate the country’s sustainable development, he said.

The push for reform comes at a time when the country’s environmental governance framework is under increasing strain from industrial pollution, mounting solid waste, chemical hazards, encroachment into environmentally sensitive zones and the widening conflict between economic activity and ecological safeguards.

Environmental officials say the revised law is intended to close long-standing legal and institutional gaps that have weakened environmental enforcement and slowed regulatory action.

Among the major changes proposed are provisions to legally recognise Strategic Environmental Assessments (SEA), strengthen the CEA’s authority to issue binding orders instead of merely recommendations, tighten controls on hazardous waste and chemicals, expand producer responsibility in waste management, and empower authorities to act more decisively against unauthorised constructions and environmentally harmful activities in protected and ecologically sensitive areas.

By Ifham Nizam

Business

La Serena marks Vesak with evening of Bhakthi Gee and reflection

Published

15 hours ago

2026/06/25

Sahan Weerasooriya

Residents of La Serena recently came together in a spirit of quiet reflection and shared devotion for a Vesak Bhakthi Gee recital, transforming the serene beachfront setting into an evening of song, mindfulness and gentle celebration.

The programme, organised for residents and invited guests, featured a collection of Buddhist devotional songs that captured the essence of Vesak, fostering a sense of inner peace and spiritual fulfilment. Voices joined in harmony, creating a deeply moving atmosphere rich in meaning and memory.

With around 60 per cent of La Serena residents being expatriate Sri Lankans, the event was particularly evocative. One resident observed that having lived overseas for many years, they had missed Sri Lankan cultural and religious celebrations, making the celebration especially meaningful.

Beyond the music, the gathering strengthened the bonds of community that define life at La Serena, encouraging connection, conversation and companionship among residents. Rooted in Sri Lankan cultural and religious tradition, the event reflected the resort’s commitment to enriching emotional and spiritual well-being through thoughtfully curated experiences.

La Serena is a purpose-built beachfront retirement resort in Uswetakeiyawa, offering a secure and dignified environment for assisted living. Combining the privacy of independent living with access to personalised care and shared amenities, it fosters a vibrant, connected lifestyle where residents can enjoy comfort, companionship and peace of mind.

Business

Sarvodaya Development Finance records strong FY2025/26 performance, reinforcing growth

Published

15 hours ago

2026/06/25

Sahan Weerasooriya

Sarvodaya Development Finance PLC (SDF) delivered a strong financial performance for the year ended 31 March 2026, recording significant growth in income, profitability, portfolio expansion, and asset quality while continuing its commitment to responsible and inclusive finance.

For the financial year under review, SDF reported total income of LKR 6.42 billion, a year-on year increase of 46.8%. Interest income rose by 43.8% to LKR 5.85 billion, driven by business expansion and growth in earning assets. Net Interest Income increased by 35.4% to LKR 3.58 billion, while Total Operating Income grew by 40.8% to LKR 4.15 billion, reflecting the Company’s ability to generate strong and sustainable earnings.

Profitability improved substantially during the year. Operating Profit before Tax on Financial Services increased by 59.9% to LKR 1.82 billion, while Profit Before Tax rose by 63.8% to LKR 1.36 billion. Profit for the Year increased by 73.1% to LKR 820.1 million compared with LKR 473.8 million in the previous year. Earnings per share improved to LKR 5.48, demonstrating enhanced value creation for shareholders.

The Company’s balance sheet expanded significantly, with total assets increasing by 65.8% to LKR 37.37 billion as at 31 March 2026. Financial assets at amortized cost, including loans and receivables, grew by 67.2% to LKR 20.60 billion, while lease rental receivables increased by 34.0% to LKR 9.19 billion. SDF also strengthened its funding profile through debt securities, including Sustainable Bonds, amounting to LKR 2.09 billion.

Commenting on the performance, Chief Executive Officer, Nilantha Jayanetti stated, “The results achieved during FY2025/26 reflect the strength of our business model, disciplined growth strategy, and commitment to delivering responsible financial solutions. We remain focused on creating sustainable value while supporting communities and enterprises across Sri Lanka.”

SDF maintained a strong capital position, with a Tier 1 Capital Adequacy Ratio of 15.48% and a Total Capital Adequacy Ratio of 22.13%, both comfortably above regulatory requirements. Asset quality also improved, with the Gross Stage 3 Loans Ratio declining to 4.93% from 7.88% and the Net Stage 3 Loans Ratio improving to 2.94% from 5.70%. The Stage 3 Impairment Coverage Ratio strengthened to 42.60%.

Operational efficiency improved as the Cost-to-Income Ratio reduced to 42.99%, while Return on Equity increased to 19.60%. Reflecting its stronger financial position, SDF’s external credit rating was upgraded to Lanka Ratings (SL) BBB- Stable.

With a network of 56 branches, SDF remains committed to advancing financial inclusion, supporting sustainable enterprise growth, and contributing to Sri Lanka’s long-term socio-economic development.