Business
Sri Lanka’s economy on Y-o-Y growth expansion of 5.3 percent – CBSL Governor
By Hiran H.Senewiratne
The Sri Lankan economy expanded for the third consecutive quarter in the first quarter 2024, with a year-on- year real growth of 5.3 percent, as per the estimates, Central Bank Governor Dr Nandalal Weerasinghe said.
‘The rebound in domestic economic activity is expected to sustain, buoyed by the transmission of relaxed monetary policy to broader market interest rates, enhanced supply conditions, the gradual rebound in external demand conditions, revival of tourism and the dissipation of uncertainties surrounding debt restructuring, Dr Weerasinghe told the press briefing following CBSL’s monthly monetary policy review meeting. The event was held at Central Bank head office in Colombo.
Dr. Weerasinghe added: ‘In consideration of the current and expected macroeconomic developments highlighted above, and with due regard to the domestic and global uncertainties, the CBSL decided to reduce the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank by 25 basis points to 8.25 per cent and 9.25 per cent, respectively.
‘CBSL underscores the need to signal its desire to continue easing monetary conditions to sustain revival of economic activity, in the absence of significant inflationary pressures.
‘The Monetary Policy Board will continue to monitor inflation developments and those of other macroeconomic variables and take policy actions as necessary in the period ahead.
‘In line with the eased monetary policy stance of the Central Bank, market interest rates continued to adjust downwards. However, the adjustments, particularly of lending interest rates other than on prime lending, remained weaker than the adjustments to deposit interest rates.
‘Further, following a contraction recorded in April 2024, credit extended to the private sector by Licensed Commercial Banks (LCBs) expanded in May and June 2024. A sustained rebound in credit growth requires market lending interest rates to decline further in line with the prevailing accommodative monetary policy stance.
‘While the external current account is likely to have recorded a surplus in the first half of the year, the cumulative merchandise trade deficit widened during this period compared to the same period in 2023. Earnings from tourism and workers’ remittances continued to be promising.
‘Gross Official Reserves (GOR) stood at US dollars 5.6 billion (including the swap with the People’s Bank of China) as of end June 2024, compared to US dollars 4.4 billion at end 2023.
‘The Sri Lanka rupee witnessed intermittent volatility against the US dollar in recent months. Overall, the Sri Lanka rupee appreciated by over 6.5 per cent against the US dollar thus far during 2024.
‘The Central Bank has cut the rate at which it is lending “printed money” to banks by 25 basis points to 9.25 percent and the rate at which excess money is taken to 8.25 percent, in a July monetary policy decision.
‘The Board arrived at this decision following a careful assessment of the current and expected macroeconomic developments and possible risks and uncertainties on the domestic and global fronts with a view to maintaining inflation at the targeted level of 5 per cent over the medium term, while enabling the economy to reach its full capacity.
‘In arriving at this decision, the Board considered the need to signal the continuation of the eased monetary policy stance, thereby inducing a further reduction in market lending rates to support economic activity, amidst a benign inflation outlook.
‘The Board noted that, based on the available information, inflation is likely to remain below the inflation target of 5 per cent by a sizable margin for the next several months before aligning with the targeted level over the medium term.
‘Since September 2022 in particular, Sri Lanka’s Central Bank has laid a strong foundation for people and businesses to engage in economic activity by keeping inflation around 2-3 percent, and exchange rate stable by largely avoiding printing money to enforce policy rates incompatible with the balance of payments.
‘Sri Lanka has to repay some sovereign debt in 2024 if a bond exchange proceeds as planned and the Central Bank itself has to settle loans to India and the International Monetary Fund requiring deflationary policy to be followed.
‘Analysts have warned that countries under IMF programs which use mathematics to decide policy rates (data driven monetary policy) ignoring laws of nature, under so-called flexible inflation targeting, tend to trigger confidence shocks, external crises, followed by stabilization programs and social unrest at home.
‘Social unrest broke out in both Kenya and Bangladesh during IMF programs, following depreciating currencies. Kenya had to hike rates steeply to end confidence shocks to the currency. Bangladesh is now following a so-called ‘crawling peg’.
‘Analysts say that a Central Bank that has reserve-related-liabilities to settle (or collect forex reserves under an IMF program) cannot cut rates based on a historical inflation statistic – especially as private credit recovers.
‘In June, the Central Bank injected 7-day money to the banking system up to Rs. 50 billion as low as 8.93 percent despite the overnight rate being at 9.50 percent, losing the ability to collect reserves in the month.
‘Headline inflation, as measured by the year-on-year change in the Colombo Consumer Price Index (CCPI, 2021=100), was recorded at 1.7 per cent in June 2024. Such considerably below-target headline inflation was underpinned by the downward revisions to the electricity tariff and fuel and LP gas prices in addition to relatively weak demand conditions.
‘Meanwhile, core inflation, which reflects underlying demand in the economy, was recorded at 4.4 per cent (CCPI- based, year-on-year) in June 2024 compared to 3.5 per cent in May 2024, although a sustained acceleration is not anticipated.
‘Realized quarterly average headline inflation during the Q2 2024 was below the inflation target by more than the margin of 2.0 percentage points stipulated in the Monetary Policy Framework Agreement (MPFA). The latest projections suggest that headline inflation is likely to be notably below the target in the forthcoming months due to the combined impact of downward adjustments to electricity tariffs and domestic fuel prices and the favourable statistical base.’
Business
Russian Federation ‘deeply considering’ supplying SL’s energy needs
The Russian Federation is deeply considering supplying energy/fuel to Sri Lanka to prevent an energy crisis due to the escalating Middle East war, Russian Deputy Foreign Minister Andrey Rudenko said.
‘We are very much keen to support Sri Lanka and provide fuel/energy to Sri Lanka. This is still under consideration but it would be a positive response from our side, Rudenko said at a media forum yesterday in Colombo. The forum was organised by Pathfinder Foundation Sri Lanka and held at Colombo Club, Taj Samudra Hotel.
Rudenko who made a brief official visit to Sri Lanka said that the Middle East conflict is quite serious and that most Asian countries, including Sri Lanka, are affected by it in areas such as transportation, energy/ fuel and food security. ‘The supply chains related to these sectors have been disrupted for many countries. The escalating war situation in Iran and the Gulf region will affect most economies of the world, he said.
The Deputy Minister said that Russia is still not affected by the crisis but it could be impacted if the war continues for sometime.
‘We will be looking for a convenient payment method for Sri Lankan, when it comes to trade and investments in the future, Rudenko added.
Responding to questions Rudenko said that at present the United Nations is not doing anything to put a full stop to the war and a need of the hour is to strengthen the United Nations to change the world order.
By Hiran H Senewiratne
Business
Lankem taps Eppawala phosphate to launch Sri Lanka’s first SSP fertiliser plant
Event coincides with volatility in global fertiliser markets
Sri Lanka’s long-discussed Eppawala rock phosphate deposit has finally begun feeding a domestic fertiliser value chain, with Lankem Ceylon PLC unveiling the country’s first locally manufactured Single Super Phosphate (SSP) fertiliser in a Rs. 3 billion industrial venture aimed at reducing import dependence and strengthening agricultural resilience.
The product, branded ‘Mada Raja’, was launched at a ceremony in Colombo on March 30, marking the commissioning of a new state-of-the-art manufacturing facility operated by Lankem Minerals Ltd, a fully owned subsidiary of the diversified conglomerate.
With an annual production capacity of 50,000 metric tonnes, the plant is expected to meet up to 80% of Sri Lanka’s SSP fertiliser requirement, positioning the company to play a strategic role in stabilising fertiliser supply at a time when global supply chains remain vulnerable to geopolitical disruptions.
The project is also the first significant industrial initiative in recent years to systematically utilise Eppawala rock phosphate, one of the country’s key mineral resources. Lankem Minerals will source over 30,000 metric tonnes annually from Lanka Phosphate Ltd, thereby strengthening a domestic fertiliser value chain while generating economic activity in the Anuradhapura region.
Speaking at the launch, Lankem Ceylon PLC Managing Director Suren Goonawardene said the initiative reflects a broader effort to reduce Sri Lanka’s dependence on imported fertilisers and build local industrial capability.
“The launch of ‘Mada Raja’ represents a significant step forward in building Sri Lanka’s agricultural resilience,” he said. “As a group we are focused on enabling long-term national value creation by strengthening domestic capability while supporting farmers through locally manufactured solutions.”
The project itself was not a quick undertaking. According to company officials, the concept was first initiated in 2015, followed by nearly a decade of research, technical trials and regulatory clearances before the plant reached commissioning.
A senior official involved in the project said the long development timeline was largely due to the unique mineral composition of Eppawala phosphate.
Earlier fertiliser formulations had typically relied on sedimentary phosphate sources, while the Eppawala deposit contains crystalline rock phosphate, which behaves differently during chemical processing.
“This fundamental difference in mineral structure directly affects how the end product reacts,” the official explained. “The same parameters used for conventional raw materials could not be applied identically.”
The company therefore had to undertake extensive laboratory work and industrial trials to refine the process. During this period, Lankem also worked closely with regulators and technical agencies to ensure the product met recognised standards.
The Sri Lanka Standards Institution, National Fertiliser Secretariat, and the Ministry of Science and Technology were engaged in the process, which eventually led to refinements in the regulatory framework and alignment with ISO-based quality standards.
“Through professional collaboration with the relevant institutions, the standards were enhanced and refined,” the official said. “Today we are unveiling a product that has passed through a rigorous framework of testing and compliance.”
Beyond the industrial and economic dimensions, the company says the product also addresses a growing agronomic challenge: sulphur deficiency in Sri Lankan soils.
Unlike conventional fertilisers such as Triple Super Phosphate (TSP), which primarily supply phosphorus, SSP provides a combination of phosphorus, sulphur and calcium.
This integrated nutrient profile helps improve root development, protein synthesis and soil structure, contributing to better crop performance and long-term soil health.
Lankem Minerals Chairman Ananda Hettiarachchy said the shift toward balanced nutrient management is becoming increasingly important for sustainable agriculture.
By Sanath Nanayakkare
Business
Ambuluwawa sends a message of peace to the world
30th anniversary marked with global initiatives, tourism surge, and meditation focus
Perched above the historic town of Gampola, where rolling hills meet drifting clouds, Ambuluwawa emerged this week as a powerful symbol of peace, sustainability, and renewal.
Marking the 30th anniversary of the Ambuluwawa Religious and Biodiversity Complex, foundation stones were laid for an International Meditation Centre and an International Library—two landmark initiatives aimed at promoting global harmony, spiritual reflection, and knowledge sharing.
The ceremony, held Saturday morning, was graced by the Maha Sangha, whose presence infused the occasion with deep spiritual significance.
Among them were the Most Venerable Karagoda Uyangoda Maithree Moorthi Mahanayake Thera of the Amarapura Maha Nikaya, Most Venerable Makulewe Wimala Mahanayake Thera of the Ramanna Maha Nikaya, Most Venerable Niyangoda Vijithasiri Anunayake Thera of the Malwathu Chapter of the Siyam Nikaya, and Most Venerable Wedaruwe Upali Anunayake Thera of the Asgiri Chapter.
At a time when global tensions and conflicts continue to claim lives, the Maha Sangha collectively invoked blessings for peace. Their message was clear and compelling: may the flames of war be extinguished, may lives be protected, and may all nations coexist in unity and compassion.
A solemn Sathya Kriya (act of truth) was conducted at the Ambuluwawa auditorium with the participation of Diyawadana Nilame Pradeep Nilanga Dela, MP and Attorney-at-Law Anuradha Jayaratne, and a large gathering of devotees.
Complementing the day’s proceedings, a spiritually significant all-night Pirith chanting ceremony was held on March 29 inside a specially constructed chamber within the iconic Ambuluwawa tower. As sacred chants resonated through the cool mountain air, they carried with them prayers for global healing, serenity, and the well-being of all living beings.
Beyond its spiritual essence, Ambuluwawa stands as one of Sri Lanka’s most remarkable biodiversity sanctuaries. Rising from a single mountain peak, it encompasses a rare concentration of ecological zones, supporting a diverse range of endemic plant and animal species.
This unique environmental setting has made Ambuluwawa a living example of conservation in action, where biodiversity is preserved alongside cultural and religious heritage.
Speaking at the event, Ambuluwawa Complex Chairman, Jayaratne highlighted the remarkable transformation of Ambuluwawa under its new management.
He noted that annual income had surged to around Rs. 300 million from a modest Rs. 11 million in earlier years, reflecting improved management and growing public interest. Tourist arrivals have also increased significantly—from around 15,000 visitors in the past to over 50,000 within the last four years—underscoring the site’s rising appeal both locally and internationally.
Jayaratne expressed confidence that, with the continued blessings and guidance of the Maha Sangha, Ambuluwawa would witness even greater development in the years ahead.
He emphasised that future initiatives would be carefully aligned with environmental sustainability and spiritual values.
Indeed, over the past decade, Ambuluwawa has steadily evolved into a major tourism hotspot.
Drawn by its distinctive tower, panoramic views, and multi-religious symbolism, visitors increasingly regard it as a unique destination that blends nature, culture, and spirituality. Authorities believe this tourism momentum can be further strengthened through carefully planned, eco-friendly initiatives.
Among these is a proposed cable car project aimed at improving access to the summit while minimising environmental disruption. If implemented with sustainability at its core, the project is expected to enhance visitor experience and elevate Ambuluwawa’s status on the global tourism map.
Central to the future vision, however, is meditation. The planned International Meditation Centre is expected to transform Ambuluwawa into a hub for spiritual tourism, attracting practitioners and seekers from around the world. In an age marked by stress and uncertainty, the tranquil surroundings of Ambuluwawa offer an ideal setting for mindfulness, reflection, and inner healing.
As it marks three decades of existence, Ambuluwawa stands at the crossroads of tradition and transformation. With its blend of biodiversity, spirituality, and growing tourism potential, it continues to send a timeless message to the world—that peace is possible when humanity learns to live in harmony with nature and within itself.
By Ifham Nizam
-
Features6 days agoA World Order in Crisis: War, Power, and Resistance
-
News7 days agoEnergy Minister indicted on corruption charges ahead of no-faith motion against him
-
Sports7 days agoSLC to hold EGM in April
-
Opinion7 days agoWhen elephants fight, it is the grass that suffers
-
Features7 days agoLest we forget
-
News3 days agoTariff shock from 01 April as power costs climb across the board
-
Business7 days agoPan Asia Bank empowers export sector as Strategic Partner of NCE Export Awards
-
News6 days agoMinister Jayakody indicted in Colombo High Court over alleged corruption
