Business

The X-Press Pearl Disaster: From Flames to Prevention

Published

3 years ago

2023/05/6

By Ruwan Samaraweera

Sri Lanka’s ecological disaster related to the MV X-Press Pearl, a container ship carrying hazardous chemicals that caught fire off its coast on 20th May 2021, is back in the news as the country attempts to claim damages. The ecological disaster washed up tons of plastic pellets and other pollutants on the country’s beaches and harmed its marine ecosystem.

It is a stark reminder of the risks associated with transporting hazardous materials and the urgent need for governments and companies to take proactive measures to prevent such disasters in the future. This blog revisits the environmental impact of the X-Press Pearl disaster and discusses how Sri Lanka can use the Sendai Framework for Disaster Risk Reduction (SFDRR) to develop strategies and policies to prevent similar disasters from happening near its shores again.

The Environmental and Economic Impacts of X-Press Pearl

The X-Press Pearl disaster has had a devastating impact on Sri Lanka’s environment and its citizens. The Marine Environment Protection Authority (MEPA) reported an oil slick of an approximate area of 0.51 km2 with a length of 4.3 km around the wreck. According to the International Pollutants Elimination Network, the ship’s cargo included billions of plastic pellets (microplastics used to produce plastic) which have washed up on the shore, causing damage to the country’s marine ecosystem, tourism industry and its reputation as an eco-tourism destination. According to the International Maritime Hazardous Goods Regulation (IMDG regulation), an analysis of the cargo manifest revealed that at least 81 of the 1,486 containers aboard the MV X-Press were transporting 15 distinct categories of hazardous materials, including 25 tons of nitric acid. While the full extent of the damage is yet to be determined by the MEPA, the insurance company for the ship has already compensated the Sri Lankan government to the tune of USD 7.85 million.

Beyond the monetary valuation, the disaster has severely impacted Sri Lanka’s fishing industry, with over 20,000 fishing families and approximately 16,000 fishermen affected. Additionally, the spillage of hazardous chemicals into the sea has killed over 300 marine animals, including turtles, dolphins, and whales.

The disaster has also raised concerns about the impact of hazardous material transportation on the environment and public safety, highlighting the need for more stringent regulations, especially in densely populated areas. It also revealed institutional and capacity constraints and a lack of training in handling such emergencies, which should be addressed to prevent such disasters. This is where the SFDRR comes into play, providing a comprehensive framework to address these issues and build resilience in the face of such catastrophes.

The Way Forward: Preventing Future Maritime Disasters

The X-Press Pearl disaster is a wake-up call for governments and companies worldwide to take proactive measures to prevent similar disasters in the future. Since its inception in 2015, the SFDRR has become widely recognised for managing diverse disasters worldwide.

The Sendai Framework

Even though there are various frameworks and policies related to disaster risk reduction at the national level in Sri Lanka, including the National Disaster Management Plan, they were inadequate to address the X-Press Pearl disaster timely and effectively. Other countries use numerous measures like response and containment techniques, preparedness and planning, regulation and enforcement, international cooperation and collaboration. The SDFRR combines these individual efforts and brings them under an umbrella framework.

Hence, it offers a comprehensive framework that countries like Sri Lanka can adopt to address the challenges associated with hazardous material transportation and other maritime disaster risks. Moreover, while the adoption of the SFDRR is novel for preventing maritime disasters, it has been widely adopted by many countries, including but not limited to Japan (climate change, Tsunami, Fukushima nuclear disaster, etc.), Australia (wildfires), and Nepal (earthquakes). Therefore, the X-Press Pearl maritime disaster emphasises the potential for harnessing the SFDRR’s wide range of applicability to prevent future similar disasters in Sri Lanka.

Understanding the risks

The first step in preventing such disasters is understanding the risks of shipping hazardous materials through Sri Lanka’s waters. Sri Lanka did not have a proper contingency plan in place to deal with a disaster of this scale. Furthermore, the risk assessment conducted prior to granting permission for the vessel to enter Sri Lankan waters did not adequately consider the potential impact of a disaster. Thus, as mentioned in the SFDRR, Sri Lanka should conduct a risk assessment concerning the potential impact of such disasters on the environment, the economy, and public health.

Strengthening regulations

The SFDRR emphasises the need to strengthen regulations and laws to prevent disasters. For instance, the Draft National Transport Policy of 2009 highlights the safer transportation of hazardous material in all modes, yet the cabinet has not approved this.

Therefore, it is imperative that Sri Lanka reviews its existing laws and regulations, such as the National Environmental Act No. 47 of 1980, the Marine Pollution Prevention Act No. 35 of 2008, and the Dangerous Goods (Transportation) Regulations governing the transportation of hazardous materials and makes necessary amendments to ensure compliance with international standards.

Building capacity

The SFDRR encourages increasing preparedness at all echelons of society. During the X-Press Pearl disaster, emergency responders lacked the necessary equipment and training to respond to the disaster effectively. Additionally, poor coordination between different agencies hampered the response effort. To address these issues, training programmes in collaboration with the Sri Lanka Navy and MEPA could be conducted for essential stakeholders such as shipping companies, port authorities, and emergency responders. These programmes could provide them with the necessary knowledge and skills to prevent and effectively respond to such catastrophes.

Promoting public awareness

The framework stresses the need to educate the public and raise awareness to prevent disasters. However, in the recent disaster, the lack of public awareness about the risks associated with transporting hazardous materials made it difficult to generate support for preventive measures. Therefore, the government, private sector, non-governmental organisations and other relevant stakeholders are responsible for informing the public about the risks of transporting hazardous commodities and the importance of adopting safe shipping practices.

Collaboration and partnerships

The framework encourages cooperation and partnership amongst all parties involved in disaster management. However, Sri Lanka did not collaborate effectively with other countries or international organisations to prevent the disaster. For example, there was no information sharing about the vessel’s previous safety record, which could have alerted Sri Lanka to potential risks. To avoid similar events in the future, Sri Lanka could collaborate with other nations (India and other South Asian countries), international organisations (such as the International Maritime Organisation), and shipping companies.

The disaster has also brought attention to the need for sustainable shipping practices, such as using alternative fuels and more eco-friendly packing materials.Hence, by adopting the Sendai Framework, Sri Lanka can develop an effective approach to prevent similar disasters in the future through proactive measures to protect the environment, public health, and the economy.

Link to blog: https://www.ips.lk/talkingeconomics/2023/05/03/the-x-press-pearl-disaster-from-flames-to-prevention/

Ruwan Samaraweera is a Research Officer at IPS with a background in entrepreneurial agriculture. He holds a Bachelor’s in Export Agriculture from Uva Wellassa University of Sri Lanka. His research interests are environmental economics, agricultural economics, macroeconomic policy and planning, labour and migration, and poverty and development policy. (Talk to Ruwan – ruwan@ips.lk)

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Business

LankaPay Technnovation Awards to spotlight inclusive FinTech as digital payments expand across Sri Lanka

Published

9 hours ago

2026/02/27

Thilina Walpola

(L-R) - Dinuka Perera – DCEO LankaPay; Channa de Silva – CEO LankaPay; Rajeeva Bandaranaike – Chairman of the Panel of Judges; Vasantha Alwis, Director – Payments and Settlements of the Central Bank of Sri Lanka; and Indrajith Boyagoda – Secretary General, Sril Lanka Bankers’ Association.

Sri Lanka’s digital payments revolution is gathering unprecedented momentum, with more than 260 government institutions now integrated into the national digital payments ecosystem, marking a decisive shift toward financial transparency, efficiency and inclusion, officials said at a press briefing held at the Hilton Colombo Residences.

The announcement coincided with the launch of the eighth edition of the LankaPay Technnovation Awards 2026 by LankaPay, Sri Lanka’s national payment network, under the theme “Inclusive FinTech,” recognising financial institutions, fintech companies and government entities that have expanded access to secure and convenient digital financial services across the country.

Chief Executive Officer of LankaPay, Channa de Silva, said the rapid expansion of digital payment adoption reflects a structural transformation in Sri Lanka’s financial architecture.

“The growth we are witnessing in digital payments is not merely technological progress—it represents a fundamental shift in how financial services are delivered and accessed. Our national payment infrastructure is enabling real-time, secure and inclusive transactions that empower individuals, businesses and government institutions,” de Silva said.

He said LankaPay’s continued investment in interoperable and accessible payment infrastructure is helping bring more citizens into the formal financial system while strengthening economic governance.

“Our objective is to ensure digital payments are accessible to all Sri Lankans, from urban centres to the most remote communities. Inclusive digital finance strengthens economic participation and supports sustainable national development,” he said.

Officials said the onboarding of 260 government institutions within a year represents a remarkable leap from just eight institutions previously connected, underscoring the State’s accelerating digital transformation agenda.

“This expansion required extensive engagement across the country. Our teams worked directly with government departments, municipal councils and regional authorities to ensure successful integration into the digital payments ecosystem,”

LankaPay officials said, noting that institutions from regions including Kurunegala, Jaffna and Trincomalee had recently been onboarded.

Authorities said the digital integration of government services improves transparency, reduces administrative inefficiencies and enhances public convenience, while enabling better financial oversight and accountability.

The LankaPay Technnovation Awards, first introduced in 2017, have become Sri Lanka’s benchmark platform recognising excellence and innovation in payment technology, honouring institutions that have demonstrated leadership in advancing digital payments and financial inclusion.

The grand awards ceremony is scheduled to be held on March 24 at the Cinnamon Life under the patronage of Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka, as Chief Guest. Eranga Weerarathne, Deputy Minister of Digital Economy, and Hans Wijayasuriya, Chief Advisor to the President on Digital Economy, will attend as Guests of Honour.

Officials said the awards recognise outstanding achievements across multiple categories, including financial inclusivity, customer convenience, digital government payments and cross-border payment enablement, reflecting the breadth of innovation taking place within Sri Lanka’s financial services sector.

By Ifham Nizam

Business

HNB supports Sri Lanka’s recovery with record advances growth

Published

9 hours ago

2026/02/27

Thilina Walpola

HNB Group delivered strong performance in 2025, with Group Profit After Tax (PAT) reaching Rs 49.8 Bn, reflecting the continued progress. The Bank’s PAT stood at Rs 45.4 Bn, supported by robust balance sheet expansion and sustained improvements in asset quality.

Commenting on the performance, Nihal Jayawardena, Chairman of HNB PLC, stated,”The year 2025 marked a decisive shift in Sri Lanka’s economic trajectory, supported by improving macroeconomic fundamentals, renewed private sector confidence, and continued progress in national reform efforts. HNB’s strong balance sheet expansion, disciplined risk management, and sustained investment in digital and operational capabilities position the Bank to play an essential role in supporting the country’s revival”.

“While the year concluded with the severe impact of Cyclone Ditwah, the resilience demonstrated by communities and institutions underscored the importance of a banking sector that remains agile, responsive, and deeply committed to national progress. We will continue to work closely with stakeholders to mobilise capital, rebuild affected livelihoods, and strengthen long‑term economic stability.”

Despite strong credit growth, net interest margins remained under pressure amid an accommodative monetary policy stance. Net Interest Income declined marginally by 0.6% year‑on‑year, reflecting the broad reduction in market interest rates, and the recognition of a portion of overdue interest from the restructuring of Sri Lanka Sovereign Bonds (SLSBs) in December 2024, which temporarily boosted interest income in the previous year. However, the decrease in net interest income was moderated by the increase in interest income from loans and advances, supported by the expansion in the loan book, and the growth in CASA deposits.

Non-fund-based income provided a strong counterbalance, with Net Fee and Commission Income increasing by 28.9% year-on-year on the back of higher card usage and a sharp increase in digital transactions. The significant increase in the demand for trade related services on the back of the reopening of vehicle imports and improving trade activity, saw trade finance emerge as one of the key contributors to non-fund income in the current year. Furthermore, Exchange income rose to Rs 6.3 Bn during the year, reversing the loss of Rs 2.9 Bn recorded in 2024.

Prudent risk management, disciplined underwriting and focused recovery efforts supported a significant improvement in asset quality during the year. The Stage 3 portfolio recorded a net reduction alongside an impairment reversal of Rs 9.2 Bn, following the recognition of Rs 2.2 Bn in post‑model adjustments made prudently for loan exposures with potential vulnerability arising from Cyclone Ditwah.

Business

HNB Assurance delivers industry leading 42% revenue (GWP) growth and 28% rise in profits (PAT)

Published

9 hours ago

2026/02/27

Thilina Walpola

HNB Assurance PLC reported an outstanding financial performance for the year ended 31st December 2025, delivering a 42% year-on-year growth in Life Insurance Gross Written Premium (GWP), this along with the growth rate in Renewals are the highest in the industry.

Life GWP reached Rs. 19.49 Bn compared to Rs. 13.71 Bn in 2024, reflecting strong New Business generation and Renewal Collection. Net Written Premium grew even faster at 43% to Rs. 18.44 Bn, highlighting the quality and sustainability of the Company’s topline expansion.

Commenting on the results, Chairman Stuart Chapman stated, “The year under review was marked by gradual macroeconomic stabilisation, improved investor sentiment and a more predictable policy environment. Although the economy continues to recover from prior volatility, we are beginning to see renewed financial confidence among individuals and businesses. Against this backdrop, HNB Assurance has delivered strong growth in both revenue and profits, while maintaining robust capital adequacy and prudent risk management. Our improvement in top line, profitability and balance sheet strength demonstrates the resilience of our business model and our ability to navigate changing economic conditions which are reflected in an ROE which increased to 18.5% from 16.9% a year earlier.”

Profit Before Tax increased by 28% to Rs. 3.03 Bn from Rs. 2.36 Bn in the previous year, while Profit After Tax (including Life Surplus Transfer) rose by 28% to Rs. 2.12 Bn compared to Rs. 1.66 Bn in 2024. Earnings Per Share improved by 28% to Rs. 14.15 from Rs. 11.04, reinforcing the Company’s ability to consistently translate business growth into enhanced shareholder value. In line with this strong performance, the Board of Directors has proposed a first and final dividend of Rs. 5.00 per share for 2025, representing a 28% increase over the Rs. 3.90 per share declared in the previous year.