Business
Central Bank sets its macroeconomic projections in a firm direction
But warns of uncertainty surrounding forecasts of given variables
by Sanath Nanayakkare
After the Central Bank of Sri Lanka (CBSL) recently set a more inclusive and predictable Monetary Policy under the new CBSL Act, the business community appears to be taking their cue from the Bank’s medium term economic projections as was evident by the increased buying interest at the Colombo Stock Exchange when the market opened trading for the week on August 7.
On August 3, Dr. P. K. G. Harischandra, Director of Economic Research at the Central Bank of Sri Lanka said that CBSL’s latest Monetary Policy Report would give guidance to financial markets and other stakeholders as to how inflation and price stability would behave in the medium term (next 2-3 years), and therefore, they could assess future trends in the economy while evaluating the matrix of downside risks and upside risks in their investment and business decisions.
“Anchoring inflation expectations is a key element in the Monetary Policy framework. We will be focusing on the need to stabilize inflation expectations in businesses and households alike,” he said on 3rd August addressing journalists at a technical discussion on the Monetary Policy Report.
Illustrating Inflation fan charts for the medium term, Dr. Harischandra said,”CBSL arrives at macroeconomic projections including that of inflation, using a semi-structural macroeconomic model. These projections are usually updated on a quarterly frequency along with the release of GDP data. Projections are arrived at using released data, projections of major global indicators, near-term forecasts of selected variables and judgments,” he said.
However, he pointed out that forecasts are uncertain by nature, which is represented by the confidence intervals, and this uncertainty needs to be taken into consideration when such forecasts are used for various purposes.
“As per latest projections, inflation is expected to reach single digit levels in Q3 2023, and will stabilize at the desired levels over the medium term. So, when inflation stabilizes over the medium term, interest rates also will move in line with it. A major element here is the risk factors on the forecasts. Sometimes the actual figures could differ from the baseline forecasts. We explain such risks in the Monetary Policy report, he said.
Dr. Harischandra noted that CBSL would build up credibility of the projections process through increased communication with the public ensuring a high level of transparency.
“Going forward, we will be publishing a forecast and when we receive actual data in the coming weeks and months, we will be able to see the difference between our forecasts and actual data. Yes, there may be some difference as our projections may not be 100% accurate. We will then explain why any such deviations from the forecasts have happened. And then we can refer to what adjustments are needed on the medium term forecasts for the benefit of the public and businesses. Through this process, we are committed to increasing the transparency and credibility of the Monetary Policy and our projections. Because when we commit ourselves to a medium term target, we have an accountability to achieve it. That is a requirement of the Monetary Policy.”
Speaking further Dr. Harischandra said, “In addition to maintaining price stability, there will be other policy coordination, and we will be creating a platform for discussions in order to support decision making in broader terms”
“In June 2023, Colombo Consumer Price Index (CCPI) was 12%. In July it came down to 6.3%. The core inflation declined to 6.1%. Within this month, we expect that it will come into the targeted range. When headline inflation came down to 6.3%, food inflation became a negative 1.4%. Non-food has gone up by 19.5%, but transportation is a negative 9.3%. These reasons, prudent policies on the fiscal front and the inflation base effect in 2022 mainly brought inflation down. People ask if inflation has decelerated why prices aren’t coming down. We say at every forum that a fall in inflation is not necessarily about a fall in prices of all commodities across the board. Prices of some consumer items have declined notably giving relief to the consumers and prices of some other items have slowed the rate of increase in prices. Overall, there are no price shocks now. Journalists also have a task in communicating this properly to the public because it is a huge incomprehension that a fall in inflation is a fall in prices of everything.”
“Each economy needs some inflation. If there is negative inflation nobody will invest and produce because if prices keep coming down there will be losses. So, no country targets negative inflation. But as we came from a very high inflation to lower inflation, there was some negative inflation. A good rule of thumb for any country is not to let the price of the overall basket to get negative inflation because the consequences of that could ripple through the economy.”
Dr. Harishchandra told The Island Financial Review that the exchange rate of the US dollar to LKR won’t see much of an adverse effect when the government begins to make foreign debt repayments because the Domestic Debt Optimization programme is designed to withstand such risk.
A five star 100-room Maldivian resort hotel property controlled by Browns Investments PLC has been disposed for USD 57.5 million, Browns Investment said in a stock exchange filing on Friday. The company had previously disclosed in September that the deal was in the pipeline pending completion of precedent conditions.
The property. Barcelo’ Whale Lagoon Maldives, belonged to Browns Ari Resort (Private) Ltd., a subsidiary of Browns investments, was purchased by ASB Hotel Properties Maldives Private Ltd.
“The transaction was completed following the satisfaction of the conditions precedent set out in the Sale and Purchase Agreement, for a total consideration of USD 57,500,000,” the filing said. The price was considered “significant” but was not the highest in the Maldives where high end hotel properties command top dollar.
Browns Investments (BIL) has a significant presence in the Maldives, developing multiple properties, notably through partnerships with Spain’s Barceló Hotel Group for projects like Barceló Whale Lagoon (now sold), Barceló Nasandhura (city hotel/apartments), and the Bodufaru Beach Resort (a major integrated project with three hotels) in North Male Lagoon, with BIL aiming to be a major Sri Lankan hotel operator in the Maldives with large room capacity.
BIL’s key Maldives projects are:
Bodufaru Beach Resort: A large-scale development in North Male Atoll with three five-star hotels, a significant undertaking with Barceló Hotel Group and Syno Hydro Corporation.
Nasandhura Palace Hotel (Barceló Nasandhura): A luxury city hotel and apartment complex in Male, managed by Barceló.
Strategy & Partners:
Browns Investments partners with Barceló Hotel Group, a Spanish hotel chain, for management and investment in their Maldivian properties.
The company aims to become the largest Sri Lankan hotel investor and operator in the Maldives, significantly expanding its room keys in the region, as described on the Browns Investment website.
Browns Investments is actively developing and managing luxury hotel properties in the Maldives, focusing on large integrated resorts and city hotels, leveraging international partnerships to grow its presence in the high-end tourism market, according to the company.
Business
Marketing Alumni Association of USJ Outlines Strategic Vision to Strengthen the Future of Marketing in Sri Lanka
The Marketing Alumni Association (MAA) of the University of Sri Jayewardenepura (USJ) set out its strategic direction for the year ahead at its Annual General Meeting (AGM) held on 10 December 2025. The event brought together academic representatives from the Department of Marketing Management and a strong contingent of alumni, providing a platform to review the association’s progress and reaffirm its commitment to advancing the marketing profession in Sri Lanka.
As the official body representing graduates of the Department of Marketing Management of the University of Sri Jayewardenepura, the MAA has, over the past 25 years, supported a network of more than 1,500 marketing professionals who now hold influential roles in leading private and public sector organizations. The association remains committed to elevating the standing of the Japura Marketing degree by strengthening industry partnerships, supporting academic excellence, and fostering a high-performing alumni community.
A key focus of the AGM was the appointment of Oshadee Withanawasam as President of the MAA for the upcoming term (2025-2027). In his inaugural address, Mr. Withanawasam emphasized the importance of strategic leadership, industry relevance, and collaborative growth in positioning USJ and its alumni at the forefront of marketing innovation in Sri Lanka.
Over the past year, the MAA has intensified its engagement efforts through a series of high-impact initiatives. The Kings and Queens Dinner Dance 2025, which brought together over 200 members, strengthened camaraderie within the alumni network. On the academic front, the association’s flagship ‘Fine Touch’ guest lecture series, conducted in partnership with the Department of Marketing Management, USJ, continued to offer undergraduates valuable exposure to industry best practices and emerging trends.
A significant milestone for the association was the launch of its first structured mentoring program for undergraduates of the department. This initiative marks a notable advancement in bridging academic training with practical corporate experience, equipping students with the competencies required to excel in a competitive business environment.
The MAA also continued to deliver meaningful social impact through its ‘Bring a Smile’ initiative, which has supported rural schoolchildren for three consecutive years (2023–2025) by providing essential stationery supplies. Further strengthening its commitment to education, the association introduced a scholarship scheme in 2024 to support deserving undergraduates pursuing their higher education in marketing.
During the AGM, outgoing President Dr. Darshana Jayasinghe and the Head of the Department of Marketing Management of USJ, Prof. Sandamali Galdolage, commended the association’s continued progress and reiterated their support for its long-term vision.
The following office bearers were appointed for the new term: Oshadee Withanawasam (President), Amitha Amarasinghe (Deputy President), Nipuni Karunarathna (Vice President), Vimukthi Kaushalya (Secretary), Thisaru Menake (Assistant Secretary), Nuwan Indika (Treasurer), and Thilanka Kalpage (Assistant Treasurer). Committee Members for the term include Prof. Ashoka Malkanthie, Chandra Kodithuwakku, Manuri Jayasinghe, Champika Vincent, Naleendra Yasassri Perera, Kaushan Agalawatte, Chandranath Gamage, and Pamudi Ketawalage.
Dr. Darshana Jayasinghe and Lalith Sumanasiri will serve as Advisors, while Prof. Sandamali Galdolage, Manojee Dabare, and Prof. Lalith Chandralal will continue as Trustees of the MAA.
A graduation ceremony for 18 Certified Sales Training Consultants, qualified to mentor aspiring marketing professionals and enhance standards in the country’s sales sector, was held recently at the Bandaranaike International Conference Hall.
The graduates represent the first phase of a programme aimed at producing 50 Certified Sales Training Consultants nationwide. The training and certification were conducted by the Asian College of Sales and Marketing (ACSM).
According to ACSM Director and Learning Consultant Sugath Munasinghe, the need for professionally certified sales training consultants to raise the quality and effectiveness of the sales sector has been identified for some time. He added that ACSM, as a higher education institute, will continue to provide structured training and certification to meet this demand.
Showers will occur in the Eastern, Uva and Central provinces and in Polonnaruwa and Hambantota districts.
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