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Extending magnitude of support for Sri Lankan prospective exporters

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‘BOC Export Circle’ novel service

By Nihal Surawimala

With the unprecedented outbreak of COVID-19, almost all the economies have been jeopardized in various ways. With even the mighty economic powerhouses around the globe feeling the pain, it is no point of exaggeration, how the pandemic hindered the emerging economies including that of Sri Lanka. With the objective of revamping businesses affected by the COVID-19 pandemic, the CBSL, in consultation with the Government of Sri Lanka, has initiated various economic measures, considering the turbulent situation and constraints of repayment that have arisen with the pandemic.

Bank of Ceylon, being the number one bank and premier state bank, has been in the forefront of executing the relief packages, introducing novel digital banking products to uplift the entire economy and helping Sri Lankan citizens realise their aspirations. Standing tall as a pillar of support to its valuable clientele, the Bank has established a revival unit with the prime objective of reinforcing the collapsed or disrupted businesses, considering it timely additional support during the pandemic situation. Also, the Bank identified vulnerable sectors and came up with innovative banking products and services to address their needs and the writer’s effort today is to highlight such another significant service introduced to the economy.

Overview of external sector performance

As correlated with the global impact, Sri Lanka’s external sector endured a major contraction in 2020 with the outbreak of the pandemic, stimulating contemporary policy measures by the Government and the Central Bank. Merchandise exports declined sharply in the months in which the spread of the virus and the resultant containment measures were more intense, but reached close to the pre-pandemic levels sooner than expected. It is learnt that in response to the policy measures taken by the Government to restrict most non-essential imports and low crude oil prices, merchandise imports reported a significant decline in 2020. The combined effect of the gradual recovery in earnings from merchandise exports and the continuous decline in expenditure on merchandise imports resulted in the trade deficit to contract notably to record the lowest trade deficit since 2010.

As per the information depicted in the Central Bank of Sri Lanka (CBSL) Annual Report 2020, earnings from merchandise exports were severely impacted during the months in which containment measures were more intense with the spread of the COVID-19 pandemic, but recovered towards the pre-pandemic levels faster than expected. As per CBSL sources, Agricultural exports registered a decline in earnings of 5.1 percent in 2020 compared to 2019, due to weaker earnings from tea, seafood and unmanufactured tobacco, while earnings from spices, coconut, minor agricultural products, rubber and vegetables increased. Agricultural exports such as cinnamon, pepper, dried vegetables, areca nuts, coconut oil and fibres and natural rubber registered increases in earnings during the year, mostly driven by higher volumes. Industrial exports registered a broad-based decline in earnings, with an overall reduction of 18.6 percent in 2020 compared to 2019.

Export of textiles and garments, the single largest export of Sri Lanka, registered a decline in earnings of 21 percent in 2020. As per the latest records pertaining to External Performance published by the Central Bank of Sri Lanka, the trade deficit widened on a year-on-year basis for the third consecutive month in May 2021 to USD 716 Mn, compared to USD 407 Mn recorded in May 2020. It is notable that exports have been resurging as usual amidst many challenges and shows a positive growth. Earnings from merchandise exports increased to USD 892 Mn in May 2021, recording growth rates of 52 percent and nine percent over May 2020 and April 2021, respectively, with higher earnings from all major sectors.

Fulfilling national duty across BOC export circle

In this backdrop, with the objective of boosting the Sri Lankan export industry and to revive the export sector during the present global recession, the Bank of Ceylon has introduced a new service brand ‘BOC export circle’. Exports are incredibly important to the country in terms of earning foreign exchange. The ‘BOC Export Circle’ is a full-fledged one-stop export unit located on the second floor of Bank of Ceylon, Head Office. The availability of adequate finance and end to end advisory services throughout the supply chain are fundamental requirements for the growth of this sector. Therefore the prime objectives of setting up the BOC Export Circle are to provide financial assistance, end to end advisory services specially to SME export customers, facilitate the revival of the export sector which was hindered by COVID-19 pandemic and to attract potential export oriented customers through a comprehensive export credit package.

The Circle will launch under a unique brand name and introduce new deposit products and new loan schemes exclusively designed for exporters. In line with the fiscal policy initiatives of the Government with regard to the revival of the economy, loan schemes will be introduced, particularly targeted at direct and indirect exporters.

The Bank has identified the timely requirement of introducing a specific financing scheme that solely addressed working capital requirements of export oriented customers. Preshipment facilities such as Packing Credit Loans in LKR and USD terms and Post Shipment facilities such as LC Bill Negotiation, Export Collection Bill Purchases, Bill Purchases under Open Account basis in Foreign Currency terms will be availed to meet the working capital requirements of direct exporters. Based on their annual turnover and number of years in operation, start-ups and Small and Medium (SME) Sector exporters are considered for the quantum of the facility.

In order to cater to indirect exporters who supply raw materials, packing materials, finished goods or provide infrastructure facilities or any other facilities and services to direct exporters, specially designed credit facilities such as revolving short term loans and local LC bill discounting facility will be introduced through ‘BOC Export Circle’.

Additionally, the Bank has arranged a Trade Information Desk to provide end-to-end supply chain information to exporters and export related advisory services to existing and potential customers of the bank. Assistance for business registration and related services, creating new business alliances with Export Development Board and Ceylon Chamber of Commerce, assisting Sri Lanka Export Credit Insurance Corporation to penetrate the SME export market and arranging links between prospective customers and export related organizations, inter-alia, are services available through the Export Circle. The above-mentioned loan schemes are implemented via the BOC Branch network islandwide. However, it is intended for the credit schemes to operate preliminarily in selected branches and move to other branches gradually.

As it gears up for 2021, the Bank of Ceylon has proven its resilience particularly in trying times such as during the pandemic. The bank emerged as the best financial provider under the ‘Saubhagya’ concessionary loan schemes and extended moratoriums in order to help fulfill the aspirations of the business community in Sri Lanka, achievable thanks to the robust asset base amounting to more than three trillion. Further, the Bank of Ceylon has entered into an agreement with the Asian Infrastructure and Investment Bank (AIIB) under the ‘COVID-19 Crisis Response Facility’ to grant a special credit support scheme for Corporates and Small and Medium sized Enterprises (SMEs) affected by economic upheaval due to the pandemic with a view to reinforce and pump additional liquidity to affected businesses.

The Bank of Ceylon has been nurturing new entrants into solid business entities, by providing assistance in trying times, from its inception through the long journey of more than eight decades in the Banking Industry. Being the bedrock of most successful business stories and a pioneer in accelerating the economy, the writer firmly believes that the BOC Export circle concept would address vital time sensitive issues concerning the entire economy.

As one of the region’s most vibrant export hubs, Sri Lanka is equally competent in agriculture, manufacturing and service sectors. The rest of the world has the opportunity to benefit from the country’s collective competitive advantage through sourcing from Sri Lanka. Over the years Sri Lankan products have gained a strong reputation worldwide for ethical manufacturing of high-quality products trusted by iconic global brands. Young Sri Lankan entrepreneurs, enriched with a diverse skill set, experience setbacks in progress due to lack of resources and financial support. As a premier banking partner the BOC endeavours to pave the way for novices of the export market to step into the global business arena and revamp and reshape the landscape of the entire economy in the long run.

(Nihal Surawimala is currently steering the Corporate and Offshore Banking Division of Bank of Ceylon as the Senior Deputy General Manager [Corporate and Offshore Banking]. He is a senior banker counting over 30 years of experience in both local and international banking. He holds a Bachelor’s (Special) Degree in Public Administration and Master of Science (M.Sc) in Management specialising in Banking and Finance, both from the University of Sri Jayawardenapura, Sri Lanka. He is also an Associate Member of the Institute of Bankers of Sri Lanka.)



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Acid test emerges for US-EU ties

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European Commission President Ursula von der Leyen

European Commission President Ursula von der Leyen addressing the World Economic Forum in Davos, Switzerland on Tuesday put forward the EU’s viewpoint on current questions in international politics with a clarity, coherence and eloquence that was noteworthy. Essentially, she aimed to leave no one in doubt that a ‘new form of European independence’ had emerged and that European solidarity was at a peak.

These comments emerge against the backdrop of speculation in some international quarters that the Post-World War Two global political and economic order is unraveling. For example, if there was a general tacit presumption that US- Western European ties in particular were more or less rock-solid, that proposition apparently could no longer be taken for granted.

For instance, while US President Donald Trump is on record that he would bring Greenland under US administrative control even by using force against any opposition, if necessary, the EU Commission President was forthright that the EU stood for Greenland’s continued sovereignty and independence.

In fact at the time of writing, small military contingents from France, Germany, Sweden, Norway and the Netherlands are reportedly already in Greenland’s capital of Nook for what are described as limited reconnaissance operations. Such moves acquire added importance in view of a further comment by von der Leyen to the effect that the EU would be acting ‘in full solidarity with Greenland and Denmark’; the latter being the current governing entity of Greenland.

It is also of note that the EU Commission President went on to say that the ‘EU has an unwavering commitment to UK’s independence.’ The immediate backdrop to this observation was a UK decision to hand over administrative control over the strategically important Indian Ocean island of Diego Garcia to Mauritius in the face of opposition by the Trump administration. That is, European unity in the face of present controversial moves by the US with regard to Greenland and other matters of contention is an unshakable ‘given’.

It is probably the fact that some prominent EU members, who also hold membership of NATO, are firmly behind the EU in its current stand-offs with the US that is prompting the view that the Post-World War Two order is beginning to unravel. This is, however, a matter for the future. It will be in the interests of the contending quarters concerned and probably the world to ensure that the present tensions do not degenerate into an armed confrontation which would have implications for world peace.

However, it is quite some time since the Post-World War Two order began to face challenges. Observers need to take their minds back to the Balkan crisis and the subsequent US invasions of Afghanistan and Iraq in the immediate Post-Cold War years, for example, to trace the basic historic contours of how the challenges emerged. In the above developments the seeds of global ‘disorder’ were sown.

Such ‘disorder’ was further aggravated by the Russian invasion of Ukraine four years ago. Now it may seem that the world is reaping the proverbial whirlwind. It is relevant to also note that the EU Commission President was on record as pledging to extend material and financial support to Ukraine in its travails.

Currently, the international law and order situation is such that sections of the world cannot be faulted for seeing the Post World War Two international order as relentlessly unraveling, as it were. It will be in the interests of all concerned for negotiated solutions to be found to these global tangles. In fact von der Leyen has committed the EU to finding diplomatic solutions to the issues at hand, including the US-inspired tariff-related squabbles.

Given the apparent helplessness of the UN system, a pre-World War Two situation seems to be unfolding, with those states wielding the most armed might trying to mould international power relations in their favour. In the lead-up to the Second World War, the Hitlerian regime in Germany invaded unopposed one Eastern European country after another as the League of Nations stood idly by. World War Two was the result of the Allied Powers finally jerking themselves out of their complacency and taking on Germany and its allies in a full-blown world war.

However, unlike in the late thirties of the last century, the seeming number one aggressor, which is the US this time around, is not going unchallenged. The EU which has within its fold the foremost of Western democracies has done well to indicate to the US that its power games in Europe are not going unmonitored and unchecked. If the US’ designs to take control of Greenland and Denmark, for instance, are not defeated the world could very well be having on its hands, sooner rather than later, a pre-World War Two type situation.

Ironically, it is the ‘World’s Mightiest Democracy’ which is today allowing itself to be seen as the prime aggressor in the present round of global tensions. In the current confrontations, democratic opinion the world over is obliged to back the EU, since it has emerged as the principal opponent of the US, which is allowing itself to be seen as a fascist power.

Hopefully sane counsel would prevail among the chief antagonists in the present standoff growing, once again, out of uncontainable territorial ambitions. The EU is obliged to lead from the front in resolving the current crisis by diplomatic means since a region-wide armed conflict, for instance, could lead to unbearable ill-consequences for the world.

It does not follow that the UN has no role to play currently. Given the existing power realities within the UN Security Council, the UN cannot be faulted for coming to be seen as helpless in the face of the present tensions. However, it will need to continue with and build on its worldwide development activities since the global South in particular needs them very badly.

The UN needs to strive in the latter directions more than ever before since multi-billionaires are now in the seats of power in the principle state of the global North, the US. As the charity Oxfam has pointed out, such financially all-powerful persons and allied institutions are multiplying virtually incalculably. It follows from these realities that the poor of the world would suffer continuous neglect. The UN would need to redouble its efforts to help these needy sections before widespread poverty leads to hemispheric discontent.

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Features

Brighten up your skin …

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Hi! This week I’ve come up with tips to brighten up your skin.

* Turmeric and Yoghurt Face Pack:

You will need 01 teaspoon of turmeric powder and 02 tablespoons of fresh yoghurt.

Mix the turmeric and yoghurt into a smooth paste and apply evenly on clean skin. Leave it for 15–20 minutes and then rinse with lukewarm water

Benefits:

Reduces pigmentation, brightens dull skin and fights acne-causing bacteria.

* Lemon and Honey Glow Pack:

Mix 01teaspoon lemon juice and 01 tablespoon honey and apply it gently to the face. Leave for 10–15 minutes and then wash off with cool water.

Benefits:

Lightens dark spots, improves skin tone and deeply moisturises. By the way, use only 01–02 times a week and avoid sun exposure after use.

* Aloe Vera Gel Treatment:

All you need is fresh aloe vera gel which you can extract from an aloe leaf. Apply a thin layer, before bedtime, leave it overnight, and then wash face in the morning.

Benefits:

Repairs damaged skin, lightens pigmentation and adds natural glow.

* Rice Flour and Milk Scrub:

You will need 01 tablespoon rice flour and 02 tablespoons fresh milk.

Mix the rice flour and milk into a thick paste and then massage gently in circular motions. Leave for 10 minutes and then rinse with water.

Benefits:

Removes dead skin cells, improves complexion, and smoothens skin.

* Tomato Pulp Mask:

Apply the tomato pulp directly, leave for 15 minutes, and then rinse with cool water

Benefits:

Controls excess oil, reduces tan, and brightens skin naturally.

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Features

Shooting for the stars …

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That’s precisely what 25-year-old Hansana Balasuriya has in mind – shooting for the stars – when she was selected to represent Sri Lanka on the international stage at Miss Intercontinental 2025, in Sahl Hasheesh, Egypt.

The grand finale is next Thursday, 29th January, and Hansana is all geared up to make her presence felt in a big way.

Her journey is a testament to her fearless spirit and multifaceted talents … yes, her life is a whirlwind of passion, purpose, and pageantry.

Raised in a family of water babies (Director of The Deep End and Glory Swim Shop), Hansana’s love affair with swimming began in childhood and then she branched out to master the “art of 8 limbs” as a Muay Thai fighter, nailed Karate and Kickboxing (3-time black belt holder), and even threw herself into athletics (literally!), especially throwing events, and netball, as well.

A proud Bishop’s College alumna, Hansana’s leadership skills also shone bright as Senior Choir Leader.

She earned a BA (Hons) in Business Administration from Esoft Metropolitan University, and then the world became her playground.

Before long, modelling and pageantry also came into her scene.

She says she took to part-time modelling, as a hobby, and that led to pageants, grabbing 2nd Runner-up titles at Miss Nature Queen and Miss World Sri Lanka 2025.

When she’s not ruling the stage, or pool, Hansana’s belting tunes with Soul Sounds, Sri Lanka’s largest female ensemble.

What’s more, her artistry extends to drawing, and she loves hitting the open road for long drives, she says.

This water warrior is also on a mission – as Founder of Wave of Safety,

Hansana happens to be the youngest Executive Committee Member of the Sri Lanka Aquatic Sports Union (SLASU) and, as founder of Wave of Safety, she’s spreading water safety awareness and saving lives.

Today is Hansana’s ninth day in Egypt and the itinerary for today, says National Director for Sri Lanka, Brian Kerkoven, is ‘Jeep Safari and Sunset at the Desert.’

And … the all-important day at Miss Intercontinental 2025 is next Thursday, 29th January.

Well, good luck to Hansana.

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