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Public support vital for SL’s economic recovery process – CBSL Governor

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By Lynn Ockersz

The duration of Sri Lanka’s economic recovery process depends on how successfully the governing authorities implement the relevant reforms and restructuring programme currently under discussion. Moreover, without public support for these recovery efforts, they would not prove fully successful, Central Bank Governor Dr. Nandalal Weerasinghe said.

Making the keynote address yesterday on the occasion of the launching of its 2022 ‘State of the Economy’ report titled, ‘Driving Policy Action from Crisis to Recovery’, by the Institute of Policy Studies, Sri Lanka, at its Dr. Saman Kelegama Auditorium, in Colombo Dr. Weerasinghe expressed optimism that Sri Lanka could achieve economic stability going forward.

However, public support is vital for the successful implementation of Sri Lanka’s economic recovery process, the Governor observed. Underscoring the importance of the media in this regard he said that it is up to the media to convey clearly to the public the issues at the heart of the economic recovery effort. Right now, this is not occurring to the desired extent. He said a vital requirement is responsible reporting and commentary by the media on the questions at hand.

The following are some extracts from Dr. Weerasinghe’s address: ‘The ongoing economic stabilization effort is a painful one, but whether there is an alternative to it is the question. It is up to those criticizing the state’s decision to go to the IMF to come out with a viable alternative programme and this is not easy to formulate. Conspiracy theories are also being aired in some quarters to the effect that the state announced a debt default prematurely to bring the country under IMF control. There is no truth in this allegation. Going forward, the recovery process is going to be difficult for the country but there are some improvements in the local economy currently.

‘Recovery is possible through Sri Lanka’s debt restructuring effort but we need to have a stable banking system which our creditors could believe in. Currency and banking crises need to be averted as we forge ahead and we need to establish market access for our export products sooner rather than later.’

Answering a question from the audience with regard to the fairness of some stipulations in the envisaged tax reforms, Dr. Weerasinghe said that taxation is only a short term solution to the country’s economic worries. While it is true that very many sections could be affected negatively by some of the income criteria that would be guiding the paying of taxes from the better-off sections of the public, people living below the poverty line, who are numerous, are more gravely affected than the middle classes. The contemplated taxation measures would help in extending and sustaining welfare measures to these poverty-stricken sections.

‘But there is no denying that there is a need to widen the tax net in an equitable manner. Burden-sharing in taxation is of vital importance. Fiscal transparency is important and the same goes for corruption-reduction, the Governor said.

Speaking earlier, Secretary to the Treasury/Ministry of Finance, Economic Stabilization and National Policies K.M. Mahinda Siriwardana said, among other things, that it is vital that the ‘political will’ be demonstrated by the authorities to take necessary but unpopular decisions to take the country on the recovery track. He underscored the importance of debt restructuring and pointed out that in the short term, monetary and fiscal policy improvements are vital. Likewise, it is important to adopt consistently, monetary and fiscal policy measures in the long term.

Pointing out the importance of revenue-based fiscal consolidation, Mr. Siriwardana stressed the need to reduce the budget deficit. In this effort the raising of enhanced corporate income tax becomes important.

The same applies to personal income tax. Some proposals under the latter head when implemented, could prove very painful to some sections, but there is no alternative. Such taxation measures could go a long way in assisting the poor. He focused on the need for short term sacrifices.

Initially, IPS Executive Director, Dr. Dushni Weerakoon, flagged off the event by making a wide-ranging analysis of the state of the Sri Lankan economy. In the course of her presentation she drew attention to the risks of ‘shallow restructuring’ that could prove counter-productive to countries such as Sri Lanka. Minimizing output loss, she said, is essential. ‘Bringing inflation under control is critical to economic stabilization, she stressed. These and other issues raised by the IPS Head set the stage for the presentations by the key speakers of the morning’s session of the forum.



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Strong Q4 net profit growth boosts Teejay Lanka’s outlook for year ahead

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Teejay Lanka Chairman Ajit Gunewardene (left) and CEO MPubudu De Silva

Strong net profit growth in the final quarter of 2023-24 has enabled Teejay Lanka PLC to end the financial year on an optimistic note despite the impacts of the appreciation of the Rupee, which contributed to its 12-month results falling below those of the preceding year.

Sri Lanka’s first multinational textile manufacturer has reported net profit of Rs 549.1 million for the three months ending 31st March 2024, up 260% over the corresponding quarter of the previous year and a 15% improvement over the preceding quarter.

Despite an increase in sales volumes, the Group’s revenue for the quarter, at Rs 15.3 billion, was down 4% over the figure for the third quarter of the year and 12% lower than the revenue of the corresponding quarter of the previous year. This was due to the appreciation of the Sri Lanka Rupee.

For the year ending 31st March 2024, Teejay Lanka reported revenue of Rs 60.8 billion, profit before tax of Rs 1.6 billion, and net profit of Rs 1.1 billion, reflecting declines of 28%, 49% and 48% respectively over 2022-23 as a result of the softening of the global market conditions during the year.

Nevertheless, the Group ended the financial year with a strong balance sheet with a cash and cash equivalents balance of Rs 8.9 billion and a net assets base of Rs 30.1 billion. Teejay’s net assets value per share of Rs 42 was lower by 6% when compared to the corresponding quarter, stemming from the strengthening of the Rupee against the Dollar, the Group said.

“The Group has reported gross profit of Rs 1.5 billion representing a year-on-year increase of 27% and a 17% increase when compared to the third quarter, as a result of the effective utilisation of the Group’s capacity at its two locations,” Teejay Lanka CEO Pubudu De Silva said. “Further optimisation of capacity utilisation and operational efficiency and stability in yarn prices have positively contributed to this growth, strengthening our confidence for the year ahead.”

Commenting on the Group’s performance in the concluded financial year, Teejay Lanka Chairman Ajit Gunewardene said it was encouraging to note the success of the multifaceted strategic initiatives undertaken to reverse the losses of the first quarter and to respond to market dynamics.

Gunewardene added: “The Group’s long-term priorities include digitalization, establishing and executing a robust ESG framework, reducing costs, developing new products, enhancing synthetic capacity, and uplifting and empowering human capital to enhance resourcefulness. These strategies are expected to come into effect in the current financial year, indicating promising prospects for the future and enabling the Group to mitigate the impact of identified pressures, volatilities, and challenges.”

The Teejay Group owns manufacturing facilities in Sri Lanka and India, along with a state-of-the-art printing facility in Sri Lanka. An ISO 9001:2015, ISO 14001:2015 and OHSAS 18001:2007 compliant company and the first in the industry to develop green fabric, Teejay Lanka was also the first textile manufacturer in Sri Lanka to receive membership of the US Cotton Trust Protocol. Teejay is a public quoted company with 40 per cent public ownership and the backing of Sri Lanka’s largest apparel exporter Brandix Lanka which has a 33 per cent stake in the Company. Pacific Textiles of Hong Kong, whose key shareholder is the Tokyo Stock Exchange listed Toray Industries Inc., owns 27 per cent of Teejay Lanka.(Teejay Lanka)

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SriLankan Cargo partners with CargoAi to enhance airfreight booking and payment experience

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SriLankan Cargo, the cargo arm of SriLankan Airlines, has partnered with CargoAi, a leader in digital freight solutions, to simplify and enhance the airfreight booking and payment process for users

SriLankan Cargo, the cargo arm of SriLankan Airlines, has partnered with CargoAi, a leader in digital freight solutions, to simplify and enhance its airfreight booking and payment processes, and bring more transparency and velocity for users than ever.

The integration of SriLankan Cargo’s airfreight services into CargoAi’s ecosystem gives users access to online booking and instant cross-border payment capabilities, while allowing SriLankan Cargo to increase its reach and support forwarders that were previously untapped.

CargoAi’s integration with SriLankan Cargo also streamlines payment processes by offering multiple payment methods, ranging from local transfers to credit card payments, removing the reliance on cash payments and enhancing security and efficiency in financial transactions. Additionally, CargoAi’s CargoWALLET platform facilitates the reconciliation process, automating tasks that were previously manual and time-consuming.

For freight forwarders, the integration also means that they no longer need to provide a bank guarantee or pay yearly subscriptions. Everything is seamlessly integrated with CargoMART, simplifying operations and reducing overhead costs, allowing forwarders to focus on core business operations without the burden of administrative complexities.

Chaminda Perera, Head of Cargo of SriLankan Airlines commented by saying, “Our partnership with CargoAi marks another significant stride in our digitalization journey, aimed at expanding our horizons. We will be able to enhance the visibility of our inventory and offer customers a convenient airfreight booking experience. We are looking forward to extending our market reach and engaging with businesses of all scales with CargoAi.”

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Mövenpick Hotel Colombo unveils ‘Space’ wellness brand

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Mövenpick Hotel Colombo proudly introduces ‘Space’, an innovative wellness brand designed to transcend boundaries and cultivate a culture of holistic well-being. The launch of ‘Space’ underscores the hotel’s unwavering commitment to fostering a vibrant and sustainable living experience for all.

‘Space’ represents a transformative leap forward for Mövenpick Hotel Colombo, consolidating its diverse offerings into a singular platform dedicated to holistic wellness. From the rejuvenating embrace of dance therapy to the serene tranquility of outdoor yoga and the invigorating energy of cross-functional fitness, ‘Space’ curates an unparalleled array of experiences tailored to nurture the mind, body, and spirit. Complemented by a thoughtfully curated selection of therapeutic treatments and a culinary journey inspired by the principles of nourishment and balance, ‘Space’ promises to redefine wellness in Colombo.

At its core, ‘Space’ is more than a brand – it’s a philosophy, advocating for the creation of space for oneself and others in the pursuit of a healthier, more fulfilling lifestyle. Through its multifaceted approach to wellness, ‘Space’ invites individuals to reclaim their well-being, fostering a sense of empowerment, connection, and community.

In a bold move towards inclusivity and accessibility, Mövenpick Hotel Colombo has brought together its entire spectrum of wellness offerings under the umbrella of ‘Space’. By consolidating these diverse experiences into one cohesive platform, the hotel seeks to ensure that every individual in the community has the opportunity to access and benefit from the transformative power of wellness. From guests seeking a rejuvenating escape to locals yearning for a sanctuary of self-discovery, ‘Space’ offers a welcoming embrace to all who seek balance and vitality.

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