Business

Real question is not whether SL should go to IMF or not: Verité Research

Published

5 years ago

2021/08/5

Sahan Weerasooriya

‘ Sri Lanka makes the mistake of letting IMF write a plan for the country’

by Sanath Nanayakkare

The real question is not whether Sri Lanka should go to the IMF or not. What is important is going to the IMF with confidence after having analysed the fiscal situation, with a convincing plan, Executive Director of Verité Research Dr. Nishan de Mel said in Colombo recently.

He made this remark at a CEOs Forum hosted by CA Sri Lanka to provide clarity on the current debt situation, whilst also helping the business community gain a better understanding on the government’s strategy and way forward to navigate through the ongoing situation.

State Minister of Money and Capital Market and State Enterprise Reforms Ajith Nivard Cabraal, was the guest speaker and the panel session brought together eminent speakers comprising of Governor of the Central Bank of Sri Lanka Professor W. D. Lakshman, Chairman of the Ceylon Chamber of Commerce Vish Govindasamy, [Executive Director of Verité Research (Pvt) Ltd Dr. Nishan de Mel], and Managing Director of Fitch Rating Agency Maninda Wickramasinghe.

Dr. Nishan de Mel further said: “For instance, when you go to a bank with a business idea to take out a loan, the bank says, ‘give me your plan’. But if you get the credit officer to write the plan for you it won’t be appropriate. The mistake Sri Lanka makes is letting the IMF write that plan for the country because the country doesn’t have one. The crux of the matter is; the credit officer shouldn’t write the plan. The country should present the plan and convince the credit officer that the plan has the potential to work out – a plan backed by an analysis that can win the confidence of the lender. That’s the structured way to obtain an IMF facility for Sri Lanka. I do hope that we can take that path.”

“The Central Bank may have a different approach to analyzsng the situation – I think publishing that analysis would be very valid because that is a test of some scrutiny and others would be able to look at it – that is a way to give confidence. I completely accept that there is no one way to analyse the situation and determine the approaches we can take, but it is important to make the chosen approach public.”

“The government and the Central Bank of Sri Lanka (CBSL) are on the right path with regard to reducing the ratio of foreign debt to domestic debt, but the greater reliance placed on domestic financing too quickly would be like running a marathon too fast as it could burn out the accelerated shift.”

“On the other hand, we might not have the option of being too slow on this aspect as rating agencies are downgrading and the markets are observing. Amid this we have to build confidence. These are very concerning which is why I say it is not too late for Sri Lanka to realign its strategy to get out of the problem and to keep its debt sustainable while making sure we won’t run into a liquidity crisis.”

“Verité’s own analysis shows that there are four steps that can make debt repayment more sustainable and a fifth step to avoid a reserve crisis which people are worried about.”

“Number 1; the interest rates on local debt can be no higher than inflation which I think we have probably achieved. The Central Bank has had a larger tolerance for inflation and it will end up in 6.5% range, and interest rates on local debt have been brought down which is an important part of the function. I t will take some time for all the government debt to reflect that lower rate, but that in reality is the right path. However, it’s a cost to society because inflation is costly in terms of real returns from your bank balances or investments.”

“Secondly, interest rates on foreign denominated loans can’t be higher than GDP growth There also Sri Lanka is well placed because even though we talk about having a large amount of commercial debt, the history of concessional debt is so high that our weighted average interest rate on foreign denominated debt is still only 3.9%, and going forward with a growth of about 4%, we can maintain that. Being able to maintain the interest on that percentage rate for foreign denominated loans is favourable for Sri Lanka.”

“Then there are two other conditions that Sri Lanka needs to do more about. One is the primary deficit- that is the deficit after paying interest- which should be less than 60% of GDP growth – that means if the GDP growth is 5%, primary deficit can’t be more than 3%. If we are expecting a lower GDP growth this time; say a growth of 3.3%, then the primary deficit can’t be more than 3%. So we really have to control that and bring it down. And it is very important to report those numbers correctly to give the markets that confidence. This still allows for a budget deficit in the high single digits because our total interest on debt is over 6% of GDP. This is not drastic, but it says that deficit has to be in the mid single digits. If we want to maintain the deficit, we need to be able to manage the upper single digits with a doable plan.”

The fourth is that depreciation of the currency can be no higher than inflation, and that brings us to the fifth step because currency depreciation today is not based on the fundamental mismatch in global crisis vs Sri Lankan crisis. From 2015 to 2019, one of the major important adjustments made was, to bring it to what you call the real exchange rate. Sri Lanka’s exchange rate until 2015 was significantly over valued. Even though depreciation hurt, the adjustment brought stability. That was an important alignment. That alignment is still sort of in place but today because of the uncertainty about the reserves, you see a speculative exchange rate- and that simply puts pressure on depreciation.”, he said.

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Business

Pan Asia Bank’s Rs. 5 b debenture issue oversubscribed

Published

19 hours ago

2026/10/3

Thilina Walpola

B D A Perera, Chairman and Naleen Edirisinghe Director/CEO of Pan Asia Bank

Pan Asia Banking Corporation PLC’s Senior Listed Rated Unsecured Redeemable Debenture issue of up to Rs. 5 billion was oversubscribed following its opening reflecting strong investor interest.

The debentures, with a par value of Rs. 100 each, will be listed on the Colombo Stock Exchange (CSE). The three-year debentures offer an interest rate of 12.75% interest payable annually, while the five-year debentures offer 13.50% interest payable annually.

The issue has been assigned a BBB+ (Stable) rating by Lanka Rating Agency.

The debenture issue was managed by the Investment Banking Unit of Commercial Bank of Ceylon PLC, with SSP Corporate Services (Private) Limited serving as the Registrar to the Issue.

The Bank said the strong investor response demonstrates continued confidence in Pan Asia Bank and its approach to creating long-term value for its stakeholders.

Pan Asia Bank, which positions itself as ‘The Truly Sri Lankan Bank’, continues to strengthen its role in supporting the financial requirements of individuals and businesses while contributing to the development of Sri Lanka’s economy.

Business

SLIIT International and Liverpool John Moores University inaugurate dedicated international learning facility

Published

19 hours ago

2026/10/3

Thilina Walpola

Andrew Patrick

The Sri Lanka Institute of Information Technology (SLIIT) and Liverpool John Moores University (LJMU), United Kingdom, recently inaugurated SLIIT International in Collaboration with LJMU, a dedicated international learning facility located at No. 17, Dickmans Road, Colombo 04, marking a significant milestone in a partnership spanning more than a decade and reinforcing their commitment to providing Sri Lankan students with access to internationally recognised UK higher education qualifications.

The Grand Opening Ceremony was attended by Andrew Patrick, British High Commissioner to Sri Lanka, who graced the occasion as Chief Guest, alongside senior representatives from SLIIT, Liverpool John Moores University, the British Council, academia, industry and other stakeholders, marking the next chapter of the longstanding SLIIT–LJMU collaboration. The new facility is particularly significant as Sri Lanka’s first academic facility dedicated exclusively to the delivery of LJMU degree programmes, reflecting the strength, maturity and long-term commitment of the partnership.

Over the past decade, the SLIIT–LJMU partnership has established a growing network of more than 1,500 alumni, while providing Sri Lankan students with opportunities to gain internationally recognised UK qualifications locally. The new dedicated facility has been designed to provide a world-class learning environment exclusively for LJMU programmes, supporting future programme expansion, strengthening the student experience and creating opportunities for deeper academic collaboration, innovation, research and student engagement.

Commenting on the milestone, Prof. Lalith Gamage – Vice-Chancellor, Managing Director and Chief Executive Officer, SLIIT, stated, “The launch of SLIIT International in Collaboration with Liverpool John Moores University represents an important new chapter in our longstanding partnership with Liverpool John Moores University. Our vision is to provide Sri Lankan students with a world-class education and student experience right here in Sri Lanka, while equipping them with the global outlook, critical thinking, professional capabilities and career readiness required to succeed in an increasingly interconnected world. This dedicated facility strengthens the student experience while providing a strong foundation for the continued growth of our collaboration with LJMU.”

Prof. Timothy Nichol, Pro-Vice-Chancellor, Faculty of Society and Culture, Liverpool John Moores University, said, “The opening of Sri Lanka’s first facility dedicated exclusively to LJMU degree programmes represents a significant milestone for the University and our partnership with SLIIT. It reflects the strength of our collaboration and our shared commitment to delivering a high-quality LJMU educational experience in Sri Lanka. The new facility also creates exciting opportunities for deeper academic collaboration, innovation, research and student engagement as we look towards the next phase of our partnership.”

A key highlight of the Grand Opening Ceremony was the panel discussion titled “Beyond Borders: The Role of British Higher Education in Developing Globally Competitive Graduates.” The discussion examined the growth of international educational opportunities in Sri Lanka, the future expansion of UK degree programmes, maintaining the quality and integrity of UK qualifications, developing future-ready graduates with global competencies, and the role of international higher education in strengthening graduate employability. The panel brought together Prof. Lalith Gamage; Prof. Timothy Nichol; Mr. Sajeewa Meepage, Representative of the British Council; and Dr. Harsha Cabral, Board Member of SLIIT.

The panelists further emphasized on emerging trends in areas including law, business, psychology and artificial intelligence, as well as the contribution of UK higher education to Sri Lanka through internationally recognised qualifications that uphold global academic standards.

The discussion explored the history and future of the SLIIT–LJMU partnership, the strategic significance of the new SLIIT International facility, academic quality, graduate employability and the long-term growth of LJMU programmes in Sri Lanka.

The ceremony also featured a special address by Andrew Patrick, British High Commissioner to Sri Lanka, followed by an address by Mrs. Clare Sears, Country Director, British Council Sri Lanka. The evening also included the ceremonial exchange of the partnership document between SLIIT International and Liverpool John Moores University, symbolising the continued commitment of both institutions to strengthening their collaboration and expanding international educational opportunities for Sri Lankan students.

Business

Dijital Team and WinSYS City University launch two-year partnership

Published

19 hours ago

2026/10/3

Thilina Walpola

Ziyam Abdeen, Chairman of WinSYS, and Peter Ward, Managing Director of Dijital Team, at the signing ceremony for the two-year partnership

Dijital Team has signed a two-year partnership with Winsys City University, strengthening the skills and capabilities of its team members to support Managed Service Providers and IT service providers while elevating tech talent to immediate industry-readiness. With a Memorandum of Understanding (MOU) signed recently, the partnership was formally launched on 9 September 2026 at Dijital Team’s office premises, Colombo.

Combining Dijital Teams’ international employer network and understanding of the capability requirements of MSPs and IT service providers across Australia, New Zealand and the United Kingdom with Winsys City University’s training heritage of 21 years, the joint programmes create legitimate classroom-to-international-career pathways, offering structured learning and certification avenues that support deeper capability across cloud, cybersecurity, automation, AI and emerging technologies.