Minister of Industries, Wimal Weerawansa along with Nandana Lokuwithana – chairman of Rigid Tyre Corporation inspecting the state-of-the-art, fully-integrated manufacturing plant
Rigid Tyre Corporation (Pvt) Ltd built with an investment of USD 250 million is slated for opening in mid-January 2021. The state-of-the-art, fully-integrated manufacturing plant was visited by Minister of Industries, Wimal Weerawansa, last week for a special inspection.
The construction of Phase 1 with an investment of USD 100mn is completed while the Phase 2 will be completed by mid-March 2022.
The landmark project is the first and only of its kind in Sri Lankan and is tipped to be the largest such facility in the whole of Southeast Asia manufacturing Passenger Car Radials (PCR) including specialized category for SUVs, two-wheelers, three-wheelers, trucks, buses and solid tyres seamlessly combining local talent with sophisticated European technology.
This export-oriented manufacturing plant with its impressive production capacity is expected to bolster the economy by revitalizing exports at this decisive juncture strengthening Government’s efforts to stabilize local currency in the face of the global pandemic. It is also expected usher in thousands of new job opportunities, both directly & indirectly, once operations commence mid-January next year.
Elaborating on the project, Executive Director Mr. Dhammika Lokuwithana said: “It is the largest FDI in the last ten years; it will also be one of the country’s foremost exporters when the production commences. Besides rejuvenating the export sector which has suffered due to different crises over the past few years, this project will also serve to revive the local rubber industry which Sri Lanka was once world renowned for.
We intend to source all the necessary rubber locally which will empower the native rubber farmer, generate new job opportunities in the thousands and, more importantly, the country will benefit from exposure to European technology which is the unrivalled forerunner in the market in terms of performance, efficiency and environmental consciousness,” he added.
The Chairman of Rigid Tyre Corporation, Mr. Nandana Lokuwithana meanwhile stated that an investment of this magnitude being made in Sri Lanka may send the right message to discerning foreign investors, giving them a sense of reassurance, to follow suit. He noted: “Investments such as these set a good precedent, cementing Sri Lanka’s position as a haven for investors globally. This falls very much in line with the Government’s vision to position the country as an industrial hub in the foreseeable future.”
Mr. Nandana Lokuwithana is a distinguished entrepreneur of global standing heading the Ceylon Steel Corporation Ltd & Onyx Group in the UAE with a host of subsidiaries including a steel fabrication company. His other investments include: Marriot Al Jadaf Hotel in Dubai, up-coming state-of-the art Cement Grinding Plant in Mirijjawila Hambantota slated to be commissioned in May 2021 and Marangoni Industrial Tyres Lanka (Pvt) Ltd.
Cabraal comments on exchange rate flexibility
Mr. Ajith Nivard Cabraal, twice Central Bank Governor and former State Minister for Finance, issued the following media statement last week on exchange rate flexibility.
“The decision to allow the Sri Lankan Rupee (LKR) to be “flexible” from March 7, 2022 onwards is sometimes described by certain persons as being a “unilateral” decision of then Governor Ajith Nivard Cabraal. Therefore, this statement is to provide the factual position so as to set the record straight.”The decision to allow flexibility in the exchange rate was taken by the Monetary Board of the Central Bank of Sri Lanka based on a Monetary Board Paper dated March 7, 2022 submitted by all three Deputy Governors (Mr Mahinda Siriwardene, Mr Dammika Nanayakkara & Mrs Yvette Fernando), Director – Economic Research Department and Director – International Operations Department.
“The Board Paper stressed the need for changing the exchange rate policy immediately in order that the exchange rate acts as a “shock absorber” in the face of adverse developments in the global front on Sri Lanka’s already fragile Balance of Payments, including the increase of the crude oil price to nearly USD 140 per barrel and the worsening Russia-Ukraine war.
“Based on that Board Paper and the discussion at the meeting, the Monetary Board decided to ‘allow the market to have a greater flexibility in the exchange rate with immediate effect and communicate that the Central Bank is of the view that forex transactions would take place at levels which are not more than Rs. 230 per US dollar.’
“From the above it will be clear that, while the Monetary Board had expressed its ‘view’ as to the level at which forex transactions would take place as a market guidance, a clear decision had been taken to allow for the flexibility of the LKR in the forex market. On the same day, a statement was issued to the media in line with the above decision.
“Further, within about a week of floating the LKR, the President made a formal announcement that the government had initiated discussions with the International Monetary Fund (IMF) for a programme.
“Subsequently, Governor Cabraal resigned on April 4, 2022, on which day, the LKR was trading at Rs. 289.73/299.99 per USD in accordance with the new ‘flexible’ exchange rate policy as announced by the Monetary Board. After Governor Cabraal’s exit, the Monetary Board chaired by the new Governor Dr. Weerasinghe continued with the ‘flexible’ exchange rate policy, whist the Government and CBSL also took a series of far reaching decisions which included the decisions to: sharply increase policy interest rates by 700 bps from April 8, 2022 onwards, and to discontinue repayments of forex loans and interest from April 12, 2022 onwards.
“In the meantime, the LKR continued to depreciate to a range of Rs. 364.23/377.50 against the USD by May 12, 2022, at which point, the Monetary Board had apparently once again decided to ‘fix’ the exchange rate at a new range between Rs.355.00/Rs.365.00 per USD. Such move to ‘fix’ the exchange rate seems quite similar to the policy adopted by the Monetary Board chaired by Governor Professor W D Lakshman which ‘fixed’ the LKR exchange rate at a range of Rs.199.00/203.00 per USD from September 6, 2021 onwards.
“It must of course be understood that there will always be conflicting opinions among stakeholders as to the value, timing and methodology to be followed in ‘fixing’, or ‘floating’ or ‘pegging’ a country’s currency. It is also quite possible that after decisions are taken to ‘float,’ ‘fix’ or ‘peg’ the currency, others could, claim that the decision was right or wrong or implemented differently.
“However, it must be appreciated that the decision-making authority has to take its decision based on the prevailing circumstances, expert advice, practical ground conditions, judgment of future expectations and outcomes, etc. when viewed holistically. That is obviously why the Monetary Law Act provides the authority to the Monetary Board to change financial and monetary sector policies (including the exchange rate policy, interest rates, statutory reserve ratios, etc) when it deems appropriate to do so, from time to time.
“It must also be appreciated that the implementation of policy measures is carried out by the professional and technical staff, of the Central Bank and they would naturally ensure that the policy measures being implemented are based on legal and binding decisions of the Monetary Board, which is the decision making authority, and not based on ‘unilateral’ decisions of a single person.”
Cathay Pacific releases its 2021 Sustainability Report
The Cathay Pacific Group has released its comprehensive annual Sustainable Development Report that addresses its commitment and progress in the areas of environmental, social and governance, which are of great importance to its stakeholders, and towards its goal of net-zero carbon emissions by 2050.
Regional General Manager, South Asia Middle East and Africa (SAMEA), Rakesh Raicar said: “We continue to ramp up our efforts to fight climate change and have made specific tangible progress towards supporting and prioritizing our sustainability issues which are communicated in our 2021 Sustainable Development Report. This includes supporting our communities in India by transporting essential aid during this global health crisis, and making new commitments towards the use of Sustainable Aviation Fuel (SAF) in our operations. We are certain, together with our partners and customers, we will continue to positively contribute to the environment and communities, and also connect Hong Kong to the world in sustainable ways as recovery accelerates.”
Some highlights from the 2021 report include:
• Helping to deliver vaccinations around the world: We raced against time to develop a dedicated Vaccine Solution to make COVID-19 vaccines available to global communities. In 2021, over 165 million vaccine doses along with other essential medical supplies were delivered to Hong Kong and beyond by our airlines.
• Making progress towards carbon neutrality: We became one of the first airlines in Asia to target 10% SAF use by 2030 and have committed to purchasing more than 350 million gallons of SAF beginning from 2024 alongside our Oneworld Alliance peers. We also co-founded the Aviation Climate Taskforce, an industry platform through which we will accelerate the development of breakthrough technologies that will help drive the decarbonisation of civil aviation. We also developed Asia’s first major Corporate SAF Program in 2021, which came to fruition in April this year with the launch of its pilot phase, bringing SAF into Hong Kong International Airport for uplift for the very first time.
Strong commitment to diversity: We have pledged to increase female representation at senior positions by 25% – reaching 30% in total – by 2025. To drive changes, a Diversity and Inclusion (D&I) Steering Committee and a dedicated team were set up in 2021.
TDL Logistics bags Bronze at National Logistics Awards
TDL Logistics Pvt. Ltd. won the Bronze Award in the Freight Forwarders and Logistics Category at the National Logistics Awards. TDL Logistics Pvt. Ltd. was established in October 2010 by Tony De Livera, along with a group of professionals in freight forwarding and logistics. TDLL has since established itself as a premier, service-oriented, international freight and logistics company with a special emphasis on the wearing apparel industry worldwide. The organisation is poised for exciting developments, such as enhancement of their network coverage, internationalization of the business and the formulation of strategic partnerships, with their prime expectation being to have rapid growth, with a strong agency network globally.
“This award further reflects the confidence of our customers in the quality of our services. I would say this is a collective achievement of our Company’s most dedicated employees at all levels. Winning an award at the first ever National Logistics Awards Ceremony is a great honour and a source of pride for me. Especially during these challenging times. As a result, I would like to thank SLFFA and fellow members for their continuous encouragement and support shown to our group and the TDLL Team, and I owe a very special thank you to all our colleagues for their hard-work and dedication over the years, that enabled us to win this award,” said Chairman of the Company Tony de Livera.
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