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CEB Reports Rs. 29.15 Bn Loss in 2025 Q4 📈

The Ceylon Electricity Board (CEB) has posted a significant financial downturn for the final quarter of 2025, reflecting a sharp shift in the state utility's profitability. • Quarterly Performance (Q4 2025): Recorded a net loss of Rs. 29.15 Bn for the quarter ended 31 December 2025. This represents a 4,929% decline compared to the Rs. 603 Mn profit reported in Q4 2024. • Annual Results (Full Year 2025): The total annual loss reached Rs. 38.73 Bn. This follows a highly profitable 2024, where the utility recorded a surplus of Rs. 141.60 Bn. • Economic Context: The reversal highlights ongoing volatility in the energy sector, impacting national fiscal stability and the broader power & infrastructure landscape. _Note: Based on latest financial statements as of March 2026._

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CEB Reports Rs. 29.15 Bn Loss in 2025 Q4 📈

The Ceylon Electricity Board (CEB) has posted a significant financial downturn for the final quarter of 2025, reflecting a sharp shift in the state utility's profitability. • Quarterly Performance (Q4 2025): Recorded a net loss of Rs. 29.15 Bn for the quarter ended 31 December 2025. This represents a 4,929% decline compared to the Rs. 603 Mn profit reported in Q4 2024. • Annual Results (Full Year 2025): The total annual loss reached Rs. 38.73 Bn. This follows a highly profitable 2024, where the utility recorded a surplus of Rs. 141.60 Bn. • Economic Context: The reversal highlights ongoing volatility in the energy sector, impacting national fiscal stability and the broader power & infrastructure landscape. _Note: Based on latest financial statements as of March 2026._

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📈 Fintrex Finance Reports Massive 352% Surge in 9-Month PAT

Fintrex Finance PLC has announced exceptional results for the nine months ending December 31, 2025, driven by strong operational momentum and successful income diversification. • Overall Profitability: Year-to-date Profit After Tax (PAT) soared to Rs. 478 Mn, a 352% YoY increase. Earnings Per Share (EPS) jumped to Rs. 2.02 from Rs. 0.45. • Revenue Performance: Gross income rose 79% to Rs. 4.80 Bn. Net Interest Income (NII) surged 91% to Rs. 2.38 Bn, supported by a 61% growth in interest income and effective asset-liability management. • Income Diversification: Net fee and commission income saw a remarkable 422% YoY growth to Rs. 667.6 Mn, highlighting a shift toward non-interest-based revenue. • Balance Sheet & Assets: Total assets grew 37% to Rs. 29.8 Bn. Loans and advances expanded by 68%, while customer deposits increased 19% to Rs. 11.6 Bn. • Strategic Growth: The company is advancing its digital footprint with a new mobile banking app and targeted financing for SMEs and students. Capital was bolstered via a Rs. 500 Mn Tier II certificate issuance and a rights issue. • Stability: Impairment provisions increased in line with loan growth using conservative IFRS 9 overlays to ensure long-term resilience.

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JXG Reports Strong 9-Month Growth with Rs. 3.2 Bn Profit 📈

Janashakthi Group (JXG) delivered a resilient performance for the nine months ended 31 December 2025 (Q3 FY26), driven by its integrated financial services portfolio. • Overall Group Performance: Consolidated Revenue: Rs. 21.9 Bn (up 19.2% YoY). Net Profit After Tax (PAT): Rs. 3.2 Bn, surpassing the Rs. 2.9 Bn recorded in the previous year. Total Assets: Stood at Rs. 163 Bn, reflecting a strengthened balance sheet. • Sector & Subsidiary Breakdown: Investment Banking (First Capital): Contributed Rs. 11.4 Bn to revenue. While mark-to-market gains moderated, the stockbroking arm saw PAT surge to Rs. 166 Mn from Rs. 39 Mn YoY. Insurance (Janashakthi Insurance): Reported a PAT of Rs. 3.4 Bn for the full year. Gross Written Premiums rose 31% to Rs. 8.7 Bn, with a significant 67% growth in New Business Premiums. Finance (Janashakthi Finance): PAT reached Rs. 240 Mn. The lending portfolio showed high traction with 49% YoY growth, pushing Net Operating Income up by 35% to Rs. 2.2 Bn. • Strategic Outlook: The Group attributes its success to a disciplined "portfolio approach" and scalable platforms. Management remains confident for the final quarter of FY26, focusing on capital allocation and risk management to sustain momentum across its banking, insurance, and leasing interests.

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📈 Ceylinco Life Secures 22nd Year of Market Leadership with Rs. 44.18 Bn Premium

Ceylinco Life has maintained its dominant position in Sri Lanka’s life insurance sector for the 2025 financial year, posting strong growth across all key financial metrics and crossing the Rs. 200 Bn Life Fund milestone. • Core Financial Performance • Gross Written Premium (GWP): Rs. 44.18 Bn (↑ 18.96% YoY) • Total Consolidated Income: Rs. 72.43 Bn (↑ 10.51% YoY) • Net Profit After Tax: Rs. 7.85 Bn (↑ 10.97% YoY) • Profit Before Tax: Rs. 11.21 Bn (↑ 11.5% YoY) • Asset Base & Stability • Total Assets: Rs. 287.02 Bn (↑ 14.15%), growing at an average of Rs. 2.9 Bn per month. • Life Fund: Milestone reached at Rs. 201.81 Bn (↑ 11.56%). • Investment Portfolio: Expanded to Rs. 253.43 Bn (↑ 13.9%). • Policyholder & Shareholder Value • Benefits Paid: Rs. 31.07 Bn in net claims and benefits (↑ 24.06% YoY). • Shareholder Equity: Increased to Rs. 67.8 Bn. • Earnings Per Share (EPS): Rs. 156.94. The results underscore the resilience of the financial services industry and Ceylinco Life’s ability to maintain high trust levels, reflected in its 19th consecutive "People’s Life Insurance Service Provider" award. The company continues to play a vital role in national risk mitigation and long-term capital formation.

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Fitch Assigns 'AAA(lka)' Rating to Hayleys Rs. 7 Bn Debentures 📈

Fitch Ratings has assigned a National Long-Term Rating of 'AAA(lka)' to Hayleys PLC’s proposed Rs. 7 billion unsecured senior redeemable debentures, reflecting the group's dominant market position and diversified revenue streams. • Financial Performance & Outlook Revenue Growth: Projected to rise by 19% in FY26, driven by consumer and retail, hand protection, and purification sectors. Margins: EBITDA margin expected at 10% for FY26 (slight dip from 11% in FY25) due to textiles export softening and US tariff pressures, with recovery to 11% forecast for FY27. Leverage: Net leverage (EBITDAR) expected to steady at 3.0x–3.5x for FY26-FY28. • Sector & Market Highlights Export Strength: Direct and indirect exports accounted for 53% of FY25 revenue; 15% stems from US/EU markets. Purification: Global leader in coconut shell-based activated carbon; 45% of capacity is located in Thailand and Indonesia. Hand Protection: Manufacturing operations in Thailand leverage the world’s largest natural rubber source. Agriculture & Tea: Holds a leading supplier position in Sri Lanka’s tea export and plantation industries. • Strategic Liquidity Capex: Planned annual investment of ~Rs. 20 billion for capacity expansion. Rights Issue: Rs. 9 billion expected in FY26 to finance new investments and debt repayment. Liquidity: Supported by Rs. 55 billion in unrestricted cash and strong access to domestic banking capital.

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📈 Sierra Cables Reports Robust Growth and Global Expansion

Sierra Cables PLC has demonstrated a strong financial resurgence for the nine months ended 2025, driven by strategic oversight under Browns Investments and a focus on high-standard manufacturing. • Overall Financial Performance Revenue: Rs. 12 Bn (↑ 68% YoY from Rs. 7 Bn) Operating Profit: Rs. 2.5 Bn (↑ 70% YoY) Net Profit: Rs. 2.1 Bn (↑ 105% YoY) Earnings Per Share: Increased to Rs. 3.88 from Rs. 1.89 • Sector & Market Highlights Export Leadership: Named "Best Sri Lankan Brand Exporter" in the Electronic and Electrical Products sector. US Market Access: Remains the only Sri Lankan cable manufacturer certified to the UL 44 standard, enabling supply to the highly regulated United States market. International Footprint: Expanding reach through operations in Zambia (Browns Manufacturing Ltd) and Fiji (Cables PTE Ltd). Infrastructure Impact: Primary supplier for major local projects including Cinnamon Life at City of Dreams and the Thambuttegama Water Supply Project. • Strategic Factors Financial Discipline: Net finance costs fell 29% to Rs. 101 Mn, aided by exchange gains from export growth. Credit Rating: Maintained an A+ (lka) national rating with a stable outlook from Fitch Ratings. Innovation: Investing in specialized solutions for renewable energy and fire-resistant cables for critical infrastructure. The company’s performance reflects a structural shift toward global competitiveness, balancing domestic market depth with a diversified international presence.

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### Amana Bank Records Best-Ever Performance in 2025 📈

Amana Bank achieved its highest profitability since inception in 2025, driven by robust growth in the SME sector and core financing activities. Financial Highlights • Profitability: Profit Before Tax (PBT) surged 47% YoY to Rs. 4.1 Bn, while Profit After Tax (PAT) rose 40% to Rs. 2.4 Bn. • Efficiency: Return on Equity (ROE) reached double digits for the first time at 10.4% (vs. 8.0% in 2024). The Cost-to-Income ratio improved to 51.8%. • Income: Total Operating Income grew 16% to Rs. 10.1 Bn, supported by a 21% rise in Net Financing Income. Lending & Asset Quality • Advances: Customer advances grew by 36% (Rs. 39.6 Bn) to reach Rs. 150.9 Bn, focusing heavily on SMEs to support the national economy. • Asset Quality: Maintained an industry-leading Stage 3 Impaired financing ratio of just 1.2%. • Assets & Deposits: Total Assets grew 12% to Rs. 204.3 Bn, while deposits rose to Rs. 172 Bn with a strong CASA ratio of 45%. Stability & Shareholder Value • Capital Position: Total Capital Ratio stood at 14.7%, comfortably above the 12.5% regulatory requirement. • Dividends: Declared its 8th consecutive interim dividend of Rs. 1.30 per share (4.3% yield). • Global Standing: Recognized among the Top 50 Strongest Islamic Banks globally by The Asian Banker. New Appointment • Board Expansion: Appointed Dr. Aishath Muneeza, a global expert in Islamic finance and former Maldives Deputy Minister, as an Independent Non-Executive Director. _Note: Based on audited FY 2025 financial data._

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📈 Pan Asia Bank to Raise Rs. 5 Bn via Debenture Issue

• Pan Asia Banking Corporation PLC has received Board approval to raise up to Rs. 5 billion through a listed, rated, unsecured, senior, redeemable debenture issue. • Issue Details: The bank plans to issue up to 50 million debentures at a face value of Rs. 100 each. • Tenor & Listing: The proposed instruments will carry tenors of up to five years and are intended to be quoted on the Colombo Stock Exchange (CSE). • Status: The move is subject to necessary regulatory approvals following the Board's decision on 26 February 2026. • Context: This capital raising initiative supports the banking & financial services sector's liquidity and long-term funding structures within the Sri Lankan economy. _Note: Based on official bank disclosure dated 03 March 2026._

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📈 Union Bank to Raise Rs. 3 Bn via Basel III Debenture Issue

Union Bank of Colombo PLC has announced a strategic debenture issue scheduled to open on 10 March 2026, aiming to raise up to Rs. 3 Billion to strengthen its Tier II capital base. • Issue Details The offering consists of Basel III compliant, listed, rated, unsecured, and subordinated redeemable debentures with a 5-year tenure (2026–2031). The instrument is rated BB (lka) by Fitch Ratings. • Investment Structure Investors can choose from three distinct types priced at Rs. 100 per unit: Type A: 13% fixed rate p.a. (paid annually). Type B: 12.5% fixed rate p.a. (paid semi-annually; 12.89% AER). Type C: Floating rate of 182-day T-Bill rate + 400 bps (paid semi-annually). • Capital Allocation The initial issue is for 20 million debentures (Rs. 2 Bn), with an option to issue an additional 10 million (Rs. 1 Bn) at the bank's discretion. Funds are earmarked to bolster capital adequacy and fuel long-term growth initiatives within the banking and financial services sector. • Key Parties The issue is managed by First Capital Advisory Services Ltd as the Managers and Placement Agents.

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📉 LB Finance Withdraws Proposed Rs. 10 Bn Debenture Issue

• LB Finance PLC has officially decided not to proceed with its previously announced listed debenture issue, which aimed to raise up to Rs. 10 billion. • The decision follows an internal assessment by the Board of Directors, effectively cancelling the plans communicated in October and December 2025. • The proposed issuance consisted of listed, rated, unsecured, senior, redeemable debentures, a move typically intended to strengthen capital bases or fund lending growth in the non-banking financial institution (NBFI) sector. • This withdrawal reflects a shift in the company's capital mobilization strategy, though specific reasons for the board's decision were not disclosed in the statement.

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SLT Group Reports Surge in FY 2025 Profitability Amid Cost Efficiency 📈

The SLT Group has recorded a massive turnaround for the financial year ended 31 December 2025, driven by disciplined expense management and a significant reduction in finance costs. • Overall Group Figures • Profit After Tax (PAT): Rs. 10.0 Bn (+221% YoY) • Revenue: Rs. 114.2 Bn (+3% YoY) • Operating Profit: Rs. 14.2 Bn (+27% YoY) • Finance Costs: Reduced by 21% to Rs. 7.05 Bn due to debt settlement and lower interest rates. • Sector Breakdowns • SLT PLC (Fixed): Revenue grew 2% to Rs. 73 Bn. PAT surged 196% to Rs. 6.2 Bn, bolstered by FTTH (Fiber-to-the-Home) adoption and strong demand in the SME and government sectors. • Mobitel (Mobile): Reported a stellar 2,123% increase in PAT to Rs. 3.1 Bn. Growth was fueled by data consumption and a transition to a profit-based tax regime. • Strategic Highlights • ICT/BPM & Digital Infra: Expansion of fiber networks supported key national projects like the Lanka Government Network. • 5G Leadership: Strategic spectrum acquisition positions Mobitel as the leader in high-speed connectivity. • National Resilience: Successfully restored 98% of network sites within one week following Cyclone Ditwah. • Q4 Momentum • Group PAT for the final quarter rose 51% YoY to Rs. 3.5 Bn, maintaining strong momentum heading into 2026.

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📈 SalamAir Suspends International Operations Amid Regional Developments

Oman’s budget carrier, SalamAir, has announced a temporary 24-hour suspension of all international flights and its Masirah service, effective 28 February 2026. • Current Status: All international routes are halted for a minimum of 24 hours. • Reasoning: The airline cited the "evolving situation in the region" as a precautionary measure, prioritizing the safety of passengers and crew. • Impact: The suspension affects regional connectivity, including routes vital for labor migration and tourism sectors linked to the Middle East. • Next Steps: Operations are under constant monitoring; affected passengers are being contacted directly for rebooking or travel arrangements. _Note: This summary is based on provisional operational updates released on 28 February 2026._ ---

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Product & Service Launches / Business Expansions

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✈️ SriLankan Airlines Adds Extra London Flight Amid Middle East Disruptions

SriLankan Airlines has announced an additional scheduled service between Colombo and London on 8 March 2026. This move aims to facilitate travel for passengers impacted by recent flight cancellations stemming from the ongoing situation in the Middle East. • Flight Details (8 March 2026): Colombo to London (UL1205): Departs 06:50 hrs; Arrives 13:10 hrs. London to Colombo (UL1206): Departs 15:05 hrs; Arrives 06:55 hrs (next day). • Operational Context: The national carrier is actively monitoring regional instability and plans to deploy further additional flights on select routes to mitigate travel disruptions. This proactive capacity management is crucial for maintaining connectivity in the tourism and aviation sectors, which are vital for Sri Lanka’s foreign exchange liquidity. • Support Channels: Passengers can verify status via the 1979 hotline, WhatsApp (+94 74 444 1979), or official digital platforms. _Summary based on official airline scheduling data._

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Sri Lankan Entrepreneur Rikas Usman Launches XPLOSA LLC in New York 📈

• Global Expansion: Sri Lankan industrialist Rikas Usman, Chairman of Xplosa Corporation, has officially expanded into the U.S. market with the launch of XPLOSA LLC in New York. This marks a strategic move to take Sri Lankan manufacturing excellence to the global industrial adhesives stage. • Sector Focus: The venture will operate under the flagship brand ARKEMIC, targeting high-growth sectors including packaging, woodworking, construction, and textiles. The product portfolio features advanced PVA, BOPP, and Styrene-Acrylic formulations. • Strategic Goals: • Establishing a full-scale adhesive manufacturing facility in the U.S. in the near future. • Delivering eco-friendly, next-generation adhesive technology compliant with EPA and international standards. • Strengthening the link between Sri Lankan polymer chemistry expertise and North American market reach. • Institutional Backing: Xplosa Corporation is part of the Kandyan Group, a prominent Sri Lankan conglomerate with over 40 years of heritage in manufacturing, FMCG, and logistics. • Economic Impact: The move highlights the potential for Sri Lankan industrial chemicals and manufacturing firms to diversify internationally, boosting the country's profile as a hub for technical entrepreneurship and specialized exports.

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📈 SITREK Group & Singapore’s ST Engineering Partner to Bolster Sri Lanka’s Cyber Resilience

Sri Lanka’s SITREK Group has signed a strategic Memorandum of Collaboration (MOC) with Singaporean technology leader ST Engineering to enhance national digital infrastructure and enterprise-level security. • Strategic Alliance: The partnership, announced at the SITREK Cyber & Tech Summit 2026, combines local expertise with global defense-grade capabilities to address evolving regional cyber threats. • Core Objectives: Focus includes technology integration, knowledge exchange, and the deployment of advanced cybersecurity systems aligned with international standards. • Economic Impact: The collaboration aims to drive skills development in the ICT/BPM sector, reinforcing Sri Lanka’s position as a burgeoning hub for cybersecurity excellence in South Asia. • Digital Trust: Initiatives target institutional capacity building to safeguard critical digital infrastructure, a vital component for national economic stability and boardroom-level risk management.

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📈 JAT Holdings Boosts Binder Production Capacity by 76%

• Manufacturing Expansion: JAT Holdings PLC has successfully commissioned the second phase of its binder manufacturing plant in Sri Lanka. The facility is now fully operational, delivering a 76% increase in production capacity. • Sector Impact: This expansion shifts focus from primarily exterior wood coatings to the interior wood coating segment, broadening the Group’s manufacturing footprint across its decorative and industrial portfolios. • Economic Resilience: Increased local production reduces dependency on imported raw materials, mitigating risks from global freight volatility, energy costs, and foreign exchange fluctuations. This backward integration enhances cost predictability and margin resilience. • Strategic Footprint: The move consolidates JAT’s position as a Sri Lankan multinational, complementing its Alkyd Resin plant in Bangladesh. The expansion supports both domestic supply and the Group’s growing international presence. • Sustainability & Efficiency: The upgraded facility incorporates process enhancements to improve consistency and reduce the environmental impact associated with the long-distance transport of intermediates.

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📈 CAL Launches Shariah-Compliant Money Market Fund

Capital Alliance Limited (CAL) has introduced the CAL Islamic Money Market Fund, an open-ended scheme providing retail and corporate investors with ethical exposure to Shariah-compliant instruments. • Investment Focus & Quality: The fund invests in instruments with maturities under 397 days, including corporate Sukuk, commercial papers, and asset-backed securities. All investments are restricted to issuers with a minimum rating of BBB- or above. • Key Features: • Liquidity: Anytime redemptions with no penalties; instant redemptions up to LKR 100,000. • Accessibility: Low entry requirements and a fully digital onboarding/management process via an investor portal. • Transparency: Daily return updates and real-time portfolio visibility. • Governance & Oversight: • Shariah Compliance: All products are screened by an approved Shariah Advisory Committee. • Regulation: Fully regulated by the Securities and Exchange Commission (SEC) of Sri Lanka. • Custody: Assets are safeguarded by Hatton National Bank (HNB) as the reputed custodian. This launch enhances financial inclusion within Sri Lanka’s wealth management sector by offering a regulated, liquid, and ethical investment alternative to traditional interest-based products.

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Seylan Bank Digitalizes Gold Loan & Pawning Repayments 📈

Seylan Bank PLC has launched a new online interest and part payment facility for its gold loan and pawning customers, aiming to reduce branch dependency and enhance digital accessibility. • Digital Shift: Customers can now settle interest expenses and make part payments digitally from any location, eliminating the need for physical branch visits or queuing. • Strategic Intent: The move aligns with evolving digital banking expectations and targets Retail Banking efficiency, specifically benefiting business owners, employees, and households. • Value Proposition: While maintaining traditional features like fast service and competitive advance amounts, the new facility offers greater flexibility in managing cash flows and loan commitments. • Economic Context: This initiative supports the broader ICT/BPM and digital finance integration within Sri Lanka's banking sector, improving financial inclusivity for gold loan borrowers. _Note: Summary based on official bank release dated March 05, 2026._

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HIP Expands RoRo Capacity to Bolster East-West Trade Position 📈

The Hambantota International Port (HIP) has commissioned a new six-hectare Roll-on/Roll-off (RoRo) yard, marking a key milestone in Stage I of its Phase II expansion to strengthen Sri Lanka’s role as a regional logistics and transhipment hub. • Capacity & Infrastructure: The new yard increases vehicle parking capacity to 4,500 units per terminal space. It is designed to reduce congestion, improve traffic circulation, and ensure faster vessel turnaround times for large Pure Car and Truck Carriers (PCTCs). • Operational Performance: In 2025, HIP handled 726,153 vehicles, driven by demand across Asia, the Middle East, and Africa. The port is now targeting an annual handling capacity of 1 million vehicles in upcoming phases. • Strategic Advantage: Located only 10 nautical miles from the main East-West shipping lane, the port offers significant "deviation savings." This reinforces its value proposition for automotive transhipment and consolidation. • Future Outlook: Construction for Stage II of Phase II is already underway, with commissioning expected in Q2 2026. Additionally, NYK has announced two new RoRo services, signaling strong industry confidence in the maritime and transport sector. _Data based on official HIPG commissioning reports (March 2026)._

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### Synogen Launches First Integrated EV Charging Hub at Independence Arcade ⚡

Synogen has unveiled "Synogen Evo," Sri Lanka’s first comprehensive electric vehicle (EV) charging station designed to support the country’s entire mobility mix at a single location. • Infrastructure Scope: The flagship hub at Independence Arcade provides dedicated charging bays for four-wheelers (AC and fast DC), electric three-wheelers, and electric motorbikes. • Strategic Impact: This marks a major milestone for the clean energy and transport sectors, specifically addressing the infrastructure gap for two and three-wheelers, which dominate Sri Lanka’s roads. • Technology: The facility features smart monitoring and load management via Synogen’s proprietary digital platform, ensuring safety and grid stability. • Future Outlook: Synogen plans to scale the Evo network across strategic commercial, retail, and hospitality transit locations island-wide. • Sustainability Goal: Future sites aim to integrate renewable energy sources and intelligent energy management to support national decarbonization efforts.

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Allianz Lanka and Pay&Go Partner to Enhance Digital Insurance Access 📈

Allianz Insurance Lanka Ltd. has strengthened its strategic partnership with MegaPay (Pvt) Ltd, the operator of the Pay&Go payment network, to simplify insurance accessibility across Sri Lanka. Originally established in 2021, this collaboration aims to integrate insurance into the local fintech ecosystem. Key Partnership Highlights: • Service Reach: Allianz policyholders can now settle premiums and obtain third-party insurance via an extensive network of over 1,000 multilingual self-service kiosks. • Strategic Locations: Kiosks are positioned in high-traffic hubs including supermarkets, banks, and retail stores to eliminate the need for physical branch visits. • Digital Inclusion: The partnership focuses on removing barriers to financial services, leveraging Pay&Go’s 13-year track record in secure digital and physical payment channels. • National Context: This move supports the digital evolution of the financial services sector by enhancing convenience and reliability for policyholders nationwide. This synergy between a global insurance leader and a local fintech pioneer reflects a shared commitment to building a more inclusive financial environment for all segments of Sri Lankan society. Based on official corporate announcement.

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STC TechSphere 2026: Strengthening Sri Lanka’s Industrial Engineering Hub 📈

• Event Overview: Swedish Trading Company (STC) hosted "TechSphere 2026" in Colombo, marking over 40 years of partnership with global engineering giants Atlas Copco and SKF. The forum focused on technical knowledge-sharing and Industry 4.0 applications. • New Strategic Partnership: STC officially introduced Germany’s SUTO iTEC as its newest principal partner, specializing in compressed air measurement and monitoring solutions to enhance industrial efficiency. • Sector Impact: The event showcased advanced technologies for the manufacturing, construction, aviation, and marine sectors. Key focus areas included: Energy Efficiency: Compressed air solutions to reduce operational costs. Predictive Maintenance: Reliability engineering to minimize industrial downtime. Digital Monitoring: Smart systems aligned with global sustainability standards. • Economic Context: A high-level panel explored how global engineering solutions can boost the competitiveness and productivity of Sri Lanka’s industrial base. STC reaffirmed its role as a strategic ICT/BPM and knowledge-transfer hub rather than just a hardware supplier. • Legacy: Established in 1982, STC (part of Chandra Senanayake Holdings) continues to drive technological advancement and sustainable growth through long-term representation of brands like Volvo, SKF, and Atlas Copco.

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FitsAir Launches Dynamic Fare Optimiser for Travel Trade 📈

Sri Lanka’s leading private international airline, FitsAir, has introduced its Dynamic Fare Optimiser (DFO), a technology-driven pricing solution designed to streamline distribution and strengthen partnerships within the aviation and travel sector. • Core Innovation: The DFO provides travel agents with real-time, competitive pricing across the FitsAir network, aimed at improving conversion rates and decision-making speed. • Strategic Integration: The tool is available exclusively via Travelport+, ensuring seamless integration into existing booking workflows for industry partners. • Economic Impact: By empowering the travel and tourism trade with responsive commercial tools, FitsAir aims to enhance operational efficiency and maintain its "Right Price Airline" positioning. • Operational Focus: This launch marks a significant step in the airline's strategy to digitize distribution, supporting the broader ICT and services integration within Sri Lanka's transport infrastructure.

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🏙️ Cinnamon Life at City of Dreams Launches Exclusive Local Resident Offer

Cinnamon Life at City of Dreams Sri Lanka has announced a targeted 'Resident Offer' to encourage domestic engagement with South Asia’s first fully integrated resort. • Special Rate: Sri Lankan residents are offered a preferred rate of US$ 110++ on a double-sharing basis, which includes breakfast. • Hospitality & Leisure: The hospitality project features over 12 restaurants and bars, the Kurundu Wellness spa concept, and extensive entertainment spaces. • Economic Context: As a centerpiece of the City of Dreams development, the resort aims to position Colombo as a top-tier regional hub for tourism and luxury lifestyle services. • Scale: The integrated resort model integrates refined accommodation with world-class entertainment, signaling a shift toward large-scale urban hospitality in the Sri Lankan economy. • Target Market: By offering localized pricing, the management seeks to integrate the project into the local social fabric, ensuring the tourism & leisure sector benefits from both domestic and international traffic.

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Industry & Sector News

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### ✈️ UAE Airspace Closure: Dubai Mandates Hotel Support for Stranded Travelers

Authorities in Dubai have moved to mitigate the impact of regional airspace closures on the tourism and aviation sectors as thousands remain stranded due to the ongoing US-Israel-Iran conflict. • Government Intervention: The Dubai Department of Economy and Tourism (DET) has directed hotels to facilitate stay extensions for impacted guests. Notably, the UAE government has committed to covering all accommodation and sustenance costs for stranded passengers. • Visa & Logistics Support: Over 15,000 emergency visas have been issued to transit passengers and tourists. This proactive measure aims to maintain Dubai's reputation as a resilient global travel hub during periods of severe disruption. • Aviation Recovery: Following a period of total closure, an air corridor has been established allowing 48 flights per hour. Emirates and flydubai have commenced a phased restoration of services as of March 2 to clear passenger backlogs. • Economic Context: While the situation is driven by regional instability, the UAE is leveraging its private sector—specifically the hospitality industry—to ensure service stability and minimize long-term damage to its tourism brand. _Source: Dubai DET / Khaleej Times (Provisional Data)_ ---

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✈️ Emirates Limits Flights Due to Regional Airspace Closures

Emirates has announced a restricted flight schedule effective from March 5 through 23:59 UAE time on March 7, 2026. This operational adjustment follows ongoing airspace closures across the Middle Eastern region, impacting key transit routes vital for global logistics and tourism. • Operational Status: Only limited flights are operating; priority is being given to passengers with existing earlier bookings. • Transit & Connectivity: Passengers transiting through Dubai are only accepted if onward connecting flights are confirmed. All city check-in facilities in Dubai remain temporarily closed. • Passenger Advisory: Travelers are strictly advised not to proceed to the airport unless they hold a confirmed booking on an operating flight or have received direct notification. • Rebooking & Refunds: Impacted passengers can rebook for travel on or before March 27. Refunds are available for bookings dated on or before March 12 if processed via the original booking channel. The airline continues to monitor the situation to adjust schedules based on safety and regional security developments.

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Geopolitical Tensions Threaten Ceylon Tea Exports 📈

The escalation of the USA–Israel–Iran conflict is disrupting key maritime routes, directly impacting Sri Lanka’s tea industry. Global shipping delays and surging insurance costs are creating significant uncertainty for the sector. • Market Impact 10 major markets (43 million kg in 2025) are directly affected. Exports to 12–15 additional countries are disrupted due to suspended shipping services. Nearly 70% of total tea exports are currently impacted by route closures or port denials. • Logistics & Costs Vessels are bypassing the Persian Gulf, rerouting around Africa’s Cape of Good Hope. This diversion has significantly extended transit times and increased fuel/freight costs. Marine insurance premiums for "war risk" have spiked, with some insurers suspending coverage entirely. • Colombo Tea Auction (March 3–4) Unsold lots rose to 15%–18%, up from previous weeks. While many grades held firm, rising unsold volumes signal growing liquidity pressure. East Asian markets (China, Japan, Australia) remain currently unaffected by route changes. • Economic Risks Private factories face cash flow strain ahead of the Sinhala and Tamil New Year. Potential reduction in bought-leaf rates for smallholder farmers. Dry weather and potential fuel shortages further threaten green leaf transport and farmer income.

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📈 Impact of Prolonged Iran Conflict on APAC Energy & Commodities

Fitch Ratings indicates a divergent credit outlook for the Asia-Pacific region as supply disruptions in the Gulf pressure global markets. While upstream exporters gain from price surges, downstream processors face significant margin compression. • Energy Sector Dynamics: Upstream oil and gas producers in Australia, Malaysia, and Indonesia are primary beneficiaries of higher realized prices. Conversely, downstream refiners in India and Indonesia face severe pressure as rising input costs outpace their ability to pass through prices to consumers. • Power & Coal: Rising gas prices (with 20% of global LNG supply at risk from Qatar) are driving a shift toward thermal coal. Newcastle coal futures rose 9% to US$ 129 per ton as of March 3, 2026, benefiting Australian and Indonesian exporters. • Industrial & Manufacturing Impact: • Metals: Global aluminum supply (8-9% from the Middle East) is tightening. Chinese producers are well-positioned due to stable power tariffs, while Japanese and South Korean firms face margin erosion from energy inflation. • Steel & Chemicals: Steel producers face negative outlooks due to logistics bottlenecks and a potential softened demand from the Middle East (15% of 2025 Chinese exports). Chemicals face "high risk" as naphtha feedstock costs spike. • National Economic Context: For Sri Lanka, these APAC trends signal potential import-led inflation in the energy and fertilizer sectors. As a downstream consumer of refined fuels and industrial inputs, the rising costs and shipping delays in the Gulf could strain foreign reserves and production margins in the manufacturing sector.

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UL 231 to Dubai Cleared Amid Middle East Flight Suspensions ✈️

Aviation Sector Update: SriLankan Airlines has confirmed that flight UL 231 is scheduled to depart for Dubai at 2:30 p.m. today (March 4), with passenger check-in already underway. The return service, UL 232, is expected to arrive back in Colombo tonight. Widespread Cancellations: Despite the UL 231 departure, the national carrier has issued a temporary suspension for most other Middle East operations until 23:59 hrs on March 4, 2026, citing the prevailing regional situation. Affected Routes: • Dubai: UL 225 / UL 226 suspended. • Doha: UL 217 / UL 218 suspended. • Kuwait: UL 229 / UL 230 suspended. • Saudi Arabia: UL 253 / UL 254 (Dammam) and UL 265 / UL 266 (Riyadh) suspended. Impact: These disruptions affect key labor migration and transit hubs, critical for Sri Lanka's inward remittances and tourism connectivity. 📈 Passenger Advisory: Travelers are urged to contact the Global Contact Centre at 1979 or visit the official website for rebooking support based on these provisional schedule changes.

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Sri Lanka Records Historic Tourism Peak in February 📈

• Overall Performance: Sri Lanka welcomed 279,328 visitors in February 2026, marking the highest monthly arrival figure in the country’s history. This reflects a 16.3% YoY increase, surpassing the previous record of 253,169 set in December 2018. • Year-to-Date (YTD): Total arrivals for the first two months of 2026 reached 556,655, a 13% YoY rise, driven largely by the ICC T20 World Cup tournament. • Top Source Markets: • India: 47,679 arrivals (17% share), up 18% YTD. • UK: 30,788 arrivals (11% share). • Russia: 23,099 arrivals (8% share). • Other key contributors: Germany, China, and France. • Daily Trends: Average daily arrivals rose to 9,976 (vs. 8,579 last year). A single-day peak of 12,731 was recorded on February 12, fueled by high-net-worth fans attending the India-Pakistan cricket clash. • Outlook: While momentum is strong, stakeholders warn of potential "headwinds" in March. Escalating Middle East tensions leading to airspace closures and flight cancellations may temporarily disrupt the growth trajectory. _Source: Provisional industry data (March 2026)_

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Flight Operations to Middle East Resume at BIA ✈️

Flight services between Sri Lanka and the Middle East officially resumed yesterday following a temporary suspension caused by regional hostilities. Operations at Bandaranaike International Airport (BIA) saw the first departures to key hubs in the UAE. • Resumption Details: FitsAir flight 8D-821 departed for Dubai at 1:20 p.m. with 47 passengers and 10 crew members. Air Arabia flight G9509 departed for Sharjah at 4:45 p.m. carrying 44 passengers and 10 crew members. • Economic Impact: The resumption is critical for the migrant labor sector, ensuring the continued flow of worker remittances. Restored connectivity supports the tourism and business travel sectors, which faced recent disruptions due to regional tensions. • Outlook: Airport authorities expect additional services to various Middle Eastern destinations to normalize in the coming days as regional conditions stabilize.

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Dubai Air Hub Faces Near Standstill Amid Regional Tensions 📉

The Dubai International Airport, a critical global aviation hub and a vital link for the ICT/BPM and tourism sectors, saw operations drop to historic lows on March 2, 2026, due to regional airspace closures. • Operational Collapse: Total daily aircraft movements plummeted from an average of ~1,240 to just 20 (16 take-offs and 4 landings). This represents a 98.4% decrease compared to the 1,257 movements recorded on February 27. • Regional & South Asian Impact: • The disruption is severe for routes connecting Europe, Asia, and India. • Several Emirates flights from Chennai, Delhi, and Bengaluru were diverted back to their origin cities. • Only one flight from Mumbai (EK501) successfully landed in Dubai, while Hyderabad services were cancelled. • Economic Context: For Sri Lanka, Dubai serves as a primary transit hub for apparel & textiles exports and migrant labor. This unprecedented slowdown signals major potential delays in logistics and supply chain operations, as airlines face widespread airspace closures and rerouting challenges.

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⚠️ SriLankan Airlines Cancels Middle East Flights Due to Regional Conflict

SriLankan Airlines has announced the cancellation of several flights scheduled for today (March 3, 2026), citing the ongoing closure of airspace in parts of the Middle East. • Overall Impact: Total of 12 flights (6 round-trip rotations) cancelled to ensure passenger safety amid regional instability. • Affected Routes: • Dubai: UL 225/226 and UL 231/232 cancelled. • Kuwait: UL 229/230 cancelled. • Doha: UL 217/218 cancelled. • Dammam: UL 253/254 cancelled. • Riyadh: UL 265/266 cancelled. • Economic Context: These disruptions affect key labor migration corridors and tourism links between Sri Lanka and the Gulf region. The Middle East remains a critical market for remittances and transit connectivity. • Passenger Support: Travelers are advised to contact the airline via 1979 (local), +94 11 777 1979 (international), or WhatsApp +94 74 444 1979 for further assistance.

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## CPC Boosts Fuel Supply Amid Panic Buying ⛽

The Ceylon Petroleum Corporation (CPC) has ramped up distribution to stabilize the domestic market following a surge in consumer demand. • Supply Volume: Over 5.2 million litres of fuel were released to the market by 9:44 a.m. today. • Context: The move aims to counter "panic buying" trends observed across the island, ensuring availability at retail outlets. • Official Stance: CPC Chairman D.J. Rajakaruna confirmed the accelerated release to meet the current spike in demand. Current status: Based on provisional reports from March 2, 2026. ---

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🚨 Emirates Extends Dubai Flight Suspensions Through March 3 ✈️

Emirates has announced an extension of its temporary flight suspension to and from Dubai until 15:00 hrs UAE time on Tuesday, 3 March 2026. This move follows ongoing regional airspace closures affecting the aviation and travel sectors. • Operational Impact: All flight operations remain halted as the airline monitors a "fluid" situation in coordination with authorities. All city check-in facilities in Dubai are currently closed. • Passenger Provisions: • Affected customers can rebook for travel on or before 20 March 2026. • Refund options are available for those impacted by cancellations. • Passengers are advised to verify flight status via email or official channels before traveling to airports. • Economic Context: For Sri Lanka, disruptions to Emirates—a key carrier for tourism and logistics—may temporarily impact arrival numbers and time-sensitive cargo exports. The airline cited passenger and crew safety as the primary reason for the continued suspension. _Note: Summary based on latest operational updates as of 2 March 2026._ ---

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✈️ SriLankan Airlines Cancels Middle East Flights Due to Airspace Closure

SriLankan Airlines has announced the immediate cancellation of several key flights today (March 02, 2026), citing the continued closure of airspace in parts of the Middle East. The decision follows heightening regional uncertainty, with the carrier prioritizing passenger safety and operational wellbeing. • Affected Routes: The cancellations impact major hubs essential for migrant labor and transit, including: Dubai (UL225/226) Doha (UL217/218) Dammam (UL253/254) Riyadh (UL265/266) Kuwait (UL229/230) • Economic Context: Disruptions to Middle Eastern routes impact the aviation and tourism sectors, as well as the flow of remittances from the Middle East, which remains a primary source of foreign exchange for Sri Lanka. • Passenger Assistance: Travelers are advised to contact the global hotline at +94 11 777 1979 or via WhatsApp at +94 74 444 1979. Based on current provisional data, further updates depend on the reopening of regional corridors. 📈

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Economic News

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📈 Silver Economy: Unlocking Sri Lanka’s Ageing Demographic

With over 18% of the population currently aged 60+—projected to reach 25% by 2041—Sri Lanka faces a critical shift from a potential social burden to a productive Silver Economy. • Economic Participation & Challenges 49% of the 55-64 age cohort is currently economically inactive. Labour force participation stands at only 36% for males and 11% for females in this bracket. Retirement at 60 years restricts formal employment, pushing many into the informal sector and leading to skill underutilization. • Financial Vulnerability Only 31% of those above retirement age receive a pension; 91.7% receive no income from savings. The 65+ demographic recorded the highest multidimensional poverty rate at 17.9% (pre-crisis data). The economic old-age dependency ratio is projected to hit 29.2% by 2030. • The Looming Care Crisis A deficit of 149,076 long-term care workers is projected by 2037. Three-generation households are expected to decline from 19% to 5% by 2060, increasing demand for commercial care and institutional care. • Strategic Recommendations Extend working lives through flexible work, WFM arrangements, and raising the formal retirement age. Develop an ecosystem of affordable elder care services, including professional home-based care and day-care centers. Promote private life insurance and contributory pension schemes to ensure post-retirement financial independence. Based on analysis by Dr. Bilesha Weeraratne (2026).

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## ⚓ Maritime Security Risks: Economic Implications for Sri Lanka 📈

The recent destruction of a naval vessel in Sri Lanka's southern waters signals rising uncertainty in a critical global maritime corridor, posing direct risks to national economic resilience. • Strategic Impact The southern sea lanes connect Middle Eastern energy hubs with East Asian manufacturing and European markets. Any perception of insecurity triggers higher insurance premiums, vessel rerouting, and altered shipping schedules. • Key Sector Vulnerabilities Port of Colombo: As a premier South Asian transshipment hub, any disruption to the east-west maritime highway threatens cargo volumes and investor confidence. Tourism: Stealthy underwater threats and maritime risks create anxiety for cruise ships, yachts, and recreational diving, impacting a vital foreign exchange earner. Fisheries: Local fishing communities are identified as a strategic "early warning" asset to enhance maritime situational awareness alongside the Navy and Coast Guard. • National Priority Measures Strengthening maritime surveillance via enhanced radar and patrol aircraft. Securing strategic assets in Colombo, Hambantota, and Trincomalee through underwater monitoring and rapid-response protocols. Integrating the ICT/BPM and telecommunications sectors to improve real-time reporting mechanisms between coastal communities and authorities. _Summary based on security analyst reporting as of March 05, 2026._

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President Leads High-Level Strategy on Middle East Conflict Impact 📈

President Anura Kumara Dissanayake convened a high-level briefing to mitigate economic risks arising from the Middle East crisis. While current reserves are stable, officials were directed to implement proactive measures to protect national economic stability. • Energy & Logistics: Current fuel reserves are termed sufficient, but plans are being finalized to manage potential supply chain disruptions. Short-term use of the Hambantota Port is being considered to expand gas storage capacity. • Trade & Shipping: Strategies are in place to support shipping lines and prevent congestion at the Colombo Port, specifically addressing potential diversions from the Suez Canal and Strait of Hormuz. • Tourism & Food: The tourism sector is exploring alternative air traffic routes for European travelers. The Ministry of Trade confirmed that food stocks are currently adequate, with contingency plans ready for future volatility. • Investment & Tech: The President instructed the Ministry of Finance to develop a relief package to boost investment in modern technology, specifically targeting data centres and the digital economy. • Inflation Control: A primary directive was issued to prioritize inflation management and protect the livelihoods of citizens from potential global price shocks. _Status: Based on official presidential briefing data._

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Business Sentiment: Corporate Confidence Dips Amid Global & Local Uncertainty 📉

The latest LMD-PEPPERCUBE Business Confidence Index (BCI) reveals a decline in optimism as the initial 2026 surge fades, influenced by geopolitical shifts and domestic health concerns. • Index Performance: The BCI fell by 11 basis points, dropping from 182 in January to 171 in February. This remains 18 points below the 12-month average (189) and significantly lower than the 204 recorded in February last year. • Macroeconomic Indicators: Sri Lanka’s official reserve assets saw a marginal 0.2% decline in January, settling at US$ 6.824 Bn. • Governance & Corruption: A notable highlight is Sri Lanka’s progress on the Corruption Perceptions Index (CPI), climbing 14 places. This suggests a perceived improvement in institutional integrity and public sector governance. • Sectoral Pressures: The business environment remains fragile following disruptions from Cyclone Ditwah. While the Central Bank maintains that economic growth targets remain intact, PepperCube Consultants note lingering fears of a slowdown. • External Risks: Global volatility, including potential US tariff threats and regional health concerns (Nipah virus), continues to weigh on the trade and investment outlook. _Summary based on LMD-PepperCube February 2026 data._

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IMF Warns of Global Trade & Market Volatility Amid Middle East Tensions 📈

The International Monetary Fund (IMF) has issued a formal warning regarding escalating global uncertainty and potential disruptions to international trade flows following intensified conflict in the Middle East. • Current Market Impact: The IMF reports immediate surges in energy prices and heightened volatility across global financial markets. These disruptions are already impacting broader economic activity and trade logistics. • Economic Outlook: While the Fund acknowledges emerging trade disruptions, it states it is "too early" to provide a full quantitative assessment of the long-term impact on the global economy. • Key Determinants: The scale of the economic fallout will depend strictly on the extent and duration of the regional conflict. • Next Steps: A comprehensive assessment of the situation and its impact on emerging economies—including implications for trade-dependent nations—will be released in the April 2026 World Economic Outlook. _Note: Summary based on provisional statements from IMF headquarters on March 3, 2026._

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Seylan Bank Disburses Rs. 1.2 Bn to MSMEs under "Atha Hitha" Scheme 📈

Seylan Bank has successfully hit its 2025 disbursement target of Rs. 1.2 billion across 90 loans, supporting the national MSME recovery strategy. Following this performance, a new allocation of Rs. 1 billion has been granted for early 2026. • Loan Terms & Interest: Financing up to Rs. 25 million is now available at a reduced concessionary rate of 5% per annum (down from 7%). Working capital loans carry a 3-year tenure, while investment/construction loans extend up to 10 years with an optional 1-year grace period. • Sector Focus: Funding is restricted to high-impact sectors including manufacturing, agriculture, fisheries, tourism, apparel, and export-oriented industries. Trading and leasing activities are excluded to prioritize value-added production. • Support for Women-Led Enterprises: A dedicated credit guarantee covers 80% of the loan for businesses with majority female ownership or management, featuring a reduced risk premium (0.5% - 1.25%) to drive inclusive growth. • Eligibility Criteria: Open to registered MSMEs with an annual turnover below Rs. 1,000 million and fewer than 200 employees. Strategic Impact: This initiative, funded by the Finance Ministry, strengthens the MSME sector—a critical driver of employment—by providing affordable liquidity for both operational needs and long-term capital investments.

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### 📈 Northern Gateway: A Blueprint for Regional Economic Integration

The Northern Gateway initiative aims to transform Sri Lanka's Northern Province into a strategic economic hub by replicating high-growth models from Southern India. This "Frontier Province" strategy shifts the region from aid-dependency to a self-sustaining engine for national GDP. • Strategic Framework Palk Strait Corridor: Direct integration with the trillion-dollar economies of Tamil Nadu and Karnataka. Regulatory Autonomy: Establishment of a Northern Single-Window Authority (NSWA) to grant investment licenses within 30 days. Connectivity: A "Green Channel" at Kankesanthurai (KKS) Port and formalizing Indian Rupee (INR) trade settlements to reduce MSME volatility. • Investment & Fiscal Incentives Tax Holidays: 8-10 years for ICT/BPM investments over US$ 100 Mn; 6 years for renewable energy (Mannar wind arrays) and infrastructure (US$ 50-150 Mn). Duty Waivers: Full exemptions on CID, VAT, and PAL for capital goods during project implementation. Digital Hubs: Zero-rated VAT for outsourced IT-enabled services (ITES) to boost price competitiveness. • Key Sector Breakdowns Energy: US$ 500 Mn commitment for green energy export to India. Technology: Creation of "Satellite IT Parks" modeled after the Bengaluru Tech Ecosystem. Logistics: US$ 500 Mn for KKS Port modernization and bridge feasibility studies via the Palk Strait Infra-Link. • Human Capital & Labor Skill Development: Partnership with India's NSDC and firms like Tata and Infosys to bridge skill gaps. Target: Training 5,000+ youth in maritime and turbine maintenance to support the blue economy. _Note: Based on a multi-year blueprint as of March 2026._

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📈 Iran Conflict: Risks & Selective Opportunities for SL Economy

A report by First Capital Research (March 2026) highlights that while escalating Mideast tensions pose risks to inflation and trade, specific sectors may see structural gains. • Macroeconomic Impacts: • Energy: Brent crude rose 6–10% to US$ 95–110 per barrel, threatening higher domestic fuel and electricity costs. • Currency & Yields: The Rupee settled at Rs. 309.24 against the USD; a 5% annual depreciation is forecasted. Emerging market bond yields are under pressure as capital shifts to safe-haven US Treasuries. • Inflation: Higher freight rates and insurance premiums due to maritime disruptions are expected to increase import costs. • Sector & Trade Breakdown: • Tea, Coffee & Spices: Nearly 25% of these exports are directed to affected regions (US, Iran, Iraq, Gulf), facing risks from logistics costs. • Logistics & Transshipment: Shipping diversions around the Cape of Good Hope could reinforce Colombo’s role as a key Indian Ocean hub, benefiting maritime services. • Remittances: While regional instability risks disruption, a moderate conflict could increase Gulf labor demand, supporting migrant worker inflows. • Financial Markets: • Equities: The S&P SL20 fell over 5% on March 3, triggering a trading halt. • Outlook: Market corrections may create entry points in logistics and export-oriented sectors if fundamentals hold.

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## Central Bank to Release Impact Report on Middle East Crisis 📈

The Central Bank of Sri Lanka (CBSL) is scheduled to issue a formal review tomorrow (March 4) regarding the economic implications of the ongoing Middle East crisis, as announced by President Anura Kumara Dissanayake in Parliament today. • Core Focus: The report will provide a comprehensive assessment of how regional instability affects Sri Lanka’s financial sector and broader economic stability. • Current Status: The CBSL has concluded its preliminary evaluations and is currently finalizing the report to provide clarity on potential risks to the national economy. • Key Considerations: While specific data points are pending the report's release, the evaluation is expected to cover critical areas such as: Energy costs and global oil price volatility. Remittances from Sri Lankan workers in the Middle East. Export markets, specifically impacts on tea and apparel shipments to the region.

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Sri Lanka’s External Debt Rises to US$ 37.7 Bn in Q4 2025 📈

Sri Lanka’s outstanding central Government external debt reached US$ 37.66 Bn at the end of 2025, marking a US$ 425 Mn increase from the September quarter, according to the latest Treasury Debt Bulletin. • Overall Public Debt: Total gross public debt (including SOEs and local government) fell to US$ 103.6 Bn (Rs. 32.2 Trillion) from US$ 106.8 Bn in Q3. • Debt Composition: Central Government debt stood at US$ 100.3 Bn, comprising US$ 62.7 Bn in domestic debt and US$ 37.7 Bn in external debt. • External Creditor Breakdown: • Multilateral: US$ 14.31 Bn (38%) • Commercial: US$ 12.67 Bn (34%) – includes US$ 10.25 Bn in International Sovereign Bonds (ISBs). • Bilateral: US$ 10.68 Bn (28%) • Restructuring Progress: Sri Lanka has completed approximately 95% of its debt restructuring agreement-signing process. Following the 2024 ISB exchange and bilateral deals with the OCC, China, and others, the country has resumed regular debt servicing. • Interest Profile: 75% of the external portfolio is held at fixed interest rates, while 23% remains at floating rates.

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📈 Sri Lanka External Surplus Surges 271% in Jan 2026

Sri Lanka’s external current account recorded a significant surplus of US$ 369.7 Mn in January 2026, tripling from the US$ 99.8 Mn recorded a year earlier. The improvement is driven by robust export growth and strong remittance inflows. • Trade Performance: The merchandise trade deficit narrowed to US$ 654.5 Mn. Exports grew 9.1% YoY to US$ 1.15 Bn, while imports saw a marginal 1% rise to US$ 1.8 Bn. Notably, vehicle imports slowed to US$ 224 Mn from US$ 301 Mn in December 2025. • Services & Tourism: The services account surplus dipped slightly to US$ 406.4 Mn. While tourism earnings reached US$ 378.3 Mn, a 154.5% surge in overseas travel expenditure (US$ 133.4 Mn) impacted net inflows. • Remittances & Investments: Workers’ remittances remain a vital pillar, rising 31.1% YoY to US$ 751.1 Mn. Financial accounts showed a net inflow of US$ 16.6 Mn in Govt. securities, offset by a US$ 21.9 Mn net outflow from the Colombo Stock Exchange. • Reserves & Currency: Gross official reserves stood at US$ 6.8 Bn at end-January. The Sri Lankan Rupee maintained stability with a 0.2% year-to-date appreciation against the US Dollar as of February 2026. • 2025 Retrospective: Based on provisional data, the 2025 full-year current account surplus reached US$ 1.73 Bn (+43.8% YoY), supported by annual remittances of US$ 8.08 Bn.

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OPEC+ Announces Larger Oil Output Hike Amid Middle East Conflict 📈

The OPEC+ "Voluntary Eight" (V8) group, including Saudi Arabia and Russia, has agreed to a production increase of 206,000 barrels per day (bpd) starting in April. This exceeds the 137,000 bpd hike previously anticipated by market analysts. • Global Supply Impact: The adjustment follows recent geopolitical escalations involving US/Israeli strikes on Iran. While OPEC+ officially cites a "steady economic outlook," the move aims to stabilize markets as regional tensions threaten supply lines. • Risk Factors: Experts warn that the increase may be insufficient to prevent price spikes. A critical concern remains the potential disruption of the Strait of Hormuz, a transit point for nearly 25% of global seaborne oil. • Economic Context: For Sri Lanka, a continued rise in global crude prices would likely pressure foreign exchange reserves and impact domestic energy and transport costs, potentially affecting the recovery of the manufacturing and logistics sectors.

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Market News

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### 📈 Global Oil Prices Surge Amid Widening Middle East Conflict

Oil prices climbed on Thursday as the U.S.-Iran war severely disrupts energy flows and forces major production cuts. • Price Movements: Brent crude rose by US$ 1.67 (+2.05%) to US$ 83.07 per barrel. WTI crude increased by US$ 1.94 (+2.60%) to US$ 76.60 per barrel. • Supply Chain Disruptions: The Strait of Hormuz, a conduit for 20% of global energy consumption, remains at a near-halt for the fifth day. Approximately 329 oil vessels are currently trapped in the Gulf. • Regional Impact: • Iraq: Cut output by nearly 1.5 million barrels per day due to lack of storage and export routes. • Qatar: Declared force majeure on gas exports; recovery to normal volumes may take at least a month. • Conflict Context: Hostilities widened following a U.S. strike on an Iranian warship off Sri Lanka. While critical infrastructure remains largely intact, J.P. Morgan notes that elevated shipping risks and logistical constraints are the primary drivers of price volatility. • Economic Outlook: Most oil fields can restart within 2-3 weeks once logistics improve, but current reservoir pressure issues in Iraq and regional storage limits remain significant hurdles for global energy markets.

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CSE Rebounds 0.60% as Bargain Hunting Offsets Record Slump 📈

The Colombo Stock Exchange (CSE) bounced back yesterday as value investors moved in to accumulate fundamentally strong shares following Tuesday’s record single-day decline. • Market Indices: The ASPI gained 0.60% (134.03 points) to close at 22,577.41, while the S&P SL20 rose 0.70% to 6,357.66. The market partially erased losses from the previous session's 1,291-point plunge triggered by Middle East tensions. • Turnover & Volume: Total turnover reached Rs. 4.7 Bn with over 171.2 million shares traded. Market breadth was positive with 157 gainers against 77 decliners. • Sector Performance: • Capital Goods: Led activity with a 32% share of turnover (Rs. 1.5 Bn). Key moves included Access Engineering (+Rs. 0.90) and ACL Cables (-Rs. 0.20). • Banking & Blue-Chips: Provided the primary upward momentum. Sampath Bank (+21.6 points) and Commercial Bank were top positive contributors to the ASPI. • Diversified Financials: Second highest turnover contributor, with the sector index rising 1.63%. • Investor Sentiment: Foreign investors remained net sellers with an outflow of Rs. 95.1 Mn. High net worth and institutional interest were noted in construction and engineering counters, though overall sentiment remains cautious due to external geopolitical developments. _Data based on market closing figures for March 4, 2026._

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📈 Global Market Volatility Amid Middle East Tensions

Global financial markets faced significant turbulence on Wednesday as escalating Middle East conflict triggered sharp equity losses and spiked energy prices, impacting inflation outlooks. • Energy & Commodities: Brent crude settled at US$ 81.18 per barrel, up nearly US$ 10 from last Friday. Gold rebounded 2% to US$ 5,193 per ounce following a sharp 4% dip. • Equity Market Plunge: Asia saw massive sell-offs with South Korea’s KOSPI suffering a record 12% single-day drop. Japan’s Nikkei 225 fell 3.6%, while Taiwan’s benchmark dropped 4.3% as investors exited the semiconductor sector. • Currencies & Yields: The US Dollar strengthened, rising 1.3% against the Yen this week. The 10-year US Treasury yield rose to 4.08%, reflecting concerns over delayed interest rate cuts. • European Recovery: After a steep two-day decline (the worst since April 2025), the STOXX 600 showed signs of stabilization, rising 1.6% in early trading. Context: For Sri Lanka, sustained high energy prices and global inflation volatility could pressure import costs and debt servicing, despite the recovery in European markets—a key destination for apparel & textiles.

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Liquidity Hits Record High as T-Bill Yields Stabilize 📈

• Money Market Liquidity: Daily net liquidity surplus surged to Rs. 403.77 Bn, crossing the 400 billion mark for the first time, up from Rs. 332.49 Bn the previous day. The Central Bank moved to drain Rs. 150 Bn via overnight and seven-day Repo auctions. • T-Bill Auction: Yields held broadly steady, ending a six-week downward streak. - 91-day: 7.63% (Unchanged) - 182-day: 7.92% (Unchanged) - 364-day: 8.23% (Slight dip of 1 basis point) The auction was notably undersubscribed, raising only Rs. 47.83 Bn (39.86%) of the Rs. 120 Bn offered. • Secondary Bond Market: Activity remained healthy with a transacted volume of Rs. 15.96 Bn. Yields on the short end edged up slightly, while longer-dated maturities consolidated, with the 01.06.33 bond trading at 10.50%. • Forex Market: The USD/LKR spot rate closed slightly weaker at 310.30/310.60, compared to the previous close of 310.10/310.30. Total traded volume stood at US$ 100.90 Mn. _Note: Based on provisional market data from Wealth Trust Securities and CBSL._

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February National Tea Sales Average Declines Slightly 📈

Sri Lanka’s tea industry saw mixed results in February 2026, with the national average experiencing a marginal dip compared to both the previous month and the prior year. • Overall National Average: Recorded at Rs. 1,152.11 (US$ 3.72), reflecting a month-on-month (MoM) decrease of Rs. 12.43 (US$ 0.04) from January 2026. On a year-on-year (YoY) basis, the average fell by Rs. 16.82 (US$ 0.24) against February 2025. • High Grown Sector: Remained a bright spot, posting an increase of Rs. 15.90 (US$ 0.06) MoM. It also outperformed last year's figures with a YoY gain of Rs. 53.31. • Medium Grown Sector: Experienced a negative variance, dropping by Rs. 6.03 (US$ 0.02) MoM. The YoY decline was more significant, falling by Rs. 46.91 (US$ 0.31). • Low Grown Sector: Noted the sharpest decline for the month, dropping by Rs. 26.38 (US$ 0.08) MoM. Compared to January 2026, the sector showed a negative variance of Rs. 30.25 (US$ 0.28). _Source: Forbes and Walker Ltd. (Provisional Data)_

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📈 CSE Recovers Following Record Single-Day Slump

The Colombo Stock Exchange showed signs of stability today (March 4) as indices regained ground following the largest single-day decline in its history. • Market Indices The All Share Price Index (ASPI) rose by 134.03 points to close at 22,577.41. The blue-chip S&P SL20 Index followed suit, advancing by 44.01 points to settle at 6,357.66. • Trading Activity Market turnover was recorded at Rs. 4.68 billion, reflecting a significant contraction in volume compared to the previous day’s turnover of Rs. 9.56 billion. • Market Sentiment While the indices moved into positive territory, the total turnover for the day was less than half of yesterday’s historic session, suggesting a cautious approach by investors as the financial services and capital markets sectors stabilize after extreme volatility.

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Secondary Bond Yields See-Saw Amid Geopolitical Tension 📈

The Sri Lankan financial market experienced a volatile start to the week as the secondary bond market and forex market reacted to escalating Middle East tensions. Despite an initial spike in yields, late-session buying interest led to a partial recovery. • Bond Market Performance Yields fluctuated sharply before closing higher day-on-day. Key trades included: Short-term: 2026 maturity at 8.30%; 2028 maturity at 9.00%. Medium to Long-term: 2029 maturities traded between 9.45% - 9.63%, while 2035 bonds reached 10.74%. Healthy transaction volumes were recorded as investors adjusted to global developments. • Upcoming T-Bill Auction A total of Rs. 120 Bn in Treasury Bills is on offer today: 91-day: Rs. 15 Bn 182-day: Rs. 70 Bn 364-day: Rs. 35 Bn The total offer is slightly below the maturing volume of approximately Rs. 125.95 Bn. • Currency & Liquidity Rupee Depreciation: The USD/LKR spot rate closed weaker at Rs. 310.10/310.30, compared to the previous close of Rs. 309.29/309.32, triggered by regional uncertainty. Market Liquidity: Remained high with a net surplus of Rs. 332.49 Bn. The Central Bank drained Rs. 75 Bn via overnight repo at 7.60%. • Context This volatility follows six consecutive weeks of declining yields in the primary market. Last week’s auction saw rates for 91-day, 182-day, and 364-day bills ease to 7.63%, 7.92%, and 8.24% respectively. _Note: Based on provisional market data from Wealth Trust Securities._

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📉 Global Markets Plunge as Mideast Tensions Drive Oil Surge

Global equity markets faced a sharp sell-off on Tuesday as escalating conflict involving Iran fueled fears of sustained economic damage. The downturn was led by soaring energy costs, with oil prices approaching the critical US$ 100 per barrel threshold. • Stock Market Impact: Wall Street saw major declines with the S&P 500 dropping 2.4%, marking its worst performance since late 2024. The Dow Jones shed 1,232 points (2.5%), while the Nasdaq fell 2.7%. • Regional Breakdown: Asia: South Korea’s Kospi plunged 7.2%, its steepest decline in nearly two years, driven by its status as a major energy importer. Japan’s Nikkei 225 dropped 3.1%. Europe: Germany’s DAX lost 3.9% as natural gas prices surged due to regional instability. • Commodities: Gold prices fell 4.9% to US$ 5,051 per ounce, retreating from recent highs above US$ 5,300 as investors recalibrated "safe-haven" positions. • Relevance to Sri Lanka: As a net importer of fuel and energy, the spike toward US$ 100 oil poses significant risks to Sri Lanka's trade balance and domestic inflation. Sustained global volatility may also impact investor appetite for emerging market debt and ICT/BPM service exports. _Note: Summary based on provisional global market data as of March 4, 2026._

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📉 CSE Plunges 5.4% as Middle East Tensions Spark Record Point Drop

The Colombo Stock Exchange experienced a historic sell-off yesterday as escalating Iran-Israel geopolitical tensions triggered panic selling and a 30-minute circuit breaker. • Market Performance: The ASPI plummeted by 1,290.68 points (5.4%) to 22,443.38, marking its largest single-day point drop in history. The active S&P SL20 also fell significantly by 322.32 points (4.9%) to 6,313.65. • Trading Activity: Despite the initial crash, bargain hunting by value investors led to a robust turnover of Rs. 9.6 Bn, which is 62.9% above the monthly average. Market breadth was overwhelmingly negative, with 269 counters ending in the red. • Sector & Stock Highlights: • The Capital Goods sector led turnover (28%), followed by Banking and Food, Beverage & Tobacco (32% combined). • Key laggards included COMB, SAMP, HNB, JKH, and HAYL. • Contrarian gains were seen in only 5 counters, led by LIOC. • Investor Sentiment: Foreign investors were net sellers with an outflow of Rs. 59.6 Mn. While High Net Worth (HNW) participation remained subdued, retail activity was notably strong as investors sought attractive valuations following the initial dip.

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### Middle East Tensions Jolt Bond Yields and Rupee 📈

Geopolitical instability in the Middle East triggered immediate volatility in Sri Lanka's financial markets at the start of the week, characterized by a sharp spike in yields and currency fluctuations. • Secondary Bond Market: Yields surged during early trade as an immediate reaction to regional tensions. A firm rebound followed as buyers entered at higher yield levels, though closing quotes remained higher than the previous session. Trading volumes remained robust as investors recalibrated positions amid the evolving situation. • Foreign Exchange (LKR): The Sri Lankan Rupee experienced intraday volatility against the US Dollar. The currency moved between a high of Rs. 309.70 and a low of Rs. 310.40. The Rupee ultimately settled at the weaker closing level against the greenback. • Market Sentiment: While the initial sell-off was sharp, the subsequent recovery indicates underlying demand, though geopolitical risks continue to weigh on the financial services sector and investor risk appetite.

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CSE Trading Temporarily Halted After 5% Index Drop 📉

• Overall Market Activity: Trading at the Colombo Stock Exchange (CSE) was temporarily halted today, March 3, 2026, following a sharp decline in the S&P SL20 index. • The Trigger: The S&P SL20 index fell by more than 5% compared to its previous close, triggering an automatic market circuit breaker designed to mitigate volatility. • Recovery Schedule: The CSE announced that regular trading is expected to resume at 10:01 a.m., following a 30-minute cooling-off period after the initial halt. • Market Context: This halt underscores current volatility within the Financial Services and Equity markets, often influenced by investor sentiment regarding national economic indicators. (Based on provisional CSE data).

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📈 Wall Street Remains Resilient Amid Middle East Volatility

U.S. markets ended Monday with mixed results as investors "bought the dip" following coordinated U.S. and Israeli air strikes on Iran. Despite initial shocks, tech-driven optimism largely offset geopolitical concerns. • Overall Market Figures: - S&P 500: Up 0.04% to 6,881.60 points. - Nasdaq Composite: Gained 0.36% to 22,748.86 points. - Dow Jones: Slipped 0.15% to 48,904.78 points. • Sector Performance: - Energy: U.S. crude rose 6% to $71.23; Brent up 6.68% to $77.74 per barrel. - Defense: The Dow Jones U.S. Defense Index gained as conflicts escalated. - Tech/AI: Shares like Nvidia and the "Magnificent Seven" led a late-session recovery, fueled by ICT/BPM productivity optimism. • Impact on Sri Lanka: Volatile energy prices remain a critical watchpoint for Sri Lanka’s import costs. While U.S. tech resilience supports global ICT/BPM sentiment, surging oil prices could pressure national inflation if Brent crosses the "emotional trigger" of US$ 100 per barrel. • Corporate Highlights: AES Corp fell 17.8% following a US$ 33.4 Bn acquisition deal by a GIP-led consortium at a discount price.

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Financial & Investment News

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### Expert Panel: Why Sri Lanka Struggles to Attract FDI 📈

A high-level symposium featuring experts from the US, China, and India has diagnosed key structural and corporate failures hindering Sri Lanka’s foreign direct investment (FDI) inflows. Key Figures & Performance • Annual FDI Inflow: Currently ~US$ 1 Bn, representing only 1% of GDP, significantly trailing the 3–4% seen in competing emerging markets. • Corporate Returns: Analysis of the top 25 listed firms shows only 5 consistently generate returns above the cost of capital. • China's Outbound Investment: Reached US$ 174 Bn in 2025, presenting a massive untapped opportunity for local partnerships. Critical Bottlenecks • Private Sector Accountability: Experts noted that tax incentives are no longer a differentiator; investors prioritize "responsibility, discipline, and performance." • Ecosystem Gaps: Beyond tax breaks, the country lacks a cohesive ecosystem involving skilled labor, industrial land, and streamlined logistics. • Institutional Weakness: A significant lack of professional and technical capacity to negotiate and manage Free Trade Agreements (FTAs) compared to regional peers like Vietnam. High-Potential Sectors • Tourism: Strategic focus needed on India’s 1.4 billion population, specifically major urban hubs. • Manufacturing & ICT/BPM: Opportunities to integrate into regional supply chains (e.g., Chennai industrial clusters) and leverage the skilled technology services workforce. • Logistics: Leveraging the strategic maritime location, provided there is better regional connectivity and a healthy national airline. Strategic Outlook To transition into an intermediate production hub, Sri Lanka must shift from serving a small domestic market to an export-oriented model backed by a stable legal system and consistent policy. _(Based on provisional 2025/26 data)_.

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Launch of $ 100 Mn Sri Lanka Opportunity Fund for Global Investors 📈

ACP Asset Management has launched the Sri Lanka Opportunity Fund, the first-ever European-regulated (UCITS) fund dedicated exclusively to Sri Lankan assets. Regulated by the FMA of Liechtenstein, the fund offers international investors a liquid, high-governance entry point into the country’s economic recovery. • Fund Status & Targets: - Already seeded with US$ 10 Mn. - Expected inflow of US$ 25 Mn within the next 30 days. - Target Assets Under Management (AUM): US$ 100 Mn within 6–12 months. • Performance Track Record: - Building on a prior strategy that delivered USD returns of 25.60% (2025), 48.55% (2024), and 38.50% (2023). - Cumulative returns of 77.55% since December 2021, significantly outperforming the MSCI Frontier Markets Index. • Investment Strategy: - Focuses on listed equities and fixed income (Sovereign and Corporate bonds in USD/LKR). - Targets high-growth sectors: Banking, Consumer, and Export-oriented industries. - Leverages attractive equity valuations currently at ~11x price-to-earnings. • Market Outlook: - Capitalizes on Sri Lanka's economic restructuring, stable debt profile, and rebounds in Tourism and Manufacturing. - The UCITS structure provides a 30% liquidity buffer, signaling Sri Lanka's readiness to operate within international regulatory frameworks.

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Sri Lanka to Host Landmark Global Investment Forum on June 10 📈

• Event Overview: The Sri Lanka Export Development Board (EDB) has announced plans for what is expected to be the largest and most extensive investment forum in the country’s history, scheduled for June 10, 2026. • Strategic Objective: The forum aims to bring top-tier global investors to Sri Lanka to facilitate direct, face-to-face engagement with local exporters, focusing on expanding international market linkages. • Sector Impact: The initiative targets growth across key national sectors, including export manufacturing, apparel & textiles, and agricultural exports, by providing a platform for discussions on expanding export opportunities. • Key Highlights: • Expected to be the most "extensive and attractive" gathering of its kind in Sri Lanka. • Focus on strengthening global buyer-investor relationships. • Led by EDB Chairman Mangala Wijesinghe to drive long-term export sector growth. _Note: Summary based on provisional EDB announcements as of February 25, 2026._

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## Capital Alliance Lists Third Closed-End Fund on CSE 📈

Capital Alliance Investments Ltd (CALI) officially listed the units of its CAL Three Year Closed End Fund on the Colombo Stock Exchange (CSE), marking another milestone in the growth of structured investment vehicles in Sri Lanka. • Listing Details: A total of 841,263,375 units were listed following a ceremonial bell-ringing at the CSE. This follows CALI’s previous launches of the Five Year Closed End Fund (2025) and the Five Year Optimum Fund (2024). • Fund Strategy: The fund is a closed-end fixed income unit trust with a three-year tenure. It focuses on capital preservation and growth through a diversified portfolio of fixed income instruments, governed by strict internal credit filters and liquidity monitoring. • Market Context: The listing reflects rising domestic interest in unit trusts as a professional entry point for retail investors. In a stabilizing yield environment, these funds aim to provide predictable cash flow and channel national savings into productive economic activity. • Sector Impact: This development strengthens the financial services sector by expanding the range of professionally managed investment products available, supporting broader capital market development during the country’s economic recovery.

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Understanding Fixed Income: Bonds & the Sri Lankan Market 📈

A collaborative insight by CFA Society Sri Lanka, SEC, and CSE highlights the role of bonds in building resilient portfolios through stable income and risk mitigation. • Core Mechanics • Bonds act as loans to the Government or corporates in exchange for regular "coupon" (interest) payments. • Maturity periods: Short-term (<3 yrs), Medium-term (3–10 yrs), and Long-term (>10 yrs). • Secondary Market Inverse: Bond prices and interest rates move in opposite directions; falling rates boost existing bond values. • Market Instruments in Sri Lanka • Government Securities: Treasury Bills (discounted short-term) and Treasury Bonds (fixed-term) issued via CBSL. • Corporate Debentures: Companies issue debt for expansion, typically with ~5-year maturities, often listed on the CSE. • Sustainable Finance: Emerging Green, Blue, and Social Bonds (GSS+) targeting ESG-focused projects. • Yields & Risk Comparison • Historical returns (1994–2024): T-Bills averaged 11.34% with no principal loss, vs. ASPI (shares) at 14.57% with high 37.10% volatility. • Key risks: Interest rate risk, inflation risk, credit (default) risk, and liquidity risk. • Credit ratings (e.g., Fitch, Moody’s) help assess an issuer's likelihood of debt repayment. • Investment Strategy • Bonds offer predictable income and priority in liquidation over shareholders. • Recommended for diversification to offset stock market volatility, especially for conservative investors and retirees.

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## Patient Capital Rebuilding the North: $ 5M Deployed 📈

Veteran banker Rajendra Theagarajah, via the Cinnamon Global fund, has outlined a "patient-capital" model to drive sustainable wealth in Sri Lanka’s Northern Province, moving away from charity toward long-term growth. • Overall Investment & Strategy Total Deployed: Approximately US$ 5 Mn over four years. Focus: Growth-stage enterprises (not startups/seed funding). Model: Revenue-linked returns instead of traditional collateral or interest. Ticket Sizes: Typically US$ 25,000 – 50,000 per entity; largest single investment at US$ 700,000. • Sector Breakdowns & Verticals Agriculture: Focus on value addition and heritage rice (expanded to 350+ farmers). Aquaculture & Fisheries: Supporting coastal economic development. ICT/BPM: Innovative ventures to retain local talent and prevent urban migration. Logistics: Services supporting the broader regional ecosystem. • Key Impact Highlights Financial Inclusion: Transitions informal businesses into the formal banking system through governance and compliance support. Agricultural Tech: Implementation of soil mapping and AI-driven crop advisory for heritage rice. Export Potential: Targeting UK and US markets for low-glycemic rice varieties. Local Empowerment: Focus on Tamil-language engagement and grassroots trust-building to bridge knowledge gaps.

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Gold & Silver Markets Shaken by Global Crash: Implications for Sri Lanka 📈

The global financial landscape witnessed a seismic shift as gold and silver prices suffered a sharp collapse, erasing an estimated US$ 3 Trillion in market value within 90 minutes. Driven by algorithmic selling and mass profit-taking, the "flash crash" has critical repercussions for Sri Lanka’s export-driven economy. • Market Breakdown & Volatility • Gold prices plunged to approximately US$ 5,135/oz, while silver fell to nearly US$ 109/oz. • Locally, 24K gold reached a milestone of Rs. 435,050 per 8g (1 sovereign) earlier in February before the correction. • The crash was accelerated by high-frequency trading and margin calls, impacting global liquidity. • Sector Impact & Exports • Gems & Jewellery: As a net importer of gold for manufacturing, Sri Lanka faces extreme volatility in working capital and inventory valuation. However, the sector showed resilience in 2025, with Diamonds, Gems & Jewellery exports estimated to grow 46.15% YoY (reaching US$ 23.91 Mn in Dec 2025). • Apparel & Textiles: Remained the top revenue driver, earning US$ 4.9 Bn in 2025 (+5.34% YoY). • Tea: Export earnings reached US$ 1.5 Bn (+4.97% YoY) in 2025. • Economic & Policy Outlook • Total exports for 2025 reached US$ 17.25 Bn (+5.6% YoY), with a US$ 20 Bn target set for 2026. • Global volatility pressures the Sri Lankan Rupee and complicates Central Bank reserve valuations, as gold is a key component of official foreign exchange reserves. • Experts advise a shift from price speculation to margin protection and design-based value addition for local stakeholders.

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Unit Trust Industry Hits Rs. 610 Bn Asset Milestone 📈

Sri Lanka's unit trust industry recorded a strong start to 2026, with Assets Under Management (AUM) growing 6.1% YoY to surpass the Rs. 600 Bn mark by end-January. • Overall Growth: Total AUM reached Rs. 610 Bn, marking a 3.8% increase from December 2025. The industry now comprises 84 funds managed by 16 companies. • Sector Performance: • Equity-related funds were the primary driver, doubling YoY to Rs. 67 Bn and surging 10.2% in January alone. • Fixed income funds maintained steady growth, rising 2.9% YoY. • Investor Participation: The industry added 3,110 new unit holders in January (+35.0% YoY), bringing the total investor base to 147,020—a 25.7% YoY increase. The shift toward equity reflects high investor confidence in capital market performance and a strategic move toward long-term capital appreciation. The Unit Trust Association of Sri Lanka (UTASL) continues to focus on enhancing financial literacy and accessibility to further integrate retail investors into the formal economy. _Data based on UTASL January 2026 industry report._

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## 📈 Understanding Unit Trust Disclaimers in Sri Lanka

The Unit Trust Association of Sri Lanka (UTASL) clarifies that mandatory disclaimers in unit trust advertisements are designed to protect investors, not fund managers, by ensuring transparency and realistic expectations. • Core Purpose of Disclaimers Since unit trusts are market-linked—investing in government securities, bonds, and equities—returns are subject to market volatility. The SEC strictly prohibits guaranteed returns to prevent misleading investors. • Decoding Key Phrases • "Yield is variable": Indicates returns fluctuate based on interest rate shifts (for money market funds) or share price movements (for equity funds). • "Past performance is not indicative of future performance": A reminder that historical gains do not guarantee future results due to changing economic conditions. • The Role of Documentation • KIID (Key Investor Information Document): A mandatory SEC-regulated document detailing fund risks, fees, and suitability. • Fact Sheets: Provide concise, regular updates on fund performance and asset allocation. • Sector Significance Unit trusts promote financial inclusion by offering professional management and diversification to retail investors. This industry, comprising 16 licensed companies, plays a vital role in mobilizing capital for national economic growth. _Note: Information based on industry insights provided by UTASL on February 17, 2026._

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Sri Lanka Investment Forum 2026: Focusing on Green Transition & Economic Recovery 📈

The Board of Investment (BOI) is set to host the Sri Lanka Investment Forum 2026 on 30 March at Cinnamon Life, Colombo. Partnering with the EU, ADB, and ESCAP, the event aims to showcase the nation's landscape for sustainability and tech-driven growth. • Core Theme: Investing in Sri Lanka’s green and connected future, with a heavy focus on renewable energy, green finance, and economic recovery strategies. • Sector Highlights: • Manufacturing: Emphasis on value-added processing, pharmaceuticals, and industrial manufacturing. • Services: Focus on logistics, integrated warehousing, and aviation services. • Infrastructure: Opportunities in technology/innovation parks, university towns, and "cinema cities." • Leisure & Recreation: Targeted growth in nautical tourism, waterfront developments, and theme parks. • Key Features: The forum will include an exclusive EU-SL Investor Dialogue, B2B matchmaking sessions, and deep dives into green finance instruments to fund the transition. • Support: Co-funded by the European Union with strategic support from the ADB and UN ESCAP to align with international sustainability standards.

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📈 SME Forum: SEC & CSE Target Regional Business Growth

The Securities and Exchange Commission (SEC) and Colombo Stock Exchange (CSE) are hosting an issuer forum today, 13 February 2026, in Weligama. The initiative aims to bridge funding gaps for regional businesses by encouraging engagement with the capital market. • Overall Market Strength (2025): • Market Capitalisation: Exceeded Rs. 8.5 Trillion. • New Listings: 25 total (including 6 new companies raising debt and equity). • Innovative Instruments: Introduction of Blue Bonds, Green Bonds, and Sustainable Bonds. • Key Focus Areas for SMEs: • Transitioning to the Empower and Diri Savi boards for easier listing. • Strategies for succession planning, governance, and wealth management. • Reducing reliance on traditional bank credit in favor of risk capital. • Strategic Outlook: The forum highlights a shift toward broad-basing companies across Sri Lanka. By leveraging a buoyant market—noted for significant volume increases—SMEs in sectors like tourism and agribusiness can access mid-to-long term capital to catalyze expansion.

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📈 TESS Agro to Raise Rs. 250 Mn via Private Placement

TESS Agro PLC has announced a strategic shift in its funding plans, opting for a private placement of shares to raise Rs. 250 million, replacing a previously proposed debenture and warrant structure. • The Deal: The company will issue up to 125 million ordinary voting shares (approximately 18.5% of issued voting shares) at Rs. 2.00 per share. • Investor: The shares are to be issued to Oman-based SE Capital Trading SPC. • Purpose of Funds: Proceeds are earmarked for the repayment of existing borrowings, meeting working capital requirements, and funding capital expenditure. • Financial Context: As of Dec 2025, the company reported long-term borrowings of Rs. 343.3 million and short-term debt of Rs. 156 million. Net assets stood at 39 cents per share. • Market Reaction: Following the announcement, TESS Agro voting shares closed at Rs. 2.10 (down 10 cents), while non-voting shares remained unchanged at Rs. 1.50. The move is part of a broader capital restructuring for the agriculture and export sector firm and remains subject to shareholder and regulatory approvals from the CSE and SEC.

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Appointments & Executive Moves

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CBSL Approves New CEO for Bank of Ceylon (BOC) 📈

The Central Bank of Sri Lanka (CBSL) has officially approved the appointment of Y.A. Jayathilaka as the General Manager/Chief Executive Officer of the state-owned Bank of Ceylon, effective from 27 February 2026. • Leadership Transition: Jayathilaka transitions into the permanent role after serving as the Acting GM/CEO since 6 August 2025. • Professional Background: He previously served as the Deputy General Manager for Product and Banking Development and joined the bank's Corporate Management team in February 2020. • Strategic Impact: As a veteran of the state-sector banking & finance industry, his formal appointment provides leadership stability for Sri Lanka's largest commercial bank during a critical period of economic recovery.

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RDB Bank Appoints New Directors to Drive Development Mandate 📈

The state-owned Regional Development Bank (RDB) has strengthened its leadership team with two high-profile appointments to its Board of Directors, aimed at enhancing financial inclusion and supporting SME entrepreneurs. • New Appointments & Expertise Asoka Bandara (Independent/Non-Executive): Effective Oct 2025. Over 40 years of experience in consumer goods (FMCG), dairy value chains, and corporate strategy. Formerly at Nestlé, Delmege Forsyth, and currently at Maliban. Wasanthe Nandasiri (Independent/Non-Executive): Effective Nov 2025. A Fellow Chartered Accountant with 20+ years in banking, financial services, and multi-country operations. Former senior lead at Ernst & Young. • Strategic Focus Areas Governance & Transformation: Integration of advanced risk management, treasury oversight, and large-scale ERP implementations. Sector Synergy: Leveraging Bandara’s leadership in the dairy and confectionery sectors to align bank lending with national industrial growth. Institutional Sustainability: Focus on long-term value creation and business restructuring to fulfill the bank's development mandate. • Key Professional Backgrounds Bandara: President of All-Island Dairy Association; former Director at People’s Leasing and Litro Gas. Nandasiri: Expertise in audit, valuation, and business transformation across South Asia and emerging markets. The move signals a push for professionalized management within state-backed development finance institutions to better serve the agricultural and manufacturing sectors.

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Lanka IOC Appoints K. Raghu as New Managing Director 📈

Lanka IOC PLC has officially announced the appointment of K. Raghu to its Board as Executive/Managing Director, succeeding Dipak Das. A veteran of the petroleum sector, Raghu brings over 26 years of experience from Indian Oil Corporation Ltd. • Leadership & Expertise: Raghu holds a B. Tech in Civil Engineering and an MBA. His career spans significant roles in downstream marketing, retail strategy, and business leadership across major Indian states. • Strategic Achievements: He is credited with driving market share growth and spearheading retail network expansion. Notable successes include commissioning top-ranked company-owned outlets and introducing CNG infrastructure in new markets. • Modernization & Sustainability: His background includes leading retail automation, visual identity overhauls, and advancing sustainable mobility via LNG stations and electric vehicle (EV) charging networks. • Impact on Sri Lanka: In his new role, Raghu will provide strategic direction to Lanka IOC, focusing on operational excellence and sustainable energy solutions to further develop Sri Lanka’s energy sector.

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Sanjay Kulatunga Appointed to WindForce PLC Board 📈

• WindForce PLC has announced the appointment of Mr. Sanjay Kulatunga as an Independent, Non-Executive Director effective March 3, 2026. He succeeds Mr. Dilshan Hettiaratchi following the latter’s resignation, aiming to strengthen the company’s strategic oversight and governance. • Mr. Kulatunga is a seasoned entrepreneur and finance professional, currently serving as the Co-Founder and CEO of LYNEAR Wealth Management. His extensive background in financial services and export-oriented industries is expected to bolster the firm’s long-term decision-making. • Key professional highlights include: • Co-founded Amba Research, a pioneer in Sri Lanka's investment research offshoring sector. • Held high-level public sector roles at the Central Bank of Sri Lanka (FSSCC), the Board of Investment (BOI), and the Securities and Exchange Commission (SEC). • Currently a Member of the Colombo Port City Economic Commission. • His academic credentials include an MBA from the University of Chicago Booth School of Business, alongside CFA and ACMA (UK) qualifications. This appointment integrates top-tier financial expertise into the renewable energy sector's leadership.

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Indira Malwatta Appointed to CT Holdings Board 📈

CT Holdings PLC has announced the appointment of Indira Malwatta as an Independent Non-Executive Director, bringing over 40 years of expertise in export promotion and international marketing to the group. • Professional Background: A veteran in public sector leadership, she served as the first female Chairperson of the Sri Lanka Export Development Board (EDB). Her experience spans the industrial, agricultural, and SME sectors. • Key Achievements: Recipient of the Wifts Foundation Lifetime Achievement Award (London, 2016) and recognized by the LMD “A-List” of Sri Lankan business leaders. She has served as a focal point for projects with the World Bank, ITC, and JETRO. • Current Directorships: Currently holds Board positions at Samson International PLC (Chairperson), Cargills (Ceylon) PLC, Kotmale Holdings PLC, and Lanka Shipping and Logistics Ltd. • Economic Context: Her appointment strengthens the board’s capacity in supply chain management and women’s empowerment, reinforcing CT Holdings’ strategic leadership in the retail and manufacturing sectors. Note: Based on provisional corporate data. ---

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Commercial Bank Appoints Hasrath Munasinghe as Executive Director/COO 📈

• Commercial Bank of Ceylon PLC has officially appointed Hasrath Munasinghe as Executive Director and Chief Operating Officer (COO), effective 27 April 2026. He succeeds S. Prabagar, who retires after a 30-year career at the bank. • Munasinghe currently serves as Deputy General Manager – Corporate Banking. His extensive tenure at ComBank includes leadership roles across Retail Banking, Digital Banking, Remittances, and Sustainability. • With 31 years of multi-disciplinary experience in Banking, Telecommunications, and FMCG, he brings over 15 years of corporate management expertise to the role. He is credited with driving portfolio expansion and strengthening asset quality. • He holds dual roles as a Director of CBC Finance PLC and a Board member of the UN Global Compact (UNGC) Network Sri Lanka, reflecting a focus on ESG and responsible governance. • Academically, he holds an MSc in IT from the University of Moratuwa, an MBA, and professional fellowships from CIMA (UK) and CIM (UK). _Note: Appointment follows the scheduled retirement of the current COO._

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### Union Assurance Appoints CEO Senath Jayatilake to Board 📈

Union Assurance PLC has officially appointed its Chief Executive Officer, Senath Jayatilake, to the Board as an Executive Director, effective immediately. This move strengthens the leadership synergy between the company’s executive management and its strategic governance. • Executive Profile: Jayatilake serves as an Executive Vice President of the John Keells Group. His previous leadership includes a tenure as CEO of John Keells Logistics Ltd. • Professional Expertise: Brings over 19 years of experience across operations management, sales and marketing, and financial management. • Qualifications: • MBA from the Postgraduate Institute of Management (SJP). • BA (Hon) in Finance, Accounting, and Management (University of Nottingham). • Associate Member (ACMA) and Chartered Global Management Accountant (CGMA). • Strategic Impact: The appointment is expected to bolster Union Assurance’s position within the insurance and financial services sectors by leveraging Jayatilake's extensive cross-industry experience within the John Keells ecosystem.

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Mazagon Dock Nominees Appointed to Colombo Dockyard Board 📈

Colombo Dockyard PLC (CDPLC) has officially appointed several new directors nominated by its major shareholder, India’s Mazagon Dock Shipbuilders Ltd (MDL), effective February 24, 2026. This follows MDL's recent acquisition of a 41.73% stake (164.9 Mn shares) as part of a US$ 52.96 Mn strategic investment to revive the facility. • New Board Appointments • Capt. Jagmohan: Chairman & MD of MDL (Non-Executive, Non-Independent Director). • Biju George: Director (Shipbuilding) of MDL. • Ruchir Agrawal: Director (Finance) of MDL. • Thimira S. Godakumbura: Current MD/CEO of CDPLC, now representing MDL. • Strategic Context • The shift reflects MDL’s increasing oversight as it moves toward securing a 51% controlling interest via an ongoing mandatory offer at Rs. 40.00 per share. • The partnership aims to integrate Sri Lanka’s shipbuilding & heavy engineering sector into regional supply chains and resolve long-standing working capital constraints. • Governance & Growth • Nominees bring expertise in naval architecture, defense operations, and finance to strengthen strategic oversight. • Appointments were approved by the Nomination and Governance Committee in compliance with CSE listing rules.

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Headline: Corporate Heavyweight Chinthaka Jayaweera Joins Boards of Ceylon Guardian and Ceylon Investment 📈

Carson Cumberbatch group companies Ceylon Guardian Investment Trust PLC and Ceylon Investment PLC have announced the appointment of Chinthaka Jayaweera as an Independent Non-Executive Director, effective February 2026. • Executive Profile A veteran with over 28 years of global experience at A.P. Moller Maersk Group, Jayaweera previously served as Vice President and Chief Internal Audit Executive. He brings extensive expertise in governance, risk management, and global finance operations, having spent over two decades at Maersk's head office in Denmark. • Strategic Board Expansion His appointment extends beyond the investment sector; he has also joined the boards of other major entities within the group, including: Bukit Darah PLC Carson Cumberbatch PLC Equity Two PLC (Real Estate) Pegasus Hotels of Ceylon PLC (Leisure/Hospitality) • Qualifications & Background Education: Global Executive MBA from TRIUM (LSE, NYU Stern, and HEC Paris); leadership programs at Harvard and INSEAD. Professional: Fellow of CIMA (UK) and Member of CIM (UK). Career Roots: Started at KPMG Sri Lanka and Vanik Incorporation before a long-tenured career in international logistics and shipping. The addition of such a high-caliber professional is expected to strengthen independent oversight and risk compliance across these key investment and holding companies. _Note: Based on official corporate disclosures to the Colombo Stock Exchange (CSE)._

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Suresh Shah appointed as HNB Chairperson effective April 2026 📈

• Leadership Transition: The Board of Hatton National Bank (HNB) PLC has appointed Suresh Kumar Shah as Chairperson, effective 1 April 2026. He succeeds Nihal Jayawardene PC, who retires following the AGM on 31 March 2026. • Profile & Expertise: Shah is currently an Independent Non-Executive Director at HNB and a Fellow of the Institute of Chartered Accountants of Sri Lanka. He brings extensive experience from the banking & finance and beverage sectors, having served as CEO of Lion Brewery (Ceylon) PLC and Ceylon Beverage Holdings PLC for 30 years. • Public Policy & Governance: A significant figure in Sri Lanka's economic policy, Shah previously headed the Government’s State-Owned Enterprise (SOE) Restructuring Unit. His leadership background includes chairing The Ceylon Chamber of Commerce and The Employers’ Federation of Ceylon. • Current Board Roles: He maintains a strong presence in the corporate sector, serving as Chairman of Ceylon Tobacco Company PLC and holding directorships at Carson Cumberbatch PLC, Bukit Darah PLC, and Lanka Canneries Ltd.

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Dr. Parakrama Dissanayake Returns as SLPA Chairman 📈

Maritime industry veteran Dr. Parakrama Dissanayake officially assumed office as Chairman of the Sri Lanka Ports Authority (SLPA) today, 17 February 2026. This marks his third tenure leading the authority at a critical juncture for the logistics & shipping sector. • Strategic Leadership: A former Presidential Advisor and the first non-British President of the Institute of Chartered Shipbrokers (UK), Dr. Dissanayake brings extensive experience from both the public and private sectors, including leadership roles at Aitken Spence PLC. • Key Objectives: His new term will prioritize: • Enhancing operational efficiency and digitalization. • Expanding capacity to meet the target of 15 million TEUs by end-2026. • Strengthening Sri Lanka’s position as the primary transshipment hub in South Asia. • Economic Context: The appointment follows a strong performance in 2025, where the Port of Colombo recorded a historic high of 8.29 million TEUs. Under his previous leadership, SLPA achieved its then-highest profit of Rs. 13.1 billion, and Colombo was ranked as the world's fastest-growing container port (1H 2018). • Infrastructure Focus: His tenure is expected to oversee the finalization of the East Container Terminal (ECT) and the West Container Terminal (WCT), which are pivotal for national employment and regional trade competitiveness.

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Kamal Munasinghe Appointed GM of Cinnamon Life at City of Dreams 🏨

• Executive Move: Hospitality veteran Kamal Munasinghe takes the helm as General Manager effective 15 February 2026. He concurrently retains his role as Senior Vice President – Colombo Hotels for Cinnamon Hotels & Resorts. • Experience Profile: Brings 30+ years of local and international experience (Switzerland, Malaysia, Vietnam). Previous leadership roles include COO of Cinnamon Hotels and stints with global brands like Marriott, Hyatt, and Mövenpick. • Strategic Focus: Tasked with driving the next growth phase of South Asia’s first fully integrated resort, aiming to solidify Colombo’s position as a hub for luxury hospitality, entertainment, and business. • Project Scope: Cinnamon Life represents Sri Lanka’s largest private sector investment. The landmark development features: • 687 luxury rooms and suites. • 5 grand ballrooms and an extensive restaurant portfolio. • A premium retail mall and over 1,000 pieces of Sri Lankan art. • Economic Impact: The appointment comes at a pivotal moment for tourism, with the integrated resort serving as a catalyst for urban transformation and global positioning of the travel & leisure sector.

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Politics & Government Impact

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SL Must Avoid Being 'Pawn or Victim' in Middle East Conflict 🇱🇰

Cabinet Spokesperson Dr. Nalinda Jayatissa has clarified Sri Lanka’s diplomatic stance regarding escalating Middle East tensions, emphasizing a policy of non-alignment and peace-building. • Strategic Position: The government maintains that Sri Lanka must not serve as an intermediary for hostile interests nor become a victim of the war. The stance is firmly anchored in formal diplomacy and international cooperation. • Economic & Labor Risks: Dr. Jayatissa highlighted significant risks to labor migration, specifically the safety of Sri Lankans working in the region. He warned of broader repercussions on global trade and energy markets which could hinder national economic recovery. • Global Responsibility: Calling on institutions established post-WWII, the spokesperson stressed that modern conflict consequences are unpredictable and no longer geographically isolated, requiring proactive intervention through "words and deeds." • Key Objective: To prevent Sri Lanka from being drawn into the conflict while supporting negotiations to protect the common people and ensure domestic stability. 📈

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President Dissanayake Expresses Solidarity with UAE Following Regional Attacks 📈

Sri Lankan President Anura Kumara Dissanayake held a high-level telephone conversation with UAE President Sheikh Mohamed bin Zayed Al Nahyan to address escalating Middle Eastern tensions. • Diplomatic Stance: President Dissanayake formally condemned recent Iranian attacks targeting the UAE and other Arab nations, affirming Sri Lanka’s support for UAE sovereignty and territorial integrity. • Security Concerns: Both leaders emphasized an urgent need to de-escalate military tensions to prevent a broader conflict that could impact global security and energy markets. • Economic Context: The UAE is a critical partner for Sri Lanka, particularly regarding energy imports, foreign remittances from the Sri Lankan diaspora, and labor migration opportunities. • Bilateral Commitment: Sri Lanka expressed readiness to assist the UAE, reinforcing ties with a key Middle Eastern ally amidst heightened volatility following retaliatory strikes in the region.

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Govt. to Recruit 15,839 Personnel for Public Sector 📈

The Cabinet has approved 15,839 new recruitments across Ministries and Provincial Councils following a comprehensive review aimed at balancing fiscal discipline with essential service delivery. • Sector Breakdowns: Defence: 9,794 positions (Largest share) Public Security: 1,915 positions Health & Mass Media: 776 positions Ports & Civil Aviation: 339 positions Education & Vocational Education: 300 positions Finance & Economic Development: 214 positions Science & Technology: 201 positions • Provincial Council Allocations: Northern: 411 North Western: 401 Eastern: 282 Sabaragamuwa: 236 Uva: 146 North Central: 66 Central: 22 • Key Context: The recruitment follows a December 2024 committee review to address operational gaps. Government spokesperson Dr. Nalinda Jayatissa noted this is a targeted approach rather than a blanket expansion, prioritizing national security, health, and infrastructure to ensure service delivery without disrupting rationalization efforts.

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### Sri Lanka to Repeal Chief of Defence Staff Act 🛡️

The Cabinet of Ministers has approved the gazetting of a draft bill to repeal the Chief of Defence Staff Act No. 35 of 2009, signaling a significant shift in the nation’s defence administration and resource allocation. • Legislative Move: The draft bill, prepared by the Legal Draftsman and cleared by the Attorney General, will soon be presented to Parliament for final approval. • Strategic Reassessment: Originally established in 2009 to coordinate the Army, Navy, and Air Force post-conflict, the government now deems the post of Chief of Defence Staff "non-essential" under current national circumstances. • Administrative Streamlining: The decision, initially reached on February 24, 2025, aims to optimize the Defence Ministry structure, reflecting a transition toward a leaner administrative framework. • Implementation Status: Based on provisional Cabinet briefings, the repeal received unanimous support as part of broader efforts to modernize the state security apparatus. 📈

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Airfare Relief for Stranded Passengers Amidst Middle East Conflict ✈️

The Civil Aviation Ministry has announced immediate concessions for travelers in Sri Lanka affected by flight disruptions and security concerns in the Middle East. Civil Aviation Minister Anura Karunathilake confirmed that all airlines have agreed to a standardized relief framework to assist passengers. • Policy Overview: Stranded travelers are entitled to full refunds for cancellations or fee-free rescheduling for postponed journeys. • Cost Impact: No additional charges or penalties will be imposed on affected passengers, ensuring financial protection during the crisis. • Operational Context: The measures follow widespread flight suspensions to and from the Middle East, impacting a significant number of travelers, including those in the labor migration and tourism sectors. • Stakeholder Alignment: The arrangement was finalized after a consensus between the government and all operating airlines to mitigate the impact of regional instability on Sri Lanka’s aviation & transport hub.

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Warning: Sri Lanka Faces Potential Economic Fallout from Middle East Conflict 📈

President’s Counsel Saliya Pieris has cautioned that Sri Lanka is vulnerable to the escalating Middle East crisis, urging early policy intervention to mitigate severe repercussions. • Global Market Pressures: Sharp increases in global oil prices and curtailed natural gas output are expected to create immediate knock-on effects for the domestic economy. • Key Sector Risks: • Tea: Potential disruptions to major export markets in the region. • Foreign Employment: Risks to worker safety and stability of remittances, a critical foreign exchange source. • Tourism: Possible decline in arrivals from both Europe and the Middle East. • Macroeconomic Impact: Anticipated volatility in foreign exchange markets and overall fiscal pressure. • Policy Recommendation: The government is advised to communicate risks transparently—drawing parallels to the 2022–23 crisis where delays in corrective action worsened the economic collapse.

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### 📉 Geopolitical Tensions: Impact of US-Iran Maritime Conflict on Sri Lanka

• Event Overview: The US has confirmed sinking the Iranian warship IRIS Dena off Sri Lanka’s territorial waters following its participation in India’s International Fleet Review 2026. The Sri Lanka Navy rescued 32 personnel; approximately 180 were reportedly on board. • Diplomatic Stance: The Sri Lankan government has maintained a cautious "non-aligned" position, calling for "maximum restraint" from all parties. Foreign Minister Vijitha Herath has refrained from a formal condemnation of the attack, opting instead for a symbolic visit to the Iranian Embassy. • Economic & Strategic Risks: Maritime Security: The escalation in the Indian Ocean poses a direct threat to regional stability and shipping routes. Bilateral Relations: Iran has historically supported Sri Lanka at the UNHRC. Analysts suggest a tepid diplomatic response could strain ties with a key ally. Macroeconomic Impact: There are rising concerns that regional instability will further pressure Sri Lanka’s "limping economy" through potential disruptions in trade and energy costs. • Internal Critique: Critics and opposition members argue the current administration's "disease to please" strategy lacks the diplomatic courage shown by previous governments, potentially weakening Sri Lanka’s sovereignty and international standing.

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### Middle East Volatility: Opportunity vs. Internal Credibility 📈

The ongoing escalation between Iran, Israel, and Western powers creates a dual-edged sword for the Sri Lankan economy, balancing potential capital inflows against deep-rooted domestic instability. • Strategic Outlook The "Next Dubai" ambition for Port City Colombo (PCC) hinges on attracting capital fleeing Middle Eastern instability. While tax incentives and regulatory sandboxes are in place, the shift from GCC markets to Sri Lanka remains speculative rather than guaranteed. • Sector Vulnerabilities Energy: Despite CPC assurances of intact supply lines, domestic fuel queues persist due to a lack of public trust, highlighting a gap between official bulletins and ground reality. Foreign Remittances: Escalation in the Gulf threatens the primary income stream from Sri Lankan expats in the UAE and Saudi Arabia. Tourism: Regional instability may deter global travelers, impacting this highly sensitive sector. • Economic Realities FDI: Experts argue that tax holidays alone won't attract "skittish" global capital. Consistent governance and the rule of law are prerequisites to compete with hubs like Singapore. Imports: Rising global oil prices due to Red Sea/Gulf tensions threaten to inflate the national import bill, straining limited forex reserves. • Summary Verdict Sri Lanka's potential to benefit from rerouted trade is hampered by "policy zig-zags" and a domestic "economy of suspicion." Success depends on institutional credibility rather than geopolitical luck. _Note: Analysis based on current editorial perspectives as of March 2026._

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📈 Geopolitical Alert: Impact of Iranian Supreme Leader’s Death

Reports confirm the death of Ali Hosseini Khamenei, the Supreme Leader of the Islamic Republic of Iran, following a coordinated missile strike by the United States and Israel on February 28, 2026. This event carries significant implications for Middle Eastern stability and global energy markets. • Historical Context: Khamenei served as President (1981–1989) and Supreme Leader since 1989. His leadership was defined by resistance against Western "hegemonistic" powers and support for regional allies. • Global Reaction: The assassination has triggered widespread protests across the US, Europe, and Asia. Attacks on US embassies have been reported in several regions, signaling heightened security risks for international trade and diplomacy. • Diplomatic Stance: Analysts suggest the Sri Lankan government faces pressure to extend official condolences, following the precedent of recognizing heads of state. This comes amidst calls to condemn the breach of international sovereignty and potential war crimes. • Economic Outlook: While the immediate data focuses on political fallout, such instability typically impacts global oil prices and supply chains, indirectly affecting Sri Lanka's energy costs and tea exports to the Middle Eastern region. _Summary based on reports as of March 5, 2026._

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### 📉 Geopolitical Patterns: Oil, Regime Change & the Indian Ocean

A deep-dive analysis highlights a recurring historical and modern pattern where national sovereignty in resource-rich or strategically located nations is challenged by global power structures. • The Petrodollar & Power The global financial order relies on the petrodollar—the 1970s agreement ensuring oil is traded in US dollars. Historically, leaders who challenged this (Iraq 2000, Libya 2009) or maintained "aggressive neutrality" (Pakistan’s Imran Khan) faced rapid regime changes or interventions. • The Venezuela-Iran Link A technical "supply chain" dependency exists where Venezuela's heavy crude requires Iranian condensates (diluents) for transport. Strategic control over these resources remains a high-stakes priority for global energy interests. • Sri Lanka’s Strategic Value The island is a primary target for "competitive colonisation" due to: Trincomalee Harbour: The world’s 4th largest natural deep-water harbour; 80% of global traded oil passes through these Indian Ocean lanes. Mineral Wealth: High-grade deposits of ilmenite, rutile, and zircon. Notably, monazite makes Sri Lanka one of only nine countries with significant rare earth elements—critical for high-tech and defense industries. Foreign Influence: Significant investments by China (Hambantota) and trilateral energy deals between India, Sri Lanka, and the UAE (Trincomalee) signal a struggle for maritime leverage. • Youth Uprisings Patterns suggest that while youth grievances (economic distress, hopelessness) are genuine, these movements are often amplified by external actors to achieve specific political outcomes favorable to global powers. • Sovereignty Concerns Based on 2025–2026 data, concerns are raised regarding the transparency of strategic agreements and whether IMF conditions limit the state's ability to retain the value of its textiles, tea, and mineral exports. _Summary based on analytical report dated March 04, 2026._

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### 📈 Impact of Middle East Conflict on Global & Local Economy

The recent escalation of the Israel-U.S. military intervention in Iran has triggered immediate volatility in global markets, threatening severe repercussions for energy-dependent economies like Sri Lanka. • Global Energy Crisis Global supply lines are breaking down just 4 days into the conflict. Experts warn oil prices could surge to US$ 200 per barrel. The breakdown follows the collapse of nuclear mediation despite Iran previously agreeing to "zero stockpiling" of fuel. • Economic Vulnerabilities U.S. domestic stability is under pressure with -18.6% approval on the economy and -32.3% on inflation. Defense spending is shifting from "butter" (social programs) to a "bottomless pit" of military expenditure. Potential for regional destabilization could revive extremist groups, further threatening international trade routes. • Geopolitical Context & Risks Iran represents a massive economic entity (17th largest country) with the Revolutionary Guard controlling approximately one-third of the economy, including oil, gas, and construction. Analysts compare the current "reckless" strategy to the 2003 Iraq invasion, predicting long-term global chaos. • National Security Parallel The report draws parallels to Sri Lanka’s internal security history, noting how political instability and "conspiracies of silence" previously impacted the national economy and safety (e.g., 2019 Easter attacks). Emphasis is placed on the risk of leaders prioritizing power over economic and civilian stability. _Note: Summary based on provisional editorial analysis dated March 04, 2026._

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Economic Warning: Impact of Middle East Crisis on Sri Lanka 📈

Former Foreign Minister Prof. G.L. Peiris has urged President Anura Kumara Dissanayake to clarify the government's strategy regarding the escalating Middle East conflict, citing four critical risks to the national economy: • Energy & Cost of Living: Global oil price hikes are expected to filter into local markets shortly, potentially aggravating public economic hardship. • Export Revenue: Commodity exports, specifically tea, face potential declines due to disrupted access to key regional markets under military action. • Tourism Sector: Significant cancellations reported from Europe, North America, and the Gulf as regional air travel becomes increasingly volatile. • Remittances: The crisis threatens the stability of financial inflows from Sri Lankan migrant workers stationed across the Gulf and broader Middle East. The opposition has offered assistance in mitigating these "multi-faceted" repercussions and called for greater transparency on the government's contingency plans. _Note: Summary based on formal correspondence from Prof. G.L. Peiris (04 March 2026)._

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Sustainability, ESG & Corporate Responsibility

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Greenpeace Calls for ‘Polluter Pays’ Action Following Cyclone Ditwah 📈

A new report by Greenpeace South Asia highlights the staggering economic and human toll of Cyclone Ditwah, urging for global climate accountability and a national loss and damage framework. • Economic Impact & Damage The World Bank estimates total economic damage at approximately US$ 4.1 Bn. Over 114,000 homes were partially or destroyed; critical infrastructure including roads, railways, and utilities faced extensive disruption. Human cost: More than 600 deaths and 2.3 million people affected by flooding and landslides. • Sectoral Disruptions Agriculture & Fisheries: Rural livelihoods and food security are severely threatened as these key sectors face long-term recovery challenges. Agrarian Debt: Experts warn that disasters exacerbate existing debt burdens for rural communities, calling for grant-based climate financing. • Climate Science & Advocacy Human-driven climate change made Ditwah’s rainfall 28% to 160% more intense. Sri Lanka contributes less than 0.1% of global emissions but bears disproportionate costs, fueling calls for the "Polluter Pays" principle against major carbon emitters. • Policy Recommendations Establishment of an independent Loss and Damage Committee to address both economic and non-economic losses (e.g., cultural and psychological). Advocacy for climate-related debt relief and restructuring to prevent further national financial vulnerability.

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UN Report Highlights Persistent Gender Gaps in Sri Lanka 📈

• Overall Legal & Social Landscape The UN identifies 67 discriminatory provisions across 28 laws affecting family, employment, and citizenship. High rates of gender-based violence persist, with 1 in 4 women experiencing intimate partner violence and 90% reporting harassment on public transport. • Economic Participation & Finance The female labour force participation rate stands at 31.6%, significantly trailing the male rate of ~70%. Unpaid care work remains a primary barrier. Additionally, women-led businesses face a massive financing gap estimated at US$ 17 Bn. • Leadership & Representation Despite comprising over 50% of the population, women hold less than 10% of parliamentary seats (22 out of 225). Representation in the Cabinet of Ministers is minimal at 8.7% (2 out of 23 positions). • Digital & Climate Vulnerabilities While 62% of women are digitally literate, only 34.6% possess computer literacy. Women also account for 58% of cybercrime complaints. In agriculture and fisheries, climate-related disasters disproportionately impact women through increased unpaid labor and disrupted maternal health access. • Summary Note Based on UN factsheet data as of March 2026. Closing these gaps requires urgent legal reforms and targeted economic empowerment to realize full gender equality.

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IESL Marks World Engineering Day 2026: Focus on Smart Engineering 📈

The Institution of Engineers, Sri Lanka (IESL) joined global celebrations for World Engineering Day on March 4, 2026, centering on the theme: "Smart Engineering for a Sustainable Future through Innovation and Digitalisation." • Key Focus Areas: The initiative emphasizes integrating digitalisation—including AI, Big Data, and Building Information Modelling (BIM)—to enhance national infrastructure planning and operational efficiency. • Strategic Objectives: • Disaster Resilience: Leveraging smart sensors and monitoring for early warning systems against floods and landslides. • Energy & Utilities: Utilizing data-driven management to optimize renewable energy integration and reduce transmission losses. • Urban Development: Applying intelligent tools to manage traffic congestion, waste, and water supply in growing cities. • Economic Impact: The IESL highlights that adopting smart engineering is critical for Sri Lanka’s economic stability, aiming to reduce project cost overruns and delays through digital modeling and innovative local solutions. • Professional Sector: As the apex body for disciplines including civil, electrical, mechanical, and ICT/BPM engineering, IESL is hosting high-level forums to align engineering expertise with national policy and sustainable development goals (SDGs).

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LOLC Divi Saviya Honored for Rapid Restoration of 200 Schools Post-Cyclone 📈

The Ministry of Education has officially recognized LOLC Holdings PLC for its "Obai Mamai Ape Ratai" initiative, which successfully restored 200 schools across Sri Lanka in just 45 days following the devastation of Cyclone Ditwah. • Rapid Recovery: The project enabled the swift resumption of education for thousands of students by repairing damaged infrastructure in 200 schools and supporting 4,000 displaced families. • Investment & Scale: Phase 03 of the Divi Saviya program involved an investment exceeding Rs. 500 million. This follows previous chapters that invested Rs. 2.5 billion to provide school supplies to 296,000 children (40% of the national student population) during the economic crisis. • Public-Private Synergy: Group CEO Kapila Jayawardena presented the progress to Prime Minister and Education Minister Dr. Harini Amarasuriya, highlighting how private sector mobilization can complement government disaster management. • Future Phase: The upcoming stage of the initiative will focus on the complete "ground-up" rebuilding and furnishing of selected schools that were entirely destroyed by the disaster. • Strategic Impact: Beyond immediate relief, these efforts stabilize the education sector—a critical pillar for long-term human capital and employment—by preventing student drop-outs during national crises.

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📈 Knuckles Spring Water Debuts Sri Lanka’s First Tethered Bottle Cap

Innovation & Sustainability • Knuckles Spring Water, a brand under CPC Lanka (subsidiary of Cargills (Ceylon) PLC), has launched the first tethered bottle cap in the Sri Lankan market. • The design ensures the cap remains attached to the bottle after opening, specifically targeting the reduction of small-format plastic litter in landfills and waterways. Environmental Impact • The initiative aims to improve plastic waste management and boost the recyclability of packaging by ensuring the cap is collected alongside the bottle. • This move aligns Sri Lankan packaging standards with international benchmarks, such as the European Union’s Single-Use Plastics Directive. Broader Conservation Efforts • Beyond packaging, the brand has deployed "Ocean Strainers" in Boralesgamuwa and Wanathamulla to intercept waterway plastic. • Current ESG activities include ecosystem awareness boards in the Knuckles mountain range, reforestation programs, and community water aid during flood relief. Strategic Context • The shift reflects a growing trend in the food & beverage sector toward circular economy practices and responsible plastic consumption, essential for long-term environmental resource efficiency in Sri Lanka.

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📈 DFCC Bank Lists Sri Lanka’s 1st Blue Bond on NSE IX

DFCC Bank has dually listed its inaugural Blue Bond on the NSE International Exchange (NSE IX) at GIFT City, India, marking a milestone for sustainable finance in the region. • Issue Details: The bond is valued at LKR 3 billion and was primarily listed on the Colombo Stock Exchange (CSE). • Cross-Border Collaboration: The listing follows an MoU between NSE IX and the CSE to enhance capital market integration and dual-listing frameworks. • Strategic Focus: Proceeds are dedicated to the marine economy, including sustainable fisheries, aquatic pollution control, and clean drinking water supply. • Historical Context: This follows DFCC’s June 2025 listing of LKR 2.5 billion in green bonds on the same exchange, which focused on renewable energy. • Market Impact: The dual listing aims to diversify the investor base by leveraging GIFT City’s offshore regulatory framework, increasing international visibility for Sri Lankan debt instruments. Based on official exchange disclosures as of February 28, 2026.

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### 📈 Sustainability & Global Economic Strategy: Sri Lanka Perspective

A recent high-level address by a former Sri Lankan Ambassador highlights the critical intersection of geo-economics and sustainable development as a pathway for national stability. • Global Economic Context Global GDP reached approximately US$ 118 Tn in 2025. The world spends US$ 2.8 Tn annually on defense—nearly 2.5% of global GDP. In contrast, eliminating global poverty would cost roughly US$ 400 Bn (0.33% of global GDP). • Regional Inequality & Comparisons South Asia’s GDP per capita remains under US$ 2,900, significantly lower than the global average of US$ 14,200. The 10-member ASEAN region averages US$ 6,000 per capita. Wealth inequality is at a historic high; the global Gini-Coefficient reached 68% in 2024. • Strategic Risks for Sri Lanka Data indicates a 15-20% likelihood of internal conflict when a developing nation faces a GDP decline of 4-5% for consecutive years. Sri Lanka’s 2022 crisis is cited as a primary example of this geo-economic vulnerability. • The Sustainability Mandate Achieving the 17 Sustainable Development Goals (SDGs) is viewed as vital for ICT/BPM, education, and human capital development. Investing just 1% of global GDP into SDGs could eliminate most challenges faced by developing nations. The transition from the 4th Industrial Revolution (AI/EVs) to the 5th Industrial Revolution (advanced biotechnology) requires robust multilateral cooperation to ensure smaller nations aren't marginalized.

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HNB & David Pieris Solar Partner to Boost Renewable Energy 📈

David Pieris Renewable Energy (DPRE) and Hatton National Bank (HNB) have signed a strategic MoU to provide specialized financing for solar energy adoption across Sri Lanka. • Financial Terms: For the domestic sector, loan values range from Rs. 500,000 to Rs. 7,000,000. Commercial & Industrial (C&I) project financing will be structured based on individual requirements. • Repayment: Loans feature a tenure of up to seven years with competitive, flexible interest rates based on the repayment period. • Strategic Impact: The partnership leverages DPRE’s technical expertise and HNB’s banking network to accelerate the transition to sustainable power for households and businesses. • National Goals: This initiative supports Sri Lanka’s target of 70% renewable energy generation by 2030 and achieving carbon net-zero by 2050.

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### Noritake Lanka & Regen Renewables Partner for 350 kWh Solar Project 📈

Regen Renewables Ltd has signed a strategic agreement with Noritake Lanka Porcelain Ltd to implement a solar power project at its Pannala manufacturing facility, advancing sustainable industrial growth in Sri Lanka. • Project Scope: Development of a 350 kWh solar power system designed to integrate clean energy into large-scale industrial operations. • Energy Output: Expected to generate approximately 448,680 kWh of clean energy annually. • Environmental Impact: Estimated reduction of 340 metric tons of carbon dioxide emissions per year, supporting Sri Lanka’s climate action goals and NDC targets. • Sector Synergy: Combines Regen’s 13+ years of expertise (80 MW installed capacity) with Noritake’s position as a pioneering porcelain tableware manufacturer. • Economic Context: Highlights the role of the renewable energy and manufacturing sectors in driving a low-carbon transition and enhancing industrial sustainability. Based on official partnership announcements. ---

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PIM Green Digital Summit 2026: Bridging Sustainability & Tech 📈

The Postgraduate Institute of Management (PIM) will host the PIM Green Digital Summit 2026 this Thursday, February 26. The forum aims to integrate digital transformation with sustainable business practices to navigate global economic complexities. • Event Focus: A premier platform for business leaders and academics to explore how sustainability and digital tools drive value creation in a low-carbon future. • Strategic Goal: Aligning with PIM’s "Business School for the New World" vision to develop leaders capable of managing disruption through ICT/BPM and green strategies. • Key Stakeholders: PIM has a massive footprint in Sri Lanka’s professional landscape, having produced over 350 CEOs and 30,000+ trained professionals. • Distinguished Speakers: Led by Director Dr. Asanga Ranasinghe and organized by Tharindu Ameresekere. Keynote contributors include: • Dr. Ravi Fernando (Sustainability Specialist) • Channa de Silva (LankaPay CEO) • Sandun Hapugoda (Mastercard Country Manager) • Impact: The summit focuses on practical applications of data and platforms to build digitally enabled organizations, essential for long-term employment and national economic competitiveness.

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## 📈 Hayleys Solar Powers Poultry Sector with 4 MW Installation

Hayleys Solar has successfully completed a large-scale 4,036 kW (4.04 MW) solar PV project for Pussalla Meat Producers, marking a significant shift toward renewable energy within Sri Lanka's livestock and poultry industry. • Project Scope: The installation spans six strategic farm locations, including Ganewatta, Hiripitiya, Mangalaeliya, Mahakumbukkadawala, Dompe, and Nagawilluwa. • Operational Impact: Designed to support energy-intensive operations across the entire value chain—from breeding and feed production to processing—enhancing long-term cost sustainability and reliability. • Environmental Contribution: The project is projected to reduce annual carbon emissions by approximately 3.39 million tonnes, aligning with national sustainability goals. • Strategic Importance: This collaboration highlights the growing trend of renewable energy adoption in the agriculture and food processing sectors to ensure business continuity amidst fluctuating energy costs.

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MAS Femography and Selyn Foundation Expand #BleedGood Initiative for 2026 📈

• Strategic Partnership: MAS Femography (FemTech) and the Selyn Foundation have renewed their collaboration to combat period poverty in Sri Lanka through the #BleedGood movement, focusing on women’s well-being and climate-conscious menstrual dignity. • Core Objectives: The 2026 initiative utilizes a four-part model involving the distribution of medical-grade reusable apparel solutions, hygiene education by health practitioners, male advocacy sessions, and climate impact awareness. • Economic & Social Impact: • Focused on reducing long-term costs for women and girls, addressing "unmet needs" exacerbated by Sri Lanka’s recent economic challenges. • Promotes sustainability by transitioning to reusable products, reducing environmental harm compared to disposable alternatives. • Features a robust monitoring framework to inform national policymaking on menstrual equity. • Sector Leadership: Leveraging MAS’s expertise in manufacturing science-backed solutions for menstruation and menopause, the program has evolved from a 2020 crisis response into a multi-stakeholder movement. • Global Footprint: Beyond Sri Lanka, the initiative is piloting programs in Afghanistan and Bangladesh, aiming to set global standards for the apparel & textiles sector in humanitarian contexts.

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Awards & Recognitions

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## Energy Efficiency as National Priority for Economic Growth 📈

Prime Minister Dr. Harini Amarasuriya emphasized that enhancing energy efficiency is a core pillar for strengthening the national economy and saving foreign exchange. Speaking at the Sri Lanka National Energy Efficiency Awards, the PM linked effective energy management directly to national development and international climate commitments. • Strategic Goals & Policy Renewable Energy: Government target to increase the renewable share to 70% by 2030. Global Commitments: Alignment with the Paris Agreement to reduce greenhouse gas emissions and ensure long-term energy security. Sector Reforms: Restructuring of the Ceylon Electricity Board (CEB) has entered its final phase to eliminate inefficiencies and irregular practices. • Key Award Winners Outstanding Energy Manager: Jeewaka Thushara (World Trade Centre Colombo). Gold Award Winners: Includes National Cleaner Production Centre, Forbes Marshall Lanka, World Trade Centre Colombo, BiC, DENTA Manufacturing, and MAS Fabrics Thulhiriya. • National Impact Emphasis on adopting new technology and transparent procurement processes. Critical focus on energy management across all scales, from large-scale industries (like apparel & textiles) to SMEs, to stabilize the economy and mitigate global warming. _Data based on official statements from the Sri Lanka National Energy Efficiency Awards._

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Digibrush & Emerald Triumph at Effie Awards 2025 📈

Sri Lanka’s digital marketing landscape saw a historic milestone as Digibrush led its client, Emerald, to win the "Most Effective Brand of the Year" at the SLIM Effie Awards 2025. • Key Achievements Digibrush secured 19 wins in total, including 2 out of only 5 Golds (40% of all Gold awards) presented during the night. Other accolades included 3 Silvers, 4 Bronzes, and 10 Finalist spots across sectors like FMCG, retail, and financial services. • The #DoublePocket Campaign Recognized as arguably the most awarded single campaign in Sri Lanka, it previously won the Grand Prix at SLIM Digis 2.5. Leveraging a cultural moment involving President Anura Kumara Dissanayake, the campaign went live within 24 hours. Impact: Emerald saw a 747% surge in double-pocket shirt orders and a 147.7X Return on Ad Spend (ROAS). • Market Significance The win underscores the growing dominance of ICT/BPM and digital agencies over traditional multinational networks in the apparel & textiles marketing space. Digibrush remains the only agency in Sri Lanka to claim four Grand Prix wins at SLIM Digis, reinforcing its position as a leader in performance marketing.

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📈 Jasmin Media Achieves 2026 Google Premier Partner Status

Colombo-based digital agency Jasmin Media has been awarded the Google Premier Partner designation for 2026. This status places the firm within the top 3% of Google partner agencies globally, marking its second such recognition in four years (previously awarded in 2023). • Performance Standards: The status is granted based on sustained campaign performance, measurable client growth, and advanced certifications across Google’s advertising infrastructure. • Full-Spectrum Capability: The agency holds certifications in search, display, YouTube video advertising, e-commerce shopping campaigns, and mobile app promotion. • Sector Diversification: Jasmin Media serves key local industries including banking, education, healthcare, FMCG, hospitality, and retail. • Regional Impact: Beyond Sri Lanka, the agency manages performance-led growth for clients in the UK, Australia, and the MENA region, showcasing the global competitiveness of the local ICT/BPM and digital marketing sector. The achievement underscores the agency's ability to operate at international standards while building high-tier digital capability within the Sri Lankan economy.

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## British Council Launches Women in STEM Scholarships for Sri Lankans 🎓

The British Council has opened applications for its sixth consecutive Women in STEM scholarship cycle, aimed at strengthening female leadership in science and innovation. • Program Scope: Provides fully funded one-year master’s degrees at top UK universities. Globally, 90 scholarships are available across 30 countries, with 25 specifically allocated to the South Asian region, including Sri Lanka. • Financial Value: Each scholarship is worth a minimum of £40,000, covering full tuition fees, living stipends, travel, visa costs, and health insurance. • Economic Impact: By connecting local talent with global expertise in fields like biomedical sciences and innovation, the program aims to bolster Sri Lanka’s ICT/BPM and research sectors, essential for national development and a diverse workforce. • Historical Reach: To date, the initiative has engaged 43 UK universities and awarded approximately 500 scholarships worldwide. • Deadline: Applications are open until late April 2026 for the 2026–27 academic year.

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Phoenix Ogilvy Tops 2025 Creative Rankings in Sri Lanka 📈

• Overall Achievement: Phoenix Ogilvy has been named the _2025 Sri Lanka Agency of the Year_ by Campaign Brief Asia, marking the country’s return to the regional creative rankings after a one-year absence. • Performance Metrics: The agency secured the top national spot with 295 Creative Ranking points. These points were amassed through significant wins at six major international award shows, including LIA, One Asia, Clio, AdFest, Spikes Asia, and The Work. • Individual Talent: The agency dominated the national Individual Creative Rankings. The top three spots were swept by Phoenix Ogilvy talent: Nadeera Warawita (No. 1 - 250 points) Sakuna Ranasinghe (No. 2 - 220 points) Samitha Kaushalya (No. 3 - 150 points) • Economic & Sector Impact: As a major hub in the ICT/BPM and creative services sector, the agency employs 290 industry specialists. This performance underscores the strength of Sri Lanka's intellectual capital and its ability to export high-value creative services globally. • Strategic Context: Chairman Irvin Weerackody attributed the success to a blend of global rigour and deep local intelligence, reinforcing the agency's 50-year standing as a pillar of the local marketing landscape. _Source: Campaign Brief Asia / Ogilvy Group Sri Lanka (Provisional Data)_ ---

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🏆 CEO of the Year 2025 Awards Tonight in Colombo 📈

The prestigious CEO of the Year 2025 Awards Ceremony will take place this evening, February 26, at the Cinnamon Grand Colombo. Organized by the Global CEO Forum, the event serves as a premier national platform to honor corporate leaders driving Sri Lanka’s economic stability. • Event Focus: Recognizing leadership excellence, strategic innovation, and resilience across various sectors. • Evaluation Criteria: Winners are selected through a rigorous process assessing organisational performance, governance standards, and industry impact. • Key Participants: Attendees include senior government Ministers, diplomats, and high-level corporate executives. • Economic Context: The ceremony emphasizes the role of the private sector in fostering global competitiveness and sustainable development for Sri Lanka. Strategic Highlights: • Focuses on ethical governance and innovation as core drivers of national progress. • Encourages public-private sector engagement to strengthen the country's economic resilience. _Note: Award winners will be announced during the gala ceremony._

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## Metropolitan Technologies Wins Special Category at 'The Great HR Quiz 2026' 📈

The Human Resources team of Metropolitan Technologies secured the Special Category Award at the 2026 edition of ‘The Great HR Quiz’, organized by the Chartered Institute of Personnel Management (CIPM) Sri Lanka. • Event Overview: The annual competition, held on 28 January 2026, featured over 70 leading organizations from across the island. It serves as a premier knowledge-sharing platform for HR professionals to promote excellence in people management and strategic alignment. • Sector Impact: As a key player in Sri Lanka’s ICT and technology solutions sector—holding a significant market share in hardware—Metropolitan’s win underscores the importance of a "future-ready" workforce in driving business performance. • Key Competition Results: • Overall Champion: International Distillers Ltd (IDL) • 1st Runner-Up: InQube Global (Pvt) Ltd • 2nd Runner-Up: DFCC Bank PLC • Sector Winner (Finance/Insurance): Janashakthi Group (JXG) • Strategic Significance: The 2026 quiz featured a revitalized format focusing on real-life HR scenarios and decision-making. The achievement reflects Metropolitan's commitment to high standards in human resource management, essential for sustaining its leadership in the local technology landscape. _Note: Results are based on the latest industry data from the CIPM 2026 event cycle._

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SLIM Effie Awards 2025 Grand Finale Set for March 3 📈

The Sri Lanka Institute of Marketing (SLIM) will host the Grand Finale of the SLIM Effie Awards 2025, celebrating the country’s most impactful marketing and advertising campaigns. • Event Details: Scheduled for March 3, 2026, at Monarch Imperial, Thalawathugoda, starting at 5:30 p.m. • Core Focus: Recognition of campaigns that demonstrate strategic insight, creative excellence, and measurable business results within the marketing and advertising sector. • Industry Significance: The SLIM Effie Awards serve as a global benchmark for marketing effectiveness, aimed at elevating industry standards and positioning Sri Lankan marketers on a global platform. • Participation: The event will convene key stakeholders, including leading brands, advertising agencies, and media partners, highlighting the resilience and innovation of the local marketing community. Based on official event announcement data. 🇱🇰

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Finalists Announced for CFA Institute Research Challenge Sri Lanka 2025/26 📈

The CFA Society Sri Lanka has revealed the top four university teams qualifying for the local finals of the prestigious global equity research competition. • Finalist Teams: - University of Kelaniya - SAB Campus CA Sri Lanka - University of Sri Jayewardenepura - University of Colombo • Key Details: - Subject Company: Digital Mobility Solutions Lanka Ltd. (PickMe) - Local Finals: Scheduled for 27 February 2026 at the HNB Auditorium, Colombo. - Objective: Teams will present equity research, financial modeling, and investment recommendations to a panel of investment community experts. • Strategic Impact: - Supported by the Colombo Stock Exchange (CSE) as Platinum Partner and HNB PLC as Banking Partner. - Focuses on strengthening capital market knowledge, analytical thinking, and ethical standards among the next generation of finance professionals. - The local winner will advance to the sub-regional competition, aiming for the Global Final in Hong Kong. • Sector Significance: - Vital for developing skilled human capital in financial services and equity research, essential for the long-term resilience of Sri Lanka’s financial ecosystem.

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Sri Lankan Scientist Wins Global 2026 OWSD-Elsevier Energy Award 📈

• Duleeka Sandamali Gunarathne from Sri Lanka has been named one of five winners of the 2026 OWSD-Elsevier Foundation Award for Early-Career Women Scientists in the Developing World. • The award recognizes her visionary leadership and research in Engineering Sciences, specifically focusing on advancing UN Sustainable Development Goal (SDG) 7: ensuring access to affordable, reliable, and sustainable energy. • Key Highlights: • Recognized for "transforming communities" through innovations in the sustainable energy sector. • One of only five global recipients selected from the Global South (alongside winners from Guatemala, Syria, Kenya, and Togo). • The award includes a cash prize of US$ 5,000 and a travel grant for an international conference to support professional growth. • Economic Impact: • Since 2013, this program has recognized 84 scientists across 38 countries, positioning winners as key role models for ICT/BPM and Engineering leadership. • Gunarathne’s achievement highlights Sri Lanka’s growing intellectual capital in renewable energy and sustainable technology, vital for long-term national energy security and professional services exports. • Awarded by the Organization for Women in Science for the Developing World (OWSD) and the Elsevier Foundation ahead of International Women’s Day.

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### Ven. Dr. Kirinde Assaji Honored with Lifetime Achievement Award in India 📈

• Event: Gangaramaya Temple Chief Incumbent Ven. Dr. Kirinde Assaji has been conferred the Lifetime Achievement Award by KITT University, India. This marks the first time a Sri Lankan has received this prestigious honor. • Significance: The award recognizes exceptional contributions to Buddhist scholarship, spiritual leadership, and the strengthening of Sri Lanka–India cultural relations. Previous recipients include eminent figures such as former Indian President Pranab Mukherjee. • Bilateral Impact: • Highlights the role of religious diplomacy in enhancing regional harmony and mutual cooperation. • Commemorates milestones such as the 2017 State Vesak Ceremony attended by PM Narendra Modi and the historic exposition of Indian Buddhist Relics at Gangaramaya. • Reinforces academic ties, as Ven. Dr. Assaji is an alumnus of the University of Delhi (MA and PhD). • Context: This recognition underscores the strategic importance of cultural and religious ties in the broader Sri Lanka–India partnership, fostering long-term bilateral stability and mutual respect. ---

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SLASSCOM Launches 2026 National Ingenuity Awards to Drive $5B Innovation Goal 📈

The Sri Lanka Association for Software and Services Companies (SLASSCOM) has officially opened applications for the 8th edition of the SLASSCOM National Ingenuity Awards (SNIA) 2026. The initiative aligns with the national target of building a US$ 5.00 Bn knowledge and innovation economy by 2030. • Core Objective: To transition Sri Lanka from service delivery toward high-value, product-driven growth and global intellectual property (IP) ownership. • Key Sectors: Awards cover Fintech, Agritech, Healthtech, Edutech, Manufacturing, Logistics, and Retail. • Eligibility: Open to Sri Lankan corporates, ICT/BPM startups (est. after Jan 2022), university undergraduates, and school students (Grade 9+). • Special Categories: Includes Woman Technopreneur of the Year, Tech-for-Good, and Innovation in RPA (Robotic Process Automation). • Timeline: Applications are open until 15 March 2026 via the official portal. The awards aim to improve Sri Lanka's Innovation Index by recognizing scalable, homegrown solutions with significant economic and societal impact. 🇱🇰

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Global & International Business

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### Sri Lanka–BELGOLUX Business Evening Boosts Investment Ties 📈

The Embassy of Sri Lanka in Belgium and the BELGOLUX–Sri Lanka Business Council (BLSBC) hosted a high-level networking event in Brussels on 24 February 2026 to strengthen economic partnerships with Belgium and Luxembourg. • Key Highlights & Strategic Focus: The event engaged over 55 Belgian companies and entrepreneurs, focusing on Sri Lanka’s evolving economic landscape and its strategic position within the EU trade framework. • Sector Opportunities: Discussions centered on high-growth areas including ports, logistics, tourism, and hospitality. The BLSBC was positioned as the primary institutional mechanism to facilitate these commercial ties. • Upcoming Trade Mission: A Belgian and Luxembourgish business delegation is scheduled to visit Sri Lanka from 17-21 June 2026. The mission will feature: Participation in Sri Lanka Expo 2026. Targeted B2B meetings and institutional engagements. Site visits to the Colombo Port City and other sector-specific hubs. • Outcome: The session saw strong interest from Belgian investors in the upcoming June mission, reflecting increased confidence in Sri Lanka’s structured investment models and the trade potential of the ICT/BPM and logistics sectors.

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### Strategic Analysis: The Decapitation Paradox in Modern Warfare (2026) 📈

This scenario analysis explores why traditional "leadership strikes" are failing against modern, decentralized sovereign systems, shifting the focus from individual targets to distributed architectures. • The Structural Shift: Traditional 20th-century "great man" doctrines assumed removing a leader triggers institutional collapse. In 2026, military command has evolved from a "vertebrate" model (central brain) to a "nervous system" architecture (distributed nodes), making systems nearly impossible to dismantle via surgical strikes. • Economic Attrition & Technology: Asymmetry: Low-cost autonomous tools (approx. $20,000) vs. high-cost interceptors ($2M+) create a "kinetic exhaustion" trap. Logistics: The defense of global supply chains becomes structurally unsustainable under saturation waves of inexpensive munitions. • Key Risks for Global Markets: Escalation Control: Removing a central leader deletes the "stop button," as no one remains with the sovereign authority to negotiate a ceasefire. Chokepoint Vulnerability: Automated retaliatory triggers often target critical corridors like the Suez Canal, potentially triggering global economic shocks. • National Resilience: For a high-employment, trade-dependent economy like Sri Lanka, the analysis underscores that sovereignty now depends on "intellectual survivability"—distributing ICT/BPM infrastructure and institutional C2 to avoid a single point of failure. _Note: Analysis based on strategic scenario data as of March 2026._ ---

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US-Japan $550 Bn Investment: Nuclear Power & Copper Projects Eyed 📈

• Energy & Infrastructure: Japan and the US are negotiating to include a massive nuclear power project in the second round of a $550 billion investment package. The deal involves Westinghouse (owned by Cameco and Brookfield) and aims to strengthen energy supply chains amid Middle East tensions. • Investment Scale: Westinghouse is exploring pressurized water and small modular reactors totaling up to US$ 100 Bn. This follows a previous US$ 80 Bn US government partnership with the firm to meet rising energy demand from AI data centers. • Industrial Expansion: A US$ 2 Bn copper smelting and refining facility by Falcon Copper is also under consideration. This project seeks involvement from Japanese suppliers and off-takers, highlighting a push for mineral supply chain security. • Strategic Context: Tokyo is accelerating deals to fulfill investment commitments under a US tariff agreement. To date, three projects valued at US$ 36 Bn (including an Ohio natural gas plant) have been announced. • Key Players: Potential involvement includes Japanese giants Mitsubishi Heavy Industries, Toshiba, and IHI. Official announcements are expected during Prime Minister Sanae Takaichi’s visit to Washington on March 19. _Summary based on provisional reports and ongoing bilateral negotiations._

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CB Governor Joins IMF Chief for High-Level Asia Policy Dialogue 📈

Central Bank Governor Dr. P. Nandalal Weerasinghe will represent Sri Lanka at the Asia in 2050 conference in Bangkok, joining global financial leaders to discuss regional growth and stability. • High-Level Roundtable: Scheduled for Friday, March 6, the session "Bringing Everything Together – Policy Challenges for Asia Going Forward" features IMF Managing Director Kristalina Georgieva and finance ministers from Malaysia and Thailand. • Regional Context: The dialogue focuses on Asia’s long-term growth prospects, emerging risks, and policy innovation, highlighting Sri Lanka's engagement in regional financial stability and economic collaboration. • Strategic Precursor: This event serves as a lead-up to the 2026 IMF and World Bank Group Annual Meetings (October 12–18), where global leaders will deliberate on poverty reduction, inclusive growth, and job creation. • Key Participation: The Governor's presence underscores Sri Lanka's continued involvement with the IMF and international partners as the nation navigates its long-term economic recovery and policy framework.

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### 📉 Oil Shock Risks: Sri Lanka Among Most Vulnerable EMs

Analysts warn that the escalating conflict in Iran and potential closure of the Strait of Hormuz could push Brent prices above $100, straining emerging market (EM) stability beyond simple inflation. • Global Market Impact Brent crude surged 7.2% to $83.36/bbl, hitting its highest level since July 2024. Goldman Sachs estimates a supply-driven jump to $85 adds 0.7% to inflation and cuts 0.5% off economic growth across emerging Asia. • External Sector Pressures A 10% rise in oil prices typically deteriorates current account balances by 40-60 basis points. Prolonged high prices threaten to "aggressively de-anchor" inflation expectations and widen deficits globally. • Specific Risks for Sri Lanka Citigroup identifies Sri Lanka, alongside Argentina and Pakistan, as a "low-reserve country" facing heightened risks. Key threats include: • Potential for significant currency slides. • Increased risk of capital outflows. • Pressure on external balances due to high energy import costs. • Regional Context While India is flagged for thin reserves, countries like Thailand and South Korea are noted for high exposure to current account deterioration. Investors are shifting toward the safe-haven US$ as EM equity and currency indexes hit three-week lows.

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## Sri Lanka-Maldives Economic Outlook: Strengthening Bilateral Ties 📈

Sri Lanka’s High Commissioner to the Maldives, M. Rizvi Hassen, has outlined a strategic roadmap to revitalize economic engagement, highlighting the role of financial institutions in bridging the two nations. • Financial Sector & Banking The Bank of Ceylon (BOC), operating in the Maldives for 44 years, remains a cornerstone of bilateral trust. As the second bank to enter the Maldivian market, it continues to facilitate trade and investment, supporting the Maldives' goal to become a specialized regional financial center. • Key Collaborative Sectors Opportunities for Sri Lankan businesses are expanding across high-growth areas: Tourism & Hospitality: Restoring pre-2019 levels of visitor exchange (historically 20,000–30,000 annually). Professional Services: Deep engagement in education and healthcare, where Sri Lanka remains a preferred destination. Agriculture & Construction: Maldivian interest in Sri Lankan agricultural expertise and tourism training. • Strategic Potential Despite the Maldives' small geographic size, it serves as a significant market and a strategic regional gateway. Proximity offers Sri Lankan enterprises unique advantages in logistics, finance, and ICT/BPM services, benefiting from lower costs and cultural familiarity. The High Commission aims to restore trade and investment momentum to 2018 levels and beyond, leveraging historical goodwill and the strong institutional presence of Sri Lankan firms. ---

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## 🇮🇳🇱🇰 Sri Lankan Aquaculturists Complete Indian Capacity-Building Program

A delegation of 10 professionals from the National Aquaculture Development Authority (NAQDA) recently concluded a specialized technical training program in India, aimed at enhancing Sri Lanka's freshwater aquaculture and fisheries sectors. • Program Overview: Conducted from February 2–13, 2026, at the Central Institute of Freshwater Aquaculture (CIFA) in Bhubaneswar, a premier research hub under the Indian Council of Agricultural Research. • Key Technical Focus: • Species and system diversification to improve yield. • Advanced breeding techniques, including carp brood stock management and cryopreservation. • Modern farming technologies such as biofloc-based fish farming and aquaponics. • Comprehensive health management for freshwater finfish and shellfish. • Strategic Impact: The initiative emphasizes capacity building as a pillar of bilateral development. India has expanded its training quota to 1,000 Sri Lankan professionals annually, facilitating knowledge transfer in ICT, agriculture, and technical services. • Field Exposure: Participants visited specialized units for ornamental fish, freshwater prawns, and selective breeding, which are critical for diversifying Sri Lanka’s export potential and rural employment. _Note: Summary based on recent institutional reporting._

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Sri Lanka-India Ties Strengthen with US$ 454 Mn Relief & Strategic Investment Focus 📈

Prime Minister Dr. Harini Amarasuriya reaffirmed the strategic importance of the Sri Lanka-India partnership during the Sri Lanka India Society's recent commemoration, highlighting a shift toward sustainable growth and deeper bilateral integration. • Economic & Financial Support: A long-term relief package of US$ 454 million from India was emphasized as a cornerstone for Sri Lanka’s current recovery efforts and ongoing development. • Investment & Tourism: A renewed call for Indian businesses to invest in Sri Lanka was issued, focusing on energy, digital transformation, and connectivity to foster long-term employment and economic stability. • Tourism Sector: Increased arrivals from India remain a priority, leveraging the geographical proximity and established people-to-people ties. • Strategic Cooperation: Key sectors identified for expanded partnership include maritime security, health, education, and trade. • Educational Milestone: The introduction of India’s first international degree program in Sri Lanka marks a significant expansion in the ICT/BPM and education sectors. • Emergency Assistance: Recognition of "Operation Sagar Bandhu" during Cyclone Dithva underscores India's role as the primary responder in regional crises.

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🇱🇰🇰🇷 Sri Lanka & South Korea to Strengthen Economic & Employment Ties

Deputy Minister of Foreign Affairs and Foreign Employment Arun Hemachandra met with South Korean counterpart Eui-Hae Cecilia Chung in Seoul to bolster bilateral cooperation as Sri Lanka advances its economic recovery. • Economic & Development Cooperation: Discussions focused on aligning South Korean development assistance with Sri Lanka’s progress in debt restructuring and national reconstruction initiatives following Cyclone Ditwah. • Overseas Employment: A primary focus was placed on expanding employment opportunities for Sri Lankans in South Korea, leveraging the strong existing labor partnership to support foreign exchange inflows. • Security & Cultural Ties: Both nations committed to enhancing security cooperation and people-to-people engagement, particularly among youth increasingly influenced by Korean culture. • 50 Years of Diplomacy: The meeting set the stage for the 50th anniversary of diplomatic relations in 2027, with plans for high-level visits to strengthen institutional and trade frameworks.

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📈 Global Biz Connect 2026: Positioning Sri Lanka as an International Business Hub

Colombo is set to host "Global Biz Connect 2026" on March 3 at Cinnamon Life, a strategic initiative under the "Rebuild Sri Lanka" movement aimed at economic revival and global trade integration. • Core Objective: The event serves as a high-level platform to bridge the gap between credible Sri Lankan enterprises and international markets, facilitating cross-border trade and foreign direct investment. • Key Industry Focus: Discussions will feature insights into critical sectors including value-added tea, confectionery, hospitality, finance & capital markets, medical tourism, and fashion. • Strategic Networking: Over 100 distinguished business leaders, investors, and influencers from Sri Lanka and the diaspora ecosystem (specifically Australia) will attend to explore scaling opportunities. • Economic Impact: Organised by JCI Colombo Mid Town and the Old Nalandians’ Association of Australia, the summit focuses on diversifying the export basket and strengthening the ICT/BPM and human resources sectors to enhance national competitiveness.

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Sri Lanka and Finland Formalize Political Consultation Mechanism 🤝

Sri Lanka and Finland held their second round of Bilateral Political Consultations in Helsinki on February 25, 2026, marking a significant milestone in their diplomatic ties established in 1954. • Strategic Partnership: The two nations signed a Memorandum of Understanding (MoU) to institutionalize a structured framework for regular political dialogue, aimed at elevating bilateral cooperation to new heights. • Economic & Sectoral Focus: • Discussions centered on expanding trade, investment, and tourism. • Emphasis was placed on private sector engagement and innovation-driven business partnerships. • Key priority areas identified include vocational education (VET), maritime sector (mutual recognition of seafarer qualifications), and meteorological data sharing. • Labor & Education Mobility: • Sri Lanka requested the establishment of a Visa Centre in Colombo to streamline processes for students and professionals. • Discussions focused on facilitating family reunification and enhancing professional mobility for the Sri Lankan expatriate community. • Economic Recovery & Aid: • Sri Lanka acknowledged Finland’s support via the EU GSP Plus scheme and assistance during economic stabilization. • Gratitude was expressed for Finland’s contribution to recovery efforts following Cyclone DITWAH. • Multilateralism: Both delegations reaffirmed their commitment to UN principles and exchanged views on regional and global security. 📈

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SL-Romania Bilateral Mission: Focus on Labour & Digital Cooperation 📈

Minister of Foreign Affairs, Foreign Employment & Tourism, Vijitha Herath, will conduct an official visit to Romania from March 1–3, 2026, to strengthen economic and diplomatic ties. • Labour & Migration: A key highlight is the signing of a bilateral Memorandum of Understanding (MoU) on Cooperation in the field of Labour. This establishes a formal, transparent framework for structured labour mobility and safe migration between the two nations. • Strategic Meetings: Discussions are scheduled with Romanian Ministers of Foreign Affairs, Labour, and Economy to enhance bilateral relations across multiple sectors. • Economic Focus: Beyond foreign employment, talks will cover digitalization, entrepreneurship, and tourism to promote institutional cooperation and mutual economic interests. • Context: This mission prioritizes the ICT/BPM and tourism sectors while formalizing the export of skilled and semi-skilled labor to the European market—a vital source of foreign exchange for Sri Lanka.

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Regulatory & Policy News

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📈 Cabinet Tightens Maize Import Controls to Protect Local Farmers

The Cabinet of Ministers has introduced a structured regulatory framework for maize imports to address domestic supply shortfalls while safeguarding the local agriculture sector. • New Pricing & Import Framework: A committee led by the Agriculture Ministry Secretary will now determine maize prices. Imports will be strictly limited to filling the gap when local harvests are unavailable in the market. • Thriposha Production: Approval granted for Sri Lanka Thriposha Ltd. to import up to 15,000 tons of maize in phases during 2026. This ensures the uninterrupted production of the national nutritional supplement despite local quality and supply constraints. • Regulated Participants: Only registered animal feed manufacturers and importers under the Department of Animal Production and Health are permitted to import, subject to rigorous supervision to prevent market distortions. • Process Streamlining: A new stepwise procedure has been formulated by the Agriculture and Trade Ministries to bypass bureaucratic bottlenecks and ensure timely procurement of high-quality raw materials. The move aims to balance the needs of the poultry & livestock and food processing industries with the livelihoods of domestic maize growers.

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### Legal Win for Colombo Fort Land: Court Clarifies Tax Status ⚖️

The Court of Appeal has ruled in favor of Colombo Fort Land & Building PLC, establishing a significant precedent for the taxation of corporate structures in Sri Lanka. • The Ruling: The Court classified the entity as a Holding Company rather than an Investment Company, rejecting the Inland Revenue Department’s (IRD) attempt to tax dividends as trading profits. • Key Distinction: The judgment clarified that Holding Companies maintain long-term control over subsidiaries, whereas Investment Companies typically engage in frequent share trading for short-term gains. • Tax Impact: The IRD argued that because dividends exceeded 80% of revenue, they should be treated as business income. The Court rejected this, ruling that high income concentration does not automatically change legal classification. • Legislative Intent: The decision reinforces the Inland Revenue Act of 2006, ensuring dividends are classified as a separate income source to prevent double taxation within corporate groups. • Economic Significance: This ruling provides much-needed tax certainty for diversified Conglomerates and Holding Companies, protecting the financial flow between parent companies and their subsidiaries.

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### Tax Clarity and Enhanced Disclosure for Sri Lankan Unit Trusts 📈

The Unit Trust Association of Sri Lanka (UTASL) has highlighted key provisions in the proposed Bill to amend the Inland Revenue Act, focusing on transparency and investor tax obligations. • Pass-Through Status: Unit Trusts will continue to be treated as pass-through vehicles for income tax, where income is taxed at the unit holder level. However, to maintain this status, trusts must now issue detailed income certifications to investors within five months of the assessment year-end. • Penalty for Non-Compliance: If a Unit Trust fails to provide the required certification (detailing income, exemptions, and withholding taxes), it will be treated as a company for income tax purposes, potentially increasing the tax burden. • Capital Gains Tax (CGT): Quoted Equities: Investments in listed equities held by Unit Trusts remain exempt from CGT under the broader framework. Other Assets: The UTASL expects CGT treatment for other asset classes to remain unchanged, provided the pass-through status is maintained. • Implementation Timeline: These requirements are expected to take effect from 1 April 2025. • Economic Impact: By formalizing disclosure, the amendments aim to improve good governance within the financial services sector and the capital markets, ensuring Unit Trusts remain a viable vehicle for long-term national investment.

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Sri Lanka Entering Final Stage for PayPal Inward Remittances 📈

Sri Lanka is nearing the completion of a long-awaited initiative to enable inward remittances through PayPal, according to Digital Economy Ministry Secretary Waruna Sri Dhanapala. • Current Status: The project is in its concluding phase following successful collaboration between private banks, PayPal, and the Central Bank of Sri Lanka (CBSL). • Economic Impact: SMEs & Freelancers: The move specifically targets internet-based service providers and the ICT/BPM sector, allowing them to receive foreign income through a formal, regulated mechanism. Foreign Exchange: By providing a local address option, the framework aims to capture "lost" forex currently held in overseas or proxy accounts. Formalization: The government expects a shift from informal channels (like Undiyal) to official platforms, improving transparency and tax compliance. • Regulatory Oversight: All transactions will fall under CBSL supervision, ensuring a secure and transparent digital payment ecosystem to strengthen national foreign exchange inflows. _Source: Digital Economy Ministry (Provisional)_

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📈 Proposed Single Cigarette Ban: Economic & Market Risks

Sri Lanka's Sectoral Oversight Committee (SOC) is re-evaluating a total ban on the sale of individual cigarettes. While driven by health concerns, the proposal faces significant pushback regarding its economic impact on small retailers and the potential for market distortion. • Economic & Health Toll: Data from NATA indicates an annual economic loss of Rs. 225–240 billion and approximately 22,000 lives lost to tobacco and alcohol-related causes. • The Unregulated Market: Experts warn a ban on "single sticks" could drive consumers toward the Beedi market (priced at Rs. 10/stick) or illegal smuggled cigarettes. The illegal cigarette trade already deprives the government of over Rs. 100 billion in annual revenue. • Impact on MSMEs: For the "Petti Kade" (micro-retailers), cigarettes act as a "bridge product" that drives foot traffic for other essentials. A full pack currently costs upwards of Rs. 3,200, a price point inaccessible to many consumers in the current economic climate. • Key Concern: A shift from legal sticks to unregulated alternatives could undermine public health goals while squeezing the daily cash flow of thousands of small-scale shopkeepers and reducing national tax collection. _Status: Currently under discussion within the Sectoral Oversight Committee._ ---

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Exporters Now Authorized to Invest in Local Dollar Bonds 📈

The Government has issued Regulations to Repatriation of Export Proceeds No. 01 of 2026 via Extraordinary Gazette, expanding the scope for exporters to utilize repatriated earnings for domestic foreign-denominated investments. • New Investment Access: The amendment updates the 2024 rules under the Central Bank of Sri Lanka (CBSL) Act, allowing exporters to invest in local loan instruments denominated in foreign exchange, a facility previously restricted to incorporated commercial banks. • Market Impact: This policy shift aims to increase demand for local Dollar Bonds, ensure competitive pricing, and deepen the domestic foreign exchange market. • Economic Objective: By enabling the apparel, tea, and ICT/BPM sectors to channel proceeds into these instruments, the move seeks to strengthen national reserves and promote economic stability through better classification of foreign exchange sources. • Regulatory Timeline: Following the initial issuance on 10 December 2025, these updated regulations await formal parliamentary concurrence to broaden participant eligibility.

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CBSL Blacklists 24 Entities for Prohibited Pyramid Schemes 🚫

The Central Bank of Sri Lanka (CBSL) has issued a formal notice identifying 24 entities and apps as prohibited schemes under Section 83C of the Banking Act, No. 30 of 1988. This follows investigations confirming these groups promoted unlawful financial structures. • New Additions: I.C.A.N Advertising (Pvt) Ltd and its affiliates (bannercuts.com, etc.) are the latest to be officially prohibited following CBSL investigations. • Key Prohibited Entities: • OnmaxDT, MTFE App (and its various SL groups), and Ledger Block. • Global Lifestyle Lanka, Best Life International, and Tiens Lanka Health Care. • Qnet/Questnet, Sport Chain, and Fruugo Online. • Fastwin (Pvt) Ltd, Windex Trading, and Beecoin App. • Regulatory Context: Engaging in or promoting these schemes is a criminal offense. The CBSL warns that these activities pose significant risks to the financial sector and individual consumer savings, often masking themselves as ICT or e-commerce opportunities. • Status: Based on official CBSL determinations as of Feb 26, 2026.

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## 📈 AI Governance: A Strategic Imperative for Sri Lanka

The rapid integration of AI across banking, healthcare, and public administration necessitates a robust national governance framework to mitigate escalating ethical and security risks. • Current Global Context Global adoption of AI is accelerating, with major frameworks like the EU AI Act (2024) and Singapore’s Model AI Governance setting international standards. The 2026 data exposure incident involving a senior US CISA official highlights how even "For Official Use Only" data can be compromised via public AI platforms. • Systemic Organizational Risks Data Leakage: Research indicates 8.6% of employees have pasted company data into public tools like ChatGPT, with 4.7% including sensitive source code or client info. Training Vulnerability: Data submitted to public models may be stored and used for future training, leading to potential proprietary knowledge leakage. • Strategic Recommendations for Sri Lanka Framework Alignment: Adopting risk-based regulations similar to the EU and ISO/IEC 42001 standards to ensure global market alignment. Sectoral Guidelines: Establishing specific mandates for high-impact sectors like Finance, Telecom, and Logistics. Secure Alternatives: Moving toward enterprise-grade solutions (e.g., private models) with contractual guarantees on data isolation. • Conclusion Proactive governance is a competitive differentiator. Without it, Sri Lanka faces regulatory misalignment and a potential erosion of public trust in digital government initiatives.

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Sri Lanka to Enact Digital Economy & Cyber Security Laws 📈

The Government is set to introduce two landmark legislations this year—the Digital Economy Act and the Cyber Security Act—to formalize the nation's digital transformation and establish a secure legal framework for a tech-driven economy. • New Authorities & Frameworks • Establishment of the Digital Economy Authority to integrate all Ministries and State institutions into a unified digital ecosystem. • Formation of the Cyber Security Authority to oversee protection standards for public infrastructure and digital systems. • Both Bills are in final drafting stages and are expected to be presented to Parliament within 2026. • Economic & Digital Goals • Target to grow the digital economy to US$ 15-30 Bn by 2030 (approx. 12-14% of GDP). • Increase digital sector foreign exchange earnings from US$ 1.6 Bn to US$ 5 Bn by 2030. • Budgetary allocation of Rs. 30 Bn to drive transformation, with Rs. 16.5 Bn specifically for the Ministry. • Strategic Initiatives • Launch of a national digital identity card and a consolidated "Super App" for State services. • ICT/BPM and GovTech focus to enhance public service efficiency (already tripled for certain certifications). • Digitization of agriculture (CROPIX), health, and education sectors to formalize rural economic activity. • Governance Outlook While the move seeks to coordinate policy, analysts warn of potential bureaucratic layers and high administrative costs by creating new bodies rather than reforming existing institutions like ICTA or SLCERT.

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### ⚖️ Court Orders Trial Against Foreign Broker Over NITF Reinsurance Tender

The Fort Magistrate’s Court has overruled preliminary objections by international firm Tysers Insurance Brokers Ltd., fixing a trial date for alleged violations of the Regulation of Insurance Industry Act. • Core Dispute: Tysers is accused of securing a major reinsurance tender from the National Insurance Trust Fund (NITF) without being duly registered under Sri Lankan law. The tender covers Strike, Riot and Civil Commotion (SRCC) insurance claims. • Financial Impact: The reinsurance contract for the 2024/2025 period involves a premium calculated at approximately Rs. 1 Billion. • Legal Violation: Local brokers, led by Strategic Insurance Brokers Ltd., argued that Section 92 of the Act prohibits any entity from conducting insurance business or acting as an agent in Sri Lanka without local registration. Tysers reportedly used George Steuart Ltd. as an agent during the bid process. • Next Steps: The Fort Magistrate held that the legal bar against unregistered entities applies. The trial is set for March 25, 2026. If found guilty, the firm faces potential fines or imprisonment under the regulatory framework governing the insurance sector.

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National Capital Markets Symposium to Strengthen Regulatory Framework 📈

The Bar Association of Sri Lanka (BASL) will host the National Capital Markets Symposium on February 26, 2026, focusing on the legal and regulatory evolution of the country's securities sector. • Core Objective: Strengthening the integrity of Sri Lanka's capital markets to restore investor confidence and support sustainable economic recovery. • Key Thematic Areas: • Regulatory functions of the Securities and Exchange Commission (SEC) and the Colombo Stock Exchange (CSE). • Listing requirements, capital formation, and issuer compliance obligations. • Enforcement strategies regarding insider trading and market manipulation (e.g., wash trades and false market activity). • Transparency, timely disclosure, and fair trading practices. • Strategic Importance: The forum aims to bridge the gap between legal expertise and market perspectives, ensuring a resilient ecosystem for listed companies, investment advisers, and investors. • Key Participants: Senior officials from the SEC and CSE, legal practitioners, and financial leaders, emphasizing that a predictable legal framework is vital for attracting global capital and protecting stakeholders.

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📈 Modernizing Financial Recovery: Sri Lanka’s New Insolvency Law

Sri Lanka is set for a landmark structural shift with the proposed Rescue, Rehabilitation and Insolvency Law. Moving away from the 1853 Ordinance, the bill shifts the focus from simple liquidation to business continuity and economic stability. • Strategic Objectives The framework aims to preserve enterprise value and protect employment by providing viable businesses a "second chance." It aligns Sri Lanka with global standards, crucial for boosting investor confidence following recent economic restructuring. • Core Pillars of the Bill Corporate Rescue: Introduces an administration regime allowing a temporary pause on creditor actions to facilitate restructuring negotiations. SME Support: Tailored mechanisms specifically for MSMEs to ensure the recovery process is accessible for smaller enterprises. Personal Insolvency: A shift for individuals, offering structured debt protection and rehabilitation orders before bankruptcy. Regulatory Oversight: Establishment of an independent Insolvency Regulatory Authority to professionalize practitioners and maintain high standards. • Economic Impact & Implementation The law addresses the high NPL (Non-Performing Loan) environment by creating predictable outcomes for creditors. Key challenges include the need for specialized training for the judiciary and balancing the new "moratoriums" with the rights of secured lenders. _Status: Based on provisional legislative drafts as of February 2026._

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Uncategorized

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## 🇻🇦 President Formally Invites Pope Leo XIV to Sri Lanka

• Diplomatic Outreach: President Anura Kumara Dissanayake has issued a formal invitation to His Holiness Pope Leo XIV for an official visit to Sri Lanka, aimed at strengthening bilateral ties with the Holy See. • Official Handover: The invitation letter was delivered at the Vatican on March 2, 2026, by Minister Bimal Rathnayake during his official mission to Italy. • High-Level Engagement: The letter was presented to Monsignor Mihaita Blaj, Under-Secretary for Relations with States, marking a significant step in Sri Lanka's international diplomacy and engagement with global religious leadership. • Context: While primarily a diplomatic and state visit, such high-profile engagements often bolster Sri Lanka's international standing and can positively impact the tourism and services sectors through increased global visibility.

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## Thousands Gather for Annual Katchatheevu Feast 2026 ⛪

The annual Katchatheevu Feast concluded on February 28, 2026, marking a significant event for cross-border religious diplomacy and the local maritime economy. • Event Overview: Held on February 27 and 28, the festival saw the participation of thousands of devotees originating from both Sri Lanka and India. • Economic Impact: While primarily religious, the feast supports the informal economy and fisheries sector by fostering bilateral relations between the two nations' coastal communities. • Logistics: Based on provisional reports, the event serves as a critical point for cultural exchange, impacting regional tourism and small-scale trade during the pilgrimage period.

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## ⛈️ Landslide Red Alert Issued for Four Districts Following Heavy Rainfall

The National Building Research Organisation (NBRO) has issued a Level 3 (Red) evacuation notice effective until 8:30 a.m. today (Feb 23), following intense rainfall exceeding 150mm within 24 hours. • High-Risk Zones (Red Alert): Immediate evacuation ordered for specific areas in Kandy (Yatinuwara, Doluwa), Kegalle (Aranayaka, Mawanella, Dehiowita), Matale (Rattota, Laggala), and Ratnapura. • Extended Warnings: Level 2 (Amber) and Level 1 (Yellow) alerts remain active for Badulla, Nuwara Eliya, Galle, Kurunegala, and Monaragala as heavy rains persist. • Economic & Safety Impact: Disruptions to plantation sector logistics and rural infrastructure are likely. Residents are advised to monitor for soil cracks, leaning utility poles, and sudden water flow changes near steep slopes. • Current Status: Based on provisional data from the NBRO; disaster management officials urge strict adherence to evacuation protocols to mitigate risks of slope failures and rock falls. 📈 ---

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Major Arrest in Akuregoda Double Murder Case ⚖️

Police have arrested a 46-year-old former Army soldier in connection with the fatal shooting of a lawyer and his wife in Akuregoda. This marks a significant development in the investigation into the February 13th attack. • Suspect Profile: The individual, a resident of Beruwala, legally discharged from the Army in 2009. He was apprehended in the Ambalangoda area by the Homagama Divisional Crime Investigation Unit. • Evidence Recovered: A mobile phone allegedly used for planning or executing the crime was seized during the arrest. • Case Context: The victims were killed inside their vehicle by two gunmen in a separate car. This arrest follows the previous detention of three other suspects accused of conspiracy and assistance in the Kottawa, Athurugiriya, and Kahathuduwa areas. • Legal Proceedings: The suspect is being interrogated by the Western Province South Crime Division and will be produced before the Kaduwela Magistrate’s Court.

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35 Years Since Northern Muslim Displacement: A Path to Reconciliation 📈

A commemorative event, “Memories of the North,” was held at the Sri Lanka Girl Guides Association in Colombo to reflect on the forcible eviction of the Northern Muslim community in October 1990. The event, featuring a documentary and photography exhibition, marks a significant step in post-war reflection and coexistence. • Historical Context (1990 Displacement) Roughly 75,000 Muslims were forced to leave the Northern Province by the LTTE within 48 hours. Evictees were stripped of belongings; many left with only the clothes they wore and minimal cash (approx. Rs. 150–3,000). Displaced families from districts like Mannar, Jaffna, and Kilinochchi faced hazardous journeys by boat to Puttalam and Kalpitiya during heavy rains. • Current Resettlement Status (as of Feb 2026) Housing & Land: A critical issue remains as many families still lack permanent housing and land deeds. New Housing Phase: The government has allocated Rs. 2,726 Mn to construct 1,363 houses in the Northern Province as part of a 7,306-unit requirement. Investment: Allocation stands at Rs. 2 Mn per house, with a 6-month completion target for the first phase. • Key Reconciliation Asks Official Apology: Activists and the NECC emphasize that a formal apology is fundamental to healing. Livelihood Support: Beyond housing, there is an urgent need for ICT/BPM and agricultural integration for the younger generation to prevent further economic marginalization. Digital Archiving: Plans are underway to create a virtual archive to preserve the history of Tamil-Muslim coexistence prior to the 1990 conflict.

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### 🏛️ Restoring National History: A Strategic Investment for Sri Lanka

• Core Policy Proposal Policymakers and educators are urged to restore history to a central role in the education sector. The move aims to counter a perceived weakening of national consciousness and patriotism among the younger generation, viewing historical awareness as a "strategic national investment" rather than just an academic subject. • Economic & Social Implications A nation’s future is defined not only by its ICT/BPM progress or economic policies but by its collective memory. The data suggests that historical ignorance leads to fragmentation and vulnerability to external manipulation, which can undermine long-term national stability and sovereign development. • Key Historical Pillars Hydraulic Civilization: Lessons from King Parakramabahu’s water management highlight ancient "sustainable development" and ecological intelligence. Governance & Justice: Historical figures like King Elara and King Dutugemunu serve as models for the rule of law and ethical leadership. Ethical Foundations: The arrival of Buddhism is credited with shaping the nation's approach to social harmony and conflict resolution. • Global & Modern Context International Benchmarks: Success stories from Germany, Japan, and India show how national identity drives economic and scientific progress. Modern Resilience: Teaching recent history, including the defeat of terrorism and the 2004 Tsunami response, is vital for building a socially responsible and resilient citizenry. • Current Status Based on the published commentary, there is a "dire need" for curriculum reform to ensure the next generation understands that independence and freedoms were hard-won achievements, essential for preserving Sri Lanka's value systems against "erosion and corrosion."

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📈 9th Edition of Colomboscope Opens with ‘Rhythm Alliances’

Sri Lanka’s premier contemporary arts festival, Colomboscope, has launched its 2026 edition, positioning the island as a growing hub for art tourism and the creative economy. The 9th edition, titled ‘Rhythm Alliances’, brings together over 50 artists to explore sound as a tool for cultural expression and social resistance. • Scale & Reach: Featuring 50+ musicians, filmmakers, and choreographers. The festival includes 35 newly commissioned projects, emphasizing the role of the ICT/BPM and creative sectors in high-value cultural exports. • Economic Context: While the creative economy remains largely untapped in Sri Lanka, events like Colomboscope drive urban footfall and support local hospitality and retail sectors through interdisciplinary public programs. • Sector Highlights: • Traditional Arts: Focus on ritualistic drumming and healing rites as enduring forms of knowledge. • Sustainability: Venues like Soul Studio highlight the intersection of sustainable manufacturing and contemporary design. • Tourism: Positioning Colombo as a regional arts destination alongside global peers like the Sharjah Biennial to attract high-spending cultural travelers. • Key Venues: Programs are spread across 8 city locations, including Barefoot Gallery, BMICH, and Scope Cinemas, facilitating broad public access and community engagement. _Note: Based on inaugural reporting; economic impact figures typically follow post-festival assessments._

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Startups & Entrepreneurship

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### Strategies for Resilient Entrepreneurship in Post-Crisis Sri Lanka 📈

A high-level roundtable convened by Dilmah Genesis and the LSE South Asia Centre in Colombo has outlined a shift from basic economic stability to long-term growth through institutional alignment and specialized support. • The Advisory Gap Research indicates that while financial aid (debt moratoria/concessional loans) is common, it is often "fragile" without relational support. Entrepreneurs rely heavily on informal networks; effective policy must integrate coaching, mentorship, and trust-based guidance rather than just technical instruction. • Sectoral Insights & Value Chains Tea & Agriculture: Experts highlighted that competition for supply can drive quality upgrading and better farmer pricing, drawing parallels from international models. SMEs: Small and medium enterprises remain central to growth but suffer from fragmented policy and under-prioritized fiscal strategies. Innovation: Global value is now defined by sustainability, provenance, and ethics—areas where Sri Lanka holds a natural competitive advantage. • Key Recommendations Digital Infrastructure: Adoption of digitally enabled public systems to restore entrepreneurial confidence. Beyond Capital: Shifting focus from purely financial instruments to human-centered support structures. Policy Alignment: Moving from "survival-driven" micro-enterprises to value-driven export strategies through ICT/BPM integration and climate-resilient innovation. _Note: Findings are based on discussions from the Dilmah-LSE workshop; a formal White Paper with policy suggestions is pending._ ---

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Bridging the Gap: Addressing the 52% Female Underrepresentation in Sri Lankan Business 📈

A recent analysis highlights a significant gender disparity in Sri Lanka’s entrepreneurial landscape, particularly visible in commercial hubs like Pettah. Despite women constituting 52% of the total population, their active economic participation as business owners remains disproportionately low. • Current Entrepreneurship Trends: Based on the Global Entrepreneurship Monitor 2023, the Total Early Stage Entrepreneurial Activity (TEA) rate for women in Sri Lanka is just 8.2%, compared to 14.7% for men. • Economic Barriers & Social Constraints: The study identifies deep-seated social and cultural barriers that prioritize homemaking over financial independence. These factors, combined with a lack of early-stage encouragement in family and educational settings, have led to "imposter syndrome" and a persistent fear of failure among potential female leaders. • Impact on National Growth: The underutilization of the female demographic represents a significant "untapped resource" for the national economy. Moving beyond small, informal ventures is critical for sustainable development. • Recommended Strategies: To build an inclusive ecosystem, the analysis calls for: Focused confidence-building programs. Enhanced access to finance and credit facilities for women. A long-term societal mindset shift to promote ownership and leadership.

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## Bluechip Technologies Asia Joins SolarX APAC Program 📈

Sri Lankan-based Bluechip Technologies Asia participated in the SolarX Startup Challenge APAC Acceleration Program in Singapore (Feb 4–6), focusing on scaling clean-energy innovations across the region. • Program Overview: Hosted by the International Solar Alliance (ISA), the event brought together 14 winning startups to pitch solar-based solutions to global investors and innovation leaders. • Sector Focus: The company explored AI-driven technology collaborations, specifically targeting: Smart Analytics: Enhancing renewable energy efficiency. Forecasting: Improving power grid predictability. Decision-Support: Optimizing clean-energy resource management. • Economic Impact: This engagement highlights the growing role of the Sri Lankan ICT/BPM sector in the global renewable energy transition through cross-border collaboration and advanced AI applications. • Strategic Outcome: The program emphasized investment readiness and business scalability, positioning clean-tech as a vital vertical for digital export growth.

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## 📈 Entrepreneurship & Capital Reinvestment: Keys to National Wealth

At a recent Ambeon Securities forum, LAUGFS Holdings Chairman Dr. W.K.H. Wegapitiya emphasized that Sri Lanka’s economic recovery hinges on shifting from a "nation of employees" to a culture of entrepreneurship and capital formation. • Wealth Gap & Growth: In 1950, Sri Lanka’s national wealth was US$ 1.4 Bn (2nd in Asia). Today, GDP stands at approx. US$ 84 Bn (90th rank), while peers like Taiwan have scaled to nearly US$ 1 Tn by prioritizing private capital and manufacturing. • The Profit-to-Capital Formula: Wegapitiya argued that "profit is not a crime" but a prerequisite for investment. Economic stagnation stems from social pressures and price controls that drain corporate earnings before they can be converted into productive capital. • Strategic High-Growth Sectors: To drive future GDP, focus must shift toward: Agriculture: Target to increase GDP contribution from 10% to 36% via processing and value addition. Healthcare & Pharmaceuticals: Vital due to aging demographics (25% of population over 60 by 2030). Manufacturing: Leveraging local natural resources to ensure stable, non-volatile economic growth. Services: High potential in equity investments and financial markets. • Current Outlook: The current fiscal environment is described as the "most conducive in five years." Experts suggest moving away from low-yield savings toward equity markets for long-term capital appreciation. • Key Constraints: • Only 2% of the workforce is entrepreneurially oriented. • Need for policy consistency and dedicated development financing.

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📈 Sri Lankan Tech Giant Fcode Labs Invests in German Coffee Startup

Sri Lanka-based ICT/BPM powerhouse Fcode Labs has announced a strategic investment in Bunamo, a Germany-based digital platform for the global coffee community. This move reinforces Sri Lanka’s growing footprint in the European tech ecosystem. • The Partnership: Beyond capital, Fcode Labs is the primary engineering partner, responsible for the platform's scalable architecture and user-centered design. • Product Scope: The platform connects home baristas, professional roasters, and brands, featuring content-driven interactions like recipe sharing and brand exploration. • Strategic Impact: This collaboration highlights the export of Sri Lankan software engineering expertise, helping European startups transition from concept to production-ready platforms. • Regional Focus: Built on a cloud-ready foundation, the platform is positioned for rapid expansion across Europe and international markets. _“Our decision was driven by the fast-growing coffee community globally,”_ stated Fcode Labs Co-CEO Buddhishan Manamperi, noting the investment aligns with their mission to back global innovation through Sri Lankan technical talent.

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## 📈 ZKTOR Enters Beta in Sri Lanka: A Shift Toward Digital Sovereignty

The South Asian social media platform ZKTOR has officially entered its beta phase in Sri Lanka. Developed by Softa Technologies Ltd., the platform prioritizes digital sovereignty, privacy, and user dignity over traditional data-driven models. • Core Technology & Architecture Zero-Knowledge Principles: System architecture ensures user activity and behavioral data are inaccessible to everyone, including platform administrators. Privacy by Design: Features include multi-layer encryption and a "no-extraction" media framework that prevents unauthorized downloading of personal content. Geographically Bounded Data: All data remains within regional borders, addressing concerns regarding external data extraction and foreign control. • Governance & Independence Zero External Funding: The platform has been developed without venture capital or government grants to maintain governance integrity and avoid investor-driven data policies. Strategic Leadership: Led by Chief Architect Sunil Kumar Singh, the design incorporates Nordic principles of digital trust and restraint adapted for South Asian linguistic and cultural diversity. • Socio-Economic Impact Digital Safety: Built-in safeguards specifically target online harm and misinformation affecting women and youth. Local Ecosystem: The operating model prioritizes local technical roles and moderation, fostering youth employment in the ICT/BPM sector without exporting regional data.

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📈 BOC Targets 2,000 Entrepreneurs via Beyond Banking Initiative

The Bank of Ceylon (BOC) is scaling its Entrepreneur Development Program (EDP) to strengthen Sri Lanka’s SME sector. Following the successful revival of nearly 700 distressed businesses, the bank is shifting focus from reactive support to proactive capacity building. • Overall Targets: BOC aims to train 1,500 to 2,000 entrepreneurs from 2026 onwards. The program is free of charge and open to both BOC and non-BOC customers. • Participant Profile: Focuses on SME owners aged 18–45 with annual turnovers between Rs. 5 million and Rs. 50 million. • Sector Breakdown: Participants are primarily drawn from high-potential and core areas: • Manufacturing & Export sectors. • ICT/BPM (IT services). • Agriculture. • Key Knowledge Areas: Training covers financial discipline, cash flow management, digital marketing, supply chain, and taxation. While non-financial, the program guides SMEs on accessing concessionary loan schemes and collateral-free facilities. • Support Model: A dedicated panel of bank experts provides ongoing mentorship via a WhatsApp-based community, ensuring long-term business sustainability and employment stability.

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Sri Lanka’s SME Financing Gap: Bridging the Venture Capital Divide 📈

Small and Medium Enterprises (SMEs) remain the backbone of the Sri Lankan economy, yet a significant "financing gap" persists for those deemed too large for microfinance but too traditional for venture capital. • Overall Figures & Economic Impact: SMEs account for over 75% of all Sri Lankan businesses, contributing 52% to the national GDP and providing 45% of total employment. Despite this, they face a staggering NPL stock valued at approximately Rs. 680 Bn following recent economic shocks. • Sector & Regional Breakdown: Venture capital remains heavily concentrated in ICT/BPM and tech-driven startups in urban Colombo. In contrast, SMEs in agriculture, manufacturing, and traditional services—especially in rural regions—are often excluded due to a lack of scalability or geographical bias. • Financing Challenges: Access to bank finance is stifled by high interest rates and rigid collateral requirements. Current SME lending rates remain a hurdle, though the Budget 2026 has proposed a Rs. 7.7 Bn allocation for concessionary loan schemes with interest rates as low as 5% for certain agricultural segments. • Proposed Solutions: Experts suggest a shift toward angel investors, impact funds, and regional venture plans. The government is also consolidating support agencies (IDB, NEDA, SMED) to streamline assistance and bridge the equity gap for the "underserved majority." _Note: Summary based on provisional 2025/2026 market data and recent budget proposals._

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**Politics & Government Impact**

Diplomatic Tension: France Questions Legitimacy of US-Israeli Strikes on Iran 🌍

• Geopolitical Context: France’s Foreign Minister, Jean-Noel Barrot, has publicly questioned the legitimacy of "unilateral" military actions taken by the US and Israel against Iran. • Diplomatic Stance: The French government asserts that such use of force should have been debated within the United Nations Security Council to acquire necessary international legitimacy. • Safety Update: As per provisional reports from the Ministry in Paris, no French casualties have been recorded at this stage. • Economic Implications: While specific trade data was not provided, such escalations in the Middle East typically impact global energy prices and shipping routes, which are critical to Sri Lanka's import costs and energy security.

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## Former SIS Chief Suresh Sallay Arrested Over Easter Attacks 📈

The Criminal Investigation Department (CID) has arrested former State Intelligence Service (SIS) Chief Major General (Retd.) Suresh Sallay in connection with the 2019 Easter Sunday terror attacks. This marks a high-profile development in the investigation of the bombings that killed 279 people and severely impacted the tourism sector. • Arrest & Detention Details Custody: Arrested in Peliyagoda by the CID under the Prevention of Terrorism Act (PTA). Detention: Authorized for a 72-hour period for interrogation regarding conspiracy and aiding/abetting. Evidence: Authorities cite "adequate evidence" emerging from ongoing probes into the April 21, 2019, coordinated bombings. • Background & Context Career Path: Served as Director of Army Intelligence, then SIS Chief (2019–2024). He most recently served as an adviser at the Sri Lankan High Commission in Malaysia. Allegations: Previously linked to the plot by whistleblowers in international documentaries, though he has consistently denied all involvement. Political Significance: This is the most significant arrest since President Anura Kumara Dissanayake took office, following pledges to expedite justice for victims. • Economic & Social Impact National Security: The move is seen as a major breakthrough in addressing the complexities of the attacks beyond the immediate suicide bombers. Tourism Recovery: Resolving the investigation remains critical for long-term stability in the hospitality and travel industries, which saw a sharp decline following the 2019 events. _Summary based on provisional police reports and current media disclosures._

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🤝 India Reaffirms Strategic Partnership with JVP Delegation

Key Interaction: Indian External Affairs Minister Dr. S. Jaishankar met with JVP General Secretary Tilvin Silva to discuss strengthening bilateral ties and regional cooperation. Strategic Support: India reaffirmed its role as a "true and trusted partner," citing its consistent support during Sri Lanka’s recent economic crisis and humanitarian assistance following Cyclone Ditwah. Development Focus: The dialogue centered on growth opportunities, social welfare initiatives, and inclusive development, aligning with Sri Lanka’s ongoing recovery efforts. Regional Context: The meeting highlights continued high-level engagement between New Delhi and Colombo across political and economic sectors to bolster regional partnerships.

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Product & Service Launches / Business Expansion

AIBL Secures Reinsurance Broking Licence for Global Market Access 📈

Assetline Insurance Brokers Ltd (AIBL), a subsidiary of the David Pieris Group, has been granted a Reinsurance Broking Licence by the Insurance Regulatory Commission of Sri Lanka (IRCSL). This allows the firm to handle both insurance and reinsurance placements directly. • Market Standing: AIBL ranks among the top three insurance broking companies in Sri Lanka with over 20 years of operations in general and life insurance. • Strategic Capability: The licence enables AIBL to independently design and place treaty and facultative programs, bridging the gap between local insurers and international reinsurance capacity. • Economic Impact: Provides specialized risk solutions for high-value sectors including infrastructure, engineering, marine, and manufacturing, where domestic capacity is often limited. • Service Integration: The move creates a single platform for insurance broking, reinsurance, and risk advisory, leveraging the institutional framework of the David Pieris Group to support complex risk transfers. This expansion aims to provide local corporates with more technically robust, competitively priced risk solutions by connecting them to leading global and regional reinsurers.

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Roar Global Scales South Asian Presence in Bangladesh and Nepal 📈

Sri Lankan mar-tech venture builder, Roar Global, has announced a strategic expansion of its regional footprint, transitioning from initial market entry to scalable operations in key South Asian markets. • Bangladesh Operations: Following a successful first year of revenue generation since September 2024, the company is shifting to a dedicated regional team model. Key focus areas include strengthening Meta advertising capabilities and expanding local infrastructure to support sustainable growth. • Nepal Market Entry: Roar Global has entered an exclusive partnership with Advantage Group to lead local execution. This alliance aims to elevate digital advertising standards, accelerate Meta adoption, and enhance advertiser performance through structured market education. • Regional Strategy: These developments reinforce Roar Global’s role as a regional leader in the ICT/BPM and digital advertising sectors. The move focuses on professionalizing digital ecosystems and leveraging local talent to build enduring commercial infrastructure across emerging markets. • National Impact: This expansion highlights the global competitiveness of Sri Lankan-led digital firms, contributing to the country's reputation as a hub for regional mar-tech innovation and professional services.

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Real Estate

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National Program Launches to Grant "Himikam" Freehold Title Deeds 📈

President Anura Kumara Dissanayake has officially inaugurated the national "Himikam" program to transition state-held land permits into absolute freehold ownership, aiming to modernize Sri Lanka’s land administration and economic productivity. • Strategic Shift: The initiative replaces restrictive permits under the 1935 Ordinance with freehold deeds under the State Lands Ordinance No. 8 of 1947. This allows citizens to utilize land as flexible economic units without previous legal constraints. • Implementation: • The program began in the Anuradhapura District with the initial distribution of 500 title deeds. • It will be implemented island-wide for permits voluntarily surrendered to the State. • Focus remains on balancing land release with national food security and agriculture requirements. • Economic Vision: The government aims to move away from "outdated inherited economies" by providing land access for industries built on modern technology and scientific advancement. • Key Objectives: • Remove political motives from land distribution. • Empower the farming community and general public with collateralizable assets. • Systematic allocation of land to attract contemporary global economic strategies.

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📈 Home Lands Unveils Landmark US$ 300 Mn Luxury Project at Port City Colombo

Sri Lanka’s real estate leader, Home Lands Group, has announced a strategic entry into Port City Colombo with a massive independent investment, reinforcing local developer confidence in the Special Economic Zone (SEZ). • Key Financials: The group secured a 3-acre mixed-use land parcel for US$ 40.1 Mn (approx. LKR 12.5 Bn). This marks one of the largest single-developer investments by a Sri Lankan firm in the project without foreign partners. • Project Highlights: Planned US$ 300 Mn mixed-use development featuring twin 40-storey towers. The "vertical sanctuary" will offer over 600 ultra-luxury units inspired by a forest resort concept. • Strategic Location: Situated in the Central Park District, the development commands 40 acres of parkland, seamless waterway connectivity, and direct oceanfront access with beach entry. • Economic Impact: As the first Sri Lankan-led independent project of this scale in the SEZ, it signals a major boost for the construction and urban development sectors, enhancing the scope for high-value service exports and foreign investment. • National Context: Chairman Nalin Herath emphasized that the move reflects the financial strength of homegrown real estate players to deliver global-scale projects, positioning Colombo as a competitive regional lifestyle hub. 🏙️ Based on project announcement data (February 2026).

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Colombo Land Values Surge 10.6% in H2 2025 📈

The Central Bank of Sri Lanka (CBSL) reports that the Land Valuation Indicator (LVI) for the Colombo District reached 261.9 in the second half of 2025, maintaining a steady upward trajectory since 2023. • Overall Growth: The LVI increased by 10.6% YoY and 2.1% on a semi-annual basis compared to H1 2025. • Sector Breakdowns: • Residential: Recorded the highest growth, up 12.4% YoY (Index: 273.1). • Commercial: Increased by 11.3% YoY (Index: 260.6). • Industrial: Showed a more moderate rise of 8.0% YoY (Index: 251.9). • Context: The valuation, based on 2017 prices (H1 2017 = 100), covers all 13 Divisional Secretariat divisions in Colombo. The broad-based gains across real estate and infrastructure sectors reflect continued demand in the capital's land market. _Source: CBSL Statistics Department (Provisional Data)_

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Prime Lands Secures Historic Colombo 7 Property for ‘The Elizabeth’ Tower 📈

Prime Lands Residencies PLC has finalized an agreement with the Urban Development Authority (UDA) to acquire the historic Otters Club car park property. This marks a major expansion in the real estate & construction sector, targeting high-end residential demand in Colombo 7. • Strategic Acquisition: The development is set on a rare ~1-acre land parcel in a premium residential enclave. • Project Scale: Features a 23-storey residential tower titled ‘The Elizabeth’, designed as a “private residential estate in the sky.” • Unique Integration: The historic Otters Club will be integrated within the 4th and 5th floors, remaining fully independent and operational. • Luxury Amenities: Includes a grand concierge lobby, business lounge, rooftop infinity pool, sky garden, and a fitness pavilion. This project follows the success of The Grand - Ward Place, reinforcing Prime’s footprint in the luxury housing market. Early reservations are now officially open to investors and homeowners.

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📈 Prime & Melwa Secure US$ 57.6 Mn Marina Land at Port City Colombo

Sri Lankan conglomerates Prime Group and Melwa have entered a joint venture to acquire a 4-acre premium waterfront land parcel within Port City Colombo. The project, managed by Prime Melwa Port City (Pvt) Ltd, marks a significant milestone for local investment in the Special Economic Zone (SEZ). • Project Scope & Financials: The acquisition is valued at US$ 57.6 Mn. The partners plan to develop a mega ultra-luxury apartment complex with an estimated total turnover of US$ 250 Mn. Construction is slated for completion within four years. • Strategic Value: The development targets international investors, expatriates, and business travelers. Being located within the SEZ, transactions are denominated in USD, providing investors with a hedge against LKR currency depreciation and reducing long-term financial risks. • Sector Impact: This move strengthens the real estate and construction sectors' international presence. It represents the lease of the 7th out of 8 available parcels in the Marina District, reflecting a 90% land uptake in the precinct. • Economic Significance: The venture underscores local investor confidence in Port City as a global business and lifestyle destination, aimed at positioning Sri Lanka as a competitive hub in South Asia's luxury property market. Based on official project announcement data. ---

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### 🏛️ Parliament Reworks Electoral System & Formalizes Real Estate Standards

The Speaker of Parliament, Dr. Jagath Wickramaratne, has announced the formation of a Parliamentary Select Committee (PSC) to reform the electoral system for future Provincial Council elections. Separately, new legislation to regulate the real estate sector has officially come into force. Key Legislative Developments: • Electoral Reform PSC: Chaired by Minister Vijitha Herath, this committee is tasked with evaluating the current framework and recommending a suitable electoral formula (reforming or replacing the existing mixed system) to resolve long-standing delays in provincial polls. • Real Estate Act: The Sri Lanka Institute of Real Estate Professionals Act, No. 6 of 2026 was certified on February 19, 2026. This establishes a professional body to maintain ethical standards, discipline, and public interest in the real estate industry. Sector Breakdown & Implications: • Governance: The PSC includes a diverse 12-member multi-party panel, including members like R. M. Ranjith Maddumabandara and Mano Ganeshan, aimed at building national consensus on governance. • Professional Services: The new real estate act aims to formalize the sector, ensuring that professionals adhere to a statutory code of conduct, which is critical for investor confidence and national economic stability. _Note: Summary based on parliamentary announcements as of February 21, 2026._

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Kristall Spaces Lanka: Shifting Real Estate Focus to Long-Term Yields 📈

Kristall Spaces Lanka, the developer of the All-Suite Resort Talpe Heights in Galle, is introducing a vertically integrated model that moves beyond traditional property handovers to emphasize long-term asset management and investor returns. • Project Overview: The development features 56 luxury residences on Dalawella Beach, targeting the growing demand for high-end serviced residences driven by a 16.7% YoY increase in tourism arrivals. • Yield & Returns: The model aims for a consistent 8–11% annual rental yield, with total combined returns (including capital appreciation) projected at 13–20% per annum. Initial rental projections conservatively estimate 120 days of occupancy in Year 1. • Strategic Partnership: Through its associate, All-Suite Resorts Lanka, the developer provides a 10-year management commitment. This partnership utilizes dynamic yield management software and global marketing networks to optimize occupancy and pricing. • Asset Protection: Professional facility management is central to the model, addressing the "performance gap" in the condominium sector. Continuous maintenance aims to support a projected 5–10% annual capital appreciation by protecting structural integrity in harsh coastal environments. • Economic Context: CEO Simon Atterbury highlighted a 10-year strategy to develop a pipeline of 5,000 beds, aligning with national goals to expand tourism capacity while offering "turnkey" investments for local and international buyers.

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📈 Groundworth Launches "The Estate" in Hokandara

Groundworth Ltd. has officially launched “The Estate”, a premium land and luxury housing development located 700m from Vidyalaya Junction, Hokandara. The project follows the company’s recent "Special Recognition for Land Investments" at the PropertyGuru Asia Property Awards 2025. • Project Scope: Features land plots of 6 perches and above, alongside five elegantly designed luxury houses. The site includes carpeted internal roads, electricity, and pipe-borne water with fully approved deeds. • Investment Figures: Land prices start from Rs. 11.5 million. Based on provisional company data, the project offers a projected Return on Investment (ROI) of 37.5% within a two-year period. • Strategic Location: The development targets real estate growth in the Colombo suburbs, offering proximity to key hubs including Thalawathugoda, Battaramulla, and major expressway interchanges. • Economic Impact: Groundworth aims to set new benchmarks in the construction & real estate sector by focusing on high-growth, strategically located assets that serve as a "foundation of prosperity" for families and investors.

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📈 Fairway Latitude Partners with Pan Asia Bank for Luxury Housing Finance

• Overall Partnership: Fairway Properties has signed an MoU with Pan Asia Banking Corporation PLC to provide tailored home financing for its seventh luxury project, Fairway Latitude, located in Colombo 05. • Financing Framework: Prospective buyers can access flexible housing loans through tripartite agreements. The partnership offers competitive interest rates and streamlined, transparent purchasing processes to enhance accessibility to the real estate sector. • Project Progress: Construction of Fairway Latitude is actively underway with six floors already completed. The development is scheduled for full completion by 2028, featuring two to four-bedroom units ranging from 902 to 2,881 sq. ft. • Sector Impact: This collaboration supports the construction and real estate industries by integrating financial services with urban development. Fairway Holdings has already delivered over 1,000 apartments across six previous projects, including Fairway SkyGardens and Fairway Elements. • Developer & Bank Profile: • Fairway Holdings: A leading developer known for contemporary design and sustainable vertical living. • Pan Asia Bank: A licensed commercial bank focusing on customer-centric solutions, including SME and housing loans.

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📈 Real Estate: Prime Lands Achieves Key Milestone in Colombo Border Project

Prime Lands Residencies PLC (CSE: PLR) has reached a significant construction milestone with the topping out of Tower Cosmos, part of its flagship "The Colombo Border" development in Peliyagoda. The project, delivered ahead of schedule, underscores a recovery in the construction and real estate sectors. • Project Specifics: • Tower Cosmos: 20-story superstructure completed; features 152 two-bedroom apartments. • Sales Status: 100% sold out, reflecting high investor demand for urban living. • Completion Timeline: On track for final delivery by December 2027. • Scale: The broader development spans 6.5 acres along the Colombo-Kandy Road, integrating three residential towers (Brielle, Cosmos, and Amaá). • Financial & Sector Impact: • Growth: PLR reported a 43% YoY revenue increase to LKR 2.80 Bn in Q3 FY2025/26, driven by accelerated progress at this site. • Efficiency: The topping out was achieved four months ahead of schedule, highlighting the group's integrated project delivery. • Economic Context: This progress aligns with a 10.5% expansion in the national construction sector (provisional 2025 data), as the industry rebounds with improved financing conditions. • Strategic Partnerships: The project utilizes a mix of in-house expertise via Prime Construction and strategic collaboration with Sanken Construction Ltd for Tower Brielle, ensuring technical rigor and structural resilience.

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Colombo Ranks Among Asia’s Lowest-Cost Construction Markets 📈

Sri Lanka’s construction sector has entered a stabilization phase, with Colombo maintaining a highly competitive cost position in the Asian region according to the 2025 CIOB Report. • Regional Competitiveness Colombo recorded the lowest construction costs in 5 out of 6 analyzed categories, including high-rise apartments, prestige offices, and hotels. It ranks as the 2nd lowest-cost city in Asia for aggregate construction costs per m². • Material Price Trends (YoY) Key inputs saw significant reductions, aiding overall stabilization: • Reinforcement Steel: -21% • Fuel: -10% • Concrete: -1% • Cement: +3% • Currency & Inflation Impact While costs rose only 13% in USD terms from 2020–2025, they surged 81% in LKR terms due to currency depreciation. In 2025, the LKR remained stable against the USD within a 1% margin. • Labour & Sector Growth • Labour costs rose 5% in 2025, driven by skilled migration and statutory wage hikes. • The construction sector grew 12.2% in Q3 2025, contributing Rs. 499.9 Bn in Gross Value Added. • Outlook Despite upward pressure on labour and financing, the real estate and infrastructure sectors retain a regional advantage. CIOB highlights the need for joint ventures and new technology to address capacity and capital issues. _Source: CIOB Construction Cost Report 2025 (Provisional)_

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## Cabinet Approves Long-Term Leases for BOI Projects in Kerawalapitiya 📈

The Cabinet of Ministers has authorized 30-year leases for two major industrial and logistics ventures on reclaimed land in Kerawalapitiya, Wattala, aimed at boosting manufacturing and supply chain infrastructure. • Industrial Manufacturing Project: Powertech Products Ltd (backed by DHT Cement Ltd) will invest US$ 7 million to establish a factory for fibre cement roofing and flat sheets. The project targets both domestic and export markets. • Financials: One-time lease payment of Rs. 272.20 million plus an annual nominal rent of Rs. 83,500. • Logistics & Warehousing: MAS Freight Wave Terminal Ltd (a subsidiary of M.A.S. Consolidated Ltd) has been allocated land to develop a specialized warehouse supply complex. This supports the apparel & textiles and broader logistics sectors. • Financials: One-time lease payment of Rs. 305.99 million (payable in two installments) with an annual nominal rent of Rs. 90,000. • Strategic Context: The projects utilize a portion of the 400 acres of swampy land previously reclaimed by the Sri Lanka Land Development Corporation. These allocations represent a push toward high-value land use for BOI-approved private sector investments to drive economic growth and employment.

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**Product & Service Launches / Business Expansions**

United Tractors & Equipment Wins Rs. 1.4 Bn Motor Grader Tender 📈

• Overall Deal: The Cabinet of Ministers has officially approved a contract worth Rs. 1,424.25 million (excluding VAT) for the procurement of 75 motor graders. • Winning Bidder: United Tractors & Equipment (Private) Limited secured the tender following a National Competitive Bidding process, beating out four other submitted bids. • Strategic Context: The machinery is designated for use in government development programmes, signaling a continued focus on infrastructure development and construction sectors. • Procurement Process: The bid was evaluated by the High-Level Standing Procurement Committee and presented by the President in his capacity as the Minister of Finance, Planning, and Economic Development. • Status: Approved (based on cabinet meeting proceedings from October 2025 and finalized February 2026).

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HNB & CARMART Partner to Boost Peugeot and LEAP Vehicle Leasing 📈

• Strategic Alliance: HNB PLC has signed a Memorandum of Understanding (MoU) with CARMART Ltd to provide specialized leasing solutions for globally recognized Peugeot and LEAP vehicle brands. • Digital & Physical Integration: The partnership leverages the Carmart.lk platform, merging digital vehicle discovery with HNB’s financing expertise to streamline the customer journey for Sri Lankan buyers. • Key Offerings: • Tailored leasing packages designed for both individual and family mobility needs. • Focus on financial efficiency and flexibility to enhance vehicle ownership accessibility. • Integration of CARMART's automotive marketplace with HNB's retail banking network. • Economic Impact: The collaboration aims to support economic participation by providing flexible financial solutions for premium mobility, helping customers maintain quality lifestyles while achieving mobility goals. _Note: Summary based on latest partnership announcement._

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Political & Government Impact

COYLE Hosts G20 Young Entrepreneurs’ Alliance (G20 YEA) Leadership Assembly 📈

The Chamber of Lankan Entrepreneurs (COYLE) successfully concluded a five-day G20 YEA Leadership Assembly in Colombo, marking a significant milestone for Sri Lanka’s global economic integration. • Strategic Impact: Representing over 500,000 young entrepreneurs globally, the assembly focused on cross-border collaboration and high-level policy advocacy to bridge local innovation with the global G20 policy circle. • Key Engagements: Infrastructure: Delegates toured the Colombo Port City to assess its potential as a premier Special Economic Zone (SEZ) for global trade. Government Relations: Discussions held with the Ministry of Industries focused on legislative frameworks to support startup ecosystems and regional economic stability. Policy Advocacy: The G20 YEA Communiqué was handed to Foreign Minister Vijitha Herath, outlining recommendations for digital transformation, inclusive growth, and sustainable entrepreneurship. • Economic Objectives: The summit aimed to position Colombo as a burgeoning hub for international business while advocating for the removal of trade barriers and expanding access to capital for young founders. • Global Connectivity: Since joining the Alliance in 2024, COYLE has leveraged this platform to integrate Sri Lankan enterprise into the national and international economic agendas, fostering long-term bilateral ties through a high-profile Diplomats’ Evening. _Source: Based on reporting from February 20, 2026._

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**Appointments & Executive Moves**

📈 SriLankan Airlines: Restructuring & Leadership Update

The NPP administration has reaffirmed its decision to maintain SriLankan Airlines under State ownership, despite its long-standing status as a significant fiscal burden. The government is currently navigating a critical financial restructuring while searching for a new CEO to steer the crisis-ridden national carrier. • Financial Performance & Debt • Accumulated Losses: Total losses have reached a staggering Rs. 628.3 Bn (provisional data suggests this increased to Rs. 631.5 Bn by late 2025). • Quarterly Loss: The group reported a loss of Rs. 10.7 Bn for the three months ending June 2025. • State Support: The 2025 Budget allocated Rs. 20 Bn for debt servicing. The Treasury plans a Rs. 100 Bn equity injection over five years to restructure the airline's debt. • Capital Infusion: A recent Rs. 25.2 Bn capital infusion (Dec 2025) was utilized to clear outstanding state bank debt. • Leadership Transition • CEO Search: Received 200 applications for the CEO post, with 75 candidates currently shortlisted. • Criteria: The government seeks a "visionary leader" with 10+ years of senior international airline management experience. • Current Debate: Discussions continue on whether to appoint a foreign expert (like former CEOs Richard Nuttall or Peter Hill) for objectivity or a local professional to ensure national interest and cost-efficiency. • Regional Context • Unlike Sri Lanka’s state-led approach, neighboring nations are divesting: Air India was reacquired by Tata Group, and Pakistan recently privatized Pakistan International Airlines.

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**Industry & Sector News**

**Global & International Business**

Sri Lanka Boosts Global Export Profile at Ambiente Frankfurt 2026 📈

Sri Lanka successfully concluded its participation at the world’s leading consumer goods trade fair in Germany, securing high-quality inquiries and potential export partnerships across diverse sectors. • Overall Impact: Six major Sri Lankan exhibitors joined over 4,600 global participants from 170 regions, showcasing the island’s design and manufacturing expertise to an international audience. • Sector Highlights: • Porcelain: Dankotuwa Porcelain showcased world-class dinnerware, reinforcing Sri Lanka’s reputation for premium ceramics. • Handicrafts: Gospel House Handicrafts and Art Decoration International featured sustainable, fair-trade wooden toys and creative crafts. • Home & Living: Phoenix Industries reported strong interest from new markets, highlighting the demand for innovative plastic and household solutions. • Stationery & Office: The Paperworld segment saw increased engagement for Javana Graphics and AMP Ceylon, opening doors to emerging global markets. • Strategic Value: Participation reinforced Sri Lanka's commitment to sustainability and design-led diversification, essential for reaching the national target of US$ 36 Bn in exports by 2030. • Key Exhibitors: Dankotuwa Porcelain, Gospel House Handicrafts, AMP Ceylon, Art Decoration International, Javana Graphics, and Phoenix Industries. _Summary based on official participation reports from Frankfurt._

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**Corporate News** ### Reasoning: 1. **Main Subject:** Janashakthi Insurance PLC (a specific company). 2. **Primary Action:** A **1:3 share split** (also known as a subdivision of shares). 3. **Category Fit:** Share splits are fundamental **corporate actions** decided by a company's Board of Directors. According to the predefined categories, "Corporate News" specifically includes corporate strategy, governance, and structural changes like restructuring or spin-offs. Since this is an internal administrative change to the company’s share structure—affecting the number of issued shares without changing the stated capital—it falls under **Corporate News**. 4. **Distinction:** While it affects the stock, it is a company-initiated structural event rather than a report on broad "Market News" (market trends/indices) or a "Product Launch."

Industry & Sector News **

Farming Reform: Sri Lanka’s Strategy Post-Cyclone Ditwah 📈

Three months after Cyclone Ditwah (Nov 2025), the focus has shifted from emergency repair to systemic reform in agriculture and infrastructure. Total direct physical damage is estimated at US$ 4.1 Bn (approx. 4% of GDP), necessitating a shift toward climate-resilient economic planning. • Overall Economic Impact Direct Damage: US$ 4.1 Bn (based on World Bank GRADE report). Population Affected: 2.2 million people across all 25 districts. Sector Loss: Agriculture sustained US$ 814 Mn in direct damage. • Sector Breakdowns & Production Risks Paddy: Over 108,000 hectares destroyed; 90% targeted for re-sowing. Vegetables: Prices spiked 100%–350% post-cyclone due to supply chain breaks. Livestock: Massive losses include 37,000 cattle/buffalo and 475,000 poultry. Fisheries: Damage estimated between US$ 66–69 Mn. • Reform Agenda Highlights Infrastructure: Rebuilding irrigation and drainage to future-proof standards rather than historical rainfall averages. Finance: Expanding crop insurance and rapid-trigger disaster financing to prevent rural debt crises. Diversification: Moving away from "all-or-nothing" systems by promoting stress-tolerant crop varieties and ICT/BPM integration for localized early warnings. • Next Steps for Recovery FAO seeking US$ 16.5 Mn for early recovery; currently only 2.4% funded. Focus on "Build-Back-Better" irrigation and shock-responsive safety nets for smallholder farmers. _Summary based on provisional FAO and World Bank data as of February 2026._

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**Economic News** ### Reasoning The news text focuses on the **macroeconomic impact** of a major natural disaster (Cyclone Ditwah) on Sri Lanka’s national economy and its sovereign debt sustainability. * **Subject:** It centers on the **Debt Sustainability Analysis (DSA)**, GDP growth projections, and the International Monetary Fund (IMF) bailout program. * **Key Elements:** The article discusses fiscal policy, central bank positioning, and a debate among world-renowned economists (including Joseph Stiglitz) regarding **sovereign debt restructuring** and **solvency vs. liquidity** in a macroeconomic context. * **Impact:** The core theme is how an exogenous shock affects national economic indicators and government debt-repayment capacity, which falls squarely under **Category 3: Economic News**. While it mentions government decisions, it is not primarily about political stability (Politics) or specific laws (Regulatory). Similarly, while it discusses debt, it does so from a national macroeconomic perspective rather than a private investment or retail banking one.

### Cyclone Ditwah Shocks Economy: Debt Restructuring Under Fire 📈

The Central Bank of Sri Lanka (CBSL) maintains that 2026 GDP growth and debt sustainability remain on track despite the catastrophic impact of Cyclone Ditwah. However, a global coalition of 121 economists, led by Nobel laureate Joseph Stiglitz, warns that the current debt deal is inadequate to absorb this US$ 4.10 Bn exogenous shock. Economic & Sectoral Impact • Agriculture: US$ 814 Mn in direct damage to paddy, vegetables, and livestock; posing severe risks to food security. • Apparel & Manufacturing: Production and shipments delayed due to flooding and power outages affecting 30% of the grid. • Infrastructure: Total damage estimated at US$ 1.74 Bn (42% of total losses), disrupting vital ICT/BPM and logistics hubs. • Macro Outlook: GDP growth expected to trim by 0.5%–0.7% as 2.2 Mn people face displacement and livelihood losses. Debt & Fiscal Position • Sustainability: CBSL Governor indicates IMF targets may need "inevitable" revision, but rejects calls for debt suspension. • Relief Demands: Economists call for an immediate debt service pause and genuine "solvency relief" (principal haircuts) over simple cash-flow reprofiling. • Emergency Funding: IMF has approved US$ 206 Mn via the Rapid Financing Instrument (RFI) to bridge urgent balance-of-payment gaps. Key Figures • Total Damage: US$ 4.10 Bn (approx. 4% of GDP). • Inflation: CCPI accelerated to 2.3% in Jan 2026; annual average 2026 forecast adjusted to 3.3%. • Remittances: Projected to rise 10%–15% (US$ 8.80 Bn total) as the diaspora supports reconstruction.

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