Category: Daily Financial Times

As Sri Lanka navigates its post-crisis economic recovery, the national conversation frequently circles back to an urgent, undeniable reality: the country must aggressively attract Foreign Direct Investment (FDI) and spur domestic capital formation to secure sustainable, export-led growth. While the Government has recently invited proposals and accelerated frameworks to roll out digital single window infrastructure, public and policy discussions have largely remained confined to the narrow mechanics of procurement.

This is a missed opportunity. A single window for investment is not merely an IT procurement project or a software upgrade. It is a (i) foundational governance reform, (ii) a productivity multiplier, and (iii) an investment competitiveness make-or-break. To transform Sri Lanka’s economic landscape, we must view the Single Window not as a digital database, but as a total re-engineering of how the state interacts with (i) capital, (ii) entrepreneurship, and (iii) risk.

Why this reform matters now

Sri Lanka stands at a historic crossroads. Recent policy initiatives by the Ministry of Finance and the Presidential Secretariat underline a national push to streamline trade and investment. Yet, capital is globally mobile and fiercely selective. Investors today do not choose destinations based on potential alone; they choose them based on (i) friction, (ii) predictability, and (iii) execution speed.

Fragmented bureaucratic clearance systems impose a heavy “hidden tax” on every enterprise seeking to set up operations. By linking the upcoming Single Window initiative to broader structural adjustments, Sri Lanka can signal to international markets that it is moving past legacy bureaucracy and entering a new era of transparent, rules-based economic governance.

High cost of the current system

“Time is the scarcest resource, and unless it is managed, nothing else can be managed.” – Peter Drucker

Under the status quo, launching a major project in Sri Lanka often requires navigating a maze involving (i) multiple regulatory bodies (ii), line ministries, and (iii) approval-granting agencies. Investors routinely have to deal with up to a dozen or more separate entities-spanning (i) environmental authorities,(ii) local government bodies, (iii) utility providers, (iv) revenue departments, and (v) sector-specific regulators.

This labyrinth generates critical economic costs:

Prolonged time-to-market: Delays in obtaining construction permits, environmental clearances, and import licenses push back project commercialisation by months, sometimes years.

Administrative uncertainty: Discretionary decision-making and conflicting departmental mandates breed opacity and corruption risks.

Opportunity cost: Global investors operating on tight timelines bypass Sri Lanka entirely in favor of regional peers where approvals are swift, digital, and predictable.

The economic cost of these delays is (i) measurable in lost jobs, (ii) foregone export revenues, and (iii) stagnant productivity.

What is a single window for investment?

A single window for Investment is a centralised digital and institutional mechanism that allows parties involved in trade and investment to lodge standardised information and documents with a single entry point to fulfill all regulatory requirements.

Rather than an investor submitting separate dossiers to 10 or 15 different agencies, data is submitted once. The system acts as a central intelligence and routing hub, concurrently distributing requirements to (i) participating Government agencies (PGAs), (ii) tracking progress, (iii) managing approvals, and (iv) issuing unified digital certifications. It replaces (i) physical queues, (ii) paper files, and (iii) repetitive bureaucratic touch points with seamless interoperability.

Lessons from international success stories

Global benchmarks demonstrate that successful investment facilitation relies on political will, institutional integration, and uncompromising digital execution.

Beyond technology: Reforming institutions

As institutional economist Douglass North noted, the rules of the game dictate economic performance. Technology alone cannot fix a broken administrative process; digitising a bad process merely accelerates inefficiency.

True reform requires three parallel tracks:

Legal reauthorisation:

Enacting a comprehensive umbrella statute for electronic commerce and digital governance that supersedes legacy statutory mandates requiring physical seals, wet-ink signatures, and paper-based archiving is foundational to this reform. This requires explicitly granting legal validity to automated “deemed approval” mechanisms, ensuring that if a regulatory agency fails to review and respond within a legally mandated Service Level Agreement (SLA), the digital system automatically issues the clearance. Furthermore, it involves harmonising conflicting sectoral laws across the 16+ approval-granting bodies to resolve legal contradictions where older statutes vest absolute discretionary power in individual officials, while simultaneously establishing robust data protection and cybersecurity frameworks to safeguard proprietary investor data. Finally, empowering an apex oversight authority with statutory teeth is essential to legally bind all participating Government agencies to the digital workflow and penalise any unauthorised offline procedural demands.

Process re-engineering (BPR): Executing rigorous Business Process Re-engineering (BPR) requires radically trimming redundant bureaucratic steps by systematically mapping and purging obsolete, overlapping clearance requirements that currently force investors to jump through unnecessary hoops. This transformation involves replacing sequential, siloed departmental reviews with concurrent digital processing workflows, enabling multiple regulatory bodies to evaluate applications simultaneously rather than waiting in a sluggish line. Furthermore, it demands establishing strict, legally binding service level agreements (SLAs) for every participating agency, complete with clear tracking metrics and administrative accountability for unwarranted delays. To ensure continuous optimisation, the BPR framework must integrate feedback loops from private sector users to routinely audit and streamline bureaucratic touch points. Ultimately, this structural overhaul re-engineers the state apparatus from a bottleneck of obstruction into an efficient, streamlined engine of investment facilitation.

Cultural transformation: Achieving a profound cultural transformation requires fundamentally shifting the mindset of public officials from traditional gatekeepers of bureaucratic control to proactive facilitators of national wealth creation and economic dynamism. This cultural reset must be driven from the top down through leadership alignment programs that redefine public service success not by how many proposals are blocked or delayed, but by how rapidly legitimate investments are operationalised. Furthermore, it necessitates dismantling entrenched risk-averse behaviors by instituting institutional protections that encourage responsible decision-making rather than penalising officials for exercising legitimate administrative discretion. Integrating modern performance management frameworks and incentive schemes-where career advancement, departmental commendations, and resource allocations are directly tied to responsiveness and investor satisfaction scores-will further reinforce this ethos. Ultimately, cultivating this service-oriented culture transforms the public sector into an engaged, empathetic partner for the business community, ensuring that state institutions actively champion rather than hinder national competitiveness.

Roadmap for Sri Lanka

To build a world-class Single Window, Sri Lanka should adopt a phased, pragmatic implementation strategy:

Phase 1: Legal and process baseline (months 1-6): Finalise the legislative framework, map out regulatory bottlenecks across agencies, and establish the overarching governance structure backed by the Ministry of Finance.

Phase 2: Core platform development and integration (months 6-18): Procure and configure the digital architecture, connect core regulatory agencies (such as the Board of Investment, Inland Revenue, Registrar of Companies, and Central Environmental Authority), and conduct rigorous user acceptance testing.

Phase 3: Pilot launch and change management (months 18-24): Roll out the system for key sectors (e.g., export manufacturing and high-tech IT investments), backed by intensive training for public servants and private sector users.

Phase 4: Full scale-out and continuous optimisation (month 24 onward): Integrate secondary municipal and utility approval bodies, introduce AI-driven tracking analytics, and tie agency performance metrics to processing speeds.

Making Single Window cornerstone of economic transformation

“The secret of economic growth is simple: improve productivity.” – (Paraphrasing Paul Krugman)

Dismantling regulatory friction unleashes trapped private capital, empowering domestic entrepreneurs and foreign investors alike to scale operations rapidly without losing momentum to administrative inertia. Cutting through red tape drastically compresses the gestation period of capital projects, allowing high-value manufacturing and technology ventures to generate economic value and revenue much sooner. Streamlined digital processes eliminate opportunities for discretionary rent-seeking and corruption, fostering a predictable, rules-based market environment that attracts sophisticated global enterprises. Accelerating business entry and expansion directly multiplies high-skilled employment opportunities, keeping domestic talent within the country and reversing destructive brain drain trends. Transforming state machinery into a lean, efficient facilitator creates a virtuous cycle of sustained productivity growth, permanently elevating national competitiveness and fiscal resilience.

Conclusion

The decision to establish a National Single Window for Investment transcends standard bureaucratic modernisation; it stands as arguably the most consequential structural intervention available to Sri Lanka since the broad economic liberalisations and institutional shifts of the late 1970s. By dismantling legacy legal roadblocks, re-engineering siloed workflows into concurrent digital paths, and fundamentally transforming the public service mindset from control to facilitation, this reform creates an ecosystem where capital can thrive. Success will ultimately depend on treating this initiative not as a routine IT procurement project, but as a historic, uncompromising mandate for national institutional renewal-moving decisively from red tape to red carpet to rewrite Sri Lanka’s economic narrative for generations to come.

(The author, among many, served as the Special Advisor to the Office of the President of Namibia from 2006 to 2012 and was a Senior Consultant with the UNDP for 20 years. He was a Senior Economist with the Central Bank of Sri Lanka (1972-1993). He can be reached via asoka.seneviratne@gmail.com.)

References

International Monetary Fund (IMF): Selected Issues Papers on Governance, Structural Reforms, and Investment Climates in Emerging Markets.

World Bank Group: Doing Business reports and diagnostic studies on Regulatory Governance and Single Window Implementation Frameworks.

Organisation for Economic Co-operation and Development (OECD): Policy Framework for Investment and Guidelines on Investment Facilitation.

United Nations Conference on Trade and Development (UNCTAD): Global Investment Reports and Investment Policy Reviews.

Country Case Studies: Enterprise Singapore (Business Grants Portal); Invest KOREA (One-Stop Service guidelines); Rwanda Development Board statutory frameworks; Estonia Information System Authority (X-Road architecture).

Tony Pellé has successfully delivered over 6,500 custom-designed leather products for staff at Cinnamon Life, marking a major milestone in the brand’s ongoing collaboration with one of the country’s most prestigious hospitality developments.

The large-scale supply includes over 5,000 pairs of genuine leather shoes, alongside leather belts and customised leather coasters, designed and manufactured locally to complement the property’s distinctive brand identity and operational requirements.

Tony Pellé Founder Kavindu Helanka said: ‘Working alongside Cinnamon Life to supply footwear and leather accessories has been a meaningful collaboration. From the beginning, our goal was to create products that not only complemented the visual identity of the uniforms but also supported the comfort and daily performance of the staff who represented the property.’

‘Tony Pellé was founded with the vision of bringing European-standard craftsmanship to locally made footwear. This collaboration demonstrates that Sri Lankan manufacturing has the capability to produce premium products at an international standard, designed and made in Sri Lanka for Sri Lankans,’ he added.

All products supplied to the Cinnamon Life Hotel were manufactured using genuine, sustainably sourced leather. Additionally, different leather grains were selected to suit various staff roles while balancing style, comfort, and durability. The shoes were specifically engineered to meet the practical demands of the hospitality environment, where staff remain on their feet and move extensively across the expansive property throughout long shifts. Moreover, plant-based tanning methods and locally produced outsoles with enhanced compositions ensure long-lasting colour, strength, and reduced environmental impact.

Working closely with the Cinnamon Life design team, Tony Pellé also customised each shoe style to match the themes and concepts of the various staff uniforms, introducing unique colours and detailing that aligned seamlessly with the property’s branding.

In addition to footwear, Tony Pellé supplied innovatively crafted, multifunctional, genuine leather belts providing versatility and durability for staff use. The company also produced two-layer vegetable-tanned leather coasters for the Nuwa Hotel, treated with oils and waxes to create a protective finish that allows water to bead on the surface rather than soak into the leather.

Tony Pellé follows European footwear production standards in both sourcing and manufacturing, enabling the brand to meet the demanding quality expectations of the Cinnamon Life project while maintaining consistent quality control across thousands of items.

As the only Sri Lankan brand focused exclusively on premium men’s leather footwear, Tony Pellé continues to combine craftsmanship, innovation, and European-standard production practices to create premium footwear designed and made in Sri Lanka, reflecting both global quality benchmarks and local expertise.

The Government will introduce new competition regulations for dominant telecommunications operators, tighten broadband service quality monitoring, and impose a September deadline for the rollout of mobile number portability (MNP), Digital Economy Deputy Minister Eng. Eranga Weeraratne

told Parliament.

He said the Government was developing a long-term national telecommunications competition strategy that would identify operators with significant market power (SMP) and impose regulatory obligations to ensure fair competition. The Telecommunications Regulatory Commission of Sri Lanka (TRCSL) is also introducing cost-based tariff models, with both measures expected to be completed this year.

On broadband services, Eng. Weeraratne said the TRCSL was revising quality of service (QoS) rules to strengthen oversight across different network technologies, including 5G and satellite services. The revised framework will also introduce monitoring of quality of experience (QoE) indicators such as latency.

He said the regulator currently relies on operator-submitted data to monitor service quality but is procuring an independent monitoring system through Asian Development Bank (ADB) funding to assess both QoS and QoE indicators.

Eng. Weeraratne, responding to questions raised by UNP MP Ravi Karunanayake, added that, with the licensing of new satellite service providers including Starlink, the Government would introduce a national strategy for universal broadband connectivity to complement existing fixed and mobile operator programs serving underserved and unserved areas.

On MNP, Eng. Weeraratne said discussions between the Digital Economy Ministry, TRCSL, and operators were continuing after one fixed-line operator sought to reconsider the original plan to introduce mobile and fixed number portability simultaneously, citing the cost and complexity of implementing fixed number portability.

He said that if the industry failed to reach agreement by the end of September, the TRCSL would issue directions under the Sri Lanka Telecommunications Act and operators’ licence conditions to proceed with MNP ahead of fixed number portability.

‘The government accepts, without qualification, that the ability to change operators while retaining one’s number is an entitlement that consumers in the modern telecommunication market argue, and that its delivery is a matter of government policy commitment rather than operator discretion,’ Weeraratne said.

He said mobile number portability would lower switching costs, improve competition and encourage operators to compete on service quality and innovation.

Responding to a supplementary question, Weeraratne said the Government considered a mobile-first approach more appropriate, noting that many emerging markets had introduced mobile number portability without implementing fixed number portability.

He said if operators failed to reach agreement by the end of September, the Government would intervene and direct the implementation of mobile number portability first, while considering fixed number portability later based on industry demand.

MP Karunanayake said the Government should not entertain any requests by the dominant fixed line operator but prioritise the rights of consumers.

Sri Lanka must fundamentally rethink its economic relationship with India and position itself to benefit from the rapid expansion of one of the world’s fastest-growing economies, President’s Special Envoy for Foreign Investment Hanif Yusoof said yesterday, describing India’s rise as a ‘once-in-a-generation opportunity’ that the country has yet to fully

appreciate.

Delivering a keynote address at the ‘India Calling’ forum, he said the global economic centre of gravity is shifting towards India, with countries around the world seeking closer trade and investment ties to gain access to its expanding consumer market.

‘The world is looking towards India,’ Yusoof said, pointing to recent trade agreements and deeper economic engagement pursued by countries including the UK, New Zealand, the EU, and nations across Asia and the Middle East.

‘They recognise where the economic centre of gravity is moving. India today is one of the world’s greatest economic growth stories,’ he added.

Yusoof opined that Sri Lanka enjoys a unique strategic advantage that few other countries possess. ‘For Sri Lanka, this is not an opportunity on the other side of the world. It is an opportunity on our doorstep,’ he said.

Calling for a significant shift in business thinking, he urged Sri Lankan companies to stop viewing India as an ‘intimidating’ market and instead treat it as a natural extension of their domestic market.

Recalling his own experience of expanding a logistics business into India despite widespread scepticism, Yusoof said many entrepreneurs underestimate the opportunities available across India’s diverse regional markets.

‘Everybody told me India was too big and intimidating. I didn’t listen,’ he said, noting that his company eventually became one of the five largest customs brokerage firms in India.

He stressed that success in India does not require conquering the entire market. ‘For many Sri Lankan companies, the first objective does not mean conquering India. It simply means succeeding in one Indian State, one city, or one consumer segment. That alone can transform the scale of our businesses,’ he explained.

He said Sri Lankan firms constrained by the country’s relatively small domestic market have access to a neighbouring economy of more than 1.4 billion consumers.

Similarly, Yusoof also urged Indian businesses to look beyond Sri Lanka’s market size and instead recognise its strategic location, modern ports, tourism potential, and connectivity to southern India.

He said Sri Lanka could serve as a regional manufacturing, logistics, and services platform for Indian companies seeking to access markets beyond India.

‘Look at Sri Lanka as a platform on which Indian businesses can manufacture, provide services, establish regional operations, and connect with markets beyond India,’ he said.

Although India is already among Sri Lanka’s largest investment partners, he pointed out that the country should be attracting a much larger share of India’s growing overseas investments.

Yusoof said India’s expanding middle class also presents enormous opportunities for Sri Lanka’s tourism industry.

Noting that India is already Sri Lanka’s largest source market, he said millions more Indians are expected to travel overseas as disposable incomes continue to rise.

He questioned why Sri Lanka should not become the preferred weekend and short-haul destination for Indian travellers seeking beaches, wildlife, wellness, shopping, dining, weddings, and entertainment.

‘We do not need to duplicate India’s scale. We need to position ourselves intelligently,’ he said.

He also encouraged greater collaboration in education, culture, sports, and entrepreneurship, arguing that durable economic partnerships are ultimately built on strong people-to-people ties.

Yusoof said Sri Lanka should embrace India’s economic rise as an opportunity rather than a threat.

‘If we get this relationship right, India’s rise does not diminish Sri Lanka’s prospects. India’s rise accelerates Sri Lanka’s own future,’ he said.

HNB Life PLC yesterday announced a formidable financial performance for the six months ended 30 June 2026, successfully translating the strategic momentum of its recent corporate rebranding into tangible financial growth.

The official transition to the HNB Life identity on 6 April 2026, symbolised by its distinctive wing icon, has resonated profoundly within the market, underscoring the Company’s unwavering commitment to cultivating trust-based relationships and delivering enduring, long-term value.

The Company recorded a Life Gross Written Premium of Rs. 12.34 billion for the first half of the year, marking an outstanding growth of 43% against the Rs. 8.63 billion achieved in the corresponding period of 2025. This top-line expansion was mirrored by a 44% surge in Net Earned Premium, which reached Rs. 11.71 billion, reflecting high policy persistency and an accelerated rate of new business acquisition. Furthermore, total net income expanded by 34% to Rs. 15.96 billion, fortified by disciplined underwriting practices and a robust interest and dividend income of Rs. 4.10 billion.

Profit after tax was Rs. 434 million without any surplus transfer from the Life Insurance Fund, which usually takes place after the actuarial valuation at the end of the year, thereby reflecting the intrinsic operational strength of the business. Crucially, the Company fulfilled its fundamental promise to policyholders by disbursing Rs. 3.99 billion in net insurance benefits and claims, a notable increase from the Rs. 1.90 billion recorded in the same period last year. This substantial disbursement underscores HNB Life’s steadfast commitment to honoring its obligations with profound empathy and integrity, ensuring that policyholders are supported during their most critical times of need.

The Company’s financial position remained exceptionally resilient. Total assets grew to Rs. 72.71 billion as of 30 June 2026, advancing from Rs. 68.44 billion at the close of 2025. Financial investments expanded to Rs. 65.84 billion, while the Life Insurance Fund witnessed a significant accumulation, reaching Rs. 55.69 billion. This continuous build-up of long-term policyholder funds, supported by a sturdy total equity base of Rs. 11.15 billion, provides a formidable capital foundation to support sustainable future expansion.

Chairman Stuart Chapman said: ‘The first half of 2026 stands as a defining epoch for HNB Life, characterised by a historic corporate transition and resolute financial execution. The launch of our new identity in April was more than a change which is cosmetic in nature; it was a strategic reaffirmation of our core purpose within the Hatton National Bank Group. Delivering a 43% growth in Gross Written Premium. Amid this transition is a clear validation of the trust our customers place in our brand and the stability we draw from our parent network. We remain resolute in our capacity to build upon this robust foundation alongside HNB General Insurance Ltd.’

Executive Director and CEO Lasitha Wimalaratne said: ‘Our first-half performance is a testament to the strategic clarity and operational discipline we have meticulously cultivated over the past few years. The rebranding initiative has not only galvanised our distribution channels but also deepened our resonance with the communities we serve. By placing genuine empathy at the forefront of our customer experience, guided by the fundamental principle of treating our policyholders precisely how we would wish to be treated, we are fostering a trust-based ecosystem that transcends mere transactional growth.’

For much of the past decade, geopolitical crises were treated by corporate boards as intermittent shocks to supply chains, commodity prices or financial markets. That assumption no longer holds.

Business leaders increasingly see volatility itself as a permanent feature of the operating environment, forcing companies to rethink capital allocation, supply chains, energy security and technology investment.

That shift in thinking dominated a panel discussion at the CMA National Management Accounting Conference 2026 last week, where executives representing telecommunications, manufacturing, energy, exports and economics argued that resilience is no longer a contingency plan but a strategic capability that directly influences competitiveness and shareholder value.

Moderated by Advocata Institute CEO Dhananath Fernando, the discussion moved beyond the immediate effects of conflict in the Middle East to examine how businesses can position themselves in an international economy increasingly defined by geopolitical rivalry, fragmented supply chains and accelerating technological change.

Economic landscape

Economist Talal Rafi argued that while attention remains focused on conflicts in the Middle East, the more profound structural change confronting Sri Lanka is the long-term realignment of the global economy around strategic competition between the United States and China.

He said the consequences were already becoming evident in Sri Lanka’s macroeconomic outlook.

The latest IMF projections indicate official reserves are expected to reach only $ 11.8 billion by end-2027, below earlier expectations. Reaching even that level would require Sri Lanka to accumulate an additional $ 3 billion in reserves, including a planned $ 1.5 billion international sovereign Bond issuance, placing renewed emphasis on restoring international credit ratings.

Rafi argued that trade disputes introduced during the first Trump administration had evolved into a bipartisan shift in US economic policy rather than a temporary political phenomenon.

‘What people don’t notice is that some of the things he put in, when Biden became president, he continued,’ he said.

‘I don’t think that’s the case that everything goes back to normal.’

He said Europe was now adopting a similarly defensive industrial stance towards China, increasing the likelihood that Chinese manufacturers would redirect excess production towards developing markets.

China’s export-led economic model, combined with substantial manufacturing overcapacity and state support, would place increasing pressure on industrialising economies unable to compete on scale or financing, he said.

‘The actual hurting for developing countries not to develop was coming from China,’ he said, referring to international research examining the effects of Chinese industrial capacity on emerging economies.

Yet Rafi maintained that disruption also creates opportunity.

He identified ports, tourism and renewable energy as sectors positioned to benefit from changing trade flows, particularly as instability around Middle Eastern logistics networks encourages businesses to diversify supply chains.

His strongest argument, however, centred on India.

By 2050, India’s economy is expected to reach approximately $ 30 trillion, roughly equivalent to the size of today’s United States economy, while neighbouring Tamil Nadu alone could become a $ 4 trillion economy.

‘We are going to have a United States-size economy just 50 kilometres north of us,’ he said.

Rather than viewing India primarily through a diplomatic lens, Sri Lanka should treat it as the country’s most significant long-term commercial opportunity, he argued, pointing to countries such as Canada and New Zealand that naturally orient much of their economic strategy towards neighbouring markets.

The economist also highlighted a second structural challenge confronting emerging economies – the changing direction of global investment.

He cited United Nations data showing around 20% of global foreign direct investment is now flowing into artificial intelligence and digital infrastructure, while more than half of international investment is concentrated in developed economies.

Combined with record levels of sovereign debt across advanced economies following the pandemic, developing countries face increasing competition for international capital.

That means attracting investment will require stronger domestic institutions and greater policy credibility rather than relying solely on traditional competitive advantages, he suggested.

Volatility as permanent operating expense

Brandix Lanka Group Managing Director Hasitha Premaratne approached the discussion from the perspective of an export manufacturer operating at the centre of global supply chains.

For apparel manufacturers, he said, geopolitical disruption is no longer measured simply by shipping delays or higher freight costs.

Instead, volatility itself has become another permanent operating expense.

‘There is a cost embedded in managing this volatility and risk. That we have to factor into the P and L,’ Premaratne said.

Brandix experienced perhaps its greatest commercial pressure not from the latest Middle East crisis but from tariff changes introduced since April 2025.

Customers approached suppliers seeking to share the burden of additional tariffs, forcing difficult negotiations that significantly reduced margins across multiple product categories.

Rather than attempting to predict geopolitical developments beyond management’s control, Premaratne said the company deliberately redirected attention towards variables it could influence.

That meant rethinking procurement strategies, redesigning manufacturing processes, reassessing legacy operating models and challenging long-held assumptions across the business.

‘What we looked at was that everything out there is not in our control,’ he said.

‘We should focus on what is in our control.’

Although Brandix began its transformation programme in 2023, the past 12 months had produced deeper operational change than previous years because management no longer had the luxury of postponing difficult decisions.

Many of those decisions had been debated internally for years but only became possible under sustained external pressure.

The objective was not simply to reduce costs temporarily but to permanently lower the company’s cost per unit while preserving competitiveness against global manufacturers despite higher tariffs, utility costs and logistics expenses.

Premaratne argued that productivity rather than expansion had become the principal driver of resilience.

Artificial intelligence, in his view, represents an important contributor to that productivity shift.

While acknowledging that enthusiasm surrounding AI currently exceeds its commercial application, he dismissed suggestions that it represents merely another technology trend.

‘AI is happening,’ he said.

‘The buzz is much bigger than the reality. That’s always the case. But if you play the game properly, there is plenty of opportunity in that space for you to drive productivity.’

His broader conclusion reflected a recurring theme emerging throughout the discussion: businesses can no longer rely on external stability to preserve profitability.

Instead, sustained competitiveness increasingly depends on organisations becoming structurally more efficient before the next geopolitical shock arrives.

Whether the disruption originates from tariffs, armed conflict, commodity markets or technological change is becoming less important than a company’s ability to adapt before competitors do.

Sustained investment

Siam City Cement (Lanka) Chairman Nandana Ekanayake said resilience in manufacturing cannot be achieved simply by holding larger inventories. Instead, it requires sustained investment to reduce structural dependence on imported energy and raw materials, even when those investments weigh on short-term returns.

The company’s experience illustrates the dilemma facing long-term foreign investors operating in volatile markets.

Siam City Cement’s parent company invested $ 100 million in Sri Lanka based on forecasts of a construction boom and an expected 10-year payback period. More than a decade later, that investment has yet to achieve the anticipated returns, reflecting the prolonged weakness in construction activity and successive economic shocks.

‘Only thing is that they can delay the return,’ Ekanayake said, noting that the original assumptions underpinning the investment had fundamentally changed.

Despite those setbacks, he said the company’s priority remained protecting customers rather than maximising margins during periods of disruption.

Like many manufacturers, Siam City Cement carries additional inventories despite the associated financing costs because interruptions to supply have wider commercial consequences than higher working capital.

‘As long as possible, we sacrifice some of our net margin,’ he said, explaining that maintaining supply was essential to protecting distributor networks and construction projects.

That strategy was severely tested when geopolitical tensions disrupted the supply of imported coal, one of the industry’s most important raw materials.

Coal accounts for around 70% of cement manufacturing inputs in Sri Lanka, compared with around 50% in some other markets such as Nigeria, making producers particularly vulnerable to international shipping disruptions and commodity price volatility.

Rather than relying on a single sourcing strategy, the company activated alternative procurement arrangements across its regional network, drawing supplies from other operations while also working with affiliated companies to secure emergency shipments.

The crisis reinforced management’s view that resilience requires investment long before disruption occurs.

One area receiving increasing attention is the replacement of imported fossil fuels with locally available alternative fuels derived from industrial waste.

Ekanayake said the company is investing around Rs.1.5 billion this year to modify its production systems to increase the use of waste-derived fuels, reducing dependence on imported coal over time.

The strategy extends beyond energy.

Siam City Cement is also increasing the use of locally available materials, including fly ash and other industrial by-products, to reduce reliance on imported clinker, one of cement manufacturing’s largest cost components.

The transition is technically complex because alternative materials require extensive testing before they can be incorporated into production at scale.

‘You cannot change it very quickly,’ he said. ‘We have to test the process, test the design and see how it performs.’

The company is also strengthening regional supply resilience by coordinating inventories across operations in Thailand and Vietnam and exploring greater control over regional shipping capacity to improve supply flexibility during future disruptions.

For Ekanayake, resilience ultimately depends less on carrying larger inventories than on systematically reducing structural import dependence.

Energy security

Lanka IOC Managing Director K. Raghu argued that energy security presents a different challenge because fuel importers have limited influence over the upstream segments of the value chain.

Unlike integrated international oil companies involved in exploration, production and refining, Lanka IOC enters the value chain only after products have already been refined, leaving it exposed to international market volatility with relatively few opportunities to influence costs.

‘Our game starts from where we source,’ he said.

That reality, he argued, means Sri Lanka should focus less on crude oil prices and more on the economics of refined petroleum products.

Using prevailing international market prices, Raghu noted that crude was trading at around $ 88 per barrel while gasoil was closer to $ 138, illustrating that countries importing refined products pay substantial premiums beyond the cost of crude itself.

This, he said, strengthens the case for refinery modernisation.

Domestic refining capacity would not only improve energy security but also enable Sri Lanka to produce cleaner fuels that meet evolving international environmental standards.

While many countries have already adopted Euro 6 fuel standards containing 10 ppm sulphur, Sri Lanka continues to permit fuels containing 500 ppm sulphur, highlighting the need for technological investment.

Raghu identified three additional priorities for strengthening long-term energy resilience: expanding storage infrastructure, introducing greater pricing certainty and maintaining stable Government policy.

Storage capacity remains limited, restricting the country’s ability to accumulate strategic inventories even when international prices are favourable.

Pricing uncertainty also discourages investment because companies cannot accurately forecast future returns.

‘Today in the market, nobody knows at what price the product is going to be sold. If I don’t know what price I am going to realise, why will an investor invest?’ he said.

Rather than broad-based price subsidies, Raghu suggested digital mechanisms linked to national identity numbers could enable more targeted assistance for vulnerable consumers while allowing market pricing to remain transparent.

Operationally, Lanka IOC has responded by diversifying suppliers, expanding higher-value products beyond transport fuels and maintaining a lean cost structure.

Over two decades, the company’s business mix has shifted from around 90% transport fuels to approximately 75%, reducing concentration risk while preserving profitability. Strong stakeholder relationships, disciplined balance-sheet management and prudent procurement have also strengthened the company’s ability to absorb market shocks, he said.

AI is here to stay

Sri Lanka Telecom PLC Group CEO Riyaaz Rasheed said digital infrastructure has become one of the most strategically exposed sectors in an increasingly fragmented global economy, requiring companies to manage geopolitical risk, cyber threats, supply chain disruptions and talent shortages simultaneously.

Unlike traditional infrastructure businesses, telecommunications operators cannot simply suspend operations during crises. National connectivity, enterprise networks, cloud infrastructure and data centres must continue functioning regardless of disruptions to global supply chains or regional conflicts.

SLT’s enterprise business now extends far beyond consumer connectivity, encompassing cybersecurity services, Government networks, cloud infrastructure and data centres that host critical customer information.

‘The biggest challenge is the enterprise business,’ Rasheed said. ‘We have cloud, we have data centres where we host information about customers. This is where the biggest challenge is.’

Maintaining those services increasingly depends on infrastructure that itself has become vulnerable to geopolitical tensions.

Sri Lanka currently relies on five international submarine cables for global connectivity, with another expected to become operational next year. While redundancy has improved network resilience, Rasheed said any disruption to those international links would have consequences extending well beyond the telecommunications sector.

‘Imagine one of these cables gets cut. It’s going to be very challenging for the country, for the economy,’ he said.

Power security presents another operational challenge.

Telecommunications infrastructure cannot tolerate prolonged electricity interruptions, forcing operators to maintain generators, batteries and backup systems across thousands of network sites. That makes energy costs a structural component of operating expenditure rather than simply another utility expense.

The industry’s capital requirements have also increased sharply because of disruptions in global semiconductor supply chains.

Rasheed said chip prices have risen by between 10 and 20 times in some cases, but the greater challenge is availability rather than price.

Major global technology companies have secured semiconductor production capacity years in advance, leaving smaller buyers struggling to source equipment even when prepared to pay substantially higher prices.

‘The bigger price is not the price. Even if you pay a higher price, you can’t source them,’ he said, noting that some buyers have already reserved production capacity for the next three years.

That has forced telecommunications companies to strengthen relationships with long-standing suppliers while carrying additional inventories to ensure equipment remains available for network expansion and hardware replacement.

Demand for computing capacity continues to grow alongside cloud services and artificial intelligence, meaning operators must simultaneously expand infrastructure while replacing ageing hardware, typically every five to six years.

The industry also faces increasing competition for skilled technology professionals.

Rasheed said engineers, cybersecurity specialists and digital infrastructure experts remain in high demand globally, while Sri Lanka continues to experience outward migration of experienced professionals.

Companies therefore have little choice but to invest continuously in developing new talent while retaining critical technical expertise.

Yet he argued the most significant strategic challenge facing corporate Sri Lanka is cybersecurity.

As artificial intelligence evolves from predictive models to increasingly autonomous systems capable of interacting with other AI agents, boards can no longer treat cybersecurity as an operational technology issue delegated to information technology departments.

‘We started AI probably 10 to 15 years ago. Then suddenly it broke out. Then from AI we have gone into Gen AI. Now we are talking about agentic AI,’ Rasheed said.

‘What happens when an AI agent deals with another agent without a human in between? We don’t know what will happen. It is so very complex.’

He said many organisations remain reluctant to commit significant resources to cybersecurity because the financial consequences of cyberattacks are difficult to quantify before an incident occurs.

The investment required is substantial, while the benefits are often invisible until systems are compromised.

Nevertheless, Rasheed said delaying those investments represents a far greater risk as digitalisation accelerates across both Government and private sector organisations.

‘We always tell them, please invest, please make sure you cover yourself with cybersecurity,’ he said.

‘This is a risk that we as a country cannot take.’

The discussion suggested that resilience is no longer defined simply by maintaining larger inventories or preserving financial buffers. Instead, it increasingly depends on making long-term investments before crises emerge, whether through stronger balance sheets, diversified supply chains, productivity-enhancing technologies, domestic industrial capability, energy infrastructure or digital security.

While each sector faces different operational risks, the executives agreed on one principle: companies that continue to treat geopolitical disruption as an exceptional event, risk falling behind those redesigning their businesses around a world where uncertainty has become permanent.

EY said its team won both the men’s and women’s championship titles at the CA Students’ Sports Tournament – Badminton 2026/27, while also securing the men’s second runner-up position.

The tournament was held on 11 July at the Sri Lanka Badminton Federation and brought together CA students from across the profession to compete in badminton.

EY said: ‘Representing EY with great enthusiasm and team spirit, our participants delivered an exceptional performance throughout the competition.

Demonstrating perseverance, discipline, and a strong competitive edge, the EY team emerged as the Men’s Champions and Women’s Champions, while also securing the 2nd Runner-Up position in the Men’s category. These achievements reflect not only the talent of our players but also their dedication and commitment both on and off the court.

EY is proud of our participants for their outstanding performance and for bringing home the Men’s and Women’s Championship titles and the 2nd Runner-Up position. These achievements reflect the talent, teamwork, and dedication of our people, and we look forward to celebrating many more successes in the future’.

PickMe on Wednesday launched Colombo Connect, the first city-wide destination to be introduced under its newly unveiled PickMe Explore platform, a national digital ecosystem designed to connect attractions, experiences, events and communities through a single technology platform.

The initiative was launched at Colombo Lotus Tower, with Western Province Governor Hanif Yusoof attending as Chief Guest. Also in attendance were Digital Economy Ministry Secretary Waruna Sri Dhanapala, Colombo Lotus Tower Chairman Shirantha Peries, travel writer, photojournalist and author Juliet Coombe, along with several other distinguished guests and members of the management teams of PickMe and Colombo Lotus Tower.

A partnership with Colombo Lotus Tower, the first destination to join the Colombo Connect ecosystem, the initiative aims to transform how residents and visitors experience the capital by digitally linking attractions, restaurants, entertainment, retail, culture and mobility into one seamless journey. The company estimates that once fully developed, the ecosystem could generate more than Rs. 30 billion annually in economic activity by encouraging visitors to discover more of Colombo and spend more time in the city.

PickMe CEO Jiffry Zulfer said: ‘Colombo already has everything it needs to become one of South Asia’s most exciting urban destinations. What has been missing is a platform that brings those experiences together. Today, attractions promote themselves. Restaurants promote themselves. Museums, events and entertainment venues all operate independently. Colombo Connect changes that by helping present the city as one connected destination where every discovery leads to another.’

Alongside Colombo Connect, PickMe announced that PickMe Events, its digital event discovery and ticketing platform, will now operate as PickMe Explore. The new identity reflects an expanded vision that extends beyond events to bring together destinations, attractions, experiences and communities through a single digital platform.

Designed as a national platform, PickMe Explore will bring together destinations, attractions, experiences and communities across Sri Lanka through a single digital interface. Colombo Connect becomes its first city-wide destination, demonstrating how technology can help entire cities become more discoverable while creating greater economic opportunities for local businesses.

Through PickMe Explore, users will be able to discover curated experiences, purchase attraction tickets, access exclusive offers, and explore destinations through one seamless platform.

As the first partner under Colombo Connect, Colombo Lotus Tower becomes the platform’s first digital gateway.

Visitors can now purchase tickets to the tower through PickMe Explore, gain access using QR-enabled entry and begin their Colombo Connect journey from one of the city’s most recognisable landmarks. Initial offerings include admission to the Observation Deck and Pixel Bloom, South Asia’s first immersive and interactive digital art museum, with additional attractions and experiences expected to join the ecosystem over time.

Colombo Connect has been designed to encourage visitors to spend more time exploring the capital before travelling to other parts of Sri Lanka, creating wider economic benefits across tourism, hospitality, retail, entertainment and transport. Tourism stakeholders have long observed that many international visitors arrive in Colombo only to leave within hours for beach resorts, wildlife destinations or the hill country, limiting the city’s economic potential despite its growing hospitality, entertainment and cultural offerings.

‘If visitors spend even one additional day discovering Colombo, the impact extends far beyond tourism,’ the CEO said. ‘Every extra stop supports another restaurant, attraction, retailer, hotel, transport provider or entrepreneur. That is how connected cities create shared economic growth.’

The company estimates that transactions generated across transport, ticketing, hospitality, retail, entertainment and other connected services could exceed Rs. 30 billion annually once the ecosystem reaches maturity.

Today, people’s first interaction with a city is increasingly through their smartphone. They discover places, book experiences, make payments and navigate their journeys digitally. Colombo Connect has been designed around that reality. ‘Cities increasingly compete through experiences,’ Zulfer added. ‘People no longer discover cities through brochures. They discover them through digital platforms. By connecting mobility, attractions, entertainment, retail and culture through one ecosystem, we can create a richer experience for visitors while helping more businesses benefit from the city’s growth.’

Future phases of Colombo Connect will expand to include museums, cultural institutions, entertainment venues, event organisers, restaurants, nightlife operators, retailers and other tourism partners, creating an increasingly connected urban ecosystem where users can discover experiences, access promotions, purchase tickets, arrange transport and navigate the city through one trusted platform.

As PickMe Explore continues to evolve, the same model is expected to be introduced across destinations throughout Sri Lanka, helping connect travellers with the country’s attractions and experiences through a single digital ecosystem.

‘For more than a decade, PickMe has connected people with transport, merchants and digital services,’ Zulfer said. ‘Our next journey is about connecting people with experiences. Colombo Connect is where that journey begins, and through PickMe Explore we hope to build a platform that eventually helps people discover the very best of Sri Lanka.’

The Ceylon Chamber of Commerce’s ‘Scale Up 2.0’, the National SME Forum 2026, on 11 August at the Taj Samudra, Colombo, will provide SMEs with a platform to address some of the most pressing challenges affecting business growth, from accessing markets and meeting evolving business requirements to securing finance and building the capabilities needed to scale.

Bringing together policymakers, industry leaders, financial institutions and business support organisations, the forum will focus on solutions, connections, and resources will that help SMEs become more competitive, market-ready and positioned for sustainable growth.

Taking place under the theme ‘Connected, Competitive, Ready to Grow,’ the forum will bring together policymakers, industry leaders, financial institutions, business support organisations and SMEs to explore solutions that help businesses strengthen their capabilities and expand their opportunities.

The forum will focus on three critical areas that shape SME growth: creating stronger pathways to markets, improving competitiveness through standards and certification, and enabling businesses to transition from survival to sustainable expansion.

Participants will gain insights into how SMEs can access new markets, connect with larger businesses and integrate into local and global value chains. The discussions will also highlight the importance of meeting quality standards, obtaining certifications and strengthening business processes to build credibility with customers and partners.

As SMEs look towards expansion, the forum will also address the importance of improving investment readiness, strengthening business practices and accessing suitable financing options to support long-term growth.

Beyond knowledge sharing, Scale Up 2.0 will provide SMEs with opportunities to engage directly with corporates, financial institutions and organisations that can support their business needs. The dedicated B2B networking segment will enable participants to explore partnerships, identify market opportunities and connect with potential sources of support.

Through Scale Up 2.0, The Ceylon Chamber of Commerce continues its efforts to create a platform that helps SMEs access the right connections, insights and opportunities needed to grow in an increasingly competitive business environment.

Registrations for the National SME Forum 2026 are now open. For registrations and further information, visit https://event.chamber.lk/event-register/486 or contact Nirosha – 0115588879 or Ravi – 0115588807.

Hemas Holdings PLC has managed to sustain revenue in the first quarter ended 30 June 2026 but suffered a dip in earnings.

The Group recorded revenue of Rs. 28.77 billion, an increase of 0.9% year-on-year (YoY), while gross profit margin improved by 0.2 percentage points to 30.4%. However, Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) declined by 14.1% to Rs. 2.26 billion and Group earnings attributable to equity holders declined by 21.4% to Rs. 937 million. Revenue growth in Consumer Brands, Hospitals, and Mobility was offset by a 3.8% decline in Life Sciences.

Hemas Group CEO Ashish Chandra said the divergence between revenue and earnings was primarily caused by the rapid escalation of costs and the time required to recover these increases through pricing.

He said despite strong headwinds, the top line grew marginally driven by sustained demand and price increases across the Consumer, Healthcare, and Mobility portfolios. However, due to the adverse macroeconomic environment, net operating costs rose by 9% YoY, weighing on EBIT and EBITDA and diluted margins. Selling and distribution costs, up 12.3% YoY, accounted for over 50% of the 1Q increase in operating costs, reflecting the significant rise in logistics, fuel, freight, and related distribution costs.

Rupee depreciation increased finance costs at the Leisure JV on its USD borrowings, reducing the Group’s earnings for the quarter.

Higher interest rates, however, benefitted Hemas as a net cash-positive company, helping to recoup some of the lost operating margin, bringing the earnings margin to 3.3%, down just 0.9 percentage points YoY (compared to a 1.4-percentage-point YoY decline in the EBITDA margin).

‘The management’s immediate priorities are to restore cost recovery, protect volumes through calibrated pricing, accelerate productivity initiatives, and improve profitability in Consumer Brands and Life Sciences. While energy and currency volatility are expected to persist, the Group remains focused on strengthening performance while executing its long-term growth priorities with discipline,’ said Chandra.

Going forward, Hemas also said segmental reporting will be broken down into Consumer Brands, Life Science, Hospitals, Mobility and Strategic Investments.

‘The key change is the split of the former Healthcare segment into Hospitals and Life Sciences, reflecting the fundamental differences between these businesses and how they are managed. This change has been implemented in line with our commitment to improving transparency, giving shareholders a better understanding of the business,’ the Group CEO added.

Commenting on the outlook, Chandra said guided by four overarching capital allocation themes, Hemas Group has established goals to accelerate its pace of growth by aggressively pursuing adjacencies through both organic and inorganic growth, exploring a new sector entry in Sri Lanka, growing international revenue, and developing human capital and digital capabilities across the Group. Alongside this, strengthening internal efficiencies to reduce the impact of costs on earnings remains a key priority for the Group.

‘While the near-term operating environment remains volatile, our priorities are clear: restore margins in Consumer Brands and Life Sciences, sustain growth momentum in Hospitals and Mobility, and execute our growth investments with discipline. Our diversified portfolio and net cash position provide resilience, while actions on pricing, cost recovery, and productivity will strengthen performance. We remain firmly focused on delivering our long-term growth ambitions and creating sustainable value for our shareholders and stakeholders,’ Chandra added.