Category: Daily Financial Times

When Cyclone Ditwah swept across Sri Lanka with days of torrential rain, floods and landslides, the first focus-rightly-was on saving lives. With over 350 deaths, nearly 400 missing, and over 1 million people affected, the country is in the grip of one of its worst disasters in years.

But once the waters recede and media attention moves on, another crisis will remain: the quiet, grinding collapse of thousands of micro, small and medium enterprises (MSMEs) that form the backbone of Sri Lanka’s economy.

MSMEs account for more than 90% of all enterprises in Sri Lanka, contribute around 52% to GDP and provide roughly 45% of employment. Yet this same sector has already been hammered by a series of shocks: the COVID-19 pandemic, the 2022-23 economic crisis, high inflation and interest rates, and a sluggish global environment for exports. Cyclone Ditwah and the associated flooding now threaten to push many of these businesses beyond recovery.

In this context, the key question for Government and policymakers is clear: What must Sri Lanka do-quickly and strategically-to keep MSMEs alive, help them recover, and make them resilient to future climate disasters?

1. Why MSMEs matter for disaster recovery

The importance of MSMEs is already well recognised in national policy. The National SME Policy Framework describes SMEs as the ‘backbone’ of the economy in terms of employment, regional development and inclusive growth. Central Bank reports and recent studies also emphasise that MSMEs are critical for innovation, supply-chain linkages and as breeding grounds for future large firms.

In a post-disaster setting, MSMEs play several additional roles:

Restoring livelihoods quickly: Most daily-wage earners, self-employed workers, and informal sector workers depend directly on micro and small businesses.

Rebuilding local economies: MSMEs in retail, services, transport, tourism and small-scale manufacturing reconnect local markets and communities far faster than large, centralised enterprises.

Supporting social stability: When MSMEs collapse, unemployment, indebtedness and migration pressures increase-fuel for social unrest and long-term poverty.

For a country already navigating a difficult IMF-supported stabilisation path, letting MSMEs fail after this disaster would undermine both economic recovery and social cohesion.

If Sri Lanka fails to act decisively, the human and economic losses from this disaster will continue to compound long after the floodwaters have receded. But if policymakers seize this moment to protect and empower MSMEs, the country can convert a period of tragedy into a turning point-towards a more resilient, inclusive and climate-ready economy.

2. The specific vulnerabilities of MSMEs in this disaster

Most MSMEs in Sri Lanka entered this climate crisis already weakened. Surveys during and after COVID-19 showed sharp revenue falls, depleted savings, and limited access to formal finance for MSMEs. The subsequent economic crisis intensified these pressures through currency depreciation, high interest rates and supply disruptions.

Cyclone Ditwah and the heavy rains have exposed several structural vulnerabilities:

1.Physical damage to assets and stocks

Many micro and small firms operate from low-lying areas-near rivers, roadsides and dense urban settlements. Floods destroy machinery, inventory, vehicles and business premises. Few of these enterprises carry comprehensive insurance, and even fewer have digital backups of records or data.

2.Cash-flow collapse and liquidity stress

When a business cannot operate for weeks, fixed costs continue: rent, electricity (where still payable), loan instalments and staff wages. For MSMEs already servicing high-interest loans, even short interruptions can tip them into default.

3.Limited insurance and risk-pooling mechanisms

Although Sri Lanka has a legal framework for disaster management and compensation under the Disaster Management Act No.13 of 2005, existing schemes focus more on households and infrastructure than on small businesses. Compensation ceilings for destroyed houses are modest, and there is no comprehensive nationwide mechanism specifically tailored for MSME asset losses.

4.Debt overhang from previous crises

Many MSMEs took on additional borrowing during COVID-19 and the 2022-23 crisis, often through emergency facilities or informal lenders. These legacy debts now limit their capacity to borrow again for reconstruction.

5.High informality and weak documentation

A large share of micro-enterprises operate informally or semi-formally, without proper registration, financial statements or tax files. This makes them invisible to formal relief programmes, bank lending schemes, and even Government data systems.

Given these vulnerabilities, ‘business as usual’ policy responses will not be enough. Sri Lanka needs a targeted, three-phase package for MSMEs: emergency relief, recovery finance, and long-term resilience.

3. Phase One – Immediate relief: Keeping MSMEs alive

3.1 Rapid, targeted grant support

The first priority is to prevent viable MSMEs from closing permanently in the next three to six months.

Government, through the Treasury and relevant ministries, should design emergency grant schemes for MSMEs in officially declared disaster-hit divisions. These could be simple lump-sum payments based on business size (micro, small, medium) and verified location, administered via Divisional Secretariats with Chamber and local authority support.

Grants should be unconditional but accountable: beneficiaries must declare basic data (sector, employment, prior turnover) to help build a comprehensive MSME database for future policy design.

International partners-such as the ADB, World Bank, UN agencies and bilateral donors-can co-finance such grants, aligning them with ongoing private-sector and climate-resilience programmes.

3.2 Temporary tax relief and administrative easement

The tax system can be a powerful shock absorber if used intelligently:

Deferral of tax payments (income tax, VAT, withholding taxes and turnover-based levies) for affected MSMEs for a defined period (e.g., 6-12 months), with clear criteria and cut-off dates.

Waiver of penalties and interest on late filings and payments for businesses in disaster-declared areas.

Fast-tracking of VAT refunds and other legitimate tax credits, particularly for export-oriented MSMEs facing working-capital constraints.

Simplified ‘post-disaster tax help desks’ within the Inland Revenue Department (IRD) and at regional offices to guide MSMEs on available relief, documentation and compliance.

Such measures would not permanently reduce the tax base but would give breathing space to businesses and protect future revenue streams.

Sri Lanka is once again reminded that climate disasters are not temporary interruptions-they are a permanent feature of our economic landscape. For a country where MSMEs form the lifeblood of local economies, employment and social stability, their collapse would deepen national vulnerability and reverse the hard-won gains of recent stabilisation efforts. This moment demands more than short-term relief; it calls for a decisive national commitment to rebuild, protect and future-proof the MSME sector

3.3 Moratoriums and regulatory flexibility from the financial sector

The Central Bank and the banking sector have previously introduced moratoriums and special credit lines during COVID-19 and the economic crisis. A similar-but better targeted-approach is needed now:

Short-term moratoriums on principal (and in some cases interest) for MSMEs directly impacted by the floods and landslides, with clear eligibility criteria and timeframes.

Regulatory forbearance allowing banks to avoid automatic downgrading of restructured MSME loans purely due to this disaster, while maintaining prudent risk management.

Encouraging licensed finance companies and micro-finance institutions to restructure loans for affected clients, backed by partial credit-guarantee schemes from the Government.

These measures would prevent a wave of defaults and preserve the financial system’s willingness to lend to MSMEs during the recovery phase.

4. Phase Two – Recovery: Financing reconstruction and adaptation

Once immediate survival is secured, MSMEs need support to rebuild better, not simply return to their previous vulnerable state.

4.1 Concessional ‘build-back-better’ credit lines

Government, in partnership with development partners and state banks, should introduce dedicated concessional credit lines for MSMEs in affected regions, with features such as:

Below-market interest rates and longer tenors to finance replacement of machinery, rehabilitation of premises, and replenishment of stock.

Grace periods on repayment that align with realistic business recovery cycles.

Blended finance structures where part of the assistance is a grant (e.g., for climate-resilient upgrades) and part is a loan.

Priority could be given to investments that reduce future risk-such as relocating facilities away from high-risk zones, adopting flood-resistant construction, or investing in renewable energy systems that also lower operating costs.

4.2 Public procurement as a recovery tool

Government is the largest single buyer in the domestic economy. It can use procurement to channel demand toward affected MSMEs:

Introduce temporary procurement preferences or quotas for MSMEs located in disaster-hit divisions, especially in sectors such as construction, supplies for schools and hospitals, and maintenance works.

Simplify bidding processes and reduce documentation burdens for small suppliers while maintaining transparency and anti-corruption safeguards.

This approach simultaneously accelerates infrastructure repair and injects revenue directly into affected local economies.

4.3 Business development, advisory and digitalisation support

Finance alone is insufficient. MSMEs also need knowledge and networks:

Agencies such as the Industrial Development Board (IDB), Export Development Board (EDB) and regional Chambers should provide business continuity and recovery advisory services, helping firms reassess markets, revise business models, and manage cash flows.

Digitalisation support-training and small grants for e-commerce, online marketing, cloud-based accounting and remote work tools-can help MSMEs reach customers even during disruptions and build better record-keeping for future support programmes.

5. Phase Three – Building long-term climate resilience into MSME policy

Climate-related disasters are no longer isolated events; they are part of the ‘new normal’. Sri Lanka already has a Disaster Management Act and a National Policy on Disaster Management, which call for comprehensive planning across all ministries and agencies. However, MSMEs have not been at the centre of this framework.

A forward-looking strategy should include:

5.1 Integrating MSMEs into national disaster-risk planning

Make MSME resilience an explicit objective in the next revision of the National SME Policy and related sectoral strategies.

Require line ministries, provincial councils and local authorities to map MSME clusters in their areas and integrate them into Disaster Management Plans, as required under the Act.

Conduct regular risk-awareness and preparedness programmes for MSMEs, including evacuation planning, supply-chain diversification and data backup practices.

5.2 Developing affordable insurance and risk-sharing mechanisms

Traditional insurance products are often too complex or expensive for micro and small enterprises. Sri Lanka can explore:

Index-based or parametric insurance products linked to rainfall or river levels, which provide automatic payouts after defined thresholds are crossed.

Group insurance schemes for MSME clusters, cooperatives or associations to lower premiums and administrative costs.

Limited, targeted premium subsidies for the most vulnerable segments during an initial adoption phase, funded from climate-finance windows and disaster-risk-reduction budgets.

Sri Lanka can convert this crisis into a platform for renewal. If policymakers act with urgency, coordination and vision, the MSME sector can emerge not only restored, but stronger, greener and better equipped to withstand the storms of the future-ensuring that national recovery is both inclusive and sustainable

5.3 Promoting green and climate-resilient MSME investment

The next phase of Sri Lanka’s growth must be both climate-smart and inclusive:

Offer tax incentives or accelerated depreciation for investments in energy-efficient machinery, rooftop solar, water-saving technologies and climate-resilient infrastructure for MSMEs.

Encourage banks to create ‘green MSME’ loan products, supported by concessional refinance lines or guarantees linked to global climate-finance facilities.

Link MSME support with national initiatives on renewable energy, circular economy, sustainable agriculture and eco-tourism, ensuring small firms are not left out of the green transition.

5.4 Strengthening data, coordination and accountability

Effective policy requires good information and coordination:

Build a centralised MSME registry that integrates data from the IRD, Registrar of Companies, provincial councils, local authorities and sectoral agencies. This would allow rapid identification of affected firms after disasters and targeted support with minimal leakages.

Establish a multi-stakeholder council on MSME resilience, including the Ministry of Finance, Ministry of Industry, CBSL, DMC, chambers of commerce, women’s business associations and MSME representatives.

Ensure transparency and public reporting on all MSME-related relief and recovery measures, with geo-tagged data on beneficiaries and a clear grievance-redress mechanism to maintain public trust.

6. Protecting the most vulnerable within the MSME ecosystem

Any MSME strategy must pay particular attention to:

Women-owned and youth-owned enterprises, which often operate with thinner capital buffers and face more barriers in accessing finance and networks.

Informal micro-enterprises in urban poor settlements and rural villages, whose survival is essential for community wellbeing, even if they are not formally registered.

nWorkers in MSMEs, many of whom lack formal contracts and social protection.

Government can link MSME relief measures with broader reforms in social protection-such as better targeting under programmes like Aswasuma-to ensure self-employed and micro-enterprise workers are not excluded from basic safety nets in future disasters.

7. A call for a ‘disaster-resilient enterprise compact’

Sri Lanka stands at a crossroads. Cyclone Ditwah has exposed not only physical vulnerabilities in infrastructure and settlements, but also institutional and economic vulnerabilities in the way we support our smallest businesses.

What is needed now is a ‘disaster-resilient enterprise compact’-a clear, time-bound agreement between Government, the financial sector, development partners, and the business community to:

Provide rapid, targeted relief to MSMEs in the worst-affected areas.

Mobilise patient recovery finance that allows firms to rebuild stronger and greener.

Embed climate resilience at the heart of MSME policy, planning and regulation.

If Sri Lanka fails to act decisively, the human and economic losses from this disaster will continue to compound long after the floodwaters have receded. But if policymakers seize this moment to protect and empower MSMEs, the country can convert a period of tragedy into a turning point-towards a more resilient, inclusive and climate-ready economy.

Sri Lanka is once again reminded that climate disasters are not temporary interruptions-they are a permanent feature of our economic landscape. For a country where MSMEs form the lifeblood of local economies, employment and social stability, their collapse would deepen national vulnerability and reverse the hard-won gains of recent stabilisation efforts. This moment demands more than short-term relief; it calls for a decisive national commitment to rebuild, protect and future-proof the MSME sector. By combining rapid financial support, smart tax and regulatory easing, targeted recovery financing, and a long-term resilience agenda rooted in climate adaptation and digital transformation, Sri Lanka can convert this crisis into a platform for renewal. If policymakers act with urgency, coordination and vision, the MSME sector can emerge not only restored, but stronger, greener and better equipped to withstand the storms of the future-ensuring that national recovery is both inclusive and sustainable.

Indian Prime Minister Narendra Modi held a telephone conversation with President Anura Kumara Dissanayake yesterday.

Prime Minister Modi expressed his condolences on the loss of lives and widespread devastation in Sri Lanka in the wake of Cyclone Ditwah.

He also conveyed that the people of India stand in firm solidarity and support with the people of Sri Lanka in this hour of need, according to a statement issued by the Office of the Prime Minister of India.

President Dissanayake conveyed his deep gratitude for India’s assistance in the wake of the disaster and appreciated the swift deployment of rescue teams and relief material. The President also conveyed the appreciation of the people of Sri Lanka for India’s timely and effective response efforts.

Prime Minister Narendra Modi has assured President Dissanayake of India’s continued support to Sri Lanka under the ongoing Operation Sagar Bandhu, providing rescue and relief to distressed persons. He assured that India, in line with its Vision Mahasagar and its established position as the ‘First Responder’, will continue to extend all necessary assistance in the coming days as Sri Lanka undertakes rehabilitation efforts, resumes public services, and works toward restoring livelihoods across the impacted regions.

The two leaders agreed to remain in close touch, the statement added further.

Ather has launched its second product, the Ather Rizta, positioning itself in the Rs. 600,000 to 800,000 range, which is currently the fastest growing segment in the local scooter market.

Sri Lanka’s two-wheeler market is entering a reset phase. After years of import restrictions and a flood of low-cost electric models, the country is now seeing a shift in consumer preference towards upgrading to better-built, long-term reliable vehicles. This trend mirrors what has played out in categories such as smartphones and used cars, where buyers have steadily moved from basic, price-driven options to feature-rich, premium products.

That same sentiment is beginning to surface in electric mobility. Riders, especially in urban centres like Colombo and Galle, are showing a growing willingness to pay for quality, performance, and technology rather than simply the lowest upfront price. For manufacturers, this marks a decisive transition point: the market is small in absolute numbers but is maturing faster than expected.

Until recently, Sri Lanka’s electric two-wheeler (E2W) market was dominated by entry-level imports that offered basic features, limited durability, and compromising battery performance. While these vehicles created initial awareness, they also left many consumers sceptical about battery reliability, servicing, and real-world performance. As a result, Electric Vehicles (EVs) were often viewed as a compromise compared to petrol scooters.

That perception is now changing. With fuel prices volatile and urban usage patterns better suited to EVs, consumers are beginning to see electric scooters as an upgrade – quieter, lower total cost of ownership, and equipped with more features than their internal combustion counterparts. A prime example is Ather’s electric scooters, which come adorned with tech advanced features and enhanced build quality and riding experience – all based on years of extensive R and D, testing, and deep engineering.

Ather Energy, India’s EV two-wheeler pioneer, exemplifies this new standard. The company has redefined India’s market with smart, software-driven scooters that combine high-performance engineering, connectivity, advanced safety, and a superior riding experience.

Founded by Tarun Mehta and Swapnil Jain, Ather entered Sri Lanka last year with its flagship 450X. Since then, the company has expanded its presence with 40 experience centres across the country.

Ather distinguishes itself from the earlier wave of budget EV imports by building its core technologies in-house. These include the battery system, software, vehicle intelligence platform called AtherStack, chassis design, and thermal management systems. This vertically integrated approach is designed to address the issues Sri Lankan riders commonly highlight, such as battery degradation, performance drops, unresponsive throttle, or and inconsistent after-sales support.

The company is providing one of its kind warranty available in the market, signalling confidence in product durability. Ather offers a five-year/60,000 km (whichever is earlier) battery warranty for all scooters, with an option to further enhance up to 8 years/80,000 kms (whichever comes first) as an additional purchase. The assurance also guarantees a minimum of 70% battery health at the end of the period.

The company is also investing in a fast-charging network in key cities to offer meaningful range in short charging sessions and reduce consumer anxiety around day-to-day usability. In India, Ather has established the widest two-wheeler fast-charging network, with over 3,500 Ather grid fast-charging stations spread across the country.

Unlike typical EVs in this segment, the Rizta uses a software-led architecture, offering features such as a touchscreen dashboard, onboard navigation, ride analytics, and assisted riding functions. The model also prioritises practicality, including one of the largest seats and storage available on an electric scooter. For Sri Lankan commuters who increasingly use connected apps, digital payments, and navigation tools, the idea of a ‘smart scooter’ is now less of a novelty and more of an expected upgrade.

Ather’s entry does not by itself transform the market. But it marks an important milestone: the arrival of engineering-led EVs that prioritise product quality over price alone. If Sri Lanka follows the pattern seen in India and Southeast Asia, the next few years could see the market coalesce around better-built scooters, dependable service infrastructure, and differentiated technology – shifting electric mobility firmly into the aspirational category.

Last week we were once again reminded of the devastating human and economic cost, and the country’s deep exposure to climate-driven disasters. In the wake of Cyclone Ditwah, over 150 lives have been confirmed lost. Entire communities have been displaced, a cultivation cycle disrupted, and the threat of water-borne disease looms large as floodwaters recede. It was the first major test for the current administration, and while the instinct for criticism is understandable, this moment calls for something more meaningful, a sober, constructive assessment of what worked, what failed, and what must urgently change before the next inevitable crisis strikes.

Extreme weather events are no longer rare occurrences. Global climate change has altered rainfall patterns, amplified storm intensity, and made hazards once expected ‘once a decade’ far more frequent. Sri Lanka, situated squarely in the path of such climatic volatility, simply cannot afford complacency. The economic toll of Ditwah arrives at a moment when our country is already financially fragile. Another shock of this scale, if not met with better preparedness, could set back recovery efforts by years.

To the Government’s credit, early warnings were issued, and some evacuation procedures were activated. The rapid deployment of the armed forces and emergency personnel saved lives. Yet, even these efforts were hampered by longstanding structural weaknesses, insufficient local-level coordination, outdated infrastructure, gaps in communication, and inadequate community preparedness. Many families received warnings too late, didn’t receive it in the language they spoke or did not have the means to act on them. Relief distribution in some districts was swift, while in others, delays left vulnerable communities stranded for days. These disparities point not to a failure of effort but to systemic issues that must be addressed.

Disaster preparedness is not merely the responsibility of a central authority. It is a nationwide undertaking. But for such collective resilience to function, systems must be predictable, well-funded, and professionally managed. Sri Lanka’s Disaster Management Centre and associated agencies require greater autonomy, better resourcing, and modern technology. Meteorological forecasting, early warning dissemination, and local-level risk mapping need significant upgrades. Investment in resilient infrastructure, flood-resistant roads, reinforced riverbanks, modern drainage systems, must become a national priority, not an afterthought following catastrophe.

The agricultural impact of Cyclone Ditwah is especially worrying. With fields submerged and crops destroyed, farmers across multiple regions face immense losses. This disruption threatens to cascade into a food security challenge in 2026. A robust response requires immediate support for affected farmers, including compensation, seeds for replanting, and access to credit. It also requires long-term thinking that includes diversifying crops, improving irrigation capacity, and adopting climate-resilient agricultural practices.

Public health preparedness must now accelerate. Stagnant water is fertile ground for dengue and gastrointestinal diseases. The Ministry of Health must mobilise surveillance teams, strengthen sanitation efforts, and ensure medical facilities are adequately supplied. The weeks following a flood often determine whether human losses end with the storm or continue silently through preventable illnesses.

The purpose of assessing disaster response is not political point-scoring but national learning. Sri Lanka needs a culture of resilience, one in which institutions are strengthened, communities are trained, and preparedness is integrated into everyday governance.

Cyclone Ditwah was a tragedy. If Sri Lanka chooses to confront its weaknesses honestly and invest in stronger systems, the country can weather the storms ahead with far fewer losses. Resilience is not built in the aftermath of disaster but in the quiet months between them.

Barcelona and Atletico Madrid are looking to put down a marker in their respective title aspirations as the sides meet at Camp Nou for a midweek blockbuster.

Barca sit precariously top of La Liga by a point from second-place Real Madrid after coming from behind to beat Alaves at the weekend for a fourth straight league win.

Fourth-placed Atletico, who won 2-0 at home to Real Oviedo at the weekend, trail Barcelona by three points.

Since losing 4-0 away at Arsenal in October, Atletico have now won seven games in a row in all competitions.

And as Real Madrid were held to a third consecutive La Liga draw in a 1-1 tie at lowly Girona on Sunday, Barcelona and Atletico will hope that they can take advantage of their rivals’ dip in form.

Despite the 3-1 win over Alaves, Barcelona’s boss Hansi Flick appeared close to tears after the game and was consoled by winger Raphinha.

Flick later said he was angered by some of the officiating, including the referee’s decision to red-card two of his staff members during the game.

‘I lacked communication. I asked the fourth official what had happened, and he told me nothing,’ Flick said after the game, saying this was an ‘endemic problem’.

‘We don’t have the control we had at times last season,’ he said. ‘We have to improve, and we can improve many things.’

Raphinha told reporters that ‘Flick believes that we are not playing at our best, and I agree’.

‘Even so, the important thing today was getting the win. We know we are not at our best, but we are working, and I am sure we will get back to playing our best this season,’ he added.

A key player in Barcelona’s domestic title double last season, Raphinha looked like his old incisive self against Alaves in his first start in two months since recovering from a hamstring injury.

He set up two early goals, twice racing in behind the defence on the left side of the area before squaring passes for Lamine Yamal and Dani Olmo to score in the eighth and 26th minutes.

Olmo added a third goal in stoppage time when he worked a one-two passing combination with Yamal before firing home.

Former Sri Lanka Tourism Development Authority (SLTDA) Chairman Priantha Fernando warned that the country is heading toward a severe shortage of licensed tour guides, a crisis he says could undermine Sri Lanka’s ambition of attracting 3 million tourists in 2026 and damage the industry’s reputation if not urgently addressed.

Fernando was shocked that SLTDA had made commitments before the Supreme Court without conducting the ‘required homework,’ arguing that the authority’s pledge to strictly enforce regulations against unlicensed guiding will have ‘ominous consequences.’

He said Destination Management Companies (DMCs) will find it ‘extremely difficult’ to operate if they are forced to rely exclusively on registered national and chauffeur guides, given the scale of shortages expected.

Sri Lanka’s target of 3 million tourists in 2026 will be driven by arrivals from over 40 countries, with the bulk coming from around 32 key markets. These tourists stay between 4.5 and 15 nights depending on origin, averaging around nine nights, with travel patterns ranging from beach-only holidays to multi-day round tours.

Fernando pointed out that around 80% of travellers require some form of guiding service, creating significant pressure on the system even under normal circumstances.

However, Sri Lanka currently has only 1,981 licensed national guides and 1,642 licensed chauffeur guides, supported by 1,490 area guides and 404 site guides. Out of the 3,132 national and chauffeur guides, only about 750 or just 25% speak a foreign language. This, Fernando stressed, makes it virtually impossible to serve high-value non-English markets such as Germany, Russia, France, the Netherlands, China, Italy, Poland, Switzerland, Japan, Israel, Korea, the Nordic region, Iran and the Middle East.

According to his estimates, Sri Lanka will need at least 9,000 licensed guides by 2026, including 4,000 foreign-language-proficient guides, if services are to be provided exclusively by licensed personnel. ‘Only around 33% of the required guides are currently available for 2026,’ he said, adding that the shortfall is ‘far worse’ when considering foreign-language ability.

Fernando warned that restricting the industry to licensed guides under current supply levels will place DMCs ‘at the mercy of guides,’ creating opportunities for unreasonable demands and forcing companies to hire individuals with inadequate language or service skills. Such a scenario, he said, risks ‘guest dissatisfaction’ and long-term reputational damage for Sri Lanka.

He urged authorities, in consultation with industry associations, to set minimum rates for guide services to prevent arbitrary pricing and exploitation. He also emphasised the need for a robust system to test and certify foreign-language proficiency, noting that being licensed ‘is not enough’ if communication skills are weak.

Fernando criticised unethical practices in parts of the guiding sector, saying many guides exploit tourists by directing them to businesses offering excessive commissions now ranging between 40% and 60%, compared to the historical norm of 10%. He cited incidents at national parks where visitors were charged hidden fees, describing such behaviour as deeply harmful to Sri Lanka’s image.

‘The noise made by the guide lecturers’ association is like the kettle calling the pot black,’ he said.

To address longstanding commission-based manipulation, Fernando proposed formalising a standard, flat commission system across all SLTDA-registered establishments. This, he argued, would help curb abuse, support the Government’s tax efforts given that 90% of guide income currently escapes the tax net’ and bring more transparency into indirect earnings.

He insisted that guides must be required to patronise only SLTDA-approved restaurants, shops, spice gardens, accommodation providers and recreational services, warning that allowing guides to promote unregistered businesses perpetuates the informal sector and exposes tourists to risks.

Looking ahead, Fernando stressed that Sri Lanka cannot realistically train and certify enough new guides within the next two to three years to meet projected demand. With Sri Lanka having just surpassed 2 million arrivals in 2025, he said the country must urgently develop an industry-wide strategy to bridge the gap, avoid conflicts during the upcoming peak season, and prevent ‘greater controversy and instability’ among stakeholders.

He said that SLTDA’s failure to anticipate these challenges before making commitments to the Supreme Court was a ‘serious lapse’ and warned that without immediate corrective action, the industry could face operational chaos during the high season beginning this month.

Sri Lanka showcased its vibrant and diverse tourism potential at the 8th edition of Travel Expo Ankara – International Tourism and Travel Fair, held from 20-22 November 2025 at the ATO Congresium. The Sri Lanka stand, organised by the Embassy of Sri Lanka in Ankara, attracted a large number of visitors and generated significant interest among travel professionals, investors, and media representatives.

Travel Expo Ankara is recognised as a premier international tourism exhibition, highlighting destination, cultural, wellness, congress, sports, and camping tourism.

The Sri Lankan stand was formally inaugurated by the Ambassador of Sri Lanka to Trkiye, Niluka Kadurugamuwa marking the beginning of three days of cultural engagement, tourism promotion, and business networking. Visitors to the pavilion were introduced to the island’s multifaceted tourism experiences, presented in both Turkish and English, highlighting Sri Lanka’s strengths in destination tourism, cultural tourism, wellness tourism, adventure travel, and more.

In addition to destination promotion, the pavilion also featured authentic Sri Lankan value-added products, including Ceylon tea, which was served to visitors throughout the event, adding a unique cultural touch and enhancing the overall Sri Lankan experience.

The Sri Lankan booth received visibility across the Turkish media, with coverage from Television channels, YouTubers, bloggers, and social media influencers. This exposure contributed to Sri Lanka’s promotional success at the fair.

On the sidelines of the exhibition, Ambassador Kadurugamuwa met with Trkiye Culture and Tourism Deputy Minister Nadir Alpaslan, and Ankara Chamber of Commerce President, Grsel Baran. The interaction focused on strengthening bilateral cooperation and exploring new avenues for partnership in tourism and related sectors.

The 8th edition of the Travel Expo Ankara welcomed approximately 10,000 participants and exhibitors, providing an influential platform for global tourism promotion and collaboration.

Colombo Dockyard PLC (CDPLC) recently delivered the ninth vessel of the 5000 DWT Eco Bulk Carrier series, named ‘Misje Sakura’ to Misje EcoBulk AS of Norway, well ahead of the contractual delivery date, marking completion of yet another milestone in this successful long-term collaboration.

Following the handover of the first vessel in September 2022, CDPLC has continued to deliver each vessel in the series with increasing quality and efficiency. The completion of ‘Misje Sakura’ once again demonstrates Colombo Dockyard’s ability to build world class ships to European owners, meeting European quality standards.

The delivery ceremony was graced by the Owner Roald Misje, CFO Alina Printseva, Site Manager Thusitha Herath, and Site Superintendents Venura Wanasinghe and Prince Jawahar all from Misje EcoBulk.

Representatives from DNV comprised of the Country Manager Saman A. Kumarasinghe and Surveyor Gishan Dias. The Authorised Nautical Inspector Captain Nish Wijayakulathilaka participated in representing the Bahamas Maritime Authority. From CDPLC, the event was led by MD/CEO Thimira Godakumbura who officially handed over the vessel to the Owner in the presence of the senior management and staff of Colombo Dockyard.

The 89.95m DNV-classed Eco Bulker was conceptualised by Wartsila Ship Design Norway, with detailed design work carried out by CDPLC’s skilled in-house design team. In line with the latest trends in sustainable shipping, the vessel is equipped with an advanced Energy Storage Battery System (ESS) for Electric Hybrid Propulsion, complementing the conventional diesel propulsion system to enhance operational performance and reduce environmental impact.The successful delivery of ‘Misje Sakura’ reaffirms Colombo Dockyard’s reputation as a reliable shipbuilder of high-quality, eco-friendly vessels for discerning global clients.

CDPLC said it continuously proves its excellence through securing and successful execution of shipbuilding projects worldwide and is the front runner of Sri Lankan industrialisation. CDPLC also contributes heavily to the national export earnings from the shipbuilding sector with much needed foreign currency to the Sri Lankan economy and plays a leading role in uplifting and driving the maritime development strategy of Sri Lanka.

President and Finance Minister Anura Kumara Dissanayake with Treasury Secretary Dr. Harshana Suriyapperuma putting final touches to 2026 Budget – File photo

Few taxes are intrinsically democratic or undemocratic. They are just a way of funding the Government. But there are occasional exceptions, including a very significant one in Sri Lanka currently: the taxes raised by local Councils, especially property tax (aka rate assessment). The most important fact about the property tax in Sri Lanka is that it is trivial on virtually any measure. Most households do not pay for it. Those that do mostly hand over a few hundred rupees. It is mainly a small number of large commercial establishments that receive property tax bills that are big enough to notice. It follows that the property tax revenue collected by Municipal, Urban and Rural Councils (Pradeshiya Sabhas) is also trivial. As a proportion of GDP, it is one of the lowest in the world. The total revenue from property tax may not even cover the cost of collection. It makes almost no contribution to Local Council revenues; they depend almost entirely on Colombo to pay their staff and furnish them with a little grant money.

Local Councils

So where is the connection with democracy? It lies in the feebleness – political, organisational and financial – of Local Councils – and in the scope for changing that through property tax reform. Government in Sri Lanka is very centralised. Whoever wins power in Colombo takes all. Local Councils have very few financial resources of their own. Their staff are posted and paid from Colombo. Local Councils do not have strong electoral legitimacy: while formally elected for four-year terms, elections are frequently postponed and Councils’ powers are sometimes vested in special commissioners appointed from Colombo. And it is the Government in Colombo, rather than the law, that determines when local elections will be held. This particular democratic deficit is not new to Sri Lanka. It has received little consideration in recent decades because attention has been focused on urgent threats to democracy at national level – and perhaps because any mention of ‘local Government’ evokes the contentious issue of the powers of provincial Councils. But now that national level democracy seems secure, we can look again at the problem of the weakness of Local Councils – without being side-tracked by the hot-button provincial council issue.

Stronger Local Councils, more able to raise their own money and spend it according to local preferences, would enhance democracy in two ways. First, and most obviously, this would enhance political diversity, dilute the excessive power of Colombo over local affairs, and give people a stronger sense of engagement in their own governance even when they do not support the party in power in Colombo.

Unhealthily undemocratic

Second, stronger Local Councils would do a great deal for the political health of Sri Lanka’s political parties. For several decades, and with the significant exception of the NPP/JVP, most political parties have been unhealthily undemocratic. Much like private businesses, they have been controlled by individuals, families or small groups. They have lacked a stable organisation below the top level. Temporary party machines have been created to contest elections by processes of selection from above. The national leaders use their personal networks and resources to select individuals to organise and contest at district level. Those individuals in turn use the same mechanisms to select other individuals to organise and contest at the electorate level. The personal networks dominate over considerations of long-term affiliation with a particular party or consistent policy positions. And the personal networks are reshuffled continuously. Accordingly, most political parties have nothing resembling memberships, i.e. sets of people with long term attachments who can be expected to work for the party and in turn can anticipate some voice in the selection of candidates and leaders or in party policy.

Sri Lankan democracy will be even stronger when the NPP/JVP finds itself in competition for votes with another political party that has also enjoyed longevity, committed membership, and a degree of inner-party democracy

The NPP/JVP have won recent elections, and are likely to repeat the performance next time around, in part because, organisationally, they are so different from what has gone before. A political party that has a stable organisational structure and a cadre of members who will work for the party in exchange for a degree of inner-party democracy can be very attractive to voters – especially when the party is seen to exercise discipline over its members. Voters then know what they are voting for. They can reasonably anticipate that, next time there are elections, the same party with much the same people will be asking for support again, on much the same kinds of grounds. This induces real electoral accountability. Stable political parties build trust in the power of the vote, and in democracy more generally. Sri Lankan democracy will be even stronger when the NPP/JVP finds itself in competition for votes with another political party that has also enjoyed longevity, committed membership, and a degree of inner-party democracy.

So how would stronger Local Councils help nurture more healthily participatory and democratic political parties? The connections run through the fact that Local Councils with more powers and significant financial resources from improved property taxes would nurture local politicians with both authentic political and electioneering skills and a demonstrated capacity to manage and spend public money effectively.

Local elections would revolve increasingly around how local property taxes were raised and the money used. Because many voters would be paying noticeable property taxes, they would have a stronger interest in local elections and local affairs. And that would contribute to the democratic health of national political parties in two ways.

First, ordinary party members would earn and gain more of a voice in party affairs because many would have experience of managing Local Council affairs. Party leaders would need to pay them more attention. Second, party members and leaders would be in a better position to select for promotion people who would strengthen the party by virtue of demonstrated competence in managing local Government affairs. The NPP/JVP has given us a welcome taste of an organised, participatory and competent political party. A more effective Local Council system would provide opportunities both for the NPP/JVP to go further and for other parties to compete for votes on the same terrain.

There is currently a window of opportunity to use property tax reform to revive local Councils. First, the Government is anyway committed by its agreement with the IMF to introduce a meaningful property tax by 2027, and is already digitising existing property tax records in preparation. Second, the Government is already acting on its commitment to the IMF to make an annual cut of 25% in the money it transfers to Local Councils. Local Councils are already feeling this and looking for other sources of revenue

Window of opportunity

The moment matters. There is currently a window of opportunity to use property tax reform to revive Local Councils. First, the Government is anyway committed by its agreement with the IMF to introduce a meaningful property tax by 2027, and is already digitising existing property tax records in preparation. Second, the Government is already acting on its commitment to the IMF to make an annual cut of 25% in the money it transfers to Local Councils. Local Councils are already feeling this and looking for other sources of revenue. Third, there is now available globally the open-source digital technology needed to radically simplify the processes of valuing and revaluing buildings for property tax, and to slash the time required and the cost. As explained in a recent research publication from Verite, it would be quite possible to import this technology into Sri Lanka and adapt it to local needs.

In the rather colourless world of taxation, the planets rarely align so positively. And there is a final bonus: property taxes are one of the most equitable ways of raising Government revenue. People with more income and wealth live in larger houses and own more property. Let us tax them in proportion to the value of their properties, but exempt the poorest half of the population, whose houses anyway have such low values that their property tax assessments are not worth collecting.

From left: CSE Chief Regulatory Officer Nilupa Perera, InsureMe Chief Operating Officer Duneeka Prashanthi, Director Niranjan Manickam, Co-Founder and Director Indika Premathunga, IRCSL Director General Damayanthi Fernando, InsureMe Co-Founder and CEO Vipula Dharmapala, CSE CEO Rajeeva Bandaranaike, InsureMe Chairman Prajeeth Balasubramaniam, Atarah Capital Managing Director Rohan Senewiratne, InsureMe Non-Executive Independent Director Randeewa Malalasooriya, and Dialog Finance Chairperson and Dialog Axiata Group Chief Digital Services Officer Renuka Fernando

InsureMe, Sri Lanka’s pioneering digital insurance aggregator and one of the country’s top insurance intermediaries, was listed on the Colombo Stock Exchange (CSE) yesterday marking a new chapter in its growth journey as the nation’s first insurance intermediary to go public.

Founded in 2016 and licensed by the Insurance Regulatory Commission of Sri Lanka (IRCSL), InsureMe has transformed the way individuals and institutions purchase and claim insurance by introducing a transparent, technology-driven digital platform. Its listing underscores the company’s strong market position, proven track record of innovation, unwavering commitment to transparency and good governance, and its mission to expand the accessibility of insurance across Sri Lanka and beyond.

Over the years, InsureMe has built an ecosystem that connects customers with leading insurers, simplifying how insurance is searched, compared, purchased, and managed. The company also provides advanced InsurTech solutions to insurers and corporates through its technology arm, DIGIS, which recently marked its international debut in Singapore through a partnership with AJAX International – Singapore.

Through its end-to-end digital platforms and customer-centric approach, InsureMe has become a catalyst for digital transformation within Sri Lanka’s insurance sector, advancing the industry’s mission to ‘Make Insurance Easy for Everyone’, which remains the company’s core vision. The listing on the CSE is expected to further strengthen InsureMe’s growth trajectory, enhance its governance framework, build greater confidence among customers and investors, and accelerate its product and market expansion initiatives.

In addition to providing direct insurance solutions and InsurTech platforms to both individual and corporate clients, InsureMe is also among the few insurance intermediaries in Sri Lanka licensed by the Insurance Regulatory Commission of Sri Lanka (IRCSL) to operate as a Reinsurance Broker. This reflects the company’s strong technical expertise in the insurance domain, reinforced by a senior leadership team with over 150 years of combined experience in the insurance industry, both locally and internationally.

InsureMe Chairman Prajeeth Balasubramaniam said: ‘Today marks a milestone not just for InsureMe, but for the dreamers and innovators of Sri Lanka, those who dare to imagine and build a brighter future. It is a celebration of vision, unwavering resilience, and unstoppable growth by a startup less than 10 years old. Gratitude goes to the passionate leadership, dedicated employees, and all other stakeholders who made this moment possible. To our new investors, your trust and belief today will fuel tomorrow’s breakthroughs.’

Co-Founder and CEO Vipula Dharmapala said: ‘The company’s listing on the Colombo Stock Exchange is a defining milestone for InsureMe and the wider InsurTech ecosystem in Sri Lanka. It reflects not only our financial and operational maturity but also our belief that innovation and transparency can redefine public trust in the insurance industry. This step allows us to bring our vision, making insurance easy for everyone, to a broader audience of investors and stakeholders.’

InsureMe’s listing on the CSE positions it among Sri Lanka’s few homegrown, digital-first companies to enter the public market. This milestone not only underscores the company’s technological leadership and industry credibility but also reinforces investor confidence in the country’s rapidly expanding tech and digital services sector.