Category: Daily Financial Times

President Anura Kumara Disanayake, yesterday met with Nippon Foundation Founding Chairman Yohei Sasakawa at the Imperial Hotel in Tokyo.

The discussion focused on further strengthening the long-standing friendship between Japan and Sri Lanka, the President’s Media Division said.

Sasakawa reiterated his commitment to enhancing livelihoods in Sri Lanka and outlined future plans for the renovation and modernisation of 100 schools in the Northern and Eastern Provinces.

President Disanayake conveyed his gratitude to Sasakawa for his dedicated efforts to advance the development and well-being of the Sri Lankan people and for his longstanding commitment to social service in Sri Lanka.

Sri Lanka could face additional debt service payments of between $ 150 million and $ 270 million a year from 2028 if its economy grows faster than projected, according to the IMF. Payments would continue until 2038 and are capped at around $ 250 million annually.

‘In the case of Sri Lanka, the one-time adjustment nature of the macro-linked bonds presents risks to Sri Lanka as higher payments after 2028, once triggered, would persist even if economic performance were to deteriorate thereafter,’ the IMF said in September 2025 working paper titled ‘Sri Lanka’s Sovereign

Debt Restructuring: Lessons from Complex Processes’.

The extra payments depend on GDP outcomes between 2025 and 2027.

‘Scenarios 1, 2, and 3 are triggered if dollar GDP in 2025-27 exceeds $ 107 billion, $ 99 billion and $ 94 billion, and 2024-27 cumulative real growth exceeds 11.5%,’ the report explained.

Once these thresholds are met, higher payments become permanent for a decade regardless of what happens to growth later.

The IMF noted that State-contingent debt treatments helped address concerns about macroeconomic uncertainties, but designing them prudently was important.

These instruments, known as State-Contingent Debt Instruments (SCDIs), link a country’s payments to its economic performance.

They have been used in Argentina, Greece and Ukraine to bridge differences between debtors and creditors by allowing creditors to trade lower upfront recovery for potential higher future payments.

In Sri Lanka, however, SCDIs constituted a core part of creditors’ recovery and prolonged the negotiations due to their complexity.

‘They can introduce political complications in the future in case higher payments are triggered but are not socially accepted’ the Staff Report said.

While the Fund does not get involved in the details of the instruments’ design in specific cases (this is an issue for the authorities, their creditors, and respective legal and financial advisers), the Fund needs to assess the impact of these instruments on program goals, i.e., the restoration of macroeconomic and debt sustainability,’ it added.

The IMF does not design these instruments itself but stressed it must evaluate their impact on debt sustainability.

This includes assessing whether the extra payments make it more likely that debt targets are breached, whether different groups of creditors are treated fairly, and whether design risks such as uncapped exposures or poorly chosen triggers could undermine repayment capacity.

The Fund explained that these assessments involve ‘complex modelling under the SRDSF framework, which informs the extent to which upside risks can be shared with creditors without compromising debt sustainability.’

The SRDSF, or Sovereign Risk and Debt Sustainability Framework, uses fan charts based on past economic data to simulate thousands of possible outcomes for debt and financing needs.

The IMF then tests whether adding the SCDIs would increase the probability of crossing debt safety thresholds, worsen debt in bad economic scenarios, or create excessive risks in extreme cases.

According to the IMF, Sri Lanka’s arrangement met these conditions. The probability of breaching debt-to-GDP and gross financing needs targets was within acceptable limits.

In scenarios where financing needs were already too high, the SCDIs did not make them worse compared to standard bonds.

The report also noted that ‘the 90th percentile contributions to average GFNs were below 0.4% of GDP,’ meaning even in the most adverse 10% of outcomes, the additional burden was still relatively small. Payments were also capped at $ 250 million per year.

Even so, the Fund cautioned that ‘some risks remain as no methodology can perfectly capture such complex uncertainties.’

Sri Lanka took a significant step forward in advancing the conversation on responsible business practices with the convening of the high-level roundtable on living wage, held on 24 September 2025 at Galle Face Hotel, Colombo.

Organised by the UN Global Compact Network Sri Lanka (Network Sri Lanka) in collaboration with the International Labour Organisation (ILO Sri Lanka), the event was hosted as A. Baur and Co.’s nationally significant event in its role as patron of the Business and Human Rights Working Group of Network Sri Lanka.

Taking place against the backdrop of the ILO’s High-Level Regional Dialogue on ‘Shaping the Living Wage Agenda in Asia and the Pacific’ in Colombo, the roundtable brought together C-Suite executives and senior business leaders from across Sri Lanka for a closed-door dialogue on the future of living wage in the corporate landscape. The session created a space to exchange ideas, reflections, and perspectives on one of the most pressing challenges for sustainable business and social equity.

Global-local dialogue

The keynote address was delivered by International Organisation of Employers (IOE)Director of Policy – Industrial Relations and ILO Coordination Luis Rodrigo Morales-Velez, who spotlighted the global significance of operationalising living wage frameworks while highlighting the critical role of the private sector in advancing fair and equitable work conditions, while stressing that this effort must go hand in hand with Government responsibility to provide an enabling environment through sound labour market policies, effective regulation, and support for enterprise development. His remarks set the tone for the discussions that followed, bridging global labour standards with the Sri Lankan corporate context.

The roundtable was also joined by ILO specialists Anoop Satpathy, Wage Specialist, Nicolas Maitre, Economist and Ravi Peiris, Senior Employer Specialist who presented key elements of the ILO conclusions on Wage Policies including living wages and contributed to the discussion relating to its advancement of living wages in the context of Sri Lanka. It was mentioned that there is no ‘one size fits all’ approach in aspiring towards this objective. Sri Lanka can take note of their current practices in collective bargaining and wage and benefit fixation and move towards promoting ‘living incomes’ which will also include wages along with other benefits that support workers’ living standards.

The roundtable was further framed within the context of the ILO’s regional deliberations on decent work and labour standards, spotlighting the global importance of fair and equitable wage practices. At the same time, it was designed to capture the Sri Lankan perspective, reflecting on the country’s evolving economic conditions, workforce realities, and the growing recognition that the private sector has a pivotal role to play in creating a more just and inclusive economy. For Network Sri Lanka, convening this dialogue marked a milestone in advancing the Ten Principles of the UN Global Compact, particularly those related to human rights, labour, and equality. It also aligned with the UN Global Compact’s Forward Faster initiative, which calls on businesses worldwide to accelerate progress toward the Sustainable Development Goals (SDGs) by 2030, including ensuring that all employees earn a living wage.

Significance of living wage

A living wage goes beyond statutory minimum requirements, ensuring that workers and their families can afford a decent standard of living. This includes access to housing, food, healthcare, education, and the ability to participate meaningfully in society. With rising costs of living and increasing demands on workers across industries, the Living Wage conversation has become a central pillar of global sustainability and human rights frameworks.

By situating the roundtable at the intersection of business imperatives and social responsibility, the meeting highlighted the strategic and ethical importance of embedding living wage principles in corporate strategies. For Sri Lankan companies, this approach not only supports workforce wellbeing and retention but also contributes to supply chain resilience, competitiveness, and long-term sustainable growth.

Hosting as nationally significant event

The event was hosted as A. Baur and Co.’s nationally significant event, reflecting the company’s leadership and commitment to responsible business practices. As Patron of the Business and Human Rights Working Group of Network Sri Lanka, A. Baur and Co. continues to play a catalytic role in advancing conversations that bridge corporate responsibility with national development priorities.

Platform for responsible leadership

By design, the roundtable encouraged peer-level exchange and reflection, with the understanding that business leaders play a decisive role in shaping workplace policies, influencing supply chains, and setting the tone for responsible business conduct. The participation of the ILO and Network Sri Lanka provided additional context and expertise, ensuring that the dialogue was grounded in both global frameworks and local realities.

Advancing forward faster

The roundtable is part of Network Sri Lanka’s broader efforts to support companies in contributing meaningfully to the 2030 Agenda for Sustainable Development. Through its Working Groups, leadership dialogues, and collaborative initiatives, Network Sri Lanka is enabling the private sector to take measurable steps on issues ranging from human rights and labour to climate action, supply chains, and gender equality.

John Keells CG Auto (JKCG) yesterday issued a further update to its customers and stakeholders on the ongoing proceedings before the Court of Appeal regarding certain consignments of BYD vehicles detained by Sri Lanka Customs and other related developments.

The company’s full statement reads as follows:

While we have sought interim relief from the Courts to obtain the release of our electric vehicles (EV), we continue to engage with the Sri Lanka Customs to clear shipments of the remaining vehicles which continue to be unjustly detained.

In the meanwhile, as reported in the media, Sri Lanka Customs has appointed a Committee of its own accord. It is our understanding that this Committee is expected to consider some technical matters belatedly raised by Sri Lanka Customs. We have consistently maintained, and indicated, our willingness to subject the select vehicle models to testing at an independent, internationally accredited motor laboratory which will help ascertain and clear any concerns regarding the output of the motor capacity of the vehicles. This will ensure accuracy, credibility and consistency, and we have already intimated this suggestion to Sri Lanka Customs, during and outside of Court proceedings. We have, in the spirit of co-operation, provided all the necessary information received by us from the Manufacturer to that Committee, and we intend to continue to do so. We remain mindful of the need for the Committee’s deliberations to be conducted with impartiality and transparency, which we consider essential to maintaining a cooperative and fair engagement, notwithstanding our position that its findings are not binding given our position that independent test verification is the clearest manner to resolve any uncertainty. In any event, the globally accepted norm is to rely on the Manufacturer’s Certificate for vehicle clearance which has not been applied to BYD electric vehicles.

While we continue to engage with the authorities, the resolution of this matter taking longer than expected has resulted in our inability to commit to a confirmed delivery timeline for our electric vehicle (EV) models, at this moment. This has necessitated us to offer alternate options to our valued customers who have placed their trust in JKCG and have been patient, and understanding, having appreciated the extenuating circumstances. We have directly contacted all affected customers and continue to engage with them. Customers who made bookings for EVs prior to 11 September 2025 have been offered three options to: (1) switch to a BYD SEALION 5 with a special discount; (2) receive a refund with interest (if confirmed by 10 October 2025); or (3) retain their original booking until Customs determination or litigation proceedings are completed.

We wish to clarify that customers can still place orders for EVs, subject to the uncertain outcome of delivery based on our engagement with the authorities. Considering the uncertainty of delivery and so as to not burden our customers, we will not require payment advances for Electric Vehicle (EV) bookings at this juncture.

We wish to assure our customers that all importation and deliveries of BYD Plug-in Hybrid Electric Vehicles (PHEVs) remain unaffected and will continue as scheduled. We further wish to reiterate and assure our existing valued EV and Plug-in Hybrid customers, that warranties, spare parts, and related services remain fully supported by BYD and JKCG.

As we believe that a fair and level playing field for all vehicle importers is essential to achieving the broader vision of rapid transition to sustainable mobility in the country, JKCG will continue its investments in charging infrastructure, expansion of our showroom network, after-sales service and capacity building. The recently opened showroom in Moratuwa and our new service facility with the new Wattala Service Centre demonstrates our commitment to support the continued growth of the EV footprint in Sri Lanka.

As stated previously, we have extended our full cooperation to all relevant authorities and provided the manufacturer’s specifications and compliance documentation, which are accepted globally, as the authorised distributor for BYD in Sri Lanka. We reiterate our commitment to compliance, and complete transparency with which we have approached this matter from the outset. We wish to thank all our stakeholders and, particularly, our customers for their loyalty, trust and continued understanding and support.

The Sri Lanka Economic and Investment Summit 2025, themed ‘Gateway to Growth: Asia’s Emerging Opportunity’, will be held on 2 and 3 December at the Shangri-La, Colombo. A key sector deep dive on day one will examine how Sri Lanka can broaden its export base and deliver sustained growth through diversification.

The session, ‘The New Age of Diversified Exports – Delivering on Diversified Export Products and Markets’, will highlight the urgency of moving beyond traditional export sectors as global demand patterns shift and resilience becomes a strategic imperative. The discussion will explore untapped opportunities in high-value industries such as cinnamon, seafood, electronics, minerals, and advanced manufacturing. It will also examine how Sri Lanka can strengthen its position in non-traditional markets through branding, standards, logistics, and strategic trade partnerships.

The keynote address will be delivered by Centre for Social and Economic Progress Visiting Senior Fellow Prof. Sanjay Kathuria. Prof. Kathuria holds a Doctorate in Economics from the University of Oxford, and has over 27 years of experience at the World Bank, and a decade at ICRIER in New Delhi. He is also the Co-Founder of the Trade Sentinel, and a Non-Resident Senior Fellow at the Institute of South Asian Studies in Singapore.

In addition to Prof. Kathuria, the panel will feature Hirdaramani Group Managing Director Ranil Pathirana, Joint Agri Products Ceylon Director/COO Chathura Abeyratne, OREL IT CEO Dr. Upendra Peiris, and Sunshine Healthcare CEO Dr. T. Sayandhan, with Verité Research Director Subhashini Abeysinghe moderating the discussion.

The Government continues to improve its fiscal performance with the overall Budget deficit for the first eight months of 2025 falling 54.88% from a year ago to Rs. 411 billion, according to the latest data released by the Central Bank of Sri Lanka (CBSL).

The overall Budget deficit in the eight months to the end of August 2024 was Rs. 911 billion.

Tax revenue for the eight months grew 31% from Rs. 2.35 trillion a year ago to Rs. 3.07 trillion, with non-tax revenue growing 8% from Rs. 209 billion to Rs. 226.2 billion.

Grants fell 17.3% to Rs. 6.7 billion, compared to Rs. 8.1 billion a year ago.

Recurrent expenditure in the eight months to end August 2025 grew at a slower pace than revenue, growing 11% from Rs. 3.04 trillion a year ago to Rs. 3.4 trillion. Capital and lending excluding repayments fell sharply by 24% from Rs. 435 billion a year ago to Rs. 331 billion.

The Government recorded a primary balance surplus of Rs. 1.27 trillion in the eight months, up 97% from Rs. 648.7 billion a year ago, with overall Budget deficit declining 55% from Rs. 911 billion a year ago to Rs. 411 billion.

CBSL data published debt figures for the first six months of 2025.

Total outstanding Government debt was up 3% from Rs. 28.7 trillion a year ago to Rs. 29.6 trillion, with outstanding foreign debt growing 3.8% from Rs. 10.4 trillion to Rs. 10.8 trillion.

Total domestic Government debt in the seven months grew 2.7% from Rs. 18.3 trillion a year ago to Rs. 18.8 trillion.

Outstanding Treasury Bills fell 3.4% from Rs. 4.1 trillion a year ago to Rs. 3.9 trillion with Bonds up 6% from Rs. 14 trillion a year ago to Rs. 14.9 trillion.

An eight-member team from Ceylinco Life recently attended a five-day training program in Kuala Lumpur, Malaysia, on the theme ‘Lead Forward’. The program focused on Agency Management and provided insights into building stronger, future-ready sales teams.

Training sessions covered a wide spectrum of topics including profitable agency management, dynamic agency building through effective systems, gearing up for affluent markets, creating leaders within agencies, the growing importance of adaptive tech-savvy leadership, and cultivating the Million Dollar Round Table (MDRT) mindset.

The sessions were conducted by eight accomplished Group Sales Managers from Great Eastern Life Insurance in Malaysia and Singapore, led by industry veteran K. Haridas. The program also included office visits to high-performing Group Sales Managers of Great Eastern Life and MCIS Life Insurance Malaysia, where the participants experienced first-hand how successful agencies are run in the region.

This initiative reflects Ceylinco Life’s continuing commitment to enhancing the professional skills and leadership capacity of its team to better serve policyholders, the company said.

The International Chamber of Commerce Sri Lanka (ICCSL) has urged the Government to adopt reforms to strengthen awareness and compliance under the Taxpayer Charter.

In a policy paper handed to the Department of Fiscal Policy, the ICCSL set out proposals to close gaps in taxpayer knowledge and trust identified through a national survey.

Key recommendations include comprehensive education programs using digital platforms, community outreach and workshops, as well as tailored communication frameworks that simplify tax obligations for the public while offering detailed guidance for professionals.

The paper also calls for stronger data privacy protections, including cybersecurity measures, and the establishment of a Charter Monitoring Unit within the Inland Revenue Department to evaluate communication tools, feedback mechanisms and revisions of the Charter.

ICCSL Chairman Shanil Fernando said: ‘This paper reflects the collective voice of taxpayers and the need for greater clarity, balance, and trust in our tax system.’ He added that the chamber remains committed to further research on effective tax practices to support Sri Lanka’s economic growth.

Accepting the paper, Department of Fiscal Policy Director General Dr. Kapila Senanayake said: ‘These are timely, practical, and necessary reforms that deserve immediate attention.’ He added that several recommendations would be seriously considered for inclusion in the upcoming budget.

Justice delayed has not only compounded victims’ suffering but has also damaged institutional credibility

Purpose

To analyse the justice delays and inconsistencies following the 2019 Easter Sunday attacks, and to propose policy measures to strengthen the rule of law, enhance prosecutorial and judicial independence, and restore public trust in Sri Lanka’s criminal justice system.

Background

The Easter Sunday terrorist attacks in April 2019 killed over 260 people and injured hundreds.

Despite extensive investigations, justice for victims remains delayed.

Inconsistencies in prosecutorial decisions by the Attorney General’s Department, coupled with judicial delays, have raised questions about political interference, institutional weakness, and erosion of public trust.

This case has become a litmus test for the credibility of Sri Lanka’s criminal justice system.

1. Rule of law under strain

Justice must be equal, timely, and free from political influence.

Prolonged delays have weakened the principle of equality before the law.

2. Law enforcement challenges

Investigations identified key suspects, but allegations of selective targeting and poor evidence management persist.

Coordination gaps between police and prosecution undermine case strength.

3. Attorney General’s Department

The AG’s independence is questioned due to inconsistent decisions on suspects.

Lack of transparency in prosecutorial choices fuels public suspicion.

4. Judiciary and delayed justice

Courts have been slow to adjudicate, compounding victims’ frustration.

Perception of judicial reluctance in politically sensitive cases undermines independence.

5. Erosion of public trust

Survivors and families perceive justice as politicised and stagnant.

Declining trust risks weakening social cohesion and democratic legitimacy.

Policy recommendations

1. Fast-track mechanisms for high-impact cases

Establish special terrorism and complex crimes courts with statutory timelines.

Ensure judges and prosecutors receive specialised training.

2. Strengthening law enforcement capacity

Develop specialised terrorism case units within police.

Enhance forensic and digital investigation capabilities.

Introduce independent oversight mechanisms for sensitive investigations.

3. Reforming the Attorney General’s Department

Introduce an independent appointments and oversight process for senior AG officials.

Mandate annual public reporting of prosecutorial decisions for transparency.

Strengthen constitutional guarantees of prosecutorial independence.

4. Judicial efficiency and independence

Establish dedicated benches for terrorism and organised crime.

Implement case management systems to reduce delays.

Ensure judicial performance monitoring with accountability for excessive delay.

5. Restoring public confidence

Create a Truth and Accountability Commission to complement criminal trials.

Provide regular public updates on case progress.

Strengthen victim-centred justice measures: legal aid, psychological support, and participation rights in proceedings.

Reform is urgent

A fast, fair, and transparent justice process is essential to uphold the rule of law.

Independent institutions are the cornerstone of democratic stability.

Restoring public trust requires visible accountability and victim-centred justice.

Conclusion

The Easter Sunday case demonstrates a critical breakdown in the alignment of law enforcement, prosecution, and judiciary. Justice delayed has not only compounded victims’ suffering but has also damaged institutional credibility. Reform is urgent: a fast, fair, and transparent justice process is essential to uphold the rule of law, restore public trust, and ensure democratic stability. Failure to act decisively will leave the Easter Sunday tragedy remembered not only as an act of terror but as a failure of justice in Sri Lanka

(The writer is a Senior Law Enforcement and Intelligence Specialist, former Head of Counter-Terrorism – State Intelligence Service, First Secretary (Defence), Embassy of Sri Lanka in Thailand, and present member of the Sri Lanka Waqfs Board.)

Pan Asia Bank has partnered with Senok Trade Combine Ltd., a diversified conglomerate with business interests across automobiles, construction, renewable energy, and trading. This collaboration marks a significant milestone in aligning financial services with industry leadership to deliver greater value to Sri Lankan businesses and consumers alike.

Through this partnership, Pan Asia Bank will extend its financial expertise to complement Senok’s extensive operations, creating new opportunities for growth across multiple sectors. Customers of Senok will gain access to specially designed financing packages, including flexible leasing options, trade finance solutions, and tailor-made credit facilities that will make it easier to invest in vehicles, equipment, and other business needs. The partnership is particularly significant for the automobile and construction sectors, where Senok has long held a leadership position, as it allows Pan Asia Bank to provide innovative banking solutions that directly support sectoral growth.

A key highlight of this collaboration is the opportunity for customers to experience some of Senok’s flagship automobiles, including the Haval Jolion, a state-of-the-art SUV; the View CS2, and the Tunland G7. With Pan Asia Bank’s innovative leasing solutions, these vehicles are now more accessible, empowering customers to drive their aspirations forward.

Pan Asia Bank Director/CEO Naleen Edirisinghe emphasised the bank’s vision for meaningful partnerships: ‘At Pan Asia Bank, we believe in forging alliances that go beyond conventional business ties. This partnership with Senok brings together financial innovation and industry expertise in a way that empowers businesses, fuels customer aspirations, and contributes to national economic growth.’

The MoU between Pan Asia Bank and Senok Trade Combine is not just a formal agreement, but a strategic step towards fostering long-term growth, innovation, and sustainability across industries. Together, the two organisations are well-positioned to support business expansion, generate employment opportunities, and create shared value for communities and stakeholders across the country.