Category: Daily Financial Times

Over the past five decades, Hayleys Agriculture Holdings Ltd., has transformed from an agrochemical manufacturer into one of Sri Lanka’s most diversified and integrated agricultural companies.

Today, its portfolio spans value-added food exports, coconut-based products, hybrid flower seeds, tissue culture plants, agri-inputs and agricultural technologies. Its latest corporate campaign, ‘Where Value Blossoms’ reflects this evolution and serves as a strategic brand-building platform that defines what Hayleys Agriculture stands for: value creation, innovation, sustainability, inclusivity and long-term partnership across the agricultural ecosystem. The new branding strengthens the company’s corporate identity while reinforcing its ambition to be recognised as a purpose-driven enterprise shaping the future of sustainable, value-added agriculture from Sri Lanka to the world.

The campaign is supported by a portfolio of businesses that have established leadership positions. HJS Condiments is Sri Lanka’s largest processed fruit and vegetable exporter, accounting for nearly 60% of the country’s exports in the category. CocoLife by Hayleys supplies premium coconut kernel-based products to international markets, while Quality Seed Co., a venture established by Hayleys Agriculture in 1980, remains the country’s only exporter of F1 hybrid flower seeds. Hayleys Agro Biotech has also established itself as the country’s leading exporter of tissue culture plants. Beyond Sri Lanka, Hayleys Agriculture has successfully expanded its footprint through Haychem Bangladesh, its wholly owned subsidiary, reinforcing its position as an agricultural enterprise with global ambitions.

Innovation has long been central to its growth strategy and key pillar of its corporate brand identity, positioning it as a forward-looking partner in the modernisation of Sri Lankan agriculture. In 2004, Hayleys Agriculture introduced mechanised harvesting solutions through the Agrotech Harvester, followed by the Kubota Harvester in 2010 to address growing labour challenges while advancing agricultural modernisation. The company has driven the adoption of micro-irrigation and pivot systems, enabling farmers to optimise water use and improve yields. More recently, the introduction of the OMNIX digital platform has enhanced farmer procurement, cultivation planning, traceability and supply chain coordination. Investments in AI-driven automation, precision farming and digital agriculture further reinforce its commitment to long-term productivity, operational excellence and future-ready agriculture. The company’s operations are further supported by internationally recognised certifications, including FSSC, BRCGS, HACCP, SMETA SEDEX, and USDA Organic.

Sustainability remains a fundamental component of Hayleys Agriculture’s business strategy and an increasingly important driver of its corporate reputation. Currently, 27% of the company’s total water requirements are sourced through sustainable channels, including rainwater harvesting and recycled water systems. Quality Seed Co. operates Sri Lanka’s largest rainwater harvesting facility, with a storage capacity of 7.6 million litres that can meet up to 35% of its annual water demand. A range of environmentally responsible practices, including steam-based growing media sterilisation, renewable energy adoption, wastewater recycling, integrated pest management, climate-smart agriculture and micro-irrigation technologies have also been implemented.

Creating shared value

Beyond commercial success, Hayleys Agriculture’s growth model emphasises inclusive economic participation. Women represent more than 80% of the workforce at Quality Seed Co. and Hayleys Agro Biotech; while approximately 30% of the company’s outgrower network comprises women farmers.

An outgrower network of more than 12,500 farmers further strengthens supply chain resilience while creating sustainable livelihood opportunities across rural communities. This people-centred approach demonstrates that the company’s growth is linked to empowering people, uplifting communities and supporting the future of Sri Lankan agriculture.

Hayleys Agriculture’s new ‘Where Value Blossoms’ campaign strengthens Sri Lanka’s agricultural brand on the global stage by showing how local capability can be transformed into world-class, value-added agricultural products, services, technologies and successful overseas ventures.

The Central Bank of Sri Lanka’s (CBSL) Financial Intelligence Unit (FIU) repeatedly warned successive Governments from 2021 that advance import payments were being used for trade-based money laundering, years before investigations uncovered hundreds of millions of dollars remitted overseas for imports that never arrived, Parliament’s Committee on Public Finance (CoPF) heard this week.

FIU officials told the Committee that strategic analysis undertaken in 2021 identified trade-based money laundering as one of Sri Lanka’s highest financial crime risks. The finding was escalated through a series of communications to the Finance Ministry, Presidency, and CBSL’s Monetary Board, while banks were instructed to strengthen monitoring of advance payment transactions.

The disclosures came after the Criminal Investigation Department (CID) told the CoPF it had identified approximately $ 715 million transferred overseas through fraudulent import transactions between 2023 and 2026, with investigators linking part of the network to international money laundering and drug trafficking operations.

FIU officials said the Unit’s core mandate was to generate actionable financial intelligence through operational analysis of money trails and strategic assessments of emerging risks. Between February and June 2021, it repeatedly warned that advance payment telegraphic transfers (TTs) presented a growing money laundering risk and urged greater law enforcement attention.

Officials said the then CBSL Governor had written to the Treasury Secretary and Presidential Secretary on the issue, while members of the Monetary Board had also raised the matter directly with the then President.

Trade-based money laundering was subsequently identified as a key national threat in both the 2021/22 and 2024/25 National Risk Assessments.

The FIU also participated in an Asian Development Bank (ADB)-led regional initiative on trade-based money laundering involving several countries, including Bangladesh, Nepal, Indonesia, New Zealand, and Pakistan. As part of that program, workshops were conducted with Sri Lanka Customs and Treasury officials, while banks were required to submit suspicious transaction reports relating specifically to advance payment remittances.

Officials said intelligence compiled from those reports up to May 2024 had been shared with Sri Lanka Customs and Sri Lanka Police and updated regularly thereafter.

“We believe much of what investigators have uncovered today stems from intelligence generated through those reports,” FIU officials told the Committee.

Officials stressed that advance payments themselves were not unlawful, as they were processed within the legal foreign exchange framework. Criminal liability arose only where investigations established fraudulent documentation, deliberate collusion involving bank officials, or links to criminal proceeds.

They said that information was provided by law enforcement, it would enable the CBSL to carry out targeted examinations of bank branches where regulatory breaches were suspected.

Sri Lanka Customs officials said they had only been able to examine transactions dating back to 2023 because limitations in its digital systems prevented investigators from tracing historical records further.

However, they said there were grounds to suspect that the abuse of advance import payments may have begun much earlier, following the enactment of the Foreign Exchange Act in 2017, which decriminalised foreign exchange offences and replaced the previous enforcement regime with a predominantly civil framework.

The officials also pointed to the widespread use of shell companies in the ongoing investigations, arguing that the new beneficial ownership requirements introduced under amendments to company law would make it more difficult to conceal the individuals behind corporate entities.

From 30 September, companies will be required to disclose verified beneficial ownership information, including personal identification details certified by company secretaries, with criminal penalties applying for false declarations.

Officials said investigators frequently encountered companies whose legal owners could not be traced, complicating criminal investigations.

They warned that if Sri Lanka acquired a reputation as a jurisdiction where shell companies could be established with untraceable ownership, it could face adverse findings during future Financial Action Task Force (FATF) assessments of its anti-money laundering and counter-terrorist financing (AML/CFT) framework.

The Committee also heard that the Government has introduced additional safeguards requiring importers to make advance payments to register with Sri Lanka Customs as eligible importers, while banks are now required to collect and submit additional information before processing such transactions.

However, officials said compliance remained incomplete. Despite the new reporting requirements, some banks continued to process advance payment transactions without providing mandatory Tax Identification Number (TIN) information.

Officials acknowledged that coordination among enforcement agencies had historically been weak but said cooperation had improved over the past year. A National Coordinating Committee comprising 22 agencies is to be established to strengthen intelligence sharing and enforcement, while an existing working group already brings together the CBSL, FIU, Sri Lanka Customs, Sri Lanka Police, and other agencies.

Officials also said the proposed National Digital Identity program would strengthen customer identification and financial crime investigations.

CoPF Chairman MP Dr. Harsha de Silva thanked FIU officials for their presentation, saying their observations were consistent with the Committee’s own findings.

In a statement issued after the meeting, Dr. de Silva said the Committee had found multiple failures across banks, Sri Lanka Customs, and the Department of Import and Export Control in reconciling outward remittances with corresponding imports.

“The most disappointing finding was that reporting requirements on outward remittances by both State and private banks were not being strictly adhered to. That is precisely the gap fraudsters exploited,” he said.

Dr. de Silva said the Committee had approved amendments requiring importers to register with Customs before undertaking advance payment transactions but stressed that stronger enforcement, rather than additional regulation, remained the priority.

“The answer to poor enforcement is not to burden bona fide importers with more regulation. It is to implement the regulations we already have, so that rogues are caught,” he said.

The Committee has directed the establishment of a multi-agency group to submit a comprehensive report within two months.

Leaders of Sri Lanka’s main Opposition political parties yesterday closed ranks against the Government’s proposal to increase the retirement age of judges, warning that the move could undermine judicial independence and pledging to mount a coordinated campaign both inside and outside Parliament.

The meeting, convened by Opposition Leader Sajith Premadasa at his office, brought together not only party leaders but also a broad spectrum of opposition figures, including MPs and former MPs.

The discussions focused on formulating a common opposition position against the Government’s proposal to extend the retirement age of judges, a move opposition parties claim could have implications for the independence of the judiciary.

Addressing the gathering, Premadasa alleged that attempts by Governments to interfere with judicial independence had historically ended in political upheaval.

Claiming the current administration of President Anura Kumara Dissanayake was attempting to undermine the judiciary, he called on all opposition parties, regardless of political differences, to unite in defence of democracy and the sovereignty of the people.

“Whatever the differences between our parties, we must come together for the common purpose of protecting democracy and safeguarding the independence of the judiciary,” Premadasa said.

Former President Ranil Wickremesinghe said the issue had united political parties across the opposition and had also drawn support from lawyers and members of the Buddhist clergy.

He noted that a conference of Buddhist monks had been convened for next Monday, while lawyers were scheduled to meet on Wednesday to discuss the matter.

Agreeing with the Justice Minister regarding the delay in hearing court cases, Wickremesinghe proposed that Parliament appoint a special select committee to address the country’s backlog of around 1.1 million pending cases.

He said judicial delays would not be resolved simply by extending the tenure of serving judges.

He also claimed the Government’s actions had brought together opposition parties, legal professionals and other groups that had not previously acted collectively.

“This is only the beginning,” Wickremesinghe said, expressing confidence that opposition cooperation would continue to expand.

SLPP National Organiser Namal Rajapaksa said constitutional amendments designed to benefit individuals had previously been rejected by the public and argued that extending the retirement age of judges would not resolve delays in hearing cases.

He questioned the rationale behind the proposal, saying practical reforms, rather than extending the tenure of office holders, were needed to improve the administration of justice.

SLPP member Prof. G.L. Peiris, who briefed party leaders on the activities of the joint opposition, said the alliance had successfully generated public awareness on key national issues, including the economy, elections and the judiciary.

He said the joint opposition alliance had already held five public rallies in Kosgama, Ja-Ela, Kandy, Matara and Kurunegala, while also engaging with foreign diplomats, senior Buddhist clergy and the United Nations.

Prof. Peiris said the next phase of the campaign would focus on expanding activities to the grassroots, including programs targeting trade unions, youth and women at the constituency level.

United Republic Front leader Patali Champika Ranawaka alleged that the Government was attempting to use its political authority to exert control over the judiciary and claimed judges had also faced threats.

National Freedom Front leader Wimal Weerawansa said the Government’s actions had compelled opposition parties to unite despite their political differences.

Tamil National People’s Front leader Gajendrakumar Ponnambalam said the issue should be taken directly to the public, with party leaders agreeing to intensify opposition to the proposal both within Parliament and through public mobilisation.

Among those present were former Prime Minister Dinesh Gunawardena, SLFP Chairman Nimal Siripala de Silva, Sri Lanka Muslim Congress Leader Rauff Hakeem, SJB General Secretary Ranjith Madduma Bandara, Sarvajana Balaya Leader Dilith Jayaweera, Democratic People’s Front Leader Mano Ganesan, Ceylon Workers’ Congress Leader Jeevan Thondaman, National Workers’ Union Leader Palani Digambaram and Pivithuru Hela Urumaya Leader Udaya Gammanpila. In addition, MPs Kabir Hashim, Dayasiri Jayasekara and Chamara Sampath Dasanayake, as well as former Minister Tiran Alles, were also present.

The Credit Information Bureau of Sri Lanka (CRIB) recently hosted its Annual CEOs Forum and Institutional Rating Awards 2026 under the theme “Credit Intelligence for National Progress.”

Central Bank of Sri Lanka Governor Dr. Nandalal Weerasinghe was the Chief Guest.

The forum was attended by Chief Executive Officers and senior leadership from across the financial services industry and other sectors-including banks, non-banking financial institutions (NBFIs), insurance providers, telecommunications companies, and key utility service providers-to shape the future of the nation’s credit intelligence landscape.

CRIB Chairman K.G.P. Sirikumara and Director/General Manager Pushpike Jayasundera addressed the audience followed by CBSL Governor Dr. Weerasinghe and an insightful keynote address delivered by Chief Adviser to the President on Digital Economy Dr. Hans Wijayasuriya,.

Dr. Weerasinghe said: “A modern financial system depends on trust, transparency, and real-time information. Through digital transformation, AI, and alternative data, institutions like CRIB are not only overcoming information asymmetry to lower credit risks, but are actively driving financial inclusion for MSMEs, young entrepreneurs, and rural communities. As our financial sector becomes increasingly data-driven, maintaining strong governance, privacy, and responsible AI standards remains vital to safeguarding long-term financial stability.”

Sirikumara said: “As Sri Lanka’s financial landscape evolves from collateral-based lending toward sophisticated, risk-based evaluations, the future of banking stability lies in dependable, high-quality data. CRIB’s transformation into an advanced, multi-sector data platform empowers financial institutions to make timely, responsible credit decisions that ultimately drive resilient economic growth.”

A major highlight of the event was the official launch of the MyCRIB Mobile App-marking a significant milestone and a giant leap in advancing financial inclusion and credit literacy for every Sri Lankan. The app empowers citizens by providing real-time, seamless access to their personal credit profiles and scores. CRIB becomes one of the few credit bureaus globally to offer a comprehensive consumer mobile application. The app enables individuals to securely access their credit profile and credit score, raise disputes, share credit reports with third parties, receive alerts, complete identity verification, and access a learning center.

Jayasundera said: “With the launch of the MyCRIB mobile app, CRIB becomes one of the few credit bureaus globally to give consumers secure, real-time access to their credit profiles, scores, and reports. Since establishing South Asia’s first credit bureau in 1990, we have evolved from traditional reporting into a comprehensive credit intelligence platform that drives financial inclusion. Enriching our national credit data ecosystem empowers both lenders and consumers with trusted, data-driven insights that strengthen decision-making across Sri Lanka.”

In his keynote address, Wijayasuriya said: “What CRIB has done is convert and transform the word ‘risk’ into ‘trust.’ By embedding citizen experience into an interoperable digital infrastructure, we are moving away from traditional, collateral-based lending toward data- and AI-driven trust evaluation. This enables micro-SMEs and everyday citizens to connect seamlessly, transact as equals with the top of the economic pyramid, and drive the true mobilisation of Sri Lanka’s digital economy.”

In recognition of institutional excellence in data governance, data accuracy, and data quality, CRIB organises the Institutional Rating Awards to honor institutions that demonstrate outstanding compliance, exemplary data governance practices, and excellence in credit data management.

This initiative promotes a culture of data excellence across the financial sector by encouraging institutions to adopt higher standards of data quality, governance, and regulatory compliance. High-quality and reliable data are fundamental to generating accurate credit intelligence, enabling sound lending decisions, effective risk management, and greater financial stability.

The US Embassy in Sri Lanka recently launched the Coach Jim Dimick Memorial Baseball Classic, celebrating the enduring American legacy of baseball in Sri Lanka as part of the Embassy’s

Freedom 250 Baseball Series commemorating the 250th anniversary of the United States.

Chargé d’Affaires Jayne Howell joined players, coaches, alumni, and Sri Lanka Baseball/Softball Association officials at Royal College Colombo to officially launch the tournament, with Marine Security Guard Gunnery Sergeant Kyle Aparicio throwing the ceremonial first pitch.

The triangular tournament brought together Royal College Colombo, Kingswood College Kandy, and Richmond College Galle-three schools whose history is closely intertwined with the growth of American baseball in Sri Lanka. Kingswood opened with a 26-10 win over Royal College before falling 15-7 to Richmond. Richmond secured a place in the championship game with a 7-7 draw against Royal College, but Kingswood prevailed 11-6 in the final rematch to capture the Freedom 250 championship.

Chargé d’Affaires Howell

said: “As America celebrates,

250 years of independence, we are proud to celebrate one of our nation›s greatest traditions-baseball. For generations, America›s national pastime has brought communities together through teamwork, perseverance, and sportsmanship. Today, that same game continues to build friendships between Americans and Sri Lankans. We are proud that baseball, first introduced to Sri Lanka through the leadership of an American coach, continues to inspire young athletes and strengthen the ties between our two countries.”

Baseball is woven into the fabric of American life. For over 150 years, families have gathered at ballparks, children have dreamed of the major leagues, and communities have rallied around the game. Today, America›s national pastime continues to inspire young athletes around the world, connecting people through teamwork, sportsmanship, and a shared love of the game.

For four decades, the United States has supported the growth of baseball in Sri Lanka through sports diplomacy, including coaching exchanges, equipment donations, youth development, community outreach, and partnerships with the Sri Lanka Baseball/Softball Association. The Freedom 250 Baseball Series celebrates both America›s semiquincentennial and the 40th anniversary of baseball in Sri Lanka. Throughout the year, the US Embassy has partnered with Sri Lankan schools, coaches, and athletes to recognise baseball›s enduring role as a bridge between our two nations and as an example of the power of sports diplomacy to connect people across cultures.

Baseball was introduced to Sri Lanka in 1985 by James “Jim”

Dimick, a US Marine Corps veteran and National Baseball Hall of Fame coach, who traveled to Sri Lanka through a U.S. Embassy initiative to conduct the country’s

first baseball clinics. Royal College Colombo was among the four original schools where the game took root, and many of those early players remain leaders in Sri Lankan baseball today. Coach Dimick’s vision and dedication established the foundation for the sport›s continued growth, making him one of the most influential figures in Sri Lankan baseball history.

Sri Lanka were facing an uphill task of saving the second and final Under-19 Youth Test and the series when they ended Day Three on 155-4 after being set a target of 472 for victory by India at the R. Premadasa International Cricket Stadium yesterday.

They lost the wicket of Dimantha Mahavithana for a duck to the second ball of the innings and were soon three down for 38.

Senuja Wekunagoda and skipper Vimath Dinsara mounted a rescue act, adding 98 for the fourth wicket. But shortly before the close, Indian Captain Yashbardhan Chauhan broke the stand by dismissing Wekunagoda for an attractive 64 off 52 balls (9 fours). Dinsara completed his half-century before the close to remain unbeaten on 55 scored off 91 balls (8 fours).

Sri Lanka trail by 317 runs with six second innings wickets in hand going into the fourth and final day today.

Early in the day, Sri Lanka were all out for 148 in their first innings, adding 26 to their overnight total.

India batted a second time and declared at 208-3, with opener Lakshya Raichandani completing a stylish unbeaten century (116 balls, 9 fours, 1 six) and first-innings centurion Chauhan 51* off 46 balls (7 fours, 1 six). – [ST]

Scores:

India (U19) 411 and 208-3 decl. (Lakshya Raichandani 100*, Yashbardhan Chauhan 20, Manal Chauhan 51*, Kavija Gamage 2/42)

Sri Lanka (U19) 148 (o/n 122-8) (Dimantha Mahavithana 24, Viran Chamuditha 21, Dulnith Sigera 31, Sethmika Seneviratne 25*, Pranav Ragavendra 2/28, Chigurupati Venkata 2/27, Jeganathan Hemchudeshan 2/34, Rohit Yadav 2/14) and 155-4 at close (Viran Chamuditha 31, Senuja Wekunagoda 64, Vimath Dinsara 55*, Chigurupati Venkata 3/25)

Bloomfield beat Tamil Union outright by five wickets at the P. Sara Oval yesterday to qualify for a quarter-final place from Group A in the Under-23 Inter-Club 2-Day Tournament.

Joining Bloomfield for the last three quarter-final spots were Negombo CC from Group D and BRC from Group C.

Earlier, Moors SC from Group A, CCC and Chilaw Marians CC from Group B, Kurunegala YCC from Group C, and SSC from Group D had already assured themselves of a place in the quarter-finals.

Tamil Union’s batting faltered for a second time in the match, getting bowled out for 104, which left Bloomfield with the formal task of knocking off 53 for victory, which they achieved losing five wickets. Bloomfield scored 204 in their first innings, with former Sri Lanka U19 off-spinner Vihas Thewmika taking 6/67.

Negombo CC recovered from their overnight score of 117-4 in reply to Police SC’s first innings of 207 to total 283-7 declared and win on first innings at the Air Force Grounds, Katunayake. Thathsara Eshan was instrumental in Negombo CC gaining the win, scoring a defiant 95 off 159 balls (7 fours) and figuring in a vital seventh wicket stand of 69 with Kaveen Deneth (52* off 99 balls, 8 fours). Off-spinner Damith Kappagoda took 4/86.

Moors SC fell short by 30 runs to overhaul Ragama CC’s first innings of 183 despite a spirited knock of 71* off 86 balls (8 fours) from Sandaru Malshan at the Moors SC Grounds. Ragama CC in their second innings came up with a better batting display, scoring 338-8. Denura Dimansith made 137 off 184 balls (13 fours, 2 sixes) and shared a 114-run stand with Lahiru Abeysinghe (62 off 73 balls, 9 fours, 1 six). Off-spinner Sandaru Malshan took 5/89.

In the other matches concluded yesterday, CCC, SSC, Kandy Customs SC, Ace Capital CC, and United Southern SC won in the first innings.

The left-arm spin of Inuka Karannagoda (7/56) resulted in Leo CC being dismissed for 241 in reply to CCC’s first innings of 348 at the CCC Grounds. Salindu Pathirana alone stood tall, compiling a century off 108 balls (15 fours, 1 six) for Leo CC. CCC made 15-0 in their second innings when the match was called off before the start of the mandatory overs.

SSC took a first innings lead of 115, scoring 292 in reply to Panadura SC’s first innings of 177 at the SSC Grounds. SSC Captain Shevon Daniel went on to complete a fine century (121 off 144 balls, 14 fours, 2 sixes) sharing a fourth wicket stand of 156 with Ranuda Somarathne (47). Off-spinner Malintha Silva picked up five wickets for 86. Panadura SC in their second innings scored 199-9, with Liviru Fernando notching 85 (108 balls, 14 fours) and off-spinner Malsha Fernando taking 5/74 for a match bag of 12/113.

Kandy Customs SC put up a marvellous all-round batting display to overhaul Kurunegala SC’s total of 314 by scoring 339 at the Welagedara Stadium. Helith Edirisinghe led the way with a compact 87 off 114 balls (9 fours, 3 sixes) and Kaveesha Induwara scored 52 (62 balls, 7 fours, 1 six) in addition to five other batsmen making 25 or more.

Ace Capital CC came up with a similar batting display to overhaul BRC’s total of 387-6 declared at the BRC Grounds. Six batsmen made over 25 and played around Thisara Ekanayake’s knock of 143 off 173 balls (20 fours) as Ace Capital CC replied with 391-9. Off-spinner Tharushka Ashel took 4/108. Despite the loss, BRC qualified for the quarter-finals.

NCC and United Southern SC played out a thrilling draw at the NCC Grounds, with both sides in with a chance of pulling off an outright win. Chasing a target of 223, United Southern SC finished on 214-9, with NCC requiring one wicket and United Southern SC nine runs. Having already conceded first innings points on the first day, NCC tried their best to win outright by declaring at 244-7 courtesy a century – 107 off 118 balls (9 fours) – from Dineth Goonewardena, who added 142 with Yenula Dewthusa (64 off 83 balls, 8 fours), but ran out of time.

Like Badureliya CC the previous week, Nugegoda SWC went on a run splurge to no avail as their fixture against Navy SC ended in a tame draw at the Panadura esplanade. Nugegoda SWC ran up the highest total of the tournament, scoring 661-6 declared, a larger part of the runs coming off the bat of former Peterite opener Lahiru Dawatage, who went on to complete a triple century – 314 off 321 balls (36 fours, 3 sixes) – and Sandun Mendis (124* off 180 balls, 15 fours). The two shared a double-century stand of 267 for the sixth wicket. Navy SC in reply scored 149-7. – [ST]

Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe yesterday said the rapid private sector credit expansion has been broad-based across the economy rather than concentrated in a few sectors, while expressing confidence that the monetary tightening introduced in May will gradually moderate lending and demand pressures.

‘A strong credit growth has been recorded in construction, wholesale and retail trade, financial services, and consumer-related lending, reflecting the broader economic recovery,’ he said addressing the post-Monetary Policy Review media briefing.

Based on outstanding credit as of May, he said industry accounted for around 37% of total private sector credit, followed by services at 30.5%, personal loans and advances at 24%, and agriculture and fisheries at around 9%.

He noted that the June sectoral credit data will be released shortly.

Dr. Weerasinghe said the CBSL expects the strong pace of lending to ease over the coming months, as the impact of the 100-basis-point policy rate hike in May, together with other policy measures implemented by the Government and the CBSL, gradually feeds through to the real economy.

‘The monetary policy tightening in May 2026 and its gradual transmission to the real economy are expected to moderate credit growth and the buildup of demand pressures going forward,’ he said.

Private sector credit expanded by 27.8% year-on-year during the first five months of 2026, equivalent to an increase of Rs. 824 billion.

Total outstanding banking sector credit to the private sector rose to a record Rs. 11.04 trillion in May from Rs. 10.8 trillion in April, representing a 2.2% month-on-month increase (https://www.ft.lk/front-page/Private-sector-credit-rebounds-in-May–surpasses-Rs–11-t/44-794580).

Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe yesterday said the Monetary Board’s proactive decision to raise policy interest rates by 100 basis points in May is beginning to produce the intended effects, with domestic demand, import growth, and credit expansion showing early signs of moderation.

Addressing the post-Monetary Policy Review media briefing, he said the Board decided to keep policy rates unchanged this month to allow more time for the previous tightening to work its way through the economy.

‘Today, around six to seven weeks after that decision, we are beginning to see the impact of those policy measures. Together with other actions taken by the Government and the CBSL, there are encouraging signs that excess demand is moderating. In particular, both import demand and credit growth have started to slow,’ he said.

The Governor recalled that the May rate hike was prompted by expectations that inflation would move towards the upper end of the CBSL’s target range following adjustments to administered prices, particularly fuel prices, amid Middle East tensions and the Government’s cost-reflective pricing policy.

At the same time, strong domestic demand and rapid private sector credit growth had fuelled import demand beyond the CBSL’s earlier projections, prompting a pre-emptive policy response.

Dr. Weerasinghe said monetary policy operates with a lag and that the Board would continue to monitor the full impact of the previous tightening, whilst closely watching supply-side price pressures, geopolitical developments, and global oil price movements.

He noted that exchange rate stability and moderating import demand indicate that the policy measures are beginning to deliver the desired results.

‘We believe the strong policy action taken at the previous review will continue to have a greater impact over the coming months,’ he said.

The Governor said inflation could edge up over the next few months due to the pass-through of recently administered price increases, but stressed that these effects are expected to be temporary.

‘Inflation expectations remain well anchored. Once these one-off price adjustments dissipate, inflation is projected to return to our target of 5%,’ he added.

Responding to questions on the decline in official reserves during June, Dr. Weerasinghe rejected suggestions that vehicle imports alone were responsible. ‘It was not only vehicle imports. Overall import demand has been elevated across a broad range of categories,’ he explained.

He said monthly imports have remained above $ 2 billion in recent months, reflecting higher international petroleum prices, increased import volumes, and stock-building of fuel reserves. ‘Vehicle imports contributed to the increase, but represented only one component of the broader rise in imports,’ he added.

The Governor said reserve accumulation continues to receive support from multilateral financing.

Noting that Sri Lanka has already received inflows linked to the Fifth and Sixth Reviews under the International Monetary Fund (IMF)-supported program, he expects further disbursements from the Asian Development Bank (ADB) and the World Bank this month and next month.

‘These inflows, together with the CBSL’s foreign exchange purchases from the market, are expected to strengthen the country’s external buffers. According to the IMF program, gross official reserves are projected to exceed $ 8 billion by the end of 2026,’ he said.

On the June Net International Reserves (NIR) target under the IMF program, Dr. Weerasinghe said the final calculation is still being completed, but the CBSL’s preliminary assessment indicates that the target has been met.

He also noted that both the June and December reserve targets had been revised under the IMF program to reflect prevailing economic conditions.

Responding to concerns that many Sri Lankans have yet to feel the economic recovery, the Governor said macroeconomic indicators clearly demonstrate that the economy has turned around.

‘The answer is, look at the data,’ he said.

He pointed to the economy’s 5.1% growth in the first quarter of 2026, following the sharp contractions experienced during 2022 and 2023, noting that quarter-on-quarter growth has remained positive since the recovery began.

‘The data speak for themselves,’ he said, adding that indicators such as credit growth, imports, exports, and broader economic activity are consistent with the official GDP estimates published by the Department of Census and Statistics.

Acknowledging that global uncertainties could slow the pace of expansion over the coming quarters, Dr. Weerasinghe said the CBSL expects the economy to maintain a similar growth trajectory in the second quarter and continue its recovery.

The Colombo Stock Exchange (CSE), together with the Securities and Exchange Commission of Sri Lanka (SEC) has launched its ‘A Share for Everyone, A Unit for Everyone’ (Samata Kotasak, Samata Ekakayak) initiative at the investor forums in Monaragala and Batticaloa last week as part of an ongoing countrywide initiative to broaden investor participation.

The forums were held in Monaragala on 16 July at the Silanrich Hotel and in Batticaloa on 18 July at the FG Golden River Hotel. The forums attracted over 500 participants across both locations.

The ‘A Share for Everyone, A Unit for Everyone’ concept, developed by the SEC Chairman Senior Prof. D.B.P.H. Dissabandara, aims to promote a shared commitment to creating wealth and value within a fair, efficient, orderly, and transparent capital market by ensuring broad and accessible participation for all.

Under this initiative, the SEC and CSE will conduct investor forums across the country to enhance investor education and awareness, while encouraging greater investor participation beyond the Western Province. Leveraging the CSE’s nationwide presence and growing interest in the equity market, the programme will provide investors with increased access to the Sri Lankan capital market through both stockbroking firms and unit trust management companies.

The initiative will also offer forum participants the opportunity to receive investment coupons sponsored by the SEC and CSE, which can be used to support their equity investments.

The Investor Forums opened with presentations by senior economists from the Central Bank of Sri Lanka, including N. B. Janagan and Kasunka Herath, who provided a high-level overview of the country’s macroeconomic landscape.

The session also featured presentations by representatives of leading stockbroking firms, including First Capital Holdings PLC Vice President – Corporate Finance and Advisory Atchuthan Srirangan and HNB Stockbrokers Director – Sales Kapila Pathirage offering participants an overview of the capital market and its investment opportunities

Representatives from the unit trust industry conducted an introductory seminar on the operation and benefits of unit trusts. Speakers included Softlogic Asset Management Ltd., Manager- Business Development Kumudu Kekirideniya and Softlogic Asset Management Business Development Officer Mohamed Ashfer who introduced participants to the fundamentals of unit trust investing.

Both forums concluded with the highlight panel discussion and Q and A segment, which brought the diverse perspectives of the speakers and members of the SEC and CSE together to explore Sri Lankan equities. Panellists included the forums speakers as well as CSE Executive – Vice President Niroshan Wijesundere, as well as SEC Senior Manager of External Relations Sheena Goonaratna and Manager of External Relations Nimal Kumarasinghe.

During the investor forums, prospective investors were able to meet representatives from stockbroker firms and unit trusts to open accounts, with the first four-hundred participants being eligible to receive investment coupons gifted by the SEC and CSE.

The forums were conducted amidst a remarkable six-year growth in the capital market which saw the All-Share Price Index (ASPI) rise from 4,846 points in May 2020 to 22,310.80 points by the end of May 2026. This represents a growth of 360% and a compound annual growth rate (CAGR) of approximately 28.98% – with capital gains remaining tax-free.