Category: Daily Financial Times

Deputy Finance and Planning Minister Dr. Anil Jayantha Fernando yesterday said the Government will decide whether to extend its fuel subsidy and relief measures after assessing economic conditions at the end of the current three-month period, while early indications show that the recently imposed 50% surcharge on vehicle imports has successfully reduced import demand.

Addressing a special media briefing, he said the Rs. 10 billion relief package introduced by the Government was designed as a temporary response to the economic impact of the Middle East crisis and was never intended as a long-term support measure.

‘From the outset, the Government made it clear that the Rs. 10 billion relief package was introduced to address a specific external shock and its impact on the economy. Our assessment at the time was that the immediate effects would be concentrated within the first three months,’ he said.

Dr. Fernando stressed that policy responses to external shocks should be calibrated according to evolving circumstances rather than being extended automatically.

‘It would not have been prudent to assume that an external event, such as the conflict in the Middle East, would necessarily require relief measures for one year or longer. External shocks should be addressed through short-term policy responses based on available information,’ he said.

He noted that there was no immediate need to decide on an extension of the subsidy program, adding that the Government would continue monitoring developments before taking further action.

‘Therefore, there is no need to rush into a decision regarding what happens after the three-month period. We will assess developments and respond accordingly. The Government has adequate cash buffers and will continue to maintain fiscal discipline,’ Dr. Fernando said.

The Deputy Minister pointed to improving global conditions, noting that oil prices had eased considerably after the initial spike triggered by geopolitical tensions.

‘Current global developments are encouraging. Oil prices, which surged sharply during the initial stages of the crisis, have since fallen significantly and are approaching previous levels. If that trend continues, we expect to manage the situation effectively,’ he said.

However, Dr. Fernando added that the Government remained prepared to intervene if circumstances changed.

‘If circumstances require further intervention, we will provide targeted relief based on the prevailing conditions and the best available information,’ he said.

Commenting on the impact of the 50% surcharge imposed on vehicle imports, Dr. Fernando said the measure had produced the intended results by cooling excessive import demand and easing pressure on foreign exchange reserves. ‘Yes, the surcharge has had a noticeable impact,’ he said.

According to him, speculative import activity continued immediately after the surcharge was introduced, with importers rushing to open letters of credit (LCs) for vehicle purchases.

‘One day after the surcharge was imposed, the value of vehicle-related LCs reached around $ 88 million,’ he revealed.

As a result, he explained the daily foreign exchange requirements for vehicle imports rose sharply in the initial stages and has since moderated significantly.

‘By June, the average daily value had fallen to below $ 4 million. According to the latest data available up to 12 June, the figure stood at $ 3.79 million per day and continues to decline,’ he said.

Dr. Fernando said the trend demonstrated that the surcharge had been effective in discouraging panic-driven imports and helping restore more sustainable demand levels.

‘This demonstrates that the surcharge has been effective. People have realised that there was no need for panic-driven imports, and demand has begun returning to more sustainable levels,’ he said.

The Deputy Minister added that the moderation in vehicle imports had also improved the Government’s projections for annual import expenditure, easing concerns over external sector pressures and foreign exchange outflows.

Pussalla Agri Ventures has achieved a significant milestone in its organic transformation journey after being awarded EU Organic and USDA Organic certifications for its premium Ceylon cinnamon products.

The certifications were conferred recently at Control Union Sri Lanka, marking a major step forward in the company’s ambition to enter high-value international markets.

The recognition strengthens Pussalla Agri Ventures’ position as an emerging exporter of certified organic products, particularly its flagship organic Ceylon cinnamon.

The company began its structured transition to organic cinnamon cultivation several years ago, developing a fully integrated system covering cultivation, processing, and value addition. It currently manages extensive cinnamon cultivation lands under strict organic agricultural practices, ensuring compliance with global certification standards.

The EU Organic and USDA Organic certifications, issued through Control Union Sri Lanka, confirm that the company’s farming and processing systems meet stringent international requirements, including restrictions on synthetic chemicals, traceability controls, and environmental sustainability practices.

In addition to these certifications, the company is already certified under SL GAP, Food GMP, and Cosmetic GMP standards, further reinforcing its compliance with both agricultural and food safety requirements across multiple product categories.

Company representatives described the achievement as a key milestone in the Pussalla organic journey, noting that it paves the way for expanded access to premium export markets in Europe and the United States, where demand for certified organic spices continues to rise steadily alongside growing consumer preference for sustainable and traceable products.

Pussalla Agri Ventures emphasised that its organic cinnamon is sourced entirely from its own estates, ensuring full control over quality, traceability, and processing integrity. The integrated model enables cinnamon to be harvested, processed, and packed under closely monitored conditions, maintaining consistency with international organic standards.

The products include premium-grade quills, powder, and value-added cinnamon items derived from carefully managed plantations producing authentic True Ceylon Cinnamon.

Pussalla Agri Ventures’ certification places it among a growing group of Sri Lankan exporters adopting globally recognised organic systems, further strengthening the country’s reputation in high-value spice export markets.

The Colombo Fort Magistrate’s Court yesterday directed the Criminal Investigation Department’s (CID) Illegal Assets Investigation Unit to arrest former Economic Development Minister Basil Rajapaksa and produce him before court in connection with an alleged misappropriation of funds belonging to the Sri Lanka Tourism Promotion Bureau.

The order was issued by Colombo Fort Magistrate Pasan Amarasena when the case was taken up before court.

During proceedings, President’s Counsel Kalinga Indatissa, appearing for the third suspect, informed court that his client was prepared to make a confidential statement under Section 127 of the Code of Criminal Procedure.

CID officers informed court that Rs. 7.8 million allocated to the Sri Lanka Tourism Promotion Bureau in 2014 for promotional activities had allegedly been used to distribute 12,000 T-shirts during the Uva Provincial Council election campaign, resulting in a loss to the State.

The Magistrate also ordered the release on bail of the Bureau’s former Managing Director, Rumi Jaufer, who had been held in remand custody. He was released on two personal bails of Rs. 1 million each and was prohibited from travelling overseas.

Investigators informed court that charges had been filed under the Public Property Act.

The Magistrate further sought clarification on whether the Bureau’s former Finance Director, who had been named in the B Report, would also be cited as a suspect. The CID informed court that advice from the Attorney General was still pending.

The case was fixed for further hearing on 14 October.

Sri Lanka’s tea production declined in May and remained below last year’s levels during the first five months of 2026, although the output continued to outperform 2024 figures, highlighting a mixed performance for the country’s key export crop.

According to data analysed by Forbes and Walker Research, tea production in May 2026 totalled 24.91 million kilos, down by 0.52 million kilos from the 25.43 million kilos recorded in May 2025.

However, production was marginally higher than the 24.65 million kilos reported in May 2024, reflecting an increase of

0.26 million kilos.

The year-on-year (YoY) decline in May was driven by lower output from the High and Medium Grown elevations, as well as the Green Tea segment, while the Low Grown category registered an increase compared with the same month last year.

For the January-May period, cumulative tea production stood at 108.95 million kilos, a decrease of 5.11 million kilos from the 114.06 million kilos produced during the corresponding period of 2025.

The first five month’s performance indicates a broader slowdown across the industry, with all elevation categories recording negative variances against last year, with the exception of the Green Tea segment.

Despite the setback compared with 2025, the industry remains ahead of 2024 levels. Cumulative production during the first five months of 2026 exceeded the 104.80 million kilos registered in the same period of 2024 by 4.15 million kilos.

Notably, Forbes and Walker Research all elevation categories posted gains against the corresponding January-May period of 2024, suggesting that while production has softened from last year’s stronger performance, the sector continues to show improvement over longer-term output trends.

The latest figures underscore the challenges facing Sri Lanka’s tea industry in sustaining last year’s production levels, even as output remains above that achieved two years ago.

Serendib Hotels PLC has appointed Minor Hotel Group’s Wayne Williams to its Board as a Non-Executive Director.

Williams is the Chief Financial Officer of Minor Hotel Group, the hotel division of Minor International, and has over 25 years of experience working in Thailand. He has been with Minor International for nearly 20 years.

During his tenure, the hotel group has expanded from 10 hotels to more than 560 hotels across over 58 countries, generating revenue in excess of $ 5 billion last year.

Prior to his current role, Williams held senior finance positions in hotels and hospitality businesses across Thailand, Australia, and the Pacific.

His professional affiliations include serving as former President of the Australian-Thai Chamber of Commerce (Thailand), former Member of the Thailand Board of Trade, Vice President of the Australia Council of Thailand, and Board Member of the Hands Across the Water Foundation.

Williams is a Commerce graduate of the University of Queensland and a Certified Public Accountant (CPA) in Australia with over 30 years of professional experience.

The Government remains confident of achieving its 5% economic growth target this year and is working towards a medium-term objective of 7% inclusive and sustainable growth, despite concerns over rising interest rates and the pace of capital expenditure, Deputy Finance and Planning Minister Dr. Anil Jayantha Fernando said yesterday.

Addressing a special media briefing, he said the first-quarter economic growth of 5.1% was a positive indicator that the country remained on its planned economic

trajectory.

‘We remain highly positive and optimistic that Sri Lanka will continue along its planned economic trajectory.”

Our medium-term objective is to achieve inclusive and sustainable economic growth of around 7%. That does not mean we expect to reach 7% in 2026 itself; rather, it is a medium-term target,’ he said.

Dr. Fernando noted that the Government was continuing discussions with development partners, donor agencies, line Ministries, and private sector stakeholders on strategies to sustain and accelerate economic growth.

‘We are continuing discussions with development partners and other stakeholders on how best to achieve our medium-term growth objective of 7%,’ Dr. Fernando explained.

Acknowledging that higher interest rates could temporarily affect economic activity, the Deputy Minister stressed that the Government did not expect a significant slowdown in demand.

‘I acknowledge that higher interest rates can temporarily dampen demand. However, we will take appropriate measures to support economic activity once conditions normalise,’ he said.

‘From the Government’s side, capital expenditure programs will continue as planned. At the same time, we encourage the private sector to remain confident and proceed with its investment plans. We do not expect the recent increase in interest rates to cause a significant contraction in demand. Any impact should be temporary. Therefore, we continue to maintain our growth target,’ Dr. Fernando added.

He argued that sustained economic growth was essential to addressing poverty, reducing income inequality, and improving living standards, describing growth as the only durable solution to Sri Lanka’s longstanding socioeconomic challenges.

Addressing concerns raised at the recent Committee on Public Finance (CoPF) meeting regarding capital expenditure performance, Dr. Fernando said figures cited during the discussions required proper context.

‘The Rs. 243 billion expenditure figure referred specifically to supplementary allocations, including funding related to post-disaster recovery, rather than the entirety of the capital budget,’ he explained.

He also rejected suggestions that capital spending was lagging behind target levels, pointing to last year’s performance.

‘A similar criticism was made early last year. However, by year-end, we were able to achieve around 75% utilisation of the capital expenditure allocation,’ he said.

According to Dr. Fernando, the Government is holding regular meetings with line Ministries and implementing agencies to accelerate project implementation and improve Budget utilisation.

‘While some delays have arisen due to procurement processes, we are working to expedite these projects and meet our targets by the end of the year,’ he said.

The Deputy Minister stressed that capital expenditure should not be assessed on a simple month-to-month basis, particularly in the case of large-scale infrastructure projects.

‘It is important to recognise that capital expenditure does not follow a simple monthly pattern. Large infrastructure projects often require extensive preparatory work, procurement procedures, and documentation before significant financial disbursements occur,’ he said.

Citing the expansion of Bandaranaike International Airport (BIA) as an example, Dr. Fernando noted that major projects often involve lengthy preparatory stages before spending becomes visible in official data.

‘Financial progress may only become visible several months after the initial work begins. Therefore, it is not appropriate to assess capital expenditure solely through a proportional arithmetic approach,’ he said.

Nevertheless, he reiterated the Government’s commitment to accelerating implementation and achieving strong capital expenditure growth this year, similar to the progress recorded in 2025.

Responding to allegations that public officials were reluctant to approve procurement documents due to fears of future investigations or legal repercussions, Dr. Fernando said he was not aware of any such instances.

‘I am not aware of any specific cases where public officials have refused to sign procurement documents due to concerns about future repercussions,’ he said.

‘If there are particular cases, they should be identified specifically. From our perspective, delays are more often attributable to technical and procedural requirements rather than reluctance on the part of officials,’ he added.

The Symphony Orchestra of Sri Lanka’s (SOSL) Pops: A Trilingual Extravaganza, sponsored by Sampath Bank, returned for its third consecutive year at the Bishop’s College Auditorium on 6 and 7 June. This pictorial captures memorable moments from the exclusive performance curated for Sampath Bank’s valued customers. The evening featured acclaimed performances by Umaria Sinhawansa, Thasihaa Raj and Eshan Denipitiya, accompanied by The Menaka Singers, Resonance, The Old Joes’ Choir and The Peterite Chorale under the direction of Nishantha Warnakulasuriya. Through this experience, Sampath Bank continued its commitment to creating meaningful moments that celebrate culture, connection and customer appreciation beyond banking.

Delmege Consumer, the flagship FMCG cluster of the Delmege Group, has evolved into one of Sri Lanka’s most trusted household names, building lasting relationships with communities across the island through a diverse portfolio of quality products that have become an integral part of consumers’ everyday lives for generations.

Renowned for enriching households with Delmege’s own brands, leading local brands, and world-renowned international brands, the company continues to strengthen its presence, reputation, and connection with consumers nationwide.

A key strength of the FMCG cluster lies in the strong and enduring partnerships it has cultivated with suppliers, enabling the company to establish a responsive, time-sensitive, and mutually beneficial distribution network that has made a significant impact across Sri Lanka. Through its extensive reach and customer-focused approach, Delmege Consumer serves retail, wholesale, HoReCa, export, and modern trade channels, supported by flexible channel management strategies and winning consumer-centric propositions that cater to evolving market needs.

Further strengthening its distribution network and expanding its digital footprint, Delmege Consumer has partnered with Daraz, Sri Lanka’s leading e-commerce platform, to offer customers a more convenient, seamless, and accessible way to purchase its extensive range of FMCG products online.

Delmege Consumer CEO Anil Meegahage said: ‘At Delmege Consumer, we are committed to innovation, continuously strengthening our product portfolio, and enhancing customer convenience and experience. Our partnership with Daraz enables us to serve customers across the country more efficiently by providing them with an easy, secure, and reliable platform to purchase trusted Delmege FMCG products online.’

Head of Group Marketing Baratha Piyadigama said: ‘This partnership with Daraz marks another important milestone in our journey to enhance brand positioning, visibility, and awareness, especially at a time when digital and online commerce continue to gain significant momentum. As one of Sri Lanka’s leading FMCG distributors, we are proud to extend our trusted portfolio of products into the digital space through Daraz, ensuring customers across the island can conveniently access their favourite products with just a few clicks.’

Delmege’s extensive FMCG portfolio includes well-known Delmege branded products such as Canned Fish, Hiru Kahata Tea, Delmege Soya, Flavours and Colours, Delmege Pasta, Delmege Noodles, and Salt, together with the much-loved Motha range of dessert ingredients, beverages, and mixes. The company also represents globally renowned international brands including Kellogg’s cereals such as Corn Flakes, Muesli, and Oats; Pringles; and the Ferrero portfolio featuring Ferrero Rocher, Nutella, Kinder Joy, and Tic Tac. Through its diverse and trusted brand portfolio, Delmege Consumer continues to reinforce its position as one of Sri Lanka’s leading FMCG companies.

Daraz, Sri Lanka’s most trusted online shopping platform, continues to enhance customer convenience through reliable service, secure payment options, and islandwide delivery. Customers are encouraged to visit the official Delmege FMCG store on Daraz via www.daraz.lk to explore the full range of premium products and enjoy exclusive online offers.

The Court of Appeal yesterday said they would deliver judgement on 3 July on the petition filed by Yoshitha Rajapaksa challenging his indictment in the High Court.

Yoshitha’s Rajapaksa challenged the continuation of proceedings against him in the High Court of Colombo in which he and his 98 year old Grand Aunt were indicted for charges of Money Laundering.

When the matter was argued yesterday Counsel Hafeel Farisz appearing on behalf of the younger Rajapaksa told Court that the entire process which resulted in him being made to stand alone in a charge of conspiracy was illegal.

He said that the process commencing from the discharge of his Grand Aunt without the charge of conspiracy being withdrawn was illegal.

Earlier Rajapaksa filed a revision application to the Court of Appeal challenging the order of the High Court which held that the indictment and the conspiracy charge can continue against Rajapaksa despite the discharge of his Grand Aunt.

Senior Deputy Solicitor General Janaka Bandara responding for the Attorney General said that although there maybe issues in the process no serious prejudice has been caused to Rajapaksa by the process and that the conspiracy charge can be maintained against him.

Having heard the submissions of both parties the two judge bench compressing of Justices R.A. Ranaraja and Dr. Sumudu Premachandra fixed the matter for order on 3 July.

Counsel Hafeel Farisz, with N.K Ashokbharan, Sanjeewa Kodithuwakku, Shannon Tillekeratne, and Ashwin Pragash instructed by Sanduni Rathnayaka, appeared for Rajapaksa.

Senior Deputy Solicitor General Janaka Bandara, with Oswald Perera represented the Attorney General.

Prime-Melwa has become the largest property investor in Port City Colombo, following the acquisition of their third and one of the most coveted land parcel in the Marina District.

The purchase lifts the partnership’s combined holding to approximately 16 acres, establishing it as the largest property investor in Port City.

For Prime and Melwa, the acquisition marks the next strategic step in a shared ambition to elevate Sri Lankan real estate to international standards and the vision of taking Sri Lankan Real Estate to the world.

The Marina District is among the most distinguished and sought-after addresses in Port City, and indeed in Sri Lanka, commanding high demand, premium positioning and strong value appreciation over short periods. Marina-front properties remain among the most prestigious and rarest categories in luxury real estate worldwide, particularly within international financial and lifestyle destinations.

The partnership’s concentration in the Marina is a deliberate, strategic choice. The marina district accounts for only around 1% of the entire Port City, making it exceptionally limited and exclusive. Crucially, it is also set to be completed within the next five years, well ahead of other development within Port City.

The newly acquired parcel will be developed as a mixed-use development, adding to the partnership’s growing presence in what is fast becoming Sri Lanka’s premier marina and waterfront destination. The investment showcases the confidence of both organisations in the country’s long-term prospects and in Port City’s standing as an emerging international real estate destination.

Prime Group Chairman Premalal Brahmanage said: ‘Becoming the largest investor in Port City Colombo is a significant milestone that reflects our confidence in Sri Lanka’s future and the immense potential of this transformative development. With the Marina District set to emerge as a world-class waterfront destination, our ambition is our nation Sri Lanka, Port City Colombo and Sri Lankan Real Estate to the world. delivering iconic developments that showcase the very best of Sri Lanka’s capabilities and potential to the world.’

The partnership’s first project, Prime Marina, has already proven a resounding success. Its grand launch on 10 June was a world-class occasion unlike Sri Lanka has witnessed before, followed by record-breaking sales demonstrating strong confidence local and overseas buyers have placed in Prime and Melwa.

With three strategic land acquisitions now secured, Prime and Melwa have positioned themselves at the forefront of Port City’s development, reinforcing real leader in Sri Lanka’s real estate sector and helping to establish Colombo as a rising destination for global property investment.