Asianet Pakistan Private Limited

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.

The Ceylon Chamber of Commerce yesterday said that while it commends the Government’s effort to introduce a legislative framework for PPPs through the Draft Public-Private Partnership (PPP) Bill, it noted several concerns that warrant further attention.

These include ensuring the independence of the proposed National Agency for PPPs, strengthening competitive safeguards around unsolicited proposals, enhancing fiscal transparency through clearer reporting requirements, and providing more robust mechanisms for dispute resolution.

‘Addressing these issues will be vital to build investor confidence and safeguard the public interest,’ the chamber said in a statement.

It noted that if the Bill is to operate as a clear and comprehensive framework, it is important to clarify its legal standing to avoid overlaps with existing laws, improve disclosure requirements to build public trust, align project evaluation processes with international best practices, and embed environmental, social, and governance (ESG) standards to ensure projects contribute to sustainable development.

The importance of safeguarding the independence of the proposed National PPP Agency, ensuring qualified appointments with Parliamentary oversight, and introducing stronger conflict-of-interest provisions is also critical.

‘We welcomed the opportunity to share private sector inputs during the consultation process with the National Agency for Public-Private Partnership and the Asian Development Bank, as private sector perspectives are essential to shaping a transparent, credible, and investment-friendly PPP framework,’ the chamber said.

The Ceylon Chamber said it hoped that the draft legislation will progress through the approval process and lead to the establishment of a strong and independent National Agency for PPPs, and stands ready to work closely with the Government and relevant agencies to support the implementation of a credible and internationally aligned PPP framework, which will be essential if Sri Lanka is to mobilise private capital on a large scale and close its infrastructure investment gap.

It said that a legislative framework for PPPs was a requisite precursor to enhancing Sri Lanka’s ability to attract private investment in infrastructure and service delivery. Amidst a tight fiscal environment for the Government, PPPs will be conducive for driving projects that will enhance growth, create jobs and bring in private capital.

‘The Ceylon Chamber notes several positive aspects of the Bill, including the mandated value-for-money and feasibility assessments, enhanced transparency through stakeholder consultation and public disclosure, clear risk allocation to the private sector, and the establishment of a dedicated National PPP Agency with a clear mandate. These provisions are in line with international best practices and can significantly improve the environment for private sector participation,’ the chamber said.

Sri Lanka’s stalled privatisation of State-owned enterprises, rigid labour laws and restrictions on foreign participation continue to weigh on investment prospects, the US State Department said in its 2025 Investment Climate Statement.

The report noted that 527 State-owned enterprises, including 55 designated as strategic, remain a major burden on public finances.

‘The previous Government initiated a program aimed at comprehensive SOE reform, including potential privatisation of several major entities. However, the current Administration suspended these privatisation efforts upon taking office,’ the report noted.

‘It has instead announced alternative restructuring approaches focused on improving management practices, reducing operational costs, and enhancing efficiency within the existing state ownership structure,’ it added.

‘The stalled privatisation of deficit-ridden State-owned enterprises, notably the Ceylon Electricity Board, hinders development of cost-effective energy supplies crucial for industrial operations. Foreign investors consistently report high transaction costs, unpredictable policies, and opaque procurement procedures’.

At the same time, the report pointed to continuing strengths. Sri Lanka permits 100% foreign ownership in most sectors, with constitutional guarantees for investment protection and unrestricted repatriation of earnings, fees, and capital.

The Colombo Stock Exchange recorded $ 66.5 million in net foreign inflows in 2024 and mobilised $ 568 million in capital. Worker remittances climbed to a record $ 6.58 billion, pushing reserves to $ 6.1 billion by year end.

Export Processing Zones continue to attract investment, while new initiatives such as the pharmaceutical manufacturing zone in Hambantota and the Colombo Port City are expected to expand opportunities.

The Economic Transformation Act, which was intended to abolish the Board of Investment and replace it with five specialised agencies, has not been implemented, leaving approvals fragmented and slow.

‘Other key impediments include unnecessary regulations, legal uncertainty, and poor bureaucratic responsiveness,’ the report noted.

The Government’s decision to impose new taxes on service export firms while granting exemptions for Port City projects has reinforced perceptions of uneven treatment. Corruption in procurement persists despite legislation passed in 2023.

Labour market conditions were also identified as a critical risk. ‘Rigid dismissal rules make restructuring costly, while emigration has intensified shortages in IT, apparel, tourism and engineering,’ the report said.

It added that ‘the garment industry reports turnover rates of 40%’ and that ‘weak social protections and limited coverage for informal workers contribute further to labour market inflexibility.’

Although GDP growth of 5% in 2024 exceeded expectations and the Administration’s commitment to the IMF’s four-year, $ 3 billion program provided reassurance, foreign direct investment remains limited.

Most deals are in the $3-5 million range, concentrated in tourism, ICT, renewable energy, manufacturing, and real estate.

The report noted the Government’s commitment to finalise Sinopec’s $ 3.7 billion oil refinery in Hambantota, the largest FDI project to date if successful, but confidence was dented when Adani Green Energy exited a $ 400 million wind farm after the Government sought to renegotiate an awarded contract.

Restrictions on land and ownership were also flagged. Foreign companies with more than 50% equity are generally barred from purchasing land, with only narrow exceptions.

Caps of 40% apply across sectors such as agriculture, natural resources, shipping and education, while retail under $ 5 million, pawn broking and coastal fishing are entirely prohibited.

The report concluded that Sri Lanka’s outlook for investment rests on its ability to convert stability into reforms that reduce state dominance, simplify approvals and enforce transparency.

‘Without progress in governance, trade facilitation and labour flexibility, the Government’s $ 5 billion FDI target for 2025 will remain difficult to achieve,’ it said.

YANGWANG, the luxury sub-brand of global new-energy vehicle (NEV) leader BYD, has set a new global production-car top-speed record of 496.22km/h at the ATP Automotive Testing Papenburg test track in Germany.

The feat was achieved with YANGWANG’s latest U9 Xtreme hypercar on 14 September 2025, eclipsing its previous EV benchmark and the 490.484km/h maximum of the quickest petrol-powered model to become the world’s fastest car overall. This modern milestone in engineering sets a new standard in electric mobility, mixing unrivalled power and speed with zero emissions.

Originally known as the U9 Track/Special Edition, and now officially confirmed as the YANGWANG U9 Xtreme in production guise, or U9X for short, the fastest car on the planet takes the existing technical architecture of the U9 currently on sale in China and harnesses the potential of a number of key evolutions.

These include, but are not limited to: an upgraded powertrain with 1200V ultra-high-voltage electrics (compared with 800V), a lithium iron phosphate Blade Battery with a remarkable discharge rate of 30C, four ultra-high-speed motors that that operate at up to 30,000rpm and produce a total of more than 3000PS, track-level semi-slick tyres, and revised DiSus-X suspension with specific tuning to cope with the increased stresses of circuit driving.

BYD Executive Vice President Stella Li said: ‘This is an incredibly proud moment for everyone in the research and development division. YANGWANG is a brand that does not recognise the impossible, and only through this commitment to what’s coming next can you end up with a vehicle like the U9X. I extend my gratitude to the whole team, and my thanks to the driver, Marc Basseng, for his skill and technical input. It’s terrific that the fastest production car in the world is now electric.’

The driver for the U9X’s record-breaking run was Marc Basseng, a German track specialist with a long history in sports-car racing and endurance motorsport. He said: ‘This record was only possible because the U9 Xtreme simply has incredible performance. Technically, something like this is not possible with a combustion engine. Thanks to the electric motor, the car is quiet, there are no load changes, and that allows me to focus even more on the track.’

The U9 Xtreme is now being made available to customers, with a limited series production run of no more than 30 units. Its name is derived from the English word ‘Extreme’, meaning ‘limit’ and ‘ultimate’, with added emphasis on the ‘X’, which represents the unknown. These qualities fit perfectly with YANGWANG’s ethos of taking joy and delight from the act of exploration and the innovations that come through that process.

By setting a new global speed record, YANGWANG redefines the sustainable hypercar. Backed by BYD’s innovation and sustainability commitments, YANGWANG employs cutting-edge tech to deliver unmatched performance, safety, and driving experience.

Japan and Sri Lanka agreed to deepen cooperation across economic, investment, security and multilateral fronts, issuing a joint statement yesterday after President Anura Kumara Disanayake’s meeting with Japanese Prime Minister Shigeru Ishiba in Tokyo.

Ishiba commended Sri Lanka’s recovery path under the International Monetary Fund (IMF) program and debt restructuring, pledging continued Japanese support. As co-chair of the Official Creditor Committee, Japan was the first to conclude a bilateral restructuring deal with Colombo earlier this year.

Both sides agreed that steady implementation of reforms and early completion of debt restructuring are critical to restoring investor confidence and underlined the need for foreign loans consistent with debt sustainability.

Economic cooperation featured prominently.

Japan resumed 11 previously signed yen-loan projects in 2024, including transmission lines and digital television infrastructure.

Both leaders welcomed the recommencement of bidding for the second phase of the Bandaranaike International Airport expansion and pledged to expedite completion.

They also signed notes on grant aid to boost productivity in the dairy sector and agreed on the importance of transport solutions to ease congestion in Colombo and other major cities.

On trade and investment, the two sides endorsed a roadmap for an export-oriented industrial corridor and agreed to resume the Inter-Governmental Economic Policy Dialogue.

They welcomed the launch of a Japan-Sri Lanka Committee on Business Environment in August, to be held quarterly, aimed at improving transparency, predictability and non-discriminatory treatment for investors.

President Disanayake highlighted a qualitative shift in the investment environment and invited Japanese corporates to explore opportunities in ICT, energy, tourism, manufacturing and other sectors.

Security cooperation was also advanced. Japan confirmed the provision of unmanned aerial vehicles to enhance Sri Lanka’s maritime surveillance and disaster relief capabilities under its Official Security Assistance program, the first extended to Sri Lanka.

Both sides welcomed continued port calls by Japan Maritime Self-Defence Force vessels, joint naval exercises, and the convening of the second Japan-Sri Lanka Defence Dialogue following the defence minister’s visit to Colombo in May.

The statement also included broader governance and development commitments. Japan pledged continued support for Sri Lanka’s anti-corruption drive and for socio-economic development in the Northern and Eastern Provinces.

Both sides welcomed Japan’s assistance to demining programs, contributing toward a ‘Mine-Impact-Free Sri Lanka.’

People-to-people exchanges will be expanded through skilled labour mobility, culture and sports cooperation, and greater promotion of Japanese language education in Sri Lanka.

On foreign policy, both sides reiterated support for a ‘Free and Open Indo-Pacific’, the rules-based international order and multilateralism.

They reaffirmed the importance of the 1982 United Nations Convention on the Law of the Sea (UNCLOS) for maritime stability, backed early reform of the UN Security Council and Sri Lanka’s continued support for Japan’s permanent seat bid.

The sides also committed to cooperation on nuclear non-proliferation, citing the NPT, Sri Lanka’s ratification of the CTBT, and the IAEA Additional Protocol.

Sri Lanka’s participation in Expo 2025 in Osaka and high-level business events in Tokyo and Osaka were noted as opportunities to further strengthen trade and investment links.

President Disanayake expressed gratitude for Japan’s hospitality and for its long-standing role as a partner in Sri Lanka’s economic and social development.

The joint statement concluded with both Governments affirming that steady reforms, infrastructure development, and improved business conditions will be central to attracting Japanese investment and supporting Sri Lanka’s recovery.

LB Finance PLC has appointed Ravi Tissera to its Board as an Executive Director.

Tissera is an inclusive finance, impact investing and green finance and MSME Sector specialist.

He was the founder CEO of LOLC Microcredit Ltd. in 2008, which was later merged with and acquired by LOLC Finance PLC in 2018. He continued as Executive Deputy Chairman/CEO of the merged entity until February 2020.

Tissera played a vital role in expanding microfinance entities outside Sri Lanka for the LOLC group, to Myanmar, Cambodia, Pakistan and Zambia.

After holding many senior positions within the LOLC Group, Tissera resigned in February 2020 to take up office as CEO at Early Dawn Microfinance Myanmar Ltd. As the CEO of Early Dawn Microfinance, he was able to uplift the Company up to Myanmar’s top four microfinance institutions.

During his term, it was also the first MFI in Myanmar to complete long -term debt restructuring. Tissera has strong competencies in Corporate Finance and lead the first USD syndicate debt finance to the Non-Bank Financial Institutions sector in Sri Lanka.

He is professionally qualified as a marketer and has received executive education training at HBS. He is also a panellist and resource person in the inclusive finance, impact investing and green finance space. Tissera has served as an Alternate Director of Seylan Bank PLC.

Prior to his appointment as the Chief Transformation Officer of L B Finance in March 2025, Tissera served as an Independent Non-Executive Director of HNB Finance PLC during the period April 2024 to March 2025.

He counts for over 15 years’ experience as a CEO in the Non-Bank Financial Institutions sector, both in Sri Lanka and Myanmar.

Sri Lanka yesterday signalled its intent to position itself as a regional leader in the digital economy, with Prime Minister Dr. Harini Amarasuriya unveiling a sweeping package of education reforms, policy initiatives, and investment opportunities at the first-ever National AI Expo and Conference 2025.

From embedding Artificial Intelligence (AI), robotics, and climate science into school curricula and upskilling 100,000 teachers, to launching a unified cybersecurity strategy, digital payment systems, and a national AI platform, the Government pledged to align human capital development with economic modernisation.

Stressing that public-private partnerships (PPPs) would be central, Dr. Amarasuriya said the National AI Expo and Conference marks a ‘paradigm shift’ that will connect Sri Lankan startups with global technology leaders, improve productivity, reduce costs, and open new markets, while ensuring inclusivity and ethical use of AI.

She declared that AI is no longer a distant technology, but a force already shaping lives and choices.

Dr. Amarasuriya also positioned AI as the backbone of a national strategy linking education reforms, startup ecosystems, cybersecurity, and PPPs, declaring that ‘Sri Lanka is ready to participate in the global digital economy.’

‘AI is not only a technology of the future. It is already influencing the choices we make today,’ the Prime Minister said, describing the Expo as both a showcase of technology and a statement of intent.

She stressed that AI must be understood not just in terms of capability, but in how it serves society. ‘Our challenge is not only to ask what AI can do, but how we want it to shape our society.’

Outlining the Government’s digital agenda, Dr. Amarasuriya announced that by 2030, Sri Lanka aims to expand its digital economy to $ 15 billion, representing 12% of GDP, with $ 5 billion in digital exports and a workforce of 200,000 skilled professionals.

‘By doing so, we send a clear message: Sri Lanka is ready to participate in the global digital economy,’ she declared.

She highlighted a series of initiatives to unify the country’s digital transformation, including the National Cybersecurity Strategy, an AI platform and expanded digital payment systems, which Dr. Amarasuriya said would replace fragmented efforts with a coherent national framework.

‘These initiatives will prepare every school, every university, every business, and every citizen for the future.’

Dr. Amarasuriya, who also serves as the Education Minister, placed strong emphasis on human capital. ‘Without human capacity, technology remains only potential,’ she cautioned.

She said the Government is embedding digital literacy, coding, AI, robotics, and climate science from early grades, while rolling out competency-based education reforms and equipping schools with smart classrooms and devices.

Prime Minister Dr. Harini Amarasuriya asserts Sri Lanka ready to participate in global digital economy at first-ever National

AI Expo

Unveils $ 15 b digital economy vision with education reforms, policy frameworks, global investment push

Stresses AI must be understood in how it serves society

Notes SL should be recognised as a producer of AI talent, research and education

Calls to build digital Sri Lanka that left no one behind by 2030

The Prime Minister also announced a Teacher Excellence Framework is being introduced to upskill 100,000 educators, alongside a National Digital ID system for the education sector. At the university level, she said curricula are being restructured to align with industry needs, producing not just employees but ‘innovators and entrepreneurs.’

‘Initiatives such as inventor clubs, vocational platforms from grade nine, and a National Skills Passport are expected to bridge the gap between students and future careers,’ she added.

Dr. Amarasuriya also underscored the importance of building the right economic environment.

‘We are expanding digital transport and payments systems via our national platform ‘GovPay,’ and strengthening cybersecurity through a national operations centre to ensure safety and trust in the digital marketplace.’

She said the Government is committed to PPPs, recognising that the public sector alone cannot drive this transformation.

‘The private sector brings agility, innovation, and investment, while the Government provides policy stability, infrastructure, and inclusivity. Together, we can achieve far more than either can alone,’ she stressed.

From an economic perspective, Dr. Amarasuriya said the National AI Expo and Conference is a marketplace of ideas and solutions.

‘It connects Sri Lankan businesses with global technology leaders, showcases local startups to investors, and demonstrates how AI can improve productivity, reduce costs, and open new markets.’

The Prime Minister emphasised that AI could add 10-12% of digital economy growth by 2030, but only if adopted responsibly. ‘It will only happen if we integrate AI with governance frameworks, ethical guidelines, and a focus on inclusivity.’

Calling the Expo ‘a living classroom,’ she said it brought students, teachers, and academics face-to-face with AI technologies and ethical debates. ‘It inspires young people to see themselves not only as consumers of technology but as creators, researchers, and entrepreneurs.’

She said the Expo would move beyond Colombo to regional centres, ensuring adoption across the country, and would eventually evolve into an international platform, attracting South Asian and global participants.

‘Sri Lanka must be recognised not only as a consumer of technology, but as a producer of AI talent, research, and education.’

In a personal reflection, Dr. Amarasuriya admitted she has long been a ‘sceptical adopter’ of technology.

‘But I think having sceptics like us is important, because we insist that technology must be used for solving human problems, not just as a fashion or trend. Education in technology must go hand in hand with educating people about humanity, ethics, and responsibility,’ she explained.

In a call for unity in the digital transition, the Prime Minister said: ‘By 2030, when we look back, let us be able to say with pride that we built a digital Sri Lanka that left no one behind. Our goal is simple: a digital Sri Lanka where opportunities go beyond privilege and become rights.’

The National AI Expo and Conference, she said, would serve as the cornerstone of that vision; ‘a paradigm shift where every community, entrepreneur, and young mind recognises its value and has a stake in the country’s digital transformation.’ (CdeS)