Scanning through the papers recently after the Central Bank of Sri Lanka published its 2011 external sector performance report, I was reminded of a pithy observation made by William W. Watt: “Do not put your faith in what statistics say until you have carefully considered what they do not say.” Some of the data were ...

Tyranny of the international capital markets Dr. Indrajit Coomaraswamy, ex-Central Banker and International Civil Servant, did not mince words when he addressed the country’s exporters last week. The veteran economist, having made an assessment of the risks associated with Sri Lanka’s external sector crisis, warned that the country will have to grapple with “the tyranny ...

The Central Bank last night said the revision of Sri Lanka Foreign Currency Rating Outlook from ‘Positive’ to ‘Stable’ and lowering of the country’s long-term local currency rating from BB- to B+ by Standard & Poor’s was unwarranted. In a statement, the Central Bank said the Sri Lankan economy is estimated to have grown by ...

Managed to divert from crisis to stability through policy changes By Cheranka Mendis Sri Lanka, teetering on the brink of a crisis, just managed to save itself through the recent policy measures taken by the Government such as the exchange rate changes, said the Commonwealth Secretariat Economic Affairs Division’s former Director Dr. Indrajit Coomaraswamy yesterday. ...

Clouded prospects in developed markets cast a shadow over outlook for trade and economyBy Jonathan Story Two key forces that have driven Asia’s transformation for decades can be counted on to continue apace in the coming year: economic development and China’s rise. Nonetheless, individual Asian countries will struggle to balance domestic and international responsibilities in ...

By Cheranka Mendis Gathered to discuss the implications, opportunities and challenges of the sudden announcement and introduction of the Government’s new policies, the export community was advised by a panel of experts to watch ahead, be prepared and make their own judgments from the information provided. With the country facing no immediate risks of getting ...

Avoiding a crisis The Pathfinder Foundation (PF) commends the Treasury and Central Bank for the policy measures introduced recently. This has prevented an external payments crisis. Without remedial action, the country would not have been able to meet its debt obligations and/or finance essential imports within a short period of time. The increases in the ...

THE effects of the fuel price hike and its effect on public expenditure is finally beginning to surface. The Finance Ministry has directed all Government institutions to limit their consumption of fuel and electricity as a priority following the upward revision of prices. The Ministry has emphasised that this is a national responsibility entrusted on ...

Contrary to exaggerated claims the EPF investments in to the stock market last week had amounted to only less than 10% of market activity and unlike some past contentious buys, this time around it had focused on blue chips. The total turnover of the Colombo bourse last week was Rs. 8.6 billion and local purchases ...

Sharp reduction in vegetables prices thanks to higher output could help soften an otherwise sharp spike in inflation following the unprecedented fuel hike and devaluation of the rupee, according to analysts. In recent weeks, prices of vegetables have dropped by as much as 50% or more and this development will make the additional cost following ...

Reuters: Israeli Defence Minister Ehud Barak said on Saturday a nuclear-armed Iran would trigger an arms race in the Middle East and nations should impose “crippling” sanctions on Tehran to force it to give up its atomic programme. “A nuclear Iran is a threat to the whole world, not just to Israel … Other major ...

Reuters: Asian shares rebounded on Friday on signs that euro zone officials will soon approve a long-awaited bailout for Greece, and after jobs and factory data pointed to a healthier U.S. economy. Financial bookmakers expected European stocks to track Asian shares higher, with financial spreadbetters calling the main indexes in London .FTSE, Paris .FCHI and ...

ASI gains by 5% as Bourse’s value swells by Rs. 96 b Brokers positive after fresh meeting with SEC EPF, private institutional and high networth investors active on attractive valuations The Colombo stock market yesterday produced a major rebound gaining by 5% thanks what some described as “spirited support” whilst others emphasised it was largely due ...

(Bloomberg): Sri Lanka doesn’t need to further tighten monetary policy for now even though an increase in fuel and transportation costs and a weakening currency may stoke inflation, the head of the central bank said. The central bank’s rate increase earlier this month will have a “demand-driven impact” and help moderate inflation, its Governor Ajith ...

Sri Lanka’s benchmark stock index, the world’s worst performer this year, may extend its slump as the central bank raises interest rates to curb inflation, according to HSBC Holdings Plc’s private banking unit. HSBC Private Bank, which oversees about $499 billion, will wait for stock valuations to fall to “single digit” multiples before it considers ...

UNP MP, its spokesman for the economy and Consultant Economist Dr. Harsha de Silva yesterday gave thumbs up to Central Bank Governor Nivard Cabraal for the latter’s dual move of hiking interest rates and depreciating the currency, though insisted risks and challenges remain. “The Central Bank Chief must be commended for finally realising that there ...

Are the Indian Army’s golf courses illegal?                 Sri Lanka’s fourth golf course opened by Air Force   India’s national auditor, the Comptroller and Auditor General (CAG), has reported to Parliament that the country’s Army has turned large tracts of State military property into illegal privately-run ...

The Central Bank of Sri Lanka recently unveiled its pioneering Sixth Strategic Plan – communicating in all transparency its plans for the forthcoming financial period – based on the theme ‘Raising the Bar’. The Sixth Strategic Plan, like its predecessors, takes root from the policy measures underscored in the ‘Mahinda Chinthana,’ and is formulated to ...

“Our sense is that if we do not act boldly and if we do not act together, the economy around the world runs the risk of a downward spiral of uncertainty, financial instability and potential collapse of global demand… we could run the risk of what some commentators are already calling the lost decade” – ...

If the Governor of Central Bank has an urge to enter politics, he should come to Parliament without playing politics inside the CB, charges United National Party Parliamentarian and well-known Economist Dr. Harsha de Silva. Dr. de Silva notes that Governor Nivard Cabraal should respect the sanctity of the Central Bank and therefore if Cabraal ...

Today, as much as China is the centre of global manufacturing, India has become the international hub for global service industries. India’s IT and outsourcing exports amount to over US$ 50 billion. The economic resurgence of China and India has also made way for the emergence of Thailand, Indonesia, Pakistan and Vietnam as manufacturing bases. ...

ABUJA(Reuters): Nigerian authorities announced on Sunday that a controversial plan to scrap fuel subsidies will be effective from Jan. 1, a move likely to lead to strikes and street protests. The plan is unpopular with Nigerians, many of whom see cheap fuel as the only benefit they get from living in Africa’s top crude oil ...

After the recent Commonwealth Games in New Delhi, India, critics found three new words for the acronym ‘CWG’ – Corruption, Waste and lack of Governance. The Chairman of the Indian National Olympic Committee, who was Chairman of the Organising Committee, is presently in Tihar Jail, in Delhi with many of his acolytes, on charges regarding ...

HONG KONG (Reuters): Global container ship operators, hammered by high costs, oversupply and flagging demand, are cutting shipping capacity to shore up freight rates depressed by a sluggish global economy. Many container carriers have been losing money since the third quarter as freight rates fell sharply, mainly due to a supply glut, industry experts said ...

Says depreciation by Budget only a one off, admits other sectors will suffer but notes growth will offset negatives By Uditha Jayasinghe The detriments of depreciation must be countered by aggressive growth in exports, the Central Bank Governor said yesterday, insisting that impediments to the industry had been removed by the latest Budget. Speaking for ...

Arrenga Capital Research takes a deeper look at Budget 2012 and impact on select listed companies 1. A challenging deficit target – 6.2% of GDP in 2012 I. Government revenue targeted to grow by 20.2% YoY to Rs. 1,126.1 b (14.7% of GDP) II. Total Government expenditure to rise 14.1% YoY to Rs. 1,594.9 b ...

Exports, imports up in Sept; Healthy financial inflows Two commercial banks infuse $ 250 m capital from overseas sources; corporate offshore debt capital raising tops $260 m Private sector borrowing averages Rs. 37 b per month in 2011 CB leaves policy rates unchanged for 10th straight month despite benign inflation and the inflation outlook Urges ...

 Eurozone crisis makes industry outlook uncertain COSCO negotiates lower charter rates Many shipping companies hit hard by industry downturn BOAO, China, (Reuters): Global shipping is in a downturn even worse than during the 2008 financial crisis, China’s transportation minister said on Thursday, with the outlook for the industry made increasingly uncertain by the European debt ...

Discussion on the validity of non-military engagements of the military The war or internal armed conflict in the north and east is over; the Emergency is no more; but still the military is everywhere. The military is now engaged in peacetime police-work, whale watching, selling vegetables, agriculture, cleaning, constructions and many other non-military activities. Yet, ...

The biggest ever IPO by a home grown entity People’s Leasing Ltd., (PLC) officially opens today aiming to raise Rs. 7 billion to boost its growing business in post-war Sri Lanka. The IPO involves 390 million ordinary voting shares at Rs. 18 each. Top brokerages have already recommended the IPO as ‘Buy’. PLC is 100% ...