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Economic & Market Bulletin
[November 16, 2004]

A weekly publication of the Economic Affairs Division of the Ministry of Foreign Affairs


Volume1:Issue 13

29th October 2004



Initial Public Offer of Lanka IOC - an innovative experience in Sri Lanka’s Capital Market 

  • Lanka Indian Oil Company (Lanka IOC) seeking regulatory approval for its giant Initial Public Offer (IPO) for trading its shares in the Colombo Stock Exchange (CSE). The proposed issue is Rs.2.2 billion, which would be 100 million shares on a book-building basis.

  • The book-building basis offers the Foreign & Local investors to determine the share price, within a pre-determined price range, and the most subscribed price would be determined as the price of the share. This method is popular in other capital markets, such as US and India, and the first experience in the Sri Lanka’s capital market. By this system investors have an option to decide whether the company share is worth. 

  • Lanka IOC is a giant company in the Sri Lanka Petroleum Market, having reported a turnover of Rs.14.58 billion and net profit of Rs.578 million for the period April 2003 to March 2004. The company expects a turnover of Rs.32 billion and increase the market share from 18.4% to 28% for the period 2004/2005. 

  • The company will be hosting a road show in Singapore and Hong Kong to promote foreign investors, in the first week of November.

Trade and Consumer Affairs Minster meets US investors 

  • Trade and Consumer Affairs Minister Jeyaraj Fernandopulle addressed the US Corporate Executives and explained the Government’s Trade, Investment and Economic policies.

  • Minister emphasized that, moving towards a more out-ward-oriented trade regime and improving market access for Sri Lanka’s exports are the objectives of the Sri Lanka’s trade policy and the Government considers bilateral and regional free trade agreements as a springboard for broader trade liberalization.

  • Representatives from major US companies and USAID, Department of Commerce and the US Trade and Development Agency participated at the forum, where some of the investors agreed to look forward the further investments in Sri Lanka. 

  • The Minister attended the fourth Joint Council Meeting under the Trade and Investment Framework Agreement (TIFA) at the White House Conference Center, and reviewed a broad range of issues that included among others, the bilateral trade relationships, Sri Lanka’s economic reform process and investment policies, the implication of the abolition of textile quotas in 2005, enforcement of the Intellectual Property Rights Law and Assistance to Sri Lanka under the Millennium Challenge Account (MCA). Minister informed the US delegation that Sri Lanka would soon be submitting the country’s MCA concept paper which envisages programs to uplift the rural infrastructure and its economy.

ICFAI University Educational programs in Sri Lanka 

  • Institute if Chartered Financial Analysts of India (ICFAI) recently inaugurated the educational programs at Undergraduate & Graduate levels in the areas of Commerce, Business Management, and Science & Technology in Colombo. 

  • ICFAI Education Lanka (IEL), a non-profit organization registered in Colombo will conduct these programs aiming to provide job oriented educational programs, and its intends to establish a University in Colombo.

Foreign Investments in Eastern Sri Lanka

  • A German-Japanese joint venture, Wild Fish Limited plans to invest half a million US dollars in Batticaloa (main city of the eastern province) on a smoked fish project, which would be one of the first foreign investments in a previously conflict affected area.

  • The project is to export smoked eel to Japanese & European Market, and becoming the first of its kind in the country. Wild Fish Ltd. hops to start operations by the end of the year. The availability of lagoons, lakes, rivers and the considerable pool of young trainable people are the comparative advantages to the proposed industry.

Sri Lankan chef wins Culinary Olympics 

  • Dimuthu Kumarasinghe, Group Skills Development Chef of Aitken Spence Hotels has won five gold medals for four different categories at the culinary exhibition and competition - the 21st Culinary Olympics 2004. 

  • The master chefs from countries like France, Germany and Switzerland, participated at the culinary Olympic with a strong cultural culinary tradition, on their familiar turf, in which Dimuthu’s awards categories were Patisserie dessert platter, Cold food show piece, Patisserie show and the open event. 

Tourist Board at the World Travel Market 

  • The Sri Lanka Tourist Board (SLTB) will attend silver anniversary celebration of the World Travel Market (WTM) scheduled to be staged on November 8 to 11 at London’s ExCel Exhibition center. 

  • SLTB will promote the country among hundreds of travel agents from over 190 countries, where Sri Lanka’s Tourism fraternity representing 57 companies. “Culture and Beach” has been selected as the theme for the SLTB pavilion in this international event. 

Sri Lankan in offshore business in Male 

  • Air Equator, a subsidiary company of the SPA Group in Sri Lanka will invest Rs.150 million along with State-Owned Air Maldives, on domestic Air Services in Male.

  • The project will be in two phases, of which firstly domestic flying and secondly travel to India & Sri Lanka for passengers and cargo. The company expects an annual income of 450,000 US dollars. 

IT Focal Group to further develop ICT industry 

  • Local and International IT Enabled Services Companies operating in Sri Lanka have formed an IT Focal Group to further develop the ICT industry.

  • 23 companies such as ASTRON, AFSS, TIMEX, HSBC, Data Processing, Convenient INFO, AMBA Research, HELLOCORP and Quantum are the pioneers to formulate the synergy ‘IT Enabled Services Association” (ITESA) with a view to step on the right directions to resolve matters in the industry.

  • The founders believe that it can generate 5,000 job opportunities, and the agency is fully committed to promote Sri Lanka as the outsourcing destination in the world and will also introduce marketing strategies to tap the untapped potential sectors in the industry.

Lanka to participate in Heimtextil 2005 Fair in Germany 

  • Sri Lanka will participate at annual international fair for home textiles and commercially used textile; Heimtextile 2005 which will be held from January 12 to 15 in Frankfurt Germany. 

  • The exhibition will attract over 3500 exhibitors and more than 100,000 visitors from all over the world. Sri Lankan house hold textile manufactures will enjoy an ideal platform to find information on current market from this exhibition.

New Association for growth of apparel and textile industry 

  • “Fabric and Apparel Accessories Manufactures Association” (FAAMA) has been formed by the industry pioneers to address the new challenges and to promote growth in the Industry. 

  • FAAMA has also teamed up with the Joint Apparel Association Forum, (JAAF) to represent the entirety of the industry under one umbrella to take steps in the right direction to create a suitable micro and macro environment that would safeguard Sri Lanka’s apparel sector.

  • The Association initially comprised 28 companies, and it has the confidence to face to the challenges arising out of the termination of Multi Fiber Agreement (MFA) and find alternative approaches to sustain and develop the industry.

Colombo Stock Exchange (CSE) to establish Branches in the Gulf 

  • Colombo Stock Exchange is looking at the possibility of establishing branches in Dubai and Abu Dhabi, with the aim of tapping the funds of Sri Lankan expatriates in the region. Stock Brokers are also hopeful to persuade investors in the US equities market based in Gulf, to invest some of their funds in the CSE.

  • The Sri Lankan delegation headed by the Minister of Finance, officials of CSE and the representatives of the stock brokering firms will visit two cities in the region in early December. The two events will be targeting around 600 participants, which will be organized by the CSE along with Sri Lanka Business Council for Dubai & Northern Emirates, Sri Lanka Embassy in UAE and Consul General in Dubai.

  • CSE already have implemented stock trading through the Internet, of which Asia Securities, Lanka Securities, J B Stockbrokers, Asha Philips Securities, Lanka Orix Stockbrokers and Ceylinco Stockbrokers possess Internet trading. This would facilitate Foreigners and outstation investors buying and selling shares in the CSE.

Sri Lankan Air Line- Best Airline in South Asia 

  • Sri Lankan Airline was selected as the Best Airline in South Asia, by the Travel Trade Gazette-Asia (TTG Asia), at a function in Bangkok.

  • This is the second time that the national carrier has been awarded the Best Airline in South Asia, first being in 2002. TTG Asia is a worldwide publication disseminating latest information on travel and tourism in Asia, including hotels, airlines and travel agents. 







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Last Updated Date: October 26, 2004 .


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