Sri Lanka, Singapore ink deal to develop port city of Trincomalee

Sri Lanka’s government and Singapore infrastructure consultancy Surbana Jurong have signed a Memorandum of Understanding (MOU) to develop the port city of Trincomalee.

It will see Surbana detailing a long-term development plan for the Trincomalee metropolitan area and surrounding cities in the island's Eastern Province.

Singapore's Minister for Trade and Industry (Industry) S Iswaran and Sri Lanka's Minister for Development Strategies and International Trade Malik Samarawickrama on Thursday (Jun 2) witnessed the signing of the MOU in Colombo.

Progress in the Eastern Province was hampered over the years by the civil war which ended in 2009. The state government is now focused on its development.

"We in the Eastern Province would certainly be willing to play the role of a launching pad for our two countries to achieve a higher level of economic achievement for the benefit of the people of our two countries," said Mr Nazeer Ahamed, chief minister of the Eastern Province in Sri Lanka.

While in Trincomalee, Mr Iswaran also visited a plant run by Singapore's Prima Group - one of the first Singapore companies to do business in Sri Lanka.

"I was personally struck by first, how long the business has been in operation here,” he said. “And secondly, the close relationship that exists between the government, the people of this region and the Prima flour business. This is the kind of example we'd like to emulate."

Mr Iswaran is in Sri Lanka for a three-day working trip.
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Sri Lanka tea crops reduced by floods, landslides

ECONOMYNEXT – Although volumes at Colombo’s tea auction have been high so far, heavy rains that caused floods and landslides in Sri Lanka recently have reduced crops that will arrive at the sale in future, brokers said.

“Crop harvests have reduced in most planting districts during that past week,” brokers John Keells Ltd. said in a report.

Several earth slips in the mountainous regions where tea is grown and floods in the low lying areas continue to cause complications in daily operations of the industry, the brokers said.

“The country suffered from unprecedented drought from January to April and faced the highest temperatures for decades,” the report said.

“The arrival of the monsoonal rains in May brought relief but in a couple of weeks the relief was replaced by floods, causing much inconvenience and damage to plantation crops and tea exporters.”

Prices fell at this week’s Colombo auction and are expected to fluctuate in the next few weeks, following quality, John Keells said.

Sri Lanka’s Central Bank to sell USD200mn development bonds

(LBO) – The Central Bank will issue 200 million US dollars development bonds with a tenor of 1 year, 2 years, 3 years and 5 years to local and foreign investors.

The Debt Department said the subscription will be at a floating rate of 6 month LIBOR for USD plus a margin through competitive bidding or at a fixed rate to be determined through competitive bidding.

Minimum investment is 10,000 US dollars with additional investments in multiples of 10,000 US dollars.

The issue will be open for subscription from 7 to 13 June and has a date of settlement of 30 June 2016.

Development bonds are to be issued by the Public Debt Department of Central Bank and exempted from income tax paid in Sri Lanka.

Foreigners, non resident or dual citizen Sri Lankans, NRFC/RFC account holders, authorized dealers in foreign exchange, primary dealers in government securities, BOI specified companies and specified insurance companies are among eligible investors.