BOI issues Letter of ... Page 3 www.island.lk Thursday 05th June, 2008 Bourse dips sharply JVP reiterates its opposition but turnover drummed up by JKH, Greig & Pan Asia to CEPA with India The Colombo bourse ing the offer period. dipped sharply yesterday on Much of yesterday’s by Saman Indrajith sector between and promised allocations for the Sri tutions or privatizing them. a turnover of Rs.201.3 mil- turnover came from JKH the two coun- Lankan goods were not allowed. The market access offered by lion, up from Rs.187.9 mil- where 0.4 million shares The JVP yesterday registered its tries are at an Examples are Pepper, vanaspathi, the CEPA is above the commit- lion the previous day, with were done between Rs.114.25 opposition to the proposed advanced stage, copper products, desiccated coconut ments stipulated in the General the All Share Price Index and Rs.114.75 losing 50 cents Comprehensive Economic and it is expect- etc. Now India pushes us to a CEPA Agreement on Trade in Services losing 28.74 points (1.14%) to close at Rs.114.50 generat- Partnership Agreement (CEPA) ed by the Indian promising enhanced access. We do (GATS) under the WTO, he said. and the Milanka dropping ing Rs.46.5 million turnover. between India and Sri Lanka. side that it may not think the Government is absurd “We have information that 53.79 points (1.77%). Environmental Resources “This agreement would achieve be concluded by enough to fall into a worse trap more than 10 rounds of talks in “The market was weak (Walker & Greig) on which nothing for us Sri Lankans but only the end of this twice,” he said. this regard had been held. Former with stock like JKH, SLT there is a lot of retail play create a market place for Indian month. If this India is lobbying to upgrade the Minister Jeyaraj Fernandopulle and Dialog slipping,” a bro- saw over 0.8 million shares entrepreneurs. We know that talks happens, the FTA to a CEPA covering services too opposed the signing of this ker said. These declines, done between Rs.35.25 and are on to hurry up finalizing the Free Trade and investments. If Sri Lanka opens agreement and pledged in a parlia- though slight, dragged down Rs.37.75 gaining a rupee to agreement and a background to Agreement up its services sector for the Indian mentary advisory committee that the indices. close at Rs.35.75. facilitate Indian businessmen is Wasantha (FTA) that businessmen then the local busi- Sri Lanka should never enter into SSP Corporate Services, ``There was a lot of retail takeing shape. Samarasinghe became opera- nessmen would lose their enterpris- the CEPA proposed by the acting for Global activity in this stock,’’ a bro- Already 1000 acres of land in tional in March 2000 will be upgrad- es. Thereafter, local professionals Indians,” MP Samarasinghe said. Telecommunications ker said. Trincomalee district had been allo- ed to a CEPA and may be signed by will lose their market to Indian pro- MP Samarasinghe said that he Holdings which bought out Pan Asia Banking cated to build two power plants to August this year. fessionals like doctors, lawyers or had already demanded of NTT from Sri Lanka Corporation, where an serve Indians. Entering into this Provision in the proposed agree- architects. If an Indian firm opens a Minister of Export Development Telecom, in a Stock investor is believed accumu- agreement will allow India to gobble ment would open up the Sri Lankan branch in Sri Lanka, Indian profes- and International Trade Prof G.L. Exchange filing said that it lating the stock, saw 1.7 mil- up our economy in a few years,” services sector for Indian profession- sionals could join it. Peiris, who represented Sri Lanka had acquired approximately lion shares done between JVP MP Wasantha Samarasinghe als. Indian professionals could capi- in the talks in connection with the 45% of SLT at the close of Rs.11.75 and Rs.12.25 gaining told The Island Financial Review This agreement on enhanced talize on the contemporary need in CEPA with Indian representatives, its mandatory offer on June 50 cents to close at Rs.13. yesterday. market access for service sectors the Sri Lankan service market, he to forward all the details and a 2. Elephant Lite too saw The CEPA is nothing but a trap between India and Sri Lanka has said adding that local service market complete report on current situa- The total number of offer activity with nearly a mil- and the JVP demands that the been brought up by India. “We have has many opportunities since a tion of the discussions to the JVP. shares accepted was approxi- lion shares done between Government does not fall for it, oth- serious reservations against the way strong majority of Lankan popula- “This issue in all its implica- mately 82.3 million (4.56%). Rs.9.25 and Rs.10 gaining 25 erwise the country would become an the India capitalized on the FTA. It tion (41.2%) earns less than two US tions must be fully discussed at all Prior to the commencement cents to close at Rs.9.25. economic colony of India, he said. had served the interests of Indian dollars a day.The Lankan govern- social levels, otherwise blindly of the offer, GTH had 35.19% C.W. Mackie & Company Talks between Sri Lankan and businessmen. ment too has gradually shifted from entering into an agreement with of the company and a fur- announced a first and final Indian officials for an agreement on Our businessmen could not even providing services to the masses India would create numerous criti- ther 5.22% was acquired dur- dividend of 75 cents a share. enhanced market access for services enter the Indian market. “Planned through either shutting down insti- cal consequences,” he said. Fitch Affirms CCC urges Media Minister’s Commercial Leasing’s Food for people highest priority intervention to protect journalists Rating; removes from not gas guzzling vehicles - President The Ceylon Chamber of nel. Threats and violence Rating Watch Evolving Commerce (CCC) has called directed at journalists,includ- Fitch Ratings Lanka has today affirmed President Mahinda Rajapaksa political in nature.” on the Minister of Mass ing abductions and Commercial Leasing Company PLC’s (CLC) ‘A- yesterday said land that could be “We opened our doors so wide to “The International economic Media and Information to murder,unfortunately feature (lka)’ (A minus(lka)) National Long-term rating used for food production shouldn’t the global market forces, that while pressures of that time coupled intervene and bring an early with increasing regularity in and simultaneously removed it from Rating be used for bio-fuel whatever the we reaped several of the benefits of with some domestic political com- end to the brutual attacks on the news. Watch Evolving on which it was placed on 16 commercial attraction may be. globalization, we failed to protect pulsions made us as a country, journalists,so that the gov- The recent abduction and May 2008. The Outlook is Stable. Addressing the UN Food Summit several of our national interests, - in shift our focus of development and ernments stated commit- despicable assault of a particular,those relating to our food in Rome, the President said that concern, away from the rural ment to press freedom can respected Editor of a recog- CLC’s rating and the resolution of the RWE security - from the negative impact reflects improvements to the asset quality in its food for the people should have the of the global market.The earlier economy and rural society, away continue in word as well as nized newspaper,is yet anoth- lease-and-hire-purchase portfolio (in contrast to highest priority, and not the run- development goal of self reliance in form agriculture and food produc- in deed. er example of this growing the deteriorating trend witnessed during the ning of gas-guzzling vehicles. food which we had almost reached, tion to manufacture, commerce While condemning the threat. agency’s last review), its good profitability, sound He urged the international and in some years even exceeded, and services; away from a concern crude attempts at violating Assurances of the con- capitalisation, and its good brand franchise within community to set up a global Food was severely weakened as my for the dignity and well being of press freedom,the CCC duct of investigations by the local non-bank financial institutions (NBFI). Crisis Fund that would have con- country gradually opened even the those who produce the food for our implored that democratic itself will not win back confi- CLC’s rating also derives comfort from the tributions from all countries and production and supply of our food people to a concern for those who principles relating to respon- dence unless such investiga- implied support deemed to be available from its from large business organizations, requirements to the free play of came to the cities and towns to be sible coverage by the media tions lead to the apprehension main shareholder Lanka Orix Leasing Company financial institutions, arms manu- global and domestic market forces.” engaged in non-farm employ- are respected.It also urged of culprits. PLC (LOLC, ‘A(lka)’/Stable). The resolution of the facturers and philanthropists. ment.” the law enforcement agen- Alternatively, at worst, it RWE also factors in a possible further increase to In addition to such a fund, “We opened our doors so wide cies, and the IGP, in particu- will be seen as a ploy or a LOLC’s shareholding in CLC, post the mandatory there should be Regional Food developing countries, is affected to global market forces, that while lar,to expeditiously act on facade to deflect the shock offer which is expected to be completed within Security Funds drawing the finan- by all of these factors - namely - we reaped several of the benefits complaints made on such and horror of the initial the next two months. CLC’s gross non perform- cial and technology resources the total dependence on imported of globalization, we failed to pro- threats,intimidation and vio- public reaction and at best, it ing leases and hire purchase loans (gross NPLs) within a region to expand food fuel; success in agriculture being tect several of our national inter- lence, as public confidence will be seen as pure incom- fell in absolute terms during the second half of production, improve storage and dependent on changing weather ests, - in particular, those relating depends on it. petence, causing serious 2007 (FY07) due to strengthened recovery distribution and also assist patterns; and problems of storage to our food security - from the neg- “Civil society has been concerns about the law and efforts. Consequently, CLC’s gross NPL ratio regional neighbours, he said. and distribution. We are also faced ative impact of the global market. viewing, with mounting order situation in the coun- reduced to 6.9% at Q108 from a high of 12.6% at He said, “It is regretted that with the fourth factor where food “The earlier development goal alarm and concern, the wan- try as the case may be”,the Q107, and was also helped by the intended rela- warnings of this crisis, although production is made difficult or of self reliance in food which we ton attacks on media person- CCC said. tively low portfolio growth of 2.2% during FY07. seen, were largely ignored, until it even hazardous due to the threat had almost reached, and in some Consequently CLC’s net NPLs/Equity reduced to assumed today’s magnitude. It is a of terrorism.Land has been neg- years even exceeded, was severely 24.9% at Q108 from 62.1% at Q107. crisis that has arisen due to grow- lected due to land mines being laid weakened as my country gradual- Telephone penetration CLC’s profitability as measured by pre-tax ing demand for fuel, the failure to by terrorists for over two decades. ly opened even the production and return on assets compared well with its peers at act in time on climate change, the While a combination of all supply of our food requirements exceeds 50 percent 5.7% and 5.9% at Q108 and FYE07 respectively, ravages of terrorism, and prob- these factors, no doubt, has result- to the free play of global and albeit reducing from 6.1% at FYE06 due to its lems of distribution.” ed in the present crisis, there is domestic market forces.” The telephony (fixed lines Department said. margins being pared on account of high borrow- “Sri Lanka, like many other also another set of factors, - socio - and cellular) density reached The government believes ing costs. The company’s average borrowing 53.6 percent in 2007 according that with a fifth player to the costs continued to increase during FY07 and EPF contributions to be revised to the Central Bank Annual mobile telecommunication stood at 18.9% and 17.2% at Q108 and FYE07 Report 2007. This means that sector receiving a license respectively compared to 13.0% at FYE06, driv- The Ministry of Labour next fifty years. government treasury bills and there is a phone for every two from the Telecommunication en by increasing market interest rates over the Relations and Manpower The Minister said that three age bonds which give a return far lower people. Regulatory Commission period. Although the company increased its lend- announced that plans were a foot to categories will be established based than the rate of inflation. The Department of (TRC) mobile telecommunica- ing rates during FY07 in an effort to contain the revise the contributions made to on which the contribution percent- The EPF recently announced Government Information tion will be more affordable depression in its net interest margin, Fitch the Employees’ Provident Fund ages will be increased. that it would implement a new attributed this growth to the and result in higher penetra- observes that increasing yields will be challenged (EPF). Health and general insurance, series of account numbers to its increase in investments to the tion levels. on account of competition, and the present eco- At present, employees con- home loans and loans for higher members in a bid to streamline the telecommunication sector and Currently, there are four nomic environment. tribute 8 percent of their salaries education will be some of the bene- processes and increase efficiency. competition within the sector. mobile telecommunication CLC is a mid-sized specialised leasing com- to the provident fund while employ- fits entitled to members of the EPF Each member will be assigned a In 2007, the number of operators in the market. The pany which was established in 1988, and has a ers contribute 12 percent. once the new policies are put into new account number which will be telephones reached the 10 mil- number of mobile phones is market share of around 5% of the leasing indus- Athauda Seneviratne, Minister effect. the National Identification card lion mark (10,734,074 to be about 8 million. try. LOLC currently owns 67% of CLC’s equity, of Labour Relations and Manpower However, the EPF is taking a number. This is expected to min- exact). According to the The number of internet while Singer Sri Lanka (‘A+(lka)’/Negative) and said that in view of the EPF cele- good beating as the value of the imise the hassle of transferring Central Bank, 2007 saw the and email connections had the general public own 30% and 3%, respective- brating its 50th year, several new monies therein are losing there data of accounts when people number of telephones increased by 56 percent from ly. policies will be implemented for the value because they are invested in change employment. increase by 47 percent, the 130,000 to 202,348.