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Thursday December 1st, 2022

Demand for small cars, homes to rise as Sri Lanka govt widens soft loan scheme

ECONOMYNEXT – Sri Lanka’s government has decided to widen its Enterprise Sri Lanka concessionary loan scheme, under which 36 billion rupees have already been disbursed, raising demand for small cars and homes.

The finance ministry said in a statement migrant workers will get up to 10 million rupees each as housing loans and owners of three-wheeled auto-rickshaws will get up to two million rupees each under the new scheme.

“The government, on realizing the success of Enterprise Sri Lanka concessionary loan scheme, is to introduce further concessionary loan to widen the schemes enabling the stake holders to move towards next generation economic activities in their areas of activities,” it said.

Migrant workers will be given up to 10 million rupees concessionary housing loans to be repaid in 15 years with two year grace period.

Migrant workers who have registered under the Foreign Employment Bureau will have to  save a considerable amount of their remittance in a local bank and 75 percent of the interest rate will be borne by the government through the Treasury.

Concessionary loans of up to two million rupees will be given to three wheel owners to convert to a safer and comfortable mini taxi service with small cars, the ministry said.

“The government will bear 75 percent of the interest rate. The three-wheel owners, who operate their own three wheelers and who are above 35 years of age, are entitled to this concessionary loan.”

The Enterprise Sri Lanka scheme offers attractive concessionary financing to stimulate investment and expansion by entrepreneurs, SMEs and even large business.

The loan amount ranges from 50,000 rupees to750 million rupees.

The proposal made by the Minister of Finance and Mass Media Mangala Samaraweera to expand the already approved loan schemes to cover more areas was approved by the Cabinet of Ministers last week.

The Enterprise Sri Lanka concessionary loan scheme introduced under the 2017 and 2018 budgets had been a huge success, the statement said.

The self employed, women entrepreneurs, and small and medium entrepreneurs have so far been registered for various loan schemes of up to 65 billion rupees through state and private banks, it said.

Loans worth 36 billion rupees have been disbursed to over 34,500 people.

The statement said Samaraweera has proposed to introduce another loan scheme of 10 million rupees with 75 percent interest concession to build elderly care centres to support Sri Lanka’s rapidly ageing population.

The loan schemes will be continued in 2019 as well with Cabinet approval being granted to a proposal made Samaraweera to allocate 700 million rupees to pay the interest rates to banks through which these loans will be channeled.

The Treasury has been authorized by the Cabinet to enter into agreements with state and private banks to extend the loan scheme in this year too.
(Colombo/January 28/2019)


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Sri Lanka China-backed port to welcome second cruise ship

ECONOMYNEXT – Sri Lanka’s China-backed Hambantota Port said it was getting ready to welcome MV Azamara Quest, a cruise ship, as another passenger vessel departed.

Mein Schiff 5, operated by TUI had departed Hambantota International Port for Pulau Penang Island, Malaysia on November.

“As well as being her maiden call at the port, Mein Schiff 5 is the first passenger cruise ship to call at the port since the pandemic began,” said Johnson Liu, CEO of Hambantota International Port Group (HIPG) said in a statement.

“It was undoubtedly a great boost for the tourist economy in the south when the vessel called at the Hambantota International Port.”

Mein Schiff 5’s passengers had also visited the Bundala National Park, Hambantota Botanical Gardens, Galle and Kataragama.

Passengers had explored Hambantota by tuk-tuk, while others had enjoyed the beaches in the Shangri La Hotel, the port said.

MV Azamara Quest will arrive in Hambanota on on December 05. (Colombo/Dec01/2022)

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Sri Lanka’s shares gain in mid market trade

EXONOMYNEXT- Sri Lanka’s shares gained in mid market trade on Thursday (1), pushed up by strong positive sentiments on interest rates easing in line with inflation and speculation on government to hold talks with multilateral creditors ADB and World Bank for a possible loan facility.

Market has continued to gain for the past four sessions.

“Shares were moving on positive strong sentiments flowing in from yesterday (30), we are seeing a rally in the hotels, while the retail favorites such as LIOC and Expolanka,” analysts said.

Positive investor sentiments have been established, from positive comments from the Governor of the Central Bank over market rates eventually seeing an ease despite the fears of a domestic debt restructuring as inflation falls, increased liquidity in dollar markets, and the inter-bank liquidity improves.

Analysts further stated that, Treasury related stocks are also activated due to downward movements in yield.

All Share Price Index (ASPI) gained by 1.4 percent or 123.41 points to 8,774.64, while the most liquid share gained by 1.31% or 35.68 points to 2,765.

The market generated a turnover of 1.6 billion rupees at 1130 hours. (Colombo/Dec1/2022)

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Sri Lanka electricity losses from overpriced fuel, no tariff hike considered: regulator

ECONOMYNEXT – Sri Lanka’s state-run Ceylon Electricity Board’s high operating costs are partly due to excessive prices paid for fuel and no tariff hike is being considered, Chairman of the Public Utilities Commission of Sri Lanka, Janaka Ratnayake said.

The CEB itself does not buy fuel but depends on state-run Ceylon Petroleum Corporation and Lanka Coal, another state firm to buy fuel. Both firms are periodically caught in procurement scandals.

“They are paying about 385 plus rupees per litre for furnace oil,” Ratnayaka told EconomyNext.

“That is too much. From the global market we can buy it to much lower price. It can be imported below 200 rupees,”

“I ask the government to take the necessary steps to create a system to import furnace oil, like they did for fuel, to be imported at the lower price levels. If that happens, we can go without going for a price hike.”

Sri Lanka’s CEB generally gets furnace oil and residual oil from the domestic refinery and usually do not import furnace oil.

The refinery however is not regularly operating due to inability to get crude amidst the worst currency crisis in the history of the island’s intermediate regime central bank.

Ratnayake had earlier brought to light import costs of the CPC.

Pushing for operations efficiency of the CEB is a role of the regulator. Regulating costs based on global benchmark prices to push for procurement efficiencies is a standard practice. However the PUCSL is not the official regulator of the petroleum sector.


Sri Lanka power tariff revisions sought in Jan and July: Minister

Power and Energy Minister Kanchana Wijesekera told parliament that cabinet approval was sought to twice yearly tariff hikes in January and July of each year.

No Electricity tariff hikes are being considered yet, Ratnayake said.

Wijesekera blamed the regulator as well as successive administrations for not regularly revising power prices and pushing the sector into crisis.

In Sri Lanka activists had also blocked cheap coal power. (Colombo/Dec01/2022)

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