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Wednesday October 14th, 2026

It’s going to be a bumpy 2020

A New Year dawns and as always, we begin to hope for a better and more successful twelve months. For us of the fourth estate, life continues attempting to make sense of the economic and political challenges the country will face.

The political drama begins on January 3 when President Gotabaya Rajapaksa delivers his policy statement in Parliament.

In the House will be the same people who were there over the past four years, except that Prime Minister Mahinda Rajapaksa and his 15 member Cabinet will be occupying the government benches.

Seated opposite the PM will be the new Leader of the Opposition Sajith Premadasa who was the New Democratic Front candidate at the November Presidential election.

What happens after the “Throne” speech will be interesting.

President Rajapaksa has the power to prorogue Parliament, shutting down the business of the House for another period as he did, soon after the elections.

However, under the 19th Amendment to the Constitution, such a second prorogation can be seen as “arbitrary” if there is no reason for this action and it could be challenged in court.

Anura Kumara Dissanayake being welcomed by crowds at his hometown of Thambuththegama/JVP Media

As Janatha Vimukthi Peramuna leader Anura Kumara Dissanayake pointed out the policy statement needs to be debated and the views and the concerns of the Members of Parliament aired. At a press conference held on Dec 26, he said the party has information that the President wants to prorogue on Friday the 3rd, and demanded that it not be done.

Shutting down Parliament will rob the chance for the Opposition to air its views, bring the clamour of the streets into the House and criticize the government.

At the same time, Parliament has to function in some form for the government to enact legislation, pass votes on account and introduce amendments to fulfil its manifesto.

The New Parliament and the struggle for nominations

Come February 28, President Rajapaksa has promised to dissolve parliament and a Parliamentary General election is expected to be called for the last week of April, probably the 25th of that month.

The SLPP will go all out to win a two-thirds majority in the House in order to bend the Constitution to its will and most importantly restore full Executive powers to the President.

That is why the two months of Parliament is crucial for all the opposition political parties as they can begin their campaign against the government in the House.

The opposition political parties will need all the help they can get to make a mark.

The principal opposition, the United National Party which got a sound thrashing in the Presidential elections because of rampant in-fighting appears to not have learnt its lessons and continues to turn on itself and is looking like a heap of scrap.

The challenger Sajith Premadasa and Prime Minister Ranil Wickremesinghe share a smile at Ranala during the presidential election campaign/PM’s Media

Party “reorganizing”, code for getting rid of former Prime Minister Ranil Wickremesinghe as the Party Leader, is going nowhere and although the party has announced that Premadasa will be its Prime Ministerial candidate, the Leader stubbornly clings to his post. Premadasa has publicly said he cannot lead the campaign without being the party leader.

The party cannot even hold a meeting it appears, as plans for a meeting of the MPs slated for Dec 30th at its headquarters in Kotte did not take place. Wickremesinghe and Premadasa were to meet also on Monday to sort out their differences, but that too did not happen.

In this state, surely the UNP cannot give the leadership to the opposition, not only to win the election which at this stage seems a daunting task, but even to build a strong Opposition in Parliament.

Another interesting issue to watch will be the nomination process for the Parliamentary elections.

In his first press conference held a month after he was elected President Rajapaksa said the public “looks at our traditional politicians with disgust.” It was a telling comment; his hard-core backers are hopeful new type of Parliamentarian who could command greater confidence in the public will be elected.

Therefore there will be a tussle between the “professional politicians” and the technocrats as well as ex-military men and women who formed the “Viyath Maga” group to get their names on the nomination lists.

There are early signs of this happening.  A Rajapaksa stalwart, Media Academic and former Media Secretary Dr Charitha Herath declined the post of Lake House Chairman, usually a plum state media job, to as he said on twitter to “serve in a bigger capacity.”

The President too seems to be wanting more of these professionals in Parliament, bringing a new element into governance. It will be somewhat like the Chinese model where technocrats are moved into political positions to make government more efficient.

But what of the traditional politicians? Will the Sri Lanka Podujana Peramuna strike a balance between the two groups? What we can certainly expect is a tussle between the two, and only time will tell, which of the two would emerge victorious.

And while that tussle takes place, the third force in the governing alliance, the Sri Lanka Freedom Party is bound to suffer. Its members who entertain the idea of entering Parliament will have to stand in line behind the SLPP as well as the Viyath Maga hopefuls.

The Tyrannosaurus Rex in the room

Beyond politics, the T-Rex in the room will be Sri Lanka’s huge international debt.  In the third quarter of this year, Sri Lanka has to pay back an instalment of a mind-boggling US$ 4.8 billion, the highest this country has paid in its history.

The government has already reduced value-added tax and income tax, cutting government revenues significantly. It may have to raise money through international bonds or other instruments. Fitch ratings has already downgraded Sri Lanka.

In their only Press Conference during the presidential campaign, the current Prime Minister when asked how they plan to pay off the debts, answered: “don’t worry we know how to get the money.” So, the elder Rajapaksa, who is also the Finance Minister will have to work some magic and deliver on the promises made.

President Gotabaya Rajapaksa congratulates his brother Mahinda after the latter was sworn in as Prime Minister/PMD

There are signs that the government is preparing the ground for some austerity measures.

At least two Ministers, Bandula Gunewardene and Mahinda Amaraweera have talked of “tightening belts.” Two Monks, Mururththetuwe Ananda Thero and Omalpe Sobhitha Thero, both close supporters of the Prime Minister, have asked Buddhists to donate money to the government.

In fact stories of how the Buddhists in Thailand opened the collection boxes in the temples and donated money when the Thai King made such an appeal, has been doing the rounds.

As the President has stated, expectations of the electorate that brought him to power are high; reforming government services to deliver a more efficient service, safeguarding national security and providing a good life for all.

Will it be as easy as he and his supporters think? The challenges are many, and he will have to learn to be both politician and manager, and not step on too many toes!

As for the Millenium Challenge Compact (MCC) deal with the USA, which the Rajapaksa camp used to scare voters to win more votes, it is now more than a possibility that it will be signed. And will Arjuna Mahendran of Bond scam fame be brought to trial? Probably not; after all, he is said to have disappeared!

All this points to a pretty tumultuous 2020, so hang on to your hats, it promises to be quite a bumpy ride!

Sri Lanka to consider cash/dollar incentives for tourism promotors: President

ECONOMYNEXT – Sri Lanka is considering a tourism industry request to provide incentives in dollars or cash to those who bring more tourists into the country from next year, President Anura Kumara Dissanayake told an investor forum this week.

Speaking at the Sri Lanka Economic and Investor Summit 2026 on Monday (12), the President said the tourism industry has submitted a proposal to raise incentives over the previous year for those who bring in tourists above the target set by the government.

“We are currently considering provisions in the upcoming budget to offer a cash or dollar incentive per tourist above that threshold through the Tourism Development Authority,” he told the gathering when speaking about the plans to boost tourism.

“This would incentivize companies and institutions to bring in higher numbers of tourists.”

The incentive will be paid on the volume exceeding that benchmark, he said.

“For example, if 100 tourists visited previously and 120 arrive the following year, an incentive wouldn’t apply to the base 20, but rather on the excess beyond a certain growth threshold.”

Sri Lanka has pinned hopes over strong tourism growth for more job creating and foreign currency inflows. (Colombo/October 14/2026)

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Sri Lanka Treasury bill yields rise on shorter term, less bills sold

ECONOMYNEXT – Sri Lanka’s Treasury bill yields rose on the shorter tenor at Wednesday’s auction, with 66.12 billion rupees of bills sold of an offered 90 billion, data from the Public Debt Management Office showed.

The 3-month bill was up 4 basis points at 9.30 percent, with 40 billion rupees offered and 40.19 billion rupees sold.

The 6-month bill was unchanged at 9.44 percent, with 30 billion rupees offered and 8.45 billion rupees sold.

The 12-month bill was unchanged at 9.95 percent, with 20 billion rupees offered and 17.48 billion rupees sold.

All 3 bills are available on tap. (Colombo/Oct14/2026)

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Sri Lanka stocks close down 1.4 pct on geopolitical concerns, profit-taking

ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange closed down on Wednesday, CSE data showed, with the benchmark All Share Price Index moving down 1.40 percent.

The ASPI was down 281.42 points at 19,796.06, while the more liquid S&P SL20 was down 0.94 percent, or 53.67 points, at 5,676.43.

Market sentiment was largely weighed down by geopolitical tensions in the Middle East and fluctuating oil prices, alongside margin calls, profit-taking, and the day’s Treasury bill auction.

“Things are moving more on sentiment rather than fundamentals these days, mainly with oil price fluctuations and Middle East developments, along with some margin calls and profit-taking,” Shahana, Senior Assistant Manager – Research at First Capital, said.

Positive contributors to the ASPI were Haycarb (up 2.84 percent at 199.50 rupees), Teejay Lanka (up 1.41 percent at 28.70 rupees), Aitken Spence (up 0.57 percent at 133.25 rupees), and Vidullanka (up 0.47 percent at 21.30 rupees).

Carson Cumberbatch (down 4.86 percent at 655.50 rupees), Tokyo Cement Company (down 4.79 percent at 73.50 rupees), Dialog Axiata (down 2.98 percent at 42.30 rupees), Distilleries Company of Sri Lanka (down 2.16 percent at 49.90 rupees), and Commercial Bank of Ceylon (down 0.63 percent at 197.25 rupees) were top negative contributors.

Market turnover was 1.93 billion rupees, roughly 35 percent above the monthly average. Capital goods led turnover with 405.82 million rupees, followed by the banking sector. Crossings were recorded in Dialog Axiata, DIMO, and John Keells Holdings, while foreign investors recorded a net selling of close to 5 million rupees.

Galadari Hotels (Lanka) announced that, following the conclusion of its ongoing refurbishment and pursuant to approval from Radisson Hospitality Belgium BV under the Hotel Management Agreement, the reopening of the hotel as ‘Radisson Blu Hotel Galadari Colombo’ is scheduled during the fourth quarter of 2026. (Colombo/Oct14/2026)

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Sri Lanka Customs set to reach fresh record revenue this year: analysts

ECONOMYNEXT – Sri Lanka Customs is likely to achieve a fresh record high revenue this year after reaching this year’s target of Rs. 2,207 billion this week, with more than 11 weeks to the year-end, analysts say.

Customs Spokesman Chandana Punchihewa said the revenue-collecting body had already surpassed this year’s target on Tuesday (13), reaching Rs. 2,208 billion.

The Customs exceeded its target for the second straight year in 2026.

Last year, Customs collected a record 2,551 billion rupees in revenue, exceeding a revised target of 2,241 billion rupees for the year and achieving 64.2% higher revenue than the previous year’s revenue of 1,553 million rupees.

Analysts say Customs will surpass last year’s record revenue by the end of November if there are no major policy reversals or disruptions to the economy in the country during that time.

Customs’ 2026 target of 2,207 billion was 13.5% less than last year’s because they originally expected a significant decline in car imports early this year. (Colombo/October 14/2026)

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Sri Lanka President reveals timelinefor new laws related to SOE, investments

ECONOMYNEXT – Sri Lanka President Anura Kumara Dissanayake revealed the timeline for key laws related to State-Owned Enterprises (SOE) and Public-Private-Partnership (PPP) to boost investments in the island nation.

Delays in formulating and enacting key structural legislation, specifically governing SOE reforms, PPPs, labor market flexibility, and modernizing the century-old Customs Ordinance, have emerged as major bottlenecks to Sri Lanka’s long-term economic competitiveness and fiscal sustainability.

The absence of a modernized legal framework for SOEs perpetuates fiscal leakages, inefficient governance, and persistent public sector debt burdens, while vague or outdated rules on PPPs and labor deter both domestic and foreign direct investment by creating regulatory ambiguity and rigid operational constraints.

Furthermore, the archaic Customs Ordinance of 1869 hinders trade facilitation, fosters administrative opacity, and creates revenue leakage risks at a time when export-led growth is critical.

Under the International Monetary Fund’s (IMF) Extended Fund Facility (EFF) arrangement, Sri Lanka has committed to prioritizing these legislative enactments.

Commenting on these laws, President Dissanayake said the government has been working on them and expects them to be enacted soon.

“Regarding the SOE law, I expect it will be presented to the Cabinet in about two weeks,” Dissanayake told the gathering at the launch of the Sri Lanka Economic and Investment Summit 2026 on Monday (12).

“The PPP law has been drafted and submitted to the Legal Draftsman’s Department, and we have received their recommendations.”

“Regarding labour law, about twelve different labour statutes currently exist. We are consolidating these into unified legislation. A draft bill has already been formulated, though reviewing and finalizing it will take some time.”

He said an agreement has been reached on the Customs Ordinance following extensive discussions involving the Treasury and the Customs Department.

“The proposed amendments to the Customs Ordinance are the most appropriate way forward,” he said.

“Those proposals have now been submitted to the Legal Draftsman’s Department, and we expect the bill to be finalized promptly. Most likely, all of these bills will be presented to Parliament by February.”

The IMF contends that establishing transparent, enforceable, and modern legal frameworks is essential to eliminate governance vulnerabilities, enforce fiscal discipline, improve revenue collection, and signal regulatory stability to foreign investors, thereby ensuring Sri Lanka’s post-default recovery transitions into sustainable macroeconomic growth. (Colombo/October 14/2026)

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Sri Lanka’s Standard Capital exits loss-making paints subsidiary

ECONOMYNEXT — Sri Lanka listed investment company Standard Capital has disposed of its stake in subsidiary Standard Paints (Pvt) Ltd for a nominal consideration of 1650 rupees, saying the move would improve its financial position as the subsidiary carried a negative equity value.

In a disclosure to the Colombo Stock Exchange, Standard Capital said its board had previously decided on August 24, to either strike off the subsidiary or dispose of its equity stake for a nominal value.

The company subsequently sold its holdings in Standard Paints on September 28, comprising a 65 percent stake represented by 6.5 million ordinary voting shares and 100 percent of the subsidiary’s 10 million preferential shares.

The shares were disposed of for a total consideration of 1650 rupees. (Colombo/Oct14/2026)

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