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Wednesday February 1st, 2023

Sri Lanka IT industry group call for education, exchange controls on foreign firms

ECONOMYNEXT – Sri Lanka Federation of Information Technology Industry Sri Lanka (FITIS) has called for more graduates to fill vacancies, liberalization of the fintech landscape and exchange controls on foreign players in the country.

Global companies are hiding behind a Western thought process that “globalisation is free for all and digital colonisation is a God given right” FITIS said.

Graduate Demand

The demand for IT graduates are much higher than the 10,000 graduates that the higher education system can produce, FITIS said, asking for measures to boost them to 50,000 a year.

An IT graduate can earn a average medium income of 250 US dollar a month and those with more knowledge and experience can earn around 500 dollar month, FITIS said.

FITIS complained that large foreign IT firms are given tax breaks not available to local ones.

“Another important step is to change policy on taxation so that level playing fields are created for our local digital economy so that foreign digital players operating in the country do not have unfair advantages,” the grouping said.

God Given Digital Colonization

FITIS also wanted exchange controls on foreign firms, which were was engaging in digital colonization as a “God given right”

“There are large international digital players operating in the local market without paying any taxes because regulators have failed to bring in policies that would prevent these players from taking our foreign currency out of the country,” the statement said.

“Although the Central Bank has admitted that a level playing field is necessary, nothing has been done since their report in 2019.

“Meanwhile these global companies hide behind the western thought process that globalisation is free for all and digital colonisation is a God given right of those who have the might to do it.

“We need to look to our neighbours like India and Bangladesh who have taken steps to prevent this from happening,” FITIS said without elaborating the exact controls.

FinTech

Sri Lanka also needs better policy space for fintech, the grouping said.

“Although FinTech is now a global phenomenon, for providing financial benefits not only to the elite but also to the bottom of the pyramid, Sri Lanka is not in a position to cash in on the technology’s full advantages, because once again we lack the policy framework to make it happen,” FITIS said.

“Fintechs are invaluable for managing money through digital payments allowing the convenience of cashless transactions.

“Online payments also save time, as business owners and customers no longer have to queue up for ATM services. Payment apps help to keep track of incoming and outgoing funds, which comes in handy while filing returns.” (Colombo/Nov23/2022)

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Sri Lanka shares edge up at close

ECONOMYNEXT- Sri Lanka’s shares edged up on Wednesday pushed as investors bought in to beaten down shares following the previous session’s drop, market analyst said.“

At this price level what we are seeing is a lot of confidence from the investors to collect when the prices drop. So, the market is not falling sharply,” a market analyst said.

Market had also seen buying in Expolanka shares on speculation that the parent company of SG Holdings was buying back into the shares.

All Share Price Index (ASPI) edged up by 0.96 percent or 84.96 points to 8,950.01.

The most liquid index S&P SL20 gained 1.27 percent or 35.02 points to 2,799.53.

Banking and Insurance counters had seen interest on the back of positive sentiments from the IMF.

The central bank has said it could cut interest rates in future when the the country sees fall in inflation, which has already started decelerating.

The market saw a turnover of 1.5 billion rupees today,lower than the month’s daily average of 1.8 billion rupees and nearly half of 2022 average turnover of 2.9 billion rupees.

The bourse saw a flow of net foreign inflow of 45 million rupees extending the net offshore buying to 1.9 billion so far this year.

Top gainers of the day were Commercial Bank, Expolanka, and Ceylinco Insurance. (Colombo/Feb01/2023)

 

 

 

 

 

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Sri Lanka bond yields down at close

ECONOMYNEXT – Sri Lanka’s bond yields were down at close following a bond auction on Wednesday, dealers said while a guidance peg for interbank transactions remained unchanged.

“The rates were steady at the auction,” a dealer said.

“This can be a signal to the market saying the rates will go down in the future.”

A bond maturing on 01.07.2025 closed at 32.40/60 percent, down from yesterday’s 32.60/85 percent.

A bond maturing on 01.05.2027 closed at 29.10/35 marginally down from yesterday’s 29.20/75 percent.

The Central Bank’s guidance peg for interbank US dollar transactions remained unchanged at 362.14 rupees against the US dollar.

Commercial banks offered dollars for telegraphic transfers at 371.38 rupees on Friday, data showed. (Colombo/Feb 01/2022)

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Sri Lanka bill auction hits pothole after 2025 bond spike

ECONOMYNEXT – Sri Lanka sold only 45 billion rupees in Treasury bills at Wednesday’s auction after offering 120 billion rupees, data from the state debt office showed, amid market confusion over a spike in a two year bond at an earlier action.

30.1 billion rupees of 3-month bills were sold at 29.91 percent, unchanged from a week earlier after offering 60 billion rupees for auction.

5.1 billion rupees of 6-month bills were sold at 28.72 percent, flat after offering 30 billion.

10.3 billion rupees of 12-month bills were sold at 27.72 percent after offering 30 billion.

Phase II subscriptions have been opened.

The market was foxed after the 2025 bonds were accepted at sharply higher yield than market on January 30, dealer said.

There was further confusion as the there was an outright purchase of 2025 at around 29 percent earlier in January.

Some investors speculated that the authorities were trying to drive more buyers towards short end bonds as bill volumes were getting larger. (Colombo/Feb01/2023)

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