News

Primary dealers ask for more 

"We should be able to short sell government securities, otherwise we cannot make a market for them," President of Primary Dealers' Association, Dula Weeratunga said at a SLASIA forum on debt last week. 

He quoted Pakistan as an example where short selling has been recently permitted and suggested that the government allows at least 10% of their outstanding debt to be short sold. 

A suggestion was also made to licence satellite dealers to back primary dealers in selling government debt in retail markets. 

But some dealers thought this move was too premature.

As even members of the audience pointed out, the government debt market is more or less limited to Colombo and perhaps a few big cities. 

No dedicated dealer has a branch network outside the capital and while some dealers are fully owned subsidiaries of commercial banks and could use bank branch networks to promote government debt, there is also an obvious conflict of interest in mobilising savings deposits vs and government debt, it was observed.

This year the Central Bank trimmed the number of primary dealers down to eight from 18 by bringing in new requirements of a Rs. 150 million capital to set up a dedicated primary dealership.

The debt market is on the threshold of springing into a more automated environment with an scripless (online) bidding system for the dedicated primary dealers and also a debt exchange for secondary market operations in government debt. The Exchange will be up and running by the first of April next year, Weeratunga said, hopefully not tongue in cheek. (see our story on debt exchange on page one )

Weeratunga said that Central Bank's open market operations or the practice of fixing the floor and caps on repurchase and reverse repurchase rates has to change to a market determined system. He said that now it is not clear if repos are used to address exchange rate policy through interest rates or control liquidity shortfall through interest rate adjustments.

Risk management and surveillance, are two other prerequisites to have develop a well-tuned government debt market, Weeratunga said. Primary dealers are also asking for off balance sheet hedging instruments like derivatives and for the development of new hedging instruments. Although the gilt edged market is generally considered the most low risk, we still have to manage interest rate risks , Weeratunge said . 

Primary dealers also want to deal in corporate debt so that portfolios could be broadbased and risk managed.

Weeratunga said that surveillance has to be undertaken by an independent body or division from the issuer. He added that a team of foreign experts advised the Central Bank on developing a separate surveillance network.

Lankan to lead Telecom Union

The study group started work last year and focuses on areas where developing countries need assistance.

Areas of study include universal services, Interconnection, development of regulatory competencies and regulation of telecommunication.

Universal access and services includes areas such as access to phones in rural areas, mobile phone operation in rural areas and tele medicine which entails keeping patient data to be communicated. Also included in the study are means of ensuring that schools are provided with internet services.

The study of interconnection involves ensuring means for the dominant operator to provide interconnection to other operators.

The International Telecommunication Union is an agency of the United Nations, which specializes in telecommunications.

Money Market update First Capital ltd.

The inter-bank call money market and the overnight repo market

A similar trend was witnesed in the term money rates and the rates upto one month eased by approximately 25 basis points. However, three months term money rate remained unchanged on the support of the renewed strong demand. 

On the back of the higher call money rates prevailed during the early part of the week, the weekly average call money rate stood at 14.68%, which is 28 basis points higher than the previous week. Following the call money rate, the market repo rates too eased slightly towards the end of the week. 

The overnight market repo rate dropped to 14% from 15% at the beginning of the week. 

Central Bank open market operations

As the Central Bank did not to offer term reverse repos, the liquidity shortfall in the market was renewed on a daily basis.

During the week, the reverse repo window released released Rs. 32.9Bn, averaging Rs. 6.58Bn a day. In spite of the increased repo rate, the amount recorded in the repo window was insignificant.

Treasury bill auction

Though the 91 days and the 364 days were well subscribed, the 182 days was under subscribed. Given the prolonging liquidity shortfall and the sustained higher inter-bank money market rates the treasury bill yields remained under pressure.

The highest gain was witnessed in the 91 days and 182 category. Due to the increased interest depicted for 364 days category, the change was marginal. The spread between 91 days yield and the 364 days yield was reduced to 167 basis points from 200 basis points in the previous week.

Treasury bond auction

Therefore, the three-year bond yield improved further, by 11 basis points. Due to the prevailing high bond yields the selling side of the secondary market was very weak, there were hardly any capital gains. 

On the other hand, the buyers were expecting. Therefore, the secondary market activities remain on the very tedious note.

Foreign exchange - dollar spot movement

Though there was some unexpected dollar selling, due to strong buying pressure, the spot rate bounced back strongly. The weekly spot average shot up to Rs. 79.37, as compared with the Rs. 79.02 of the previous week. Three months forward was quoted at Rs. 81.15 to Rs. 81.25, while six months was at Rs. 82.80 to Rs. 83.00. 

91 Days 182 Days 364 Days
Last Week 13.32% 13.62% 15.20%
This Week 13.61% 13.97% 15.28%
Change 0.29% 0.65% 0.08%
Maturity O8-Sept-03
Coupon 11.00%
Amount offered Rs.Mn 1250
Amount Accepted Rs.Mn 1250
Weighted Average 15.92%
Change 0.11%

Damro goes to India

The company sees value addition of around 40-50 per cent in Sri Lanka. Raman-ayake revealed that his company does not incur duty on the import of raw material unlike the company's Indian counterparts who incur import duties, enabling the company to have a competitive edge. The company aims to compete on price while providing a quality product.

We hope to take our product to Australia in five years, Rama-nayake said. Expansion plans also include the Middle East.

As a part of its commitment to sustainable development the company has invested in forestry and maintains 350 acres to feed its raw material requirements.

Damro Company (Pvt) Ltd was established in 1986 and started operations manufacturing steel chairs and subsequently diversified into the plastic and wooden furniture. The company maintains showrooms in most major towns and has a dealership network of around 1000 dealers. 

It has a monthly turnover of Rs.60 mn and fixed assets of Rs 250 mn. The company which employs 1200 workers has ten factories situated on 20 acres of land in Nittambuwa.

Doing wonders with Indian powerloom sector

By Udeshika Dissanayake 

Speaking at an exhibition held in Colombo by the exporters Sandeep Jain, Executive Director Powerloom Development and Export Promotion Council (PDEXL) said the two countries must gear up to face the challenge of more competition when the quota system is abolished. 

The two countries must make their presence felt in the international market.

"Sri Lanka has a good garment industry and India has good fabrics, if the countries get together we can do wonders," he said.

He also pointed out the need for the creation of a regional block for trade. 

The SAARC has created the SAFTA agreement but it needs to be more effective.

Jain said the delegation comprised mostly of traders with limited exposure of exporting. We have come forward to organise this exhibition because as individuals they may not be able to start exporting.

The exhibition held at Hotel Taj Samudra by the sales cum study team comprising 16 members on September 26 and 27 displayed a range of powerloom fabrics from India. 

The delegation also met with members of the associations of the garment manufacturers and importers to develop contacts and trade.However a visitor from a buying office said that, it is doubtful whether the exhibition has a significant impact on the garment manufacturers in the country. 

"We have been in the industry for over 20 years and most fabric manufacturers developed contacts through visits," she said.

He also pointed out that though the exhibitors did have good quality cotton fabrics and very good colours most of the exporters in the delegation were small or medium mill owners whereas buyers require a large quantity which could not be met by exhibitors.

He said the company had been buying fabric from Korea and Taiwan. 

These countries. have a massive range of fabrics as well as the latest designs in comparison to exhibits on display.

Sandeep Jain admitted that the powerloom manufacturers did not produce in very large quantities.

The need of the industry is not to have large quantities of the same design but to have various designs. 

The powerloom industry has more designs and colour combinations than the mill sector, he said. He also pointed out that India had a large range of fabrics of various designs .

The country's fabrics include those of traditional as well as modern designs, the problem is that the total range of Indian designs have not been exposed to Sri Lanka. Mr. Jain admitted that the Indian fabric exports to the country had dropped in the past years due to the quality. 

But now we have put our house in order and also realise the potential of garments manufactured in Sri Lanka.

The Powerloom Development and Export Promotion Council (PDEXCIL) set up by the Ministry of Textiles, Government of India for the purpose of developing and promoting exports of powerloom textiles, has undertaken a number of measures since its inception in 1995. 

Since the signing of the Free Trade Agreement between the two countries various delegations have been visiting the country including the visit of individual fabric manufacturers as well as visits and an exhibition by Sri Lankan delegations
Tea update 

All time record broken

The low grown average moved up to Rs. 155.92 from its previous record following good demand from traditional markets. 

The overall sales average on the other hand went up Rs. 148.10 in the previous week, the highest on record since March 1998. 

Meanwhile, the higher elevations saw a slow down in work due to the workers strike in the previous weeks. This has caused many plantations to overgrow. 

Plantation officials are now working frantically to clear up the overgrowth and ensure quality. 

However, up coming elections followed by the Hindu Deepavali festival promises to make or break the cycle for many days. 

Brokers expect the quality to drop as a result.

General elections 2000 from coconet online

Coconet Online is part of the Interlink Group, one of the oldest IT Companies in Sri Lanka. The Interlink Group also publishes Sri Lanka's only IT Magazine, PC World and the Sinhala Edition PC Lokaya.

Coconet Online's www.srilankaelections.com Web Portal site dedicated to the elections features everything you need to know about the General Elections 2000 - candidates, political parties, manifestos, campaign trails, election chat page, candidate listing numbers and their profile. This page will also feature election results as they come in on the 10th of October 2000, with direct updates from the counting centres.

Statistics-wise there is a search facility for election results of 1994 General Elections to give previous election results, their percentages, voting patterns by electorate, district and by province.

Extensive coverage of information on political parties, featuring PA, UNP, SLMC, Sihala Urumaya and JVP amongst others will also be available on this site.

Local company distributes Indian channels in Europe

These TV channels will be marketed to the homes of Indians living in Europe via Direct to Home (DTH) and cable( SMATV and CATV) DD-world, while DD- News will be available to subscribers from this month and DD- Tamil and DD-Bengali channels, from March 2001. 

DD-World is a Hindi entertainment channel with Indian films, film based programmes, Hindi music and dance; DD- News is a 24 hour news, current affairs and documentaries channel in Hindi and English, a company release says.

Worldview Global Media (WGM) is the owing company of young Asia Television, Media solutions, Worldview Global education, Worldview Institute, Panlanka Networking and Worldview Multi-media Sdn. Bhdin Malaysia. 

The local company has over 20 years experience in TV program production and distribution in Asia. WGML has already established the satellite downlink and uplink centre to bridge Asia with Europe for this project in Cyberjaya of the multi media super corridor (MSC) in Malaysia.
In the sky

New offer from one world

The "oneworld Explorer fare" is a specially priced ticket, perfect for travellers who need to visit at least three continents on one trip. Explorer is flexible to accommodate changes in travel plans, has no mileage restriction and with the oneworld global network, offers tavellers the choice of the whole world! This is made possible because of the alliance partners whose networks span the globe. Aer Lingues, American Airlines, British Airways, Cathay Pacific, Finnair, Iberia, LanChile and Qantas can take you to any part of the world you might wish to visit on their special price "Oneworld Explorer multi continent fare."

The oneworld Explorer fare simply treats the continents as individually priced stepping stones. 

For this purpose the world is divided in to six oneworld zones.

Europe and the Middle East including Algeria, Egypt, Morocco, Sudan and Tunisia, Africa Asia including the Indian Subcontinent Southwest Pacific including Australia, New Zealand and Papua New Guinea, North America including Canada, the United States, The Caribbean, Mexico, Central America and Panama, South America.

SriLankan flight schedules now on Dialog mobile phones

This is a result of the airline teaming up with MTN Networks (Pvt) Ltd, marketers of Dialog GSM mobile phones, to launch a Wireless Application Protocol (WAP) service.

While several international airlines feature the WAP facility, Sri- Lankan Airlines is only the second airline in Asia to give its customers the benefit of the WAP facility.

WAP technology permits access to Internat pages using mobile phones. A WAP phone has a custom built browser similar to that of a personal computer that enables it to display WAP pages, as does a computer browsing the Internet.

Today, large mobile phone manufacturers have started producing the special WAP phones and Dialog GSM has played a pioneering role in introducing this revolutionary technology to the mobile phone market in Sri Lanka. All Dialog GSM phones will now have WAP as a standard feature.

Mortein goes to South Africa

Mortein mosquito coils are manufactured by Reckitt and Colman, which commenced the process of manufacturing mosquito coils locally in 1993. fulfilling 50% of the local requirements. The Reckitt and Colman coil manufacturing plant is the first in the world to go into operation within the company.

With ISO 9002 quality standard endorsement on its products, the Mortein Mosquito Coils factory is recognised as a leading coil manufacturing plant in South Asia that produces quality mosquito coils meeting global standards.

According to company sources, Mortein Mosquito Coils are constantly subject to research at the Reckitt and Colman International Research Centre based in Australia. 

Mortein King Coil, Mortein's innovative red coil launched recently was a product developed at the centre, which was followed by "Mortein Lo Smoke" the first low smoke coil to be launched in the market. Mortein is also available in the market as Mortein 10 hour Red King coils with 20% extra power, Mortein 71/2 coils, Mortein Lo-Smoke coil. Mortein King 12 hour mats and Mortein aerosol cans, says a company news release.

Study in Adelaide

This is the biggest South Australian educational exhibition held in Sri Lanka. Top academic and study consultants from the South Australian Educational Institutes will be participating at this Exhibition to advise and assist Sri Lankan students in their career pathways. 

The Institutes that will be participating at this exhibition are Adelaide University, Flinders University, University of South Australia, Le Cordon Bleu, Eynesbury College and TAFE South Australia.

The city of Adelaide with a population of one million people is a cosmopolitan city with a high standard of quality and lifestyle. Adelaide is also one of the cheapest cities to live in compared to other Australian and Far East cities.

Adelaide is also known as the IT capital of Asia due to the presence of IT giants like Motorola, Microsoft etc. and it is also known as the "students' city" due to the presence of well established educational institutes, says a news release.

Grindlays post Rs. 365 m pre-tax profits 

The bank offers a broad range of products and services for both corporate and consumer customers and has progressively encroached further into cash management services, says a bank release.

"Early Bird" Competition

There will be three age categories - under 9, between 9 and 14, and from 14 to 18 years. The entry should not be larger than 42 cms by 30 cms and must be submitted by midday on October 2 at the Head Office or any branch.

A special feature of this campaign will be that those children who are Early Bird customers will receive higher cash rewards if they win. The top prize is Rs. 25,000 for Early Bird acount holders. Further details can be obtained by calling the bank's Hotline number 556660, says a bank release.

Another branch for Commercial Bank

This Service Point is connected to 76 other Branches, Service Points and MiniCom outlets, through ComNet and also offers 24 hour banking facilities through its CAT Automated Teller Machine and ComTel tele banking service.

The manager of the Homagama Service Point is Mr Lalith Jayasuriya. The Service Point is situated at 100, High Level Road Homagama says a bank release.

Lottery luck from Mobitel

Results of the following lottery will be announced. They are Mahajana Sampatha, Govi Sampatha, Jayaviru Sampatha, Wasana Sampatha, Supiri Vasana Sampatha and Arogya Shala Lotto.

The Mobitel Information Service was launched recently giving value addition to mobitel service.

LOLC share price climbs up

The Managing Director, Raj de Silva, who took over the post in January said that the share price of his company was being pushed up by heavy buying demand propelled by the recent turnaround of the Company. LOLC which has been revamped with new management, launched its third decade last month, with island-wide events. The recently released quarterly result of the company showed a 125% increase in profits over the last year.

The exceptional first quarter results have driven the Company to declare a very early 15% interim dividend. LOLC has traditionally paid its interim dividends only in its last quarter. A rights issue of one for one too has been announced, doubling the share capital of this extremely reserve rich company. Despite the high share price, LOLC which has an asset value of Rs. 126/- per share is still a good buy with an attractive P/F: ratio.

'Voyage of Discovery' on a new challenge

Prior to the re-launch of the Voyage of Discovery, the yachts' exterior, interior, mechanics and computer systems were given a complete overhaul and then finely tuned under the watchful eye of skipper Joe Outred, in preparation for this world adventure.

"The Voyage of Discovery World Adventure is going to be a fantastic challenge," admits Skipper Joe Outred. 

"The boat is carrying the most up-to-date equipment and I have meticulously studied the sea charts for the journey ahead. A round-the-world trip is the ultimate adventure for any mariner - this is a great challenge for all the crew and we are raring to go," added Outred.

The Voyage of Discovery created an imposing sight last month as it sailed gracefully past the ultramodern skyline of Singapore on to Indonesia, then over to Thursday Island in Australia, Bali and Samoa, the first stops in a long list of destinations the yacht will visit as it circumnavigates the globe. 

The boat's 126 foot mast was dwarfed by the highrise buildings crammed against the waterside where cutting edge architecture was set against the very latest in boat design and maritime technological innovation.

The crew spent weeks preparing for the formidable task ahead. "Some testing waters lay before us and we will be spending extended periods at sea - up to 15 weeks at a time - so it is imperative that the crew are at the height of physical fitness," explained Outred. 

Relentless training included raising and lowering the two tonne sails countless times - pushing the boat, and the spirited crew to the limit of their capabilities.

Last year the Voyage of Discovery and her crew of intrepid explorers successfully completed a Voyage of Discovery which took them to 17 countries, spanning three continents in just 170 days. 

The epic journey reached its climax in the Indian Ocean in November last year, a destination which will hopefully witness the euphoric return of the vessel when they complete their round-the-world adventure in 2000.

Quality people for success - CIMA survey

Announcing details of the findings, CIMA's Sri Lanka Division said half of the senior executives from leading businesses around the world identified this as the key success factor, ahead of speed of change (17%), intellectual capital (8%) and the impact of IT (8%)

However, regional variations show that respondents from Asia voted less frequently that the retention of quality staff was the top issue for future business. About 37% of executives from Asian companies rated this as the key factor compared to the other regions studied where the proportion is at least 50%. 

By contrast, 22% of Asian respondents valued speed of change as the most crucial business success factor, which is slightly higher than the global mean of 17% and significantly higher than the response from Germany where the comparative percentage was just 8%. Richard Ebel, President of CIMA - Sri Lanka said Global Business Management Week was organised to alert businesses to the challenges facing them over the next decade. This survey has highlighted that, despite all the talk about the potential impact of issues such as e-business, the euro and the speed of change, companies have not lost sight of their most important asset- their people, says a news release. 

ITI acquires Toc analyser

The Organic Carbon in water and waste water is composed of a variety of organic compounds in various oxidation states. Some of these carbon compounds can be oxidised further by biological or chemical processes, and the Biochemical Oxygen Demand (BOD) and Chemical Oxygen Demand (COD) may be used to characterize these fractions. The presence of organic carbon that does not respond to either the BOD or COD test makes these tests unsuitable for the measurement of total organic carbon. Total organic carbon is a more convenient and direct expression of total organic content than either BOD or COD, but does not provide the same kind of information. If a repeatable empirical relationship is established between TOC and BOD or COD, then TOC can be used to estimate the accompanying COD or BOD.

The TOC analyzer utilized heat and oxygen to convert organic carbon to carbon dioxide, which is measured directly by a non discursive infra-red analyser. Organic carbon levels as low as 100 parts per billion and up to 10,000 parts per million can be detected through this technique. The TOC method is an efficient and environmentally friendly technique as it is fast, does not generate toxic chromium as in COD analysis, and needs only a small quantity of sample. This facility at the ITI is now being used to investigate anthorpogenic impact on Sri Lanka lakes in Anuradhapura, Dambulla, Dambana, Kandy, Mahiyangana and Polonnaruwa using the paleo ecological concepts. This work is being done in collaboration with the Queen's University of Canada, says a news release.

Workshop on Interest Based Problem solving

The Merchant Bank of Sri Lanka Limited (MBSL) was privileged to host an EFC Asia Foundation workshop on "Enterprise Labour/Management Training" on September 7 and 8. Its objective was to train both managers and union members to resolve disputes and specifically in-house disputes as part of HRM strategy of the MBSL, says a Bank release.

The Interest Based Problem Solving (IBPS) technique, which is now widely used in mediation, is adopted for dispute resolution aimed at fostering Labour Management cooperation to improve productivity. The IBPS technique is one where both parties win through a solution based on each party's interest rather than a position based negotiation resulting in a compromise.

ISO 9001 for ABS

ABS commenced its operations at their Kaduwela plant in July 1999. Within a period of 12 months, ABS has been able to complete major projects such as factory buildings, warehouses and aircraft hangers.

MTI launches 8S model in Sri Lanka

The 8S model, which was conceptualized, researched and developed by MTI - the international marketing consultancy, is already used by clients in USA, Mexico, South America, Philippines, Bahrain, Spain, Italy and Poland, says a company news release

Compendium of Law on web

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