Tea markets buoyant in first quarter 2001

"Taking into consideration that quality would reflect an improvement starting with January sales, combined with the current indications of demand, producers could expect remunerative prices during the first quarter of 2002," they said in an annual review. Healthy prices were maintained towards the end of the year with the strong marketing conditions experienced during the months of November and December, they said.

The final auction for the year ended on a "reasonably high note" last week, they said.

Most overseas buyers appeared to be quite active despite the holiday period and overall demand was better than anticipated, the brokers said. The absence of a sale this week would also have contributed to more buying pressure, they said.

Low growns, which make up more than half the crop, met with better demand and most varieties appreciated in value. Last week's auction averages are expected to improve from the previous week's sale because of improved demand from most markets and the depreciation of the rupee. The US dollar, which was trading at Rs. 83.35 during the first sale of the year, had gained by 11.7 percent to Rs. 93.14 by the sale of December 12, the broking firm said.

The sale average of Rs. 153.67 at the first sale of the year had fallen by 2.4 percent by the sale of December 12 when an average of Rs. 149.93 was recorded. In dollar terms the decline was a significant 12.5 percent. "In an industry that is 18 - 20 percent dependent on imported raw material inputs, the effects may be dramatic," the firm said.

Volume Based Charging for Mobile Internet

By Akhry Ameer

With the introduction of GPRS, Dialog GSM joins the ranks of developed markets such as Europe and South East Asia and is one of 40 countries to adopt this stepping-stone move towards third generation (3G) mobile technology. To the end-user it means high-speed mobile Internet access and data communication.

The technology also stimulates a shift in pricing from time-based charging to volume-based charging. Through GPRS, users will be always connected to the Internet. However, the users will only be charged for "downloads" rather than the duration they have been connected. This sounds to be a better method, as the charge will be more attractive overcoming problems such as slower links and heavy traffic. According to Dr. Hans Wijesuriya, CEO of MTN Networks the charge will be in the region of cents per kilobyte. The actual tariff is expected to be announced towards the end of the one-month free pre-commercial trial period.

Though all of Dialog GSM network base stations have been upgraded to provide GPRS services throughout its total coverage area, customers need to be in possession of one of many specified GPRS enabled devices to make use of these services. The most basic GPRS enabled device (hand phones) are now available in the market from Rs. 30,000 upwards, the prices of which should come down during the forthcoming year, according Dr. Wijesuriya. He added that the introduction is part of his organisation's policy to present the latest technology to its customer and is confident that the investment will realise its true potential in time to come.

ADB aid for SMIs in Sri Lanka

The package consists of loans totaling US$86 million and a partial credit guarantee to support commercial cofinancing of up to US$90 million.

The Small and Medium Enterprise Sector Development Program will enhance the business environment, strengthen business capabilities, and improve access to finance. 

It will also use information technology to improve access to markets and technology, and to enable banks to reduce lending costs.

Afghanistan – a long way towards rebuilding

This won't be the first time the international community has tried to help. More than three-dozen foreign aid groups have spent two decades on the ground in Afghanistan. They've built roads, bridges, homes, clinics, schools and mosques. They've laid out irrigation canals, dug wells, started bakeries and handed out food. They have taught job skills to war orphans and fitted land mine victims with artificial limbs. Their work kept the country from sliding further toward the Stone Age, but many of the gains it produced were obliterated by fighting, Taliban repression and an absence of rain. Will it be any different this time?

"I have a sense of a great national U-turn at the grass-roots level, of ordinary Afghans rejecting the cycle of war and decline," says Mark Malloch Brown, head of the United Nations Development Program (UNDP). "Afghans want to seize the moment."

Malloch Brown puts the price tag for Afghan reconstruction at US$ 6.5 billion over the first five years. World Bank President James Wolfensohn says it could cost $10 billion to $20 billion over a decade. At $20 billion, the bill would approach $1,000 for everyone in Afghanistan, making it one of history's costliest attempts at nation building.

Few states have failed as spectacularly as Afghanistan. Three out of four Afghans lack access to safe water; nine out of 10 have no toilets or other sanitation facilities; four out of five can't read; nearly one in 20 is disabled by land mines. One-fifth of Afghan children die before age 5. A third of the survivors are orphans; half are malnourished. The Afghan economy "is in a state of collapse," the World Bank says. The challenges in engineering a recovery are immense.

The major development agencies involved in the funding effort would be Brown's own agency, a host of other UN bodies, the World Bank, the International Monetary Fund (IMF), and the Asian Development Bank. The Islamic Development Bank also will likely help. So will dozens of non-governmental agencies, many for years working quietly in both pre-Taliban and Taliban Afghanistan. The development challenge is huge. Even before the conflict period, Afghanistan was "bouncing around the bottom" when nations were ranked according to the UNDP's human development index, notes Brown.

Meanwhile Afghanistan's Finance Minister, Hedayat Amin-Arsala, visited the World Bank on December 14 to discuss his country's reconstruction with the Bank's president, James Wolfensohn.

The two agreed on the importance of a strong government budget that would help coordinate distribution of foreign aid, which is expected to amount to tens of billions of dollars. "They agreed that a significant challenge for the interim authority would be the coordination of donor assistance in such a way that commitments and expenditures were aligned to Afghanistan's needs and its own vision for its future," the Bank said in a statement.

FAO study on Sri Lankan tea taste, appearance

Such a study could benefit India, where tea is grown in a much larger geographical area spread from Darjeeling in the east to Nilgiris in the south. 

"A study is being undertaken in league with the FAO's inter-governmental group on tea, on how climate affects the chemical properties in the beverage and its positive effects," Sri Lanka Tea Board chairman C.S. Ratwatte told the Press Trust of India (PTI). 

The study would help growers know exactly what these differences are and its positive impact on human health and consumer preference, Ratwatte said. 

Tea grown in Sri Lanka falls broadly into 6 climatic areas, and each has its own unique characteristics. 

While the difference in taste and appearance from various areas was known, what was not "widely" known was that these variations were the result of different chemicals in 'made tea'. 

These chemicals have been produced due to a combination of the climatic zone, the planting material and the method of manufacture. 

An example was the tea produced in the Nuwara Eliya climatic zone, which has chemical properties more akin to green tea than the standard characteristics of black tea. 

The study was deemed necessary because inadequate research had been carried out so far on the subject. 

Better Maldivian public services via IT

The project to link government agencies and provide information and services electronically to the public will improve the efficiency, transparency, and accountability of public sector management. The project will also establish the National Computer Center to coordinate ICT policies, standards, and practices for government work, and to build Internet kiosks in remote atolls. It will bring in sector reforms to bring down the costs of telecommunication access and services, which are relatively high.

A quarter of Maldives' 280,000 population is on the island capital of Male, and the rest are spread among 200 islands. "Most people on the atolls would be hugely empowered if they could access public services through the Internet at the same affordable prices as on Male," says ADB senior financial analyst Dong-Soo Pyo.

The project will link government ministries and related organizations in Male as well as on 20 outer atolls. The networks will be extended to other islands in a phased manner in future. 

South Asian insurance regulators meet

"The primary objective of this forum is to promote co-operation among South Asian insurance regulators to facilitate regulatory activities; the sharing of information and exp-eriences; the training of regulatory staff and the harmonisation of legislative approaches," said Dayanath Jayasuriya, Director General of IBSL. Nadeem Ul Haq, the IMF Representative in Sri Lanka, making the keynote address said there was a need to build good regulations with incentives. Country representatives also made separate presentations on the current status of the insurance industry and regulation in their regions.

Container truck firms face difficulties

ACT, while welcoming the new deputy finance minister Bandula Gunawardene, also in charge of rural economy, said the container industry suffered its worst period in the past two years

It said mostly small scale entrepreneurs were involved in the industry owning a few vehicles with finance from lending institutions. "They have mortgaged their properties to obtain loans to purchase commercial equipment. Most of these loans or leases are in arrears and some vehicles and properties are being seized due to nonpayment of loans/leases," the statement said. While agreeing that the situation cannot be changed overnight, the association said it was necessary to provide some assistance to the industry particularly small entrepreneurs.

WB loan 

SINWA retains MTI for strategic planning

With its 51-year history Sinwa is one of Sri Lanka's leaders in bonding solutions, rubber products and fashion footwear representing brands such as Multibond adhesives and Sinwa shoes. 

Commenting on this strategic decision, Sinwa's Managing Director Mr. Mohideen Cader said, "In times as competitive as these it is of paramount importance that we ensure rational, strategic thinking to provide the base of our activities. I am confident that MTI can provide the framework in which to do this."

The 8S model is a research based strategic marketing planning model. It approaches all aspects of the marketing function in a strategic and sequential manner.

It involves a strategic audit of the existing business and culminates with the formulation of a practical and action-oriented marketing plan document. 

The model is delivered using MTI's innovative ConsulTraining approach using a series of highly interactive workshops.

PMB concludes first real estate project in the south

The project was managed by the Bank's Real Estate Division, which was set up earlier this year. The bank has already purchased another block of land, which is now being developed with marketing of the land due to start next month, a PMB press release said.

The next stage of the Real Estate Division's business plan is to venture into low cost housing since several investors have approached the bank to form joint ventures to engage in low cost housing projects, it said. 

Celltel X'mas Dreams ring out loud at Majestic City 

Thousand of prizes ranging from T-shirts, caps and bandanas to free facilities from Celltel, discounts of up to 50 percent on new handsets or accessories, sensational red-uctions at participating shops, and grand prizes of two air tickets to the Maldives and two phones with connection are on offer at this promotion "Celltel X'mas Dreams." "Synchronized by a central Celltel booth in the main lobby of the mall, 'X'mas dreams' is turned into an electrifying experience through 25 participating shops and live DJ music and entertainment in association with Sun FM. All purchases at these shops entitle participants to discounts on Celltel services," a Celltel press release said.

Usually late but now punctual!

Between October 2000 and October 2001, 85 per cent of all flights departed within 15 minutes of scheduled departure time and 76 per cent of all flights took off within three minutes of scheduled departure time.

SriLankan flies to 27 cities in 20 countries and currently has 154 flight departures a week around its network. 

A new fleet of A330s and a concerted effort by the airline's Punctuality Improvement Committee (PIC) in Colombo has achieved sound results. The Punctuality Improvement Committee comprises all operational departments involved in flight departures such as Flight Operations, Engineering and Maintenance, Cargo, Airport Service, Inflight Service, Catering, Schedules Planning and Security. 

"We recently introduced a superior product by way of the Airbus A330 and A340 and the inflight features they offer," says SriLankan's Chief Technical Officer Richard Hutton. "What is also vitally important to ensure an overall quality product is on-time departure. 

We thus placed priority on punctuality and are glad to have seen sustained results over a period of time."

Citi National raises Rs 2.2 bln in funds

A bank statement said that through these instruments Citi National has tapped the market of investable funds of tenors of 6 months to 7 years. Investors have included pension funds, unit trusts, insurance funds, banks and semi gove-rnmental organisations as well as individual investors. 

"A noteworthy feature of such fund raising is that these specially designed instruments catered to investors with varying risk baring capacities, from bank guaranteed to asset backed products," the statement said adding that instruments also had tenors to suit varying investment horizons whilst allowing the corporate issuers to match their cash flows.

Out of the funds raised approximately Rs. 1.6 billion was through the issuance of promissory notes. 

Citi National also structured and placed listed debentures issues with tenors ranging between 2 and 7 years. 

"The issuance of long term instruments with tenors of more than 5 years is important to the development of the capital market as there are no government bonds of similar maturities. Long term guaranteed debentures can establish a market driven yield curve for low risk debt instruments. 

This is an essential prerequisite for pricing of future issues and for the valuation of companies, " it said.

Securtisations carried out by Citi National has enabled companies to diversify their funding sources and access lower cost funds. Also importantly, companies have gained access to longer-term funds which match their cash inflows from assets. 

The main concentration of issuers for securitisation so far has been in the leasing industry however Citi National recently ventured into securitisation of hire purchase receivables. 

The structured financing team at Citi National is presently working on a number of issues to further diversify the product range.

Citi National Investment Bank is the investment banking arm of Citibank NA in Sri Lanka, and of the National Development Bank (NDB). 

Emirates unveils opportunities to Colombo travel agents

In a presentation to about 50 travel professionals last week, Emirates Sales Manager Colombo, Devika Ellepola, said the airline's plans to increase its fleet to 100 aircraft by 2010, coupled with breath-taking development plans for Dubai will provide a much needed stimulus to the local travel industry.

"In every crisis, we see an opportunity," Ms Ellepola said. "The commitment of US $ 15 billion for 58 new aircraft is a forceful vote of confidence in the future of Emirates and Dubai. Use this to your advantage to sell more travel out of Colombo."

She said Dubai is also emerging as a major international convention venue, and is constructing a 9000-capacity complex for the 2003 conference of the International Monetary Fund (IMF) and the World Bank, an airline statement said.

Letter

Combank shareholders relieved

Along with many others, I took up this issue through the newspapers raising my concerns. As a layman it was initially difficult for me to understand the real impact of the proposal. But after obtaining the necessary information from my brokers and monetary authorities, I was shocked that a proposal of this nature had even been made because there was a real risk of the blue chip Commercial Bank share becoming a valueless piece of paper after being sucked into a holding company.

The issue has now ended and shareholders of the bank must be thankful to the Central Bank and the bank's board of directors for having clearly identified the dangers of the proposal and refusing to permit the formation of the holding company.

D.L.C. Fernando
Mattakuliya

BA withdraws fuel surcharge

"The withdrawal of the fuel surcharge is in direct response to customer demand and the recent fall in fuel prices," a BA statement said.