Financial Times

Despite blasts and Trincomalee unrest
Biz community, investing public optimistic
By Duruthu Edirimuni
Sri Lanka’s business community together with the investing public say they are optimistic about the economy and the general business sentiment of the country following week-long unrest.

Nawaz Rajabdeen, President, Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL) told The Sunday Times FT that the business community has risen from “worse situations” than what happened last week.
“This is a temporary setback and there will be no drastic change where business is concerned. We have had the Ceylinco, Galadari Hotel and the Bandaranaike Airport incidents but our growth rates have never declined. The foreign media has blown this out of proportion,” he said.

He said that the FCCISL had received confirmation from a high powered Chinese business delegation confirming their visit to Sri Lanka on May 13.
“Two weeks ago we had intimation from our Chinese counterpart saying that a powerful business delegation from China had proposed to visit Sri Lanka to explore investment opportunities. Last Thursday they confirmed saying that they are coming as planned and they have also requested to meet the Board of Investment officials. As such I feel that Sri Lanka has enormous resilience and we are already bouncing back,” Rajabdeen said.

Deva Ellepola, CEO, HNB Stockbrokers (Pvt) Ltd, said the market had gained during last Thursday and Friday and that it seems to be picking up. “We have had many such incidents in the past and we have been resilient. This has been a bad experience, but it has also brought some new areas to the peace process,” he said. He said that during the last two market days foreigners brought a lot of volumes. “This means that they have not lost hope in the country,” he said.

Dimuthu Abeyesekera, CEO, Asha Phillip Securities Ltd., said that the peace process should restart for the economic environment to show the promise it had before the bomb blast. “The market sentiment has not been affected much, but for sustainable growth the peace process has to start,” he said.
Rohan Fernando, Director C T Smith Stockbrokers (Pvt) Ltd, said that the business sector and the stock market will rebound, but the peace process has to continue for their long-term sustainability.

Deva Rodrigo, President, Ceylon Chamber of Commerce said that the Trincomalee events and the bomb blast at the Army Headquarters had an adverse impact on the country as shown by the downgrading of the sovereign rating by Standard & Poor and by Fitch Rating. “Some adverse impact on tourist arrivals is also likely. These are however insignificant when compared to the hardships and suffering endured by the affected people and their families,” he said.

“I am not surprised by the downgrading of the Sovereign Rating, but I am confident that the rating agencies will be equally quick to reassess the negative rating because the incidents in Trincomalee did not spread to any other part of the country and life is fast returning to normal there,” he added.
He said that the Minister of Enterprise Development and Investment Promotion, Rohitha Bogollagama, had informed business leaders that the SME Bank had agreed to provide soft loans to the 32 affected businesses at 4 percent yearly interest which is one third of the prime rate.

“I am therefore confident that Trincomalee businesses will soon be back on their feet, civilian property and life will be protected, businesses in the country will run as usual, and the impact of the recent events on business will be minimal and short-lived,” he said.

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