News & market updates

Planters' Association warned the government's decision to allow selected companies to import spices under an "approved enterprise" scheme risks diluting the Pure Ceylon brand, enabling smuggling/adulteration and harming farmers and exporters, potentially triggering trade disputes.

World Bank VP Johannes Zutt pledged continued World Bank support to help Sri Lanka implement job-creating reforms and mobilize private capital, following a prior pledge of over US$1 billion. The WBG has backed a 1 GW renewable energy program (US$150m) and a US$100m agriculture project, and plans further operations in tourism, regional development, digital development and ports/logistics.

World Bank VP Johannes Zutt concluded his visit, reaffirming WBG support including a pledge of over US$1 billion for Sri Lanka and partnership on a 1 GW renewable energy program (US$150m) and a US$100m agriculture project. Additional operations are planned in tourism, regional development, digital development and ports/logistics to mobilize private investment and create jobs.

The National Chamber of Exporters submitted 2026 Budget proposals seeking cross-cutting reforms to boost exports, including a request for the EDB to reimburse 50% of certification costs. It also called for tax-free export profits for products with >60% local value addition, triple R&D deductions, low-interest loans, an Export-Import Bank and measures to address acute labour shortages.

CBSL's Business Condition Index rose to 130 in 2Q 2025 and is projected at 138 for 3Q 2025, the highest since 2Q 2022. Firms expect year-on-year increases in demand and sales across agriculture, industry and services, citing lower interest rates and a stable exchange rate.

EDB and Germany’s Import Promotion Desk will formalize a Cooperation Agreement to expand support to Sri Lanka's digital products and services sector alongside natural ingredients and processed foods. The pact will extend IPD advisory and matchmaking services, coaching on EU market entry, and curated B2B missions to help SMEs access European buyers.

Government targets $6.5 billion in export earnings from four crops by 2030: tea $2.5bn, coconut $1.5bn, rubber $2bn and cinnamon $0.5bn. The minister said a QR-code system for fertiliser distribution will be introduced and investor inflows into the sector are gradually increasing.

Industry and Entrepreneurship Development Minister Sunil Handunneththi said the government will liquidate 33 non-functional state-owned enterprises to reduce the taxpayer burden and promote private sector-led growth. The Finance Ministry's Special Liquidation Unit will oversee a two-phase process with wind-ups and possible amalgamations.

The Inland Revenue Department will discontinue the Simplified VAT (SVAT) system effective 1 October, removing upfront VAT refund arrangements used by exporters and requiring new filing and approval deadlines (suspended invoices end 30 Sep; SVAT schedules and approvals due in Oct).

Sparkinbox hosted a seminar with Sri Lankan and German experts on evolving EU trade and sustainability rules, noting Sri Lanka exported €2.6bn to the EU in 2023 (about €1.3bn under GSP+). Speakers said upcoming laws (CSDDD, EUDR, EUFLR, LkSG) will increase due-diligence, traceability and labour compliance requirements for textiles, rubber, agriculture, fisheries and IT exporters.

Dearo Agri will support the government's 'Eka Mitata Govibimata' rice self-sufficiency program by financing cultivation of more than 50 hectares of abandoned paddy lands in Gampaha, Kaduwela and Biyagama, and providing interest-free farmer loans and farm machinery.

Sri Lanka and the Philippines concluded the third round of political consultations in Colombo, agreeing to expand cooperation in agriculture (notably coconut and plantation industries), labour, trade and fisheries ahead of their 65th diplomatic anniversary in 2026.

Sri Lanka's Embassy in Bangkok held 'Ceylon Tea – Finest Evening' on 1 September to promote Ceylon Tea, trade and tourism in Thailand; the Sri Lanka Tea Board and nine exporters (including Dilmah, Basilur, Stassen) showcased teas to Thai importers, hoteliers and retailers.

Colombo Stock Exchange closed down, with the ASPI down 0.14% (29.43 pts) at 20,612 as budget concerns created volatility. Market turnover was 5.847 billion rupees; DFCC, Nations Trust and Watawala were among top gainers while Commercial Bank and Sampath weighed on the index.

Paddy and coconut production rose in July while fish, tea and rubber production fell. The central bank cited a Department of Agriculture forecast of 2.2 million mt for the 2025 Yala (up 11.7% y/y) and a 2025 paddy forecast of 4.8 million mt (up 2.7%).

World Bank says Sri Lanka's VAT hike and fiscal reforms contributed to a 3.9% rise in poverty between 2022 and mid-2023. The report links removal of electricity subsidies to a 5% drop in disposable income for the poorest decile and cites currency depreciation, monetary policy and protectionist food taxes for higher living costs.

The Ceylon Chamber presented its 2026 Budget wish list to President Anura Kumara Disanayake, urging trade facilitation (National Single Window, customs modernisation, dedicated FTA team), investment incentives and PPPs, a global tourism marketing push, and accelerated Digital ID/5G rollout.

The Ceylon Chamber of Commerce presented its priority proposals for the National Budget 2026 to the President, calling for trade and investment facilitation, tourism promotion including BIA terminal expansion, a National Digital ID and 5G rollout, agricultural mechanisation and PPP/ease-of-doing-business reforms.

The Ceylon Chamber presented its National Budget 2026 proposals to the President, structured around five themes including trade & investment facilitation, tourism & infrastructure, digital economy, sector enablers and ease-of-doing-business, proposing measures such as a National Single Window, BIA terminal expansion, National Digital ID/5G rollout and a PPP Act.

US trade officials will meet President Anura Kumara Disanayake today to discuss expanded bilateral commerce after Washington talks produced a cut in the US tariff on Sri Lankan imports to 20% from the previously announced 44%. Sri Lanka's exports (mainly garments and rubber goods) were $3bn in 2024 while imports from the US were $370m.

A Colombo session on 12 Sept led by Markus Löning will review German Supply Chain Act amendments and their intersection with EU GSP+ and the forthcoming EU Supply Chain Law, noting reporting obligations have been abolished and sanctions narrowed while core due-diligence duties remain—implications for Sri Lankan exporters (apparel, tea, rubber, fisheries, ICT).

A Colombo event on 12 Sep 2025 will review reforms to Germany's Supply Chain Act and the forthcoming EU CSDDD; the German draft abolishes the reporting obligation and narrows sanctions to firms that neglect preventive/remedial measures while core due-diligence duties remain, with implications for Sri Lankan exporters and GSP+ eligibility.

World Bank will provide a $100m IDA loan for Sri Lanka’s $120m Integrated 'Rurban' Development and Climate Resilience Project to directly support 8,000 agri-food producers and benefit 380,000 people; the project funds irrigation, climate-smart farming, crop insurance, value chains and food-safety upgrades.

Cabinet approved the Sri Lanka National Climate Finance Strategy 2025–2030 to mobilise private capital into renewables, agriculture, fisheries and climate‑resilient infrastructure. The government says about $500m a year is needed for these investments and the national budget cannot sustain that level of spending.

LOLC sold part of its stake in Digital Mobility Solutions Lanka (PickMe) while foreign fund Tundra increased buying; PickMe dominated turnover with Rs.1 billion on 23.4 million shares and closed at Rs.132.75 (up Rs.0.50). Several other listed names saw notable turnover and mixed price moves.

Lotus Group of Companies marked its 10th anniversary on 7 July with religious and community events and a tree-planting programme at its Bingiriya premises, highlighting a decade of expansion into agriculture-related subsidiaries (seeds, fertilizers, crop care, machinery, packaging).

SDB bank signed an MoU with the Australian Government-funded Market Development Facility (MDF) to strengthen coconut, coffee and mango value chains via co-investment, technical advisory, market access and value-chain financing.

The EDB's National Organic Control Unit held its fourth island-wide organic awareness session in Anuradhapura on 29 Aug 2025 to promote organic certification and exports. Farmers, exporters and stakeholders attended; Commercial Bank presented digital marketing strategies while EDB covered certification, processing and market trends.