News & market updates

Minor International CEO Dillip Rajakarier urged Sri Lanka to shift from discount-led tourism to value tourism, calling for investment in brand-building, service training, infrastructure and skills to boost GDP and foreign exchange. He cited Minor's post-COVID rebound and Thailand's 40% rate lift from media exposure as examples.

AIIB will provide $52 million in sovereign financing to Sri Lanka for the Kerawalapitiya–Port L second 220kV underground transmission line to strengthen power transmission and enable evacuation of renewable energy to Greater Colombo. The project aims to improve grid stability, meet rising demand in the Greater Colombo area and support the upcoming special economic zone.

SLEIS 2025 Day 2 will host a 'Why Sri Lanka – Investor View' session with IFC South Asia Director Imad Fakhoury and a panel including Axiata, Variosystems, Unilever Sri Lanka and CHEC Port City to discuss attracting strategic investment, export expansion and private-sector-led growth.

Sanken Construction was awarded a Rs.3.04 billion (excluding VAT) contract to build an airfield facility at Ratmalana Airport after Cabinet approval; Sanken was the lowest responsive bidder from nine submissions.

AIIB will provide USD 52 million in sovereign-backed financing to Sri Lanka for the Kerawalapitiya–Port L Second Transmission Line Project. The project will install a 220kV single-circuit underground cable linking Kerawalapitiya to Colombo Port L to improve grid stability and enable evacuation of renewable energy into Greater Colombo.

Commercial Bank of Ceylon (COMB.N0000) signed an MoU with Baili Investments Lanka to provide home loans covering up to 75% of purchase price for buyers at a 1,000-unit Rajagiriya mixed-development. Loans offer up to five-year grace periods, low market rates, tailored repayment plans and free DTAP for first-time buyers.

The inaugural South Asian Bitumen Conference (SABIT 2025) will be held 13–14 November at Cinnamon Life, Colombo, convening policymakers and industry specialists across the bitumen value chain. Sessions will cover supply, trade flows, refining/upgrading, sustainable paving technologies and logistics.

World Bank says Sri Lanka's recovery remains incomplete, projects GDP growth of 4.6% in 2025 and 3.5% in 2026, and urges urgent structural reforms and more efficient, better-targeted public spending to boost private investment and complete/maintain infrastructure.

World Bank urges Sri Lanka to liberalize land, labour and trade to lift growth, projecting 4.6% in 2025 and 3.5% in 2026; it also calls for better public investment management, maintenance spending and warns of high food prices and persistent poverty (~22.3% in 2025).

World Bank projects South Asia growth of 6.6% this year, slowing to 5.8% in 2026, and recommends trade liberalization and AI adoption to boost jobs and productivity.

Sri Lanka's construction industry urged the government to immediately implement long-delayed relief measures, warning a 23% contraction in 2023 and over 500,000 job losses since 2019. Industry demands include a standing steering committee, tax/cash-flow relief, contract protections, and forex/inflation compensation.

Sri Lanka's construction sector expanded in August, with the central bank's PMI at 61.1. New Orders rose to 59.7 and Employment to 52.8, driven by road and water supply projects and higher demand for construction materials.

MP Shanakiyan Rasamanickam accused the government of neglecting development of Palaly Airport and the Kankasanthurai (KKS) Port despite $63 million in donor funding being available. He warned of economic consequences, citing BIA capacity constraints and cancelled flights, and criticised ministerial inaction.

Sri Lanka's central government debt-to-GDP ratio rose to 99.5% in June 2025 (104.11% including SOE-guaranteed debt), with total central government debt at 30,795 billion rupees. Domestic debt was 19,655 billion and foreign debt 11,140 billion rupees in June.

Sri Lanka's Construction PMI rose to 61.1 in August 2025, signalling continued expansion in construction activity. New orders, employment and purchases increased, suppliers' delivery times lengthened due to higher material demand, and the sector outlook is positive with more projects expected.

Colombo Stock Exchange extended its rally to a 13th session as the ASPI rose 0.46% (100.49 pts) to 21,951.79 with turnover of Rs.6.5bn and foreign net inflows of Rs.46.4m. Banking, capital goods and food/beverage counters led activity, with Melstacorp, Access Engineering, Union Bank, RCL and NDB among top contributors.

Colombo Stock Exchange rose after Fitch confirmed Sri Lanka's CCC+ sovereign rating; the ASPI closed up 0.46% at 21,951.79. Market turnover was Rs6.51bn, with bank stocks (Rs1.54bn) and capital goods (Rs1.35bn) driving gains and top contributors including Melstacorp, Access Engineering, Royal Ceramics and NDB.

The Securities and Exchange Commission launched the "12 Pillars One Vision" strategic plan to transform Sri Lanka's capital market, targeting stock market capitalization of at least 50% of GDP (from 26%) and a meaningful expansion of the corporate debt market. The plan (after a year-long consultation) also aims to boost market participation to 10%, add 500–1,000 listings, and develop derivatives, investor protection and alternative products.

Colombo Lotus Tower Management Company (CLTMC) reported revenue of Rs.1.43 billion for the year to August 2025, a 31% increase; gross profit rose 77% to Rs.786.86m and PBT rose 192% to Rs.539.93m. CLTMC, under new management since Oct 2024, cited safety upgrades, digital ticketing and planned attractions (aquarium, bungee, luxury suites, warehouse redevelopment).

Colombo bourse extended its rally for a 12th session as the ASPI rose 0.33% to 21,851.30, led by banking-stock buying and positive contributions from MELS, HHL, DIMO and RIL. Turnover was Rs. 6.46bn and foreign investors were net buyers of Rs. 90.7m.

Sri Lanka spent $917.0m on vehicle imports up to August 2025 while gross foreign exchange earnings were $18.97bn, central bank data showed. Investment goods imports rose 21.3% to $2,597m, machinery imports rose 15.3% to $1,658m and total imports were $13.4bn.

The Securities and Exchange Commission launched '12 Pillars One Vision', a strategic roadmap to transform Sri Lanka's capital market aiming to raise stock market capitalization from 26% to at least 50% of GDP, expand the corporate debt market from 0.8%, increase participation to 10%, and grow listings to 500–1,000.

Construction PMI (Total Activity Index) rose to 61.1 in August 2025, indicating continued expansion. New orders, employment and purchase quantities increased—road and water supply projects were prominent—while supplier delivery times lengthened amid higher material demand.

JICA announced the long-delayed Bandaranaike International Airport expansion will soon resume and reaffirmed the resumption of concessional yen loans to Sri Lanka. The talks also covered monitoring macro reforms, support for the digital/AI economy, Western Province waste management and a dairy productivity grant.

Colombo Stock Exchange extended its rally into an 11th session as the ASPI rose 0.47% (102.30 pts) to 21,778.60 with turnover of Rs. 6.27 billion and foreign net outflows of Rs. 362.2 million. Top contributors included DIMO, BUKI, CCS, MELS, WATA and SUN, with gains also in CHOT and PKME.

Sri Lanka's inflation was 1.5% in the 12 months to August 2025 and 2.3% over 36 months as the central bank's deflationary policy supported exchange-rate stability; food prices are down 2.7% since Sept 2022. The economy grew 4.9% in Q2 2025.

Prime Minister Dr. Harini Amarasuriya met IMF Mission Chief Evan Papageorgiou on Sept 29; the IMF praised the government's reform commitments, governance and tax measures and welcomed 2026 budget allocations for social protection. The PM said the forthcoming budget will prioritise SMEs and rural participation, accelerate digitalisation, advance infrastructure, improve tourism quality and strengthen agriculture.

Japan pledged continued support for Sri Lanka’s recovery, resuming 11 yen-loan projects and backing the IMF programme and debt restructuring while committing loans, grants and investment for airport expansion, transmission lines, digital TV, dairy productivity and an export corridor.

US State Department's 2025 Investment Climate Statement says stalled SOE privatisations—notably the Ceylon Electricity Board—rigid labour rules and limits on foreign participation are weighing on Sri Lanka’s investment outlook. It warns high costs and opaque procurement threaten the government's $5bn FDI target for 2025.

Sri Lanka's overall budget deficit for Jan–Aug 2025 fell 54.9% YoY to Rs. 411 billion. Tax revenue rose 31% to Rs. 3.07 t, primary surplus was Rs. 1.27 t, total govt debt reached Rs. 29.6 t (foreign debt Rs. 10.8 t); T-bills fell to Rs. 3.9 t, bonds rose to Rs. 14.9 t.