2. CONTENTS
ECONOMY, BUSINESS & DEVELOPMENT
ComBank launches LankaPay cards in Sri Lanka
ComBank crowned ‘People’s Private Bank of theYear’ at SLIM Kantar People’s
Awards
ECONOMY, BUSINESS & DEVELOPMENT
Sri Lanka – Unemployment 2022
Purchasing Manager’s Index – March 2023
Forbes lists Sri Lanka as one of 23 best places to visit in 2023
Asiri Group plans USD 100mn hospital in Port City Colombo
ADB urges government to revisit proposal to set up credit guarantee institution
for SMEs
News Snippets
GLOBAL UPDATE
“It’s the U.S., not Europe’s banking system that’s a concern” - top EU
economists say
“U.S-China tensions could cost the world about 2% of its output “- IMF
BRICS countries to introduce a new currency?
China economy rebounds after pandemic measures lifted
News Snippets
Monthly global commodity price movements - 2022 to 2023 Mar
Research & Development Unit
4. Research & Development Unit
ComBank launches LankaPay cards in Sri Lanka
Sri Lanka’s payment cards domain took a
giant leap when the Commercial Bank of
Ceylon in collaboration with LankaPay
launched a national credit and debit card
with international acceptance.
This is the first launch of LankaPay Credit Cards in Sri
Lanka and the first time five variants of LankaPay cards -
three credits cards and two debit -- cards were launched
by a Sri Lankan Bank.
LankaPay Card is an internationally accepted card, which is cost-effective and equipped with the latest
technology and highest security features. All domestic transactions via LankaPay cards are routed locally
and when the cards are used overseas the transactions are routed via the JCB International network.
This initiative will ensure that no foreign exchange outflow takes place for any local card transaction,
which could potentially save the country a considerable amount of foreign exchange
5. Research & Development Unit
ComBank crowned ‘People’s Private Bank of theYear’ at
SLIM Kantar People’s Awards
By popular vote, the Commercial
Bank of Ceylon has been crowned
the ‘People’s Private Bank of the
Year’ at the SLIM Kantar People’s
Awards 2023, positioning it as the
Bank that is closest to the hearts of
the Sri Lankan people.
The Bank was conferred this noteworthy accolade following the results of a survey to
determine consumer preferences across multiple sectors
7. Research & Development Unit
Sri Lanka – Unemployment 2022
Sri Lanka ended 2022 with an official
unemployment rate of 4.8%, a figure which
masked much of the anomalies in the
country’s labour market, as many people
either migrated or gave up looking for work
when the economy fell into its worst slump
in the country’s post-independent history.
Unemployment rates and it’s 95% confidence
intervals, 2019Q4 - 2022Q4
Sources: DCS
8. Research & Development Unit
Purchasing Manager’s Index – March 2023
Manufacturing PMI turned positive in March 2023, after
nine consecutive survey rounds, recording an index value
of 51.4
This month-on-month expansion was driven by the
increase in New Orders and Production sub-indices mainly
due to the seasonal demand. However, Employment, Stock
of Purchases and Suppliers' Delivery Time sub-indices
remained below the neutral threshold.
Sources: CBSL
9. Research & Development Unit
Purchasing Manager’s Index – March 2023 (Cont.)
Services sector PMI returned to the growth territory,
recording an index value of 55.1 in March 2023 indicating
an expansion across the services sector. This was driven
by the increases observed in New Businesses, Business
Activities, and Expectations for Activity
Sources: CBSL
The Index PMI is calculated as a ‘Diffusion Index’, where it takes values between 0 and 100
PMI=50 - sector remained neutral on month-on-month basis;
PMI>50 - sector is generally expanding on month-on-month basis
PMI<50 - sector is generally declining on month-on-month basis
10. Research & Development Unit
Forbes lists Sri Lanka as one of 23 best places to
visit in 2023
US-based international travel influencer Juliana
Broste, an award-winning travel filmmaker and host,
showcasing adventures and fun things to do around
the world, recommended Sri Lanka to be listed as one
of the best places to visit in 2023 and as a result of
her continuous effort, Sri Lanka has been listed on
the Forbes list as one of the 23 best places to visit in
2023.
This was a result of her visit to Sri Lanka in 2022, under the Visiting
Blogger Programme of SLTPB 2022 (Sri Lanka Tourism Promotion
Bureau). Juliana, who explored the destination on a photo tour, says
that even with inflation, visitors will find Sri Lanka a spectacular,
affordable destination worth the long haul.
Source: https://www.forbes.com/sites/laurabegleybloom/2023/03/30/the-23-best-places-to-travel-in-2023-chosen-by-the-experts/?sh=4071638776da
11. Asiri Group plans USD 100mn hospital in Port City
Colombo
Research & Development Unit
One of Sri Lanka’s largest private sector healthcare providers, Asiri
Hospital Holdings PLC, a unit of Softlogic Group, in a landmark
announcement disclosed its plans to set up a state-of-the-art hospital
within China-backed Port City Colombo (PCC).
Asiri Port City Hospital (Pvt.) Ltd, a fully-owned subsidiary of Asiri
Hospital Holdings PLC, has entered into an agreement with the
Colombo Port City Economic Commission to lease government-owned
land in PCC for a period of 99 years.
A media statement from Softlogic Group said a lease agreement was entered into for a hospital with “500 plus bed capacity, with an estimated
investment of USD 100 million” within PCC, in line with the master plan of the Colombo Port City Economic Commission.
The proposed hospital is intended to deliver innovative and state-of-the-art healthcare solutions and unique patient care services in promoting
health through integrated clinical practice, education and research.
It will also engage local and international medical experts and specialists who will be supported by internationally trained and experienced nursing
and medical care staff.
This new venture by Asiri Hospitals of Softlogic Group in Sri Lanka is a significant milestone in the country’s journey towards developing and
attracting medical tourism
12. Research & Development Unit
ADB urges government to revisit proposal to set up credit
guarantee institution for SMEs
Asian Development Bank (ADB) urged the government to revisit
the policy decision taken in 2016 to setup a small and medium-
sized enterprises (SMEs) credit guarantee institution in order to
enable access to credit for the country’s credit-constrained
SMEs.
“Establishing a credit guarantee institution for small and
medium-sized enterprises would encourage entrepreneurs and
private sector participation,” ADB stated in its Asian
Development Outlook (ADO) report released.
Responding to a request by the government in 2016, ADB initiated a capacity development technical
assistance (TA) committee and proposed a project to assist the move to setup a SME credit guarantee
institution, a new non-bank financial institution that would support SMEs to access commercial loans,
with a USD 50mn loan. However, the project to-date remains in proposed status.
Full report : https://www.adb.org/sites/default/files/publication/863591/asian-development-outlook-april-2023.pdf
13. News Snippets
Research & Development Unit
Sri Lanka to further relax import
controls
State Minister of Finance said that
measures would be taken to further
relax import restrictions on many other
goods in the future. The minister said
that it would also be a step towards
achieving the revenue target of Sri
Lanka Customs.
Tourist Arrivals
Tourist arrivals for the first 16 days of April topped 56,000,
bringing the total number of international visitors entering
the country for the year-to-date to 392,081.
Provisional data released by the Sri Lanka Tourism
Development Authority (SLTDA) showed that for the April 1
to 16 period, the island nation welcomed 56,402 visitors.
Paris Club says aims to start Sri Lanka debt negotiations
The Paris Club of creditor governments aims to start negotiations to restructure Sri Lanka’s debt, the group said
after a creditor committee was set up during the third week of April 2023.
The Paris Club said the Japanese and Indian finance ministers along with its president and representatives of Sri
Lanka set up a creditor committee on 14th April, 2023 on the sidelines of the spring meetings of the International
Monetary Fund and World Bank in Washington.
15. “It’s the U.S., not Europe’s banking system that’s a
concern” - top EU economists say
Research & Development Unit
Europe learned its lessons after the
2008/09 financial crisis and is now in a
strong position to weather further stress
in its banking system, several EU
economists and policymakers say.
The collapse of U.S.-based Silicon Valley Bank and of several other regional lenders in
early March prompted fears of contagion, furthered by the emergency rescue of Credit
Suisse by Swiss rival UBS.
Policymakers of both US and the EU took decisive action and pledged further support if
needed. Markets have staged something of a recovery.
16. “U.S-China tensions could cost the world about 2% of its
output “- IMF
Research & Development Unit
The International Monetary Fund said that global tensions could disrupt overseas investment and
eventually lead to a long-term loss of 2% of the world’s gross domestic product.
Companies and policymakers across the globe are
exploring ways to make their supply chains more
resilient by “moving production home or to trusted
countries,” the IMF warned in a report, adding that this
will lead to fragmenting foreign direct investment.
The IMF pointed to recent bills adopted against the
backdrop of rising tensions between the U.S. and China,
such as Washington’s Chips and Science Act.
Japan recently imposed its own restrictions on 23 types
of semiconductor manufacturing equipment, joining
U.S. efforts to curb China’s ability to make advanced
chips.
Source: CNBC
17. BRICS countries to introduce a new currency?
Research & Development Unit
Brazil’s president called on *BRICS nations to come up
with an alternative to replace the dollar in foreign
trade.
His remarks were made on Apr 12, 2023 during a visit
to the Shanghai-based New Development Bank, an
institution created by BRICS countries.
Beijing has ramped up efforts to boost the use of its own
currency in foreign trade. Last month, Brazil and China took
steps to make it easier to settle their foreign trade operations
in yuan or reais, with the stated goal of reducing costs by
eliminating a third currency from the transactions.
As at end 2020
South African Foreign Minister has said some countries have inquired on possibilities of obtaining the BRICS
membership. In early March 2023, she told that she had inquiries from countries such as Saudi Arabia,
United Arab Emirates, Egypt, Algeria, and Argentina, as well as Mexico and Nigeria.
*
Source: DW, Bloomberg
18. China economy rebounds after pandemic measures lifted
Research & Development Unit
Retail sales, the main indicator of household consumption, jumped by 10.6%, compared to a year earlier. At
the same time, output from the country's factories rose by 3.9%.
Meanwhile, there was also evidence of a strong rebound for the country's airline industry. China Civil Aviation
Administration data showed that more than 45 million air passenger trips were taken last month, an almost
threefold increase on the same time last year.
Source: BBC
China's economy grew faster than expected in the first
three months of the year, as the country emerged
from its tough COVID restrictions.
Compared to the same period last year, gross domestic
product (GDP) grew by 4.5%, official figures show.
The key measure of economic activity was driven up by
a boost in household spending and rising factory
activity.
19. News Snippets
Research & Development Unit
US inflation
America’s annual inflation rate fell to 5% in March 2023 the lowest it has been since May 2021. But the core inflation rate, which
strips out volatile food and energy prices, rose to 5.6%. On a month-by-month basis the price of natural gas for consumers fell
again, by 7.1%. Petrol dropped by over 4%.
More Fed rate hikes
Even with turmoil in the banking industry and uncertainty ahead, the Federal Reserve likely will approve a quarter-percentage-
point interest rate increase during the last week of April 2023, according to many Wall Street experts.
China
China recorded a surprising surge in export growth for March, 2023 reversing five months of declines. Exports were up by 15%,
year on year, mostly in electric cars, lithium and solar panels.
China’s property industry rebounded for the first time in more than a year, while the government said it will take more measures
to boost consumption, adding to optimism about the economy’s outlook. The real estate sector grew 1.3% in January-March, 2023
from a year earlier, according to National Bureau of Statistics data released on 19th April, 2023.
Zambia – Debt restructuring latest
Zambia’s official creditors, co-led by China, made progress towards a long-awaited debt-restructuring deal on 18th April, 2023 and
will meet again next month.
20. Monthly global commodity price movements
- 2022 to 2023 Mar
Research & Development Unit
Source: World Bank – Commodity prices
21. The views expressed in Economic Capsule are not necessarily those of the Management of Commercial Bank of Ceylon PLC
The information contained in this presentation has been drawn from sources that we believe to be reliable. However, while we have taken reasonable care to maintain
accuracy/completeness of the information, it should be noted that Commercial Bank of Ceylon PLC and/or its employees should not be held responsible, for providing the
information or for losses or damages, financial or otherwise, suffered in consequence of using such information for whatever purpose.
< Research & Development Unit >
Emerging from the economic crisis
• There should be no room for complacency.
• Implementation and follow through of economic reforms would be key.
