2. C O N T E N T S
BANKING & FINANCE
ď´ ComBankâs 267th branch opens in Hettipola
ď´ ComBank wins 5 awards at LankaPay Technnovation Awards 2019
ď´ ComBank the highest ranked Bank in latest LMD 100
ď´ ComBank upgrades ATM network to accept JCB cards issued worldwide
ECONOMY & BUSINESS
ď´ SL South Asiaâs most improved in Global Competitiveness Index 2019
ď´ Sri Lanka ranked 99th in the World Bank Groupâs Doing Business Index
ď´ Sri Lanka among top 20 rising stars of world trade
ď´ SL removed from FATF's Grey List
ď´ SL Tourism expects quicker recovery
ď´ Biz confidence dips marginally
ď´ Iran, Turkey sanctions hurt Ceylon Tea
ď´ LankaPay & JCB Internationalâs commercial roll-out of National Card Scheme
ď´ Senaka Zenn to setup USD 10.3 mn concrete electric poles manufacturing plant
ď´ Omega Line to invest USD 24 mn in new lingerie factory
ď´ A new 5-star hotel to be built in Kandy
ECONOMY & BUSINESS (cont)
ď´ Sri Lankaâs Manufacturing activities growth slowdown in September 2019
ď´ Sri Lankaâs Services activities growth slowdown in September 2019
ď´ September inflation increases
INTERNATIONAL
ď´ China's GDP growth grinds to near 30-year low as tariffs hit production
ď´ US set to impose tariffs on USD 7.5bn of EU exports in Airbus row
ď´ Abu Dhabi is investing hundreds of millions in tech start-ups from the Middle East
ď´ Fed to begin Treasury bond purchases
4. ComBankâs 267th branch opens in
Hettipola
Research & Development Unit
The Commercial Bank of Ceylon has
further strengthened its presence in
the Kurunegala District, with the
opening of a fullyâfledged branch (the
267th branch) in Hettipola .
Research & Development Unit
5. ComBank wins 5 awards at LankaPay
Technnovation Awards 2019
Research & Development Unit
Commercial Bank was honoured with
five awards at the LankaPay
Technnovation Awards 2019, Sri Lankaâs
only payment technology innovation
awards presented for the third
consecutive year.
Research & Development Unit
The Bank won:
⢠Best Acquirer on LankaPay Online Payment Platform â Gold
⢠Payment Application of the Year â Gold
⢠Overall Excellence in Interbank Payments â Bronze
⢠Bank of the Year for Financial Inclusivity under category A â Merit
⢠Bank of the Year for Excellence in Customer Convenience under category A
â Merit
6. ComBank the highest ranked Bank in
latest LMD 100
Research & Development Unit
Commercial Bank has been ranked third in the latest edition of
the âLMD 100â â Sri Lankaâs premier ranking of the countryâs
listed companies â moving up two places from last year.
Commercial Bank is the highest-ranked bank in the 26th edition
of this prestigious ranking, widely considered Sri Lankaâs version
of the Fortune 500.
Commercial Bank has been ranked among the Top 10 listed
companies in Sri Lanka every year since the ranking was first
published in respect of 1993-94.
LMDâs latest ranking establishes that Commercial Bank has
outperformed many of the countryâs leading diversified
conglomerates, telcos, retail giants, insurers and other sector
leaders, in addition to topping all listed banks.
Research & Development Unit
7. ComBank upgrades ATM network to
accept JCB cards issued worldwide
Research & Development Unit
Commercial Bank has announced that worldwide holders of JCB (Japan
Credit Bureau) Credit Cards can now withdraw money from the Bankâs
ATMs in Sri Lanka, offering a noteworthy segment of tourists visiting the
country easy access to their funds.
The announcement follows a network-wide upgrade of Commercial
Bankâs ATMs to channel JCB card transactions to JCB International via the
national card switch LankaPay, the Bank said.
Earlier this year, Commercial Bank became one of the first banks in Sri
Lanka to have its point-of-sale (POS) network accept LankaPay-JCB co-
branded cards issued under the national card scheme programme, and
said the Bankâs POS machine network would gradually be upgraded to
accept both LankaPay-JCB co-branded cards issued by local banks and
JCB cards issued internationally.
Research & Development Unit
The new development of ATM acceptance of JCB cards enables the Bank to enhance its services to the increasing
number of tourists and business professionals visiting the country, especially from Asia where JCB has a large
number of card members
9. SL South Asiaâs most improved in
Global Competitiveness Index 2019
Research & Development UnitSource: World Economic Forum
Sri Lanka becomes the
most improved economy
in the South Asian
region in Global
Competitiveness Index
2019, by gaining 1.1
index points and
improving its ranking to
84th, out of 141
countries, due to the
improvements in socio-
economic elements.
The country was ranked
85th in the 2018 Global
Competitiveness Index,
compiled by Geneva-
based World
Economic Forum.
10. Sri Lanka ranked 99th in the
World Bank Groupâs Doing Business Index
Sri Lanka has climbed one notch to 99th in the World Bank Groupâs Doing Business 2020
study from 100th position, last year, out of 190 countries.
The data released by the World Bank showed Sri Lankaâs doing business score unchanged at
61.8 from the 2019 ranking released last year.
DB
Rank
DB
Score
Source: World Bank
Cont.
11. Sri Lanka ranked 99th in the
World Bank Groupâs Doing Business Index (cont.)
Source: World BankResearch & Development Unit
12. Sri Lanka among top 20 rising stars of
world trade
Research & Development Unit
The Trade20 index demonstrates that while existing trade powers like China and
India continue to rapidly improve their potential, smaller trading nations are
also making swift progress towards increased trade growth.
Sri Lanka has been featured as one of the
rising stars of global trade in a new report
released by Standard Chartered Global
Research, which puts the country among top
20 performers that have the greatest trade
growth potential.
Titled âTrade20: The rising stars of global
tradeâ, the report looks at the 20 markets
that have demonstrated impressive progress
in trade growth potential in the last decade.
These markets are identified by measuring
changes in 12 metrics across three pillars:
economic dynamism (foreign direct
investment, export and GDP growth), trade
readiness (infrastructure, e-commerce and
ease of doing business), and export
diversity.
Source: SCB
13. SL removed from FATF's Grey List
Research & Development Unit
The Financial Action Task Force (FATF), the global policy setter on Anti-Money Laundering and
Countering the Financing of Terrorism (AML/CFT), has delisted Sri Lanka from FATFâs Compliance
Document which is more commonly identified as âthe Grey Listâ.
The decision was taken at the FATF Plenary held during 13-18 October 2019 in Paris.
In October 2016, the FATF announced that Sri Lanka would be subject to a review of the International Co-
operation Review Group (ICRG) of the FATF to assess the progress of AML/CFT effectiveness in the country. After
several discussions and progress reports, the FATF indicated that Sri Lanka has not made sufficient progress in 4
areas namely, International Co-operation, Supervision, Legal Persons and Arrangements and Targeted Financial
Sanctions on Proliferations (North Korea and Iran). As a result, the FATF at its Plenary held in October 2017,
listed Sri Lanka as a jurisdiction with strategic AML/CFT deficiencies in the FATFâs Compliance Document and
provided a time bound Action Plan for implementation.
Source: The Financial Action Task Force (FATF)
14. SL Tourism expects quicker recovery
Research & Development Unit
Sri Lanka Tourism countered
industry pessimism, saying that
the sector has recovered in five
months and year-end tourist
arrivals will dip only 20% despite
the Easter Sunday terror attacks.
The industry has recovered 80%
in just five months, Sri Lanka
Tourism Promotion Bureau
(SLTPB) Chairman Kishu Gomes
told.
In April, soon after the Easter Sunday attacks, tourism officials estimated a 30% drop in arrivals for 2019
and it was later revised to 20% considering the visitor level trends over the past four months.
Considering the recovery level in countries who faced similar situations, Mr Gomes said Sri Lanka had
definitely surpassed the recovery time period, especially compared to Bali and Australia.
Monthly Tourist Arrivals
Month 2018 2019* % Cha. 2018/19
Jan 238,924 244,239 2.2
Feb 235,618 252,033 7.0
Mar 233,382 244,328 4.7
Apr 180,429 166,975 (7.5)
May 129,466 37,802 (70.8)
Jun 146,828 63,072 (57.0)
Jul 217,829 115,701 (46.9)
Aug 200,359 143,587 (28.3)
Sep 149,087 108,575 (27.2)
Oct 153,123 - -
Nov 195,582 - -
Dec 253,169 - -
Total 2,333,796 - -
Up to Sep 1,731,922 1,376,312 (20.5)
Source: SLTDA
15. Biz confidence dips marginally
Research & Development Unit
After recording a six-month high in August, the
LMD-Nielsen Business Confidence Index (BCI)
declined by four basis points to register 90 in
September.
According to business magazine LMD, the index
stood at 87, a year ago and is currently above its
12-month average of 89.
Nielsen Managing Director Sharang Pant said:
âThis comes on the back of sustained growth in
exports, a decline in imports amid controls,
stable inflation levels, and tourism arrivals
moving back to an average of 140,000 in the last
couple of months.â
16. Iran, Turkey sanctions hurt Ceylon Tea
Research & Development Unit
As the United States sanctions against Iran has left Sri
Lanka still working out an arrangement for its tea exports,
similar actions reported to be initiated against Turkey
would aggravate the industryâs problems.
Sri Lanka is still working out the arrangement for the
payment of its tea exports to Iran via the debts to its oil
companies even as a delegation arrived in the country just
last week.
A Reuter report has stated that Republicans in the U.S. House of Representatives planned to
introduce legislation that will impose sanctions on Turkey in response to Ankaraâs incursion into
Syria.
At present Turkey buys around 30 million kg of Ceylon Tea and is one of the key export markets.
17. LankaPay & JCB Internationalâs
commercial roll-out of National Card
Scheme
Research & Development Unit
LankaClear (Pvt) Ltd., the operator of LankaPay, Sri Lankaâs
National Payment Network, together with JCB International Co.
Ltd (JCBI), the international operations subsidiary of JCB Co. Ltd,
has announced the commercial roll-out of the National Card
Scheme (NCS) programme of Sri Lanka, after successfully
completing the pilot stage.
With the commercial roll-out of NCS programme, LankaPay/JCB
co-badged payment cards are now accepted at ATMs and
merchants on JCB network, globally. This partnership has also
enabled JCB cardholders worldwide to use their cards at ATMs
and POS terminals within Sri Lanka, LankaClear said.
Under the NCS programme, many banks will issue EMV enabled
LankaPay/JCB co-badged cards. This marks the first ever JCB
branded card issued in Sri Lanka.
18. Senaka Zenn to setup USD 10.3 mn concrete electric
poles manufacturing plant
Research & Development Unit
The Board of Investment of Sri Lanka signed a supplementary agreement
with M/s Senaka Zenn (Private) Limited to set up a project to manufacture pre-stressed spun
concrete electrical poles, piles and railway sleepers with improved technology, for both local and
export markets.
The Initial investment made by the company was USD 10.3mn.
The project is very significant because it is an import substitution project which will save Sri Lanka
considerable foreign exchange and at the same time is environmentally friendly since it reduces the
dependence on wooden poles. The project was started as a substitute for the wooden poles used.
Omega Line Limited, a unit of Luxembourgâbased Calzedonia Finanziaria, is to expand its existing current factory complex
in Sandalankawa by constructing a USD 24 mn new lingerie factory. The supplementary investment agreement in this
regard was signed between Omega Line and Board of Investment (BOI) recently.
Omega Line to invest USD 24 mn in new lingerie factory
A new 5-star hotel to be built in Kandy
The Board of Investment of Sri Lanka signed an agreement with Star Class Hotel Ltd., to set up 67
room 5-star hotel which will be located in Kandy.
This new project is to create 61 new employment opportunities and represents an investment of
USD 5.2 mn.
19. Sri Lankaâs Manufacturing activities
growth slowdown in September 2019
Research & Development Unit
⢠The slowdown in manufacturing PMI
was mainly driven by the slowdown
in Production and New Orders during
the month of September.
⢠Slowdown in Production could be
observed, especially in
manufacturing of food & beverages
and textiles & wearing apparel
sectors.
Source: CBSL
20. Sri Lankaâs Services activities growth
slowdown in September 2019
Research & Development Unit
⢠The slowdown in Services PMI was
mainly due to slower expansion in
Business Activities.
Source: CBSL
21. Research & Development Unit
September inflation increases
Headline inflation as measured by the year-on-year change in the National Consumer
Price Index increased to 5.0 % in September 2019 from 3.4 % in August 2019.
The core inflation, which reflects the underlying inflation in the economy, declined to
5.6 % in September 2019 from 5.9 % in August 2019 on year-on-year basis.
Source: CBSL
23. Research & Development Unit
China's GDP growth grinds to near
30-year low as tariffs hit production
Source: Reuters/BBC
Chinaâs third-quarter economic growth slowed more
than expected and to its weakest pace in almost three
decades as the bruising U.S. trade war hit factory
production, boosting the case for Beijing to roll out fresh
support.
Gross domestic product (GDP) rose just 6.0% year-on-
year, marking a further loss of momentum for the
economy from the second quarterâs 6.2% growth.
Chinaâs trading partners and investors are closely
watching the health of the worldâs second-largest
economy as the trade war with the United States fuels
fears about a global recession.
24. US set to impose tariffs on USD 7.5 bn of
EU exports in Airbus row
The US has been given the go-ahead to impose tariffs on USD 7.5 bn of goods it imports from the EU.
It is the latest chapter in a 15-year battle between the US and the EU over illegal subsidies for
planemakers Airbus and rival Boeing.
The World Trade Organization (WTO) ruling will mean tariffs on EU goods ranging from aircraft to
cheese, olives and jumpers from 18 October.
Brussels has threatened to retaliate similarly against US goods.
US trade officials said the tariffs would be set at a 10% rate on aircraft and 25% on agricultural and other
items.
They have published a list of all the items that will be subject to the additional tariffs, most of which will
apply to imports from France, Germany, Spain and the UK.
Source: BBC
Research & Development Unit
25. Abu Dhabi is investing hundreds of millions
in tech start-ups from the Middle East
Research & Development Unit
Abu Dhabi is doubling down on its push into the
technology sector with a USD 250 mn investment to
support start-ups from the Middle East and North
Africa region.
Mubadala, Abu Dhabiâs state investment arm,
announced its new MENA tech funds will invest in
companies and venture funds that help boost local
tech incubator *Hub71.
Source: CNBC
*Hub71 was launched earlier this year as part of a broader effort by the government of the United Arab
Emirates (UAE) to diversify its economy. Microsoft and SoftBank are also partners in the Abu Dhabi-
based scheme. Hub71 offers incentives like office space and health care coverage to encourage start-ups
to set up shop in the region.
26. Fed to begin Treasury bond purchases
Research & Development Unit
The Federal Reserve began buying short-term government bonds at a monthly
rate of USD 60 bn in order to refill its portfolio until at least the second quarter
of next year.
It is doing this to ease a cash crunch and sharp rise in banksâ overnight lending
costs (the repo rate).
The size of the intervention took many by surprise. The central bank described
it as a technical move, not a return to quantitative easing, which involved
buying longer-dated treasuries.
Source: The Economist
27. 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.
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