News & market updates

Sri Lanka and China EXIM Bank aim to sign an amended financing agreement for the Central Expressway Project (Section I, Kadawatha–Mirigama) by end‑August 2026, subject to internal approvals. The talks also covered broader development cooperation and priority sectors including tourism, logistics, energy and IT.

Sri Lanka's unemployment rate edged down to 3.7% in Q1 2026 from 3.8% a year earlier, while labour force participation fell to 49.2% from 49.7%. Services accounted for 50.4% of employment, industry 25.9% and agriculture 23.7%, with youth and female unemployment notably higher.

The Export Development Board hosted a regional Exporters' Networking Forum in Chillaw to link North Western and North Central provincial exporters with government institutions and address customs, legal and market-access challenges. Attendees held direct talks with Sri Lanka Customs and the Inland Revenue Department to seek practical solutions and strengthen supply chains.

Uber has launched Uber Eats and Uber Rides in Ratnapura, expanding its delivery and ride-hailing services to the district. The launch provides access to food, groceries and transport for residents and visitors and creates new earning opportunities for local merchants, delivery partners and drivers.

Sri Lanka Customs collected 225.2 billion rupees in June 2026, 22% above its target, and first-half revenue rose 29.5% year‑on‑year to 1,373.8 billion rupees. Officials credited stronger enforcement, improved valuation practices, a rebound in import volumes and currency movements for the increase.

China EXIM Bank Vice President Yang Dongning met Sri Lanka's Deputy Minister of Finance on 2 July 2026 to review and expedite the amended financing agreement for the Central Expressway Project (CEP-1) Section I, targeting signature before end‑August 2026. They also discussed cooperation to support tourism, value-added manufacturing, logistics, energy, IT and higher-education links.

Asian stocks rose (MSCI Asia-Pacific ex-Japan up ~1.3%) after a softer-than-expected US jobs report reduced near-term Fed rate-hike odds and regional PMIs showed economic expansion in June.

Realised FDI reached about $250m in 1H and BOI Director General Dr. Sulakshana Jayawardena outlined a reform agenda including a digital single-window approval platform targeted this year, an Investment Protection Act, and land and skills reforms to boost investor confidence.

ISSO – Prawn Crazy opened a 90-seat flagship in Canary Wharf, London, importing Lion Beer and Lion Stout from Sri Lanka for its launch. The concept pairs automated kitchen tech with a vertically integrated cold chain sourcing export-grade prawns from 150+ artisanal fishermen.

Sri Lanka Tourism Promotion Bureau launched an international influencer familiarization tour (6–17 July 2026) bringing creators from Australia and Indonesia to showcase key destinations across the island to millions of followers. The program involves hotels, transport and other tourism partners to boost global exposure and inspire travel.

The Sri Lanka–Germany Business Council held Members' Day where Germany reaffirmed cooperation and highlighted opportunities in logistics, manufacturing, renewable energy, green technologies, digital transformation and tourism. SLGBC also announced a CSR project to support a local school's infrastructure.

GITA, together with the Indo‑Lanka Chamber of Commerce and Industry, has launched an India Trade Desk in Colombo to provide end-to-end, one-to-one advisory and market-entry support for Sri Lankan firms seeking to expand into India. The service targets SMEs and larger firms across textiles, food processing, ICT/BPM, tourism, pharma, logistics, manufacturing and renewable energy.

The Sri Lanka–Germany Business Council held its Members' Day, with Germany reaffirming bilateral partnership and participants highlighting trade and investment opportunities in logistics, manufacturing, renewable energy/green tech, digital transformation and tourism; SLGBC also announced a CSR project and networking initiatives.

The Sri Lanka Export Development Board and Germany's Import Promotion Desk signed an MoU renewing their partnership to strengthen export development and European market access for Sri Lankan export‑oriented SMEs, expanding cooperation on trade promotion, business matchmaking and support for women entrepreneurs.

German Ambassador Felix Neumann urged continued trade facilitation to boost Sri Lanka–Germany ties, highlighting opportunities in logistics, manufacturing, renewable energy, digital transformation and tourism. He delivered the keynote at the Sri Lanka–Germany Business Council Members' Day to promote investment and collaboration.

The World Bank reclassified Sri Lanka from lower-middle-income to upper-middle-income effective July 1; 5.0% real GDP growth in 2025 and small population and exchange-rate effects pushed GNI per capita over the threshold. The WB warned the status is fragile due to high public debt and slowing growth.

Cabinet approved agreements to secure a $450m Indian disaster recovery package (a $350m line of credit — $250m long-term, $100m short-term — plus a $100m grant) to fund Sri Lanka's post-Cyclone Ditwah reconstruction across infrastructure, housing, health, education and water. The government estimates reconstruction needs at $3.5bn.

The World Bank approved $150m in financing (REGROW DPO) to support Sri Lanka's reform agenda to boost investment, competitiveness, high-value exports and jobs. The first of three operations focuses on reducing trade barriers, improving the investment climate, strengthening the financial sector and power competitiveness.

ADB approved $200 million in emergency assistance for Sri Lanka's post-Cyclone Ditwah recovery (a $100m regular loan, $100m concessional loan and a $0.5m technical grant). The project will finance rehabilitation of roads and irrigation, restore smallholder livelihoods and support climate-resilient housing reconstruction.

The Pink Auto Shop (Pvt) Ltd won 'Most Famous Detailing Shop of the Year' at the BWIO Awards 2026. The award recognises the company's contribution to raising standards in Sri Lanka's automotive detailing industry as demand for vehicle protection services rises with vehicle imports resuming.

Hayleys Mobility (Hayleys PLC) opened a new workshop at No. 88 Nikape Aththidiya Road, Bellanthara, expanding its after-sales service network to serve Colombo and nearby suburbs with advanced diagnostic equipment and trained technicians. The facility aims to improve accessibility and reduce service turnaround times.

Duminda Hulangamuwa was appointed Chairman of the Board of Investment and pledged to restore the agency's authority and turn it into a one-stop shop to boost FDI and accelerate export growth.

Sri Lanka's current account recorded a US$194 million deficit in May 2026, the second consecutive monthly deficit and leaving a US$97 million deficit for January–May. The trade gap widened to US$4.7bn (Jan–May), fuel import spending rose 112% YoY in May, tourist earnings fell 5.1% YoY in May, remittances rose 26% YTD, reserves were US$6.9bn and the rupee was down 7.9% YTD.

ADB approved $200 million in emergency assistance for Sri Lanka's post-Cyclone Ditwah recovery, comprising a $100m regular loan, $100m concessional loan and a $500,000 technical grant to finance reconstruction of roads, irrigation, housing and support for smallholder farmers with climate-resilient measures.

Sri Lanka's current account posted a US$194m deficit in May 2026, the second consecutive monthly deficit, driven by a wider trade gap and a smaller services surplus despite higher remittances. The cumulative trade deficit reached US$4.7bn Jan–May 2026, fuel imports rose 112% YoY in May, and gross official reserves were US$6.9bn at end-May.

Colombo market opened down 0.65% as the ASPI fell 146.53 points to 22,263.28 with turnover over Rs.1.7bn and foreign net outflow of Rs.466.1m; Windforce, CIC and Hayleys were main negative contributors while Windforce, Colombo Dockyard and Sathosa Motors led turnover.

Opposition Leader Sajith Premadasa urged a whole-of-government, science-based National Climate Resilience strategy, warning of a limited window before a likely strong 2026–27 El Niño and proposing anticipatory governance, reservoir/water management, climate-smart agriculture, early warning systems and a disaster intelligence centre.

Around 35–40 investors have expressed interest in partnering with the state to operate Mattala Rajapaksa International Airport, with EOI proposals due by 9 July. The government says MRIA has been renovated and cleared for safe operations; it handled 140,614 passengers in 2025 but has run annual losses of about Rs. 3 billion.

UK High Commissioner urged Sri Lankan businesses to use the Developing Countries Trading Scheme (DCTS), which offers zero-tariff access to the UK and whose January 2026 reforms expand preferential access for the apparel sector, boosting export opportunities for Sri Lankan firms.

Marlon Ferreira, founder of Exterminators PLC, has been named a finalist in the 2026 Great British Entrepreneur Awards' Global Entrepreneur of the Year category. Ferreira, who also founded Sentario UK, has developed AI-powered pest-management platforms including MACCP X and PACCP X.