News & market updates

Sri Lanka’s central bank raised the Overnight Policy Rate by 100bps to 8.75% to address rising inflation, credit expansion and external pressures; the statement cited 5.4% y/y inflation in April, high fuel prices, a wider trade deficit and gross official reserves of USD 6.8bn.

The Sri Lankan–German Business Forum 2026 will be held in Colombo on May 27–29 to bring German public and private sector representatives together with Sri Lankan stakeholders to explore collaboration and investment, focusing on maritime, logistics and IT. Prime Minister Harini Amarasuriya and senior German officials will attend; sessions will cover port infrastructure financing, digitalisation and boosting exports to the EU.

Embilipitiya Stores Tool & Ceramic Manufacturing (Eagle Group affiliate) was awarded ISO 9001:2015 certification for design, manufacturing and marketing of sanitaryware, tile mortar and wire‑based construction products. The certification followed an SGS Lanka audit and the company says it will use it to boost quality and expand local and export markets.

Sri Lanka unveiled South Asia's first solar hybrid bakery oven (solar + biogas) on 22 May, aimed at replacing fossil-fuel baking and supporting sustainable livelihoods and reduced import reliance. The project, led by Incitare, GRFC, German Tech Kilinochchi and GIZ, includes donations, local production and training.

Sampath Bank PLC has become the first bank in Sri Lanka to integrate PayPal withdrawals and account connectivity via the Sampath Vishwa app, allowing customers to link PayPal and withdraw funds in LKR or USD. The service targets freelancers, SMEs and exporters to ease access to international payments and support foreign currency inflows.

Haycarb PLC reported a 5% rise in quarterly profit to Rs 1.42 billion for the quarter ended March 31, 2026, with consolidated revenue up 67% to Rs 19.7 billion. Cost of sales rose 89% to Rs 16.2 billion, finance costs nearly doubled to Rs 485.7m and tax expense jumped to Rs 616.6m.

Sri Lanka's rupee closed at 325.50/327.00 to the US dollar on Monday (from 329.00/331.00 on Friday) while government bond yields fell sharply (e.g. the 15.09.2027 bond quoted at 9.15/50%).

Colombo Stock Exchange closed higher, with the ASPI up 1.98% to 22,364.77, as rupee stabilisation and lower interest rates boosted investor confidence. Ceylon Cold Stores and Hemas posted strong quarterly profits and John Keells declared a final dividend; Dialog, Commercial Bank and Sampath gained while hSenid and Dipped Products fell.

Sri Lanka's total exports reached US$1,380.93m in April 2026 (up 6% y/y) and US$5,784.38m in Jan–Apr 2026 (up 4.3% y/y); merchandise exports rose 9.87% in April while services exports, led by ICT/BPM and financial services, also expanded.

Sri Lanka's services exports fell 6.13% in April 2026 to $317.16m. ICT/BPM exports rose 24.89% to $146.09m and financial services grew 119.41% to $10.45m, while construction and transport/logistics exports declined sharply.

Sri Lanka's merchandise exports rose 9.87% to $1,063.77m in April 2026. Growth was led by coconut-based products (up 23.49% to $92.17m, with activated carbon +58.32%), rubber products and processed food & beverages, while tea fell 6.82% and apparel fell 4.88%.

JAAF said Sri Lanka apparel exports fell 4.72% in April 2026 to US$328.15m and were down 7.47% to US$1.53bn for Jan–Apr 2026. The association urged policy consistency, energy cost reforms, trade facilitation, skills development and market diversification to restore competitiveness and target US$5bn.

hSenid Business Solutions (HBS.N0000) delivered an FY2026 turnaround with revenue of LKR 2.1bn (up 13% YoY), normalized EBITDA of LKR 200m (10% margin) and exit ARR of USD 5.5m (up 32% YoY). The company generated positive free cash flow, narrowed full-year PBT loss to LKR 8m, posted Q4 PBT of LKR 7m, launched Lexi Insights AI and won a national export award.

Sri Lanka's apparel exports fell 4.72% YoY to $328.15m in April, and were down 7.47% YoY to $1.53bn for Jan–April. The JAAF said fundamentals remain strong but called for coordinated policy support, cost reform and market diversification to reach a $5bn target.

The Central Bank of Sri Lanka intervened in FX markets and the rupee surged as much as 2.7% on Friday, reversing a nine-day slide and becoming Asia's best-performing currency; CBSL data showed YTD depreciation widened from 4.5% (15 May) to 7.2% (22 May).

BOI Acting Chairman Dr. Sulakshana Jayawardena unveiled a pipeline of 30 structured investment projects across manufacturing, logistics, tourism and infrastructure aimed at Vietnamese investors. He said Sri Lanka has regained macro stability with GDP growth of 5% in 2024–25 and FDI rising to $1.063bn in 2025 (target $1.5bn in 2026).

Sri Lanka's rupee was quoted at 328.00/335.00 to the US dollar, weaker than on Friday, while bond yields held firm with maturities quoted around 10.20%–11.35%. Exporters feared new surrender rules and interbank markets resumed activity after strong forward selling by exporters.

EFL Global has appointed Rooso Ramachandran as its Global CEO as part of an organizational realignment to strengthen global integration and execution. Rooso, who led EFL's India business for 24 years, will focus on stabilizing performance and operational excellence.

Sri Lanka's Foreign Minister Vijitha Herath will open the Sri Lanka High Commission in Wellington during his May 26–June 3 visit to New Zealand and Australia and hold bilateral talks with counterparts Winston Peters and Penny Wong; the visit is expected to strengthen relations and enhance cooperation in areas of mutual interest.

Dr Rohitha Silva has been appointed President of the Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL). He is Chairman and MD of idac Ltd and will focus on supporting SMEs, strengthening trade linkages and aiding private-sector recovery amid FX shortages, inflation and high finance costs.

The Ceylon Chamber of Commerce delegation led by Chairman Krishan Balendra held high-level economic engagements in Mumbai on 13–14 May, culminating in the renewal of an MoU with the Indian Merchants' Chamber. Discussions targeted technology, manufacturing, healthcare, renewable energy and digital transformation to boost bilateral trade and investment.

Somasena Mahadiulwewa has assumed duties as Acting Director General of Commerce at the Department of Commerce. He brings over 24 years' service, including experience in FTAs, WTO negotiations and export promotion.

Indian High Commissioner Santosh Jha commended the Indian CEO Forum at its 22 May 2026 AGM, which reaffirmed commitments to deepen India–Sri Lanka economic and commercial ties and urged upgrading the bilateral FTA to boost investment. The Forum represents 70+ members and said members contributed over $2 million during Cyclone Ditwah.

The Sri Lankan–German Business Forum 2026 will run 27–29 May in Colombo to promote FDI in maritime, ports and logistics and to showcase Sri Lankan IT startups. The conference, attended by the Prime Minister, will focus on port infrastructure financing, boosting exports to the EU and digitalisation.

Sri Lanka unveiled South Asia’s first solar hybrid bakery oven — a solar-and-biogas system developed by Incitare and GRFC with GIZ support, with installations completed in Dambulla and Kilinochchi to support sustainable livelihoods, food security and local training.

Samsung Electronics agreed to distribute KRW 40 trillion (~$26.6bn) in bonuses to its semiconductor division — an average of about $339,000 per employee, paid as 10.5% of profit in stock plus 1.5% cash; the deal could run 10 years and payouts occur early 2027 if the union approves.

President Anura Kumara Dissanayake said Sri Lanka faces external pressures from the Middle East conflict—higher oil and import costs and rupee depreciation—but rejected a repeat of the 2022 collapse, noting Central Bank reserves near $7bn and a $700m inflow expected; he assured no shortages of fuel, gas, milk powder or fertiliser.

Deputy Finance and Planning Minister Dr. Anil Jayantha Fernando defended Sri Lanka's flexible exchange rate and independent monetary policy amid rupee pressure, noting the interbank rate averaged Rs.330/USD (bids Rs.327, offers Rs.332). He warned fuel import costs could hit $521m in May, forecast remittances above $9b and expected IMF tranche approvals.

The Free Trade Zone Manufacturers’ Association urges the government to zero-rate locally supplied inputs to BOI exporters to remove an 18% VAT that currently disadvantages domestic suppliers. They propose a gazette notification under existing VAT law to equalise local and import pricing and help retain foreign exchange.

Regenerative Agriculture Digital Resource Centres were handed over to the Tea Smallholdings Development Authority on 20 May to modernise Sri Lanka's smallholder tea sector through regenerative practices, digital learning and faster transfer of TRI research. Funded by Solidaridad and the Nucleus Foundation and based at Hanthana, the authority's head office and Walahanduwa, the centres will use digital tools and act as Training-of-Trainers hubs for smallholder capacity building.