Helping Business

Helping Business

Minister of Power, Energy and Business Development Ravi Karunanayake does not see any “practical essence” in tagging responsibility for business development on to his other tasks. It is a new portfolio, which has been added on rather incongruously to a very, important, though, unconnected, ministry.

He says that business development is there by name, but the drive does not exist, to ensure that start-ups progress – these are the very companies which have problems. And he thinks he knows the cause.

“I think the biggest problem in our country is the Central Bank. Their monetary policy is certainly defeatist to the government. With the fiscal policies after I was appointed finance minister in 2015, we increased revenues almost 100% over the two years’ period that I was there. That was sizeable, it is what is keeping the government going on at the moment, but it did not match the monetary policy pursued by the so-called Central Bank. I mean, they pursue a more negative-growth-oriented monetary policy. Today, an innocent person going to the bank, you have to pawn yourself to get a loan from the bank, and it is just not helpful for a start-up to a small and medium enterprise. So our interest is to try and galvanise the support of the banks and every conceivable chamber, and to make it meaningful. If we are able to give a rate of about 5-6%, which is the regional trend in lending, I guess you don’t have to go after handouts which are being given liberally, which is nonsensical. On one side the Central Bank push it up, which they say is anti-inflationary, but we see inflation going up and interest rates also down. I think this has been the root cause of the negativism that is there. I think it is high time that the government pursues a pro-small and medium enterprise-oriented approach. Lack of knowledge of a business environment by the people who sit in offices, in administrative areas, or decision-making positions, has been the biggest problem.”

Ambitious

The entrepreneur, he says, comes into business thinking gloriously and ambitiously, to create a business empire. However, they do not receive assistance. They are faced with bureaucratic delays.

“You don’t have quick decision-making. If you go to an environmental entity to get approval, it takes a long time. Banks are a fiasco. You go to get a LKR 500,000 loan, you have to pawn your entire future life and you come out not knowing whether you have come out with a benefit or with a permanent liability. These are the areas that need to change, and this is what I was doing in 2015 to 2017, until the changes took place. But I am sure that we will be able to get back into the driving seat and able to get things moving from a more pro-Sri Lankan perspective.”

He sees the Bretton Woods institutions, the World Bank and International Monetary Fund, as another part of the problem.
“But then, what are you going to say? You can say they are part of the problem. But we are small in a global picture. It is that we should pursue policies which are favourable to us. Unfortunately, we have bureaucrats who are basically high-standing, whose job is to perform or lure the officials that come in, so that they can get a retirement job over there. This has been seen as the problem. Especially when you come across officials who don’t understand economics or finance, they easily massage their egos and get that job done.”

Conversely, he says, if you the bureaucrats do know their job, then foreign “experts” coming in does not help at all.
“End of the day, they take professional assistance from us, they put a foreign label, and come back and say this is the professional report that they give. This has been the bane of our society. We overly think of a foreign-skin mentality, which has always been to our detriment.”

Prospects

He thinks that some very firm, pro-Sri Lankan decisions are needed, to safeguard and develop the three most important things: national security, the national economy and the youth. “If you walk the talk, I guess we have won 90% of the problem. I think we have the ability to steer, to navigate ourselves, if we are led properly. Unfortunately, there are far too many decision-making processes which are counter-productive.”

Sri Lankans procrastinate, he thinks, at taking the correct decisions. He points to countries such as Singapore, Thailand and Malaysia as exemplars, the success in coming out of poverty of which he attributes to fast, firm, decision-making.

In Sri Lanka, on the other hand, “Anybody who works is basically targeted and alienated, but you have to have the guts to go well beyond that. That should be the revival process of Sri Lanka.”

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Nelli and Rasakinda For a world of green goodness

Nelli and Rasakinda For a world of green goodness

Link Natural Swastha Amurtha distributes a large number of Nelli and Rasakinda plants for World Environment Day

Two key medicinal plants that have dominated the ayurvedic milieu for centuries are Nelli (phyllanthus amblica) and Rasakinda (tinospora cardifolia), known for their useful goodness in health, longevity and relief from aches and discomforts. However, due to rapid urbanisation and deforestation, these medicinal trees are slowly dying out, like many other plants in Sri Lanka, preventing our children and the future generations from enjoying life in a healthy green environment.

Being the core ingredients of Swastha Amurtha, the 100% natural herbal drink by Link Natural Products (Pvt) Ltd., the brand has initiated a CSR project to coincide with World Environment Day, titled “Thuru Wawamu, Gatha Niwamu” (Let’s plant trees to heal our bodies not just externally, but internally as well).

The aim of the campaign is to encourage the public including children, to grow Nelli and Rasakinda trees for the betterment of the environment and the well-being of all living beings. The first phase of the programme was held at the Siyane National College, Dompe, with the participation of its principal, Anuragoda Dhammarama Thero, teachers and students, where several Nelli trees were planted within the school premises.

The students were entrusted with the responsibility of looking after these plants. The event served as a means of educating the children present at the occasion about the initiation of such social causes, and the benefits of planting trees .

Educational sessiom

This was followed by another special educational session at the Sanasa Conference Hall in Palugama with volunteers from different Grama Niladhari divisions in attendance. A large number of Nelli and Rasakinda plants, along with packs of compost, were distributed on this occasion, and the participants were encouraged to plant them in their home gardens. Dr. J. T. R. Jayakody, a Senior Lecturer at the Gampaha Wickramarachchi Ayurveda Institute of the University of Kelaniya, conducted a session about the priceless benefits and medicinal values of Nelli and Rasakinda.

The implementation of this programme was supported by M. D. J. Prasad, the Divisional Secretary of Dompe and officials, Leonard Perera, the Deputy Director of Planning, Economy Development Officials, Police Officials and the members of the Youth Federation of Dompe.

Nelli and Rasakinda is one of the best medicinal combinations that helps cool the body, cleanse blood circulating in the body and boost immunity as protection against various diseases. Continuous blood purification results in longevity and relief from various discomforts such as joint pains, prickly heat, excessive sweating and body odour, cracked heels, burning sensation in the body, heels and eyes, and ailments in the urine system to name a few.

Harder to find

“It is unfortunate that these plants are becoming harder to find in Sri Lanka, and the public is not aware of their medicinal values. With the rapid deforestation currently prevailing in the country people are now concerned about the need to grow trees. This is why Link Natural Products’ Swastha Amurtha planned this campaign as an initiation for a social cause. Through this project we are not only able to hand out a large number of high quality Nelli and Rasakinda plants along with packs of compost, but we can also speak directly to the people, especially children, and educate them on the importance of such a project”, stated Priyantha Collonnege – Manager of ER & CSR at Link Natural Products (Pvt) Ltd.

“We are glad that we were able to initiate a CSR project of this kind for World Environment day from our brand, Swastha Amurtha, as we believe in setting an example to society during a time of need. We wish to continue this project in different areas of the country in the coming months as this is only the initial step of this massive project. Let’s all gather together to make this country a lush green paradise once more”, said Niroshika Perera, the Brand Manager of Link Natural Products (Pvt) Ltd.
Link Natural Swastha Amurtha, which is a 100% natural drink is produced from extracts obtained from Nelli and Rasakinda, using the extraction technology that is owned only by Link Natural Products, thereby ensuring consistency of the product. It is a convenient form of these two natural ingredients that is prepared in a ready to use manner. It can be consumed as either a hot or cold drink, and positively facilitates the internal functions of the body.

About Link Natural Products (Pvt.) Ltd.

Link Natural Products (Pvt) Ltd is a local company that has been operating successfully for 35 years. The company has a range of products including Ayurvedic products in its portfolio and it is registered at the Department of Ayurveda in Sri Lanka. It is a company that has won the trust of Sri Lankans over the past years due to the high quality of the products owned by them.

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Were you one of those 300,000 students, who pursued their goal with the help of a Mahapola scholarship?

Were you one of those 300,000 students, who pursued their goal with the help of a Mahapola scholarship?

Were you one of those three hundred thousand students, who pursued their goal with the help of a Mahapola scholarship?

Are you aware of the financial provider, who makes every effort to lend a hand to the students of the country, extending Mahapola Scholarship, which once brought you under its shelter?

Most probably, you have no idea.

It is human nature to forget easily the giant trees, which gives us cover from the burning sun in the summer. In the same way many, who followed their education receiving the “Mahapola scholarship” may have no idea of the real body, which renders a tremendous service behind the scenes for the benefit of the sons and daughters of the country.

The Development Lotteries Board, which provided its contribution to offer scholarships to more than 306,637 students from 1983 up to 2019, is still on the same humble mission of the year whilst being the hope of our compatriots.

Establishment of Mahapola Scholarship Fund

The late Lalith Athulathmudali was the founder of this precious treasure, established to assist youth, following their higher education, who look to the future amidst various economic hardships.
As the Minister of Trade and Shipping, Athulathmudali introduced the Mahapola concept in 1980, and the fund was raised with the help of the Mahapola exhibition – a great attraction of the time – and the Mahapola lottery. At the commencement of the fund, the income was utilised to enhance schools in rural areas and, with the time, Athulathmudali considered investing the funds at national level, for the benefit of the whole country. With a view to achieving this goal, he made arrangements to establish sa cholarship scheme to help students, who follow their education at higher educational institution, including universities, amidst financial hardships.

As a result of the concept of this man of the people, ever dedicated to the improvement of the country, the Mahapola Scholarship Fund was established, its legal base was assured by means of the Mahapola Higher Education Scholarships Trust Fund Act No 66 of 1981, which underwrote the administration of the whole process.

The financial base had been built so far by holding trade exhibitions and fairs and also by the sale of Mahapola Lotteries, but was further strengthened by the establishment of the Development Lotteries Board in 1983, with an investment of LKR 22 million by the President’s Fund and the Mahapola Trust Fund. With this change, the stability of the process was assured.
Working on the foundation made by the Presidents Fund and the Mahapola Fund, the Development Lotteries Board remits its dividends directly to the President’s Fund, fulfilling statutory requirements. Thereafter, 50% of the income is sent to the Mahapola Trust Fund through the President’s Fund.

Accordingly, the Development Lotteries Board has remitted LKR 25,880 million to the President’s Fund during the period 1983 to 2019.
The Development Lotteries Board is the only Government Institution which makes financial contribution to the Mahapola Scholarships Fund.

Beneficiaries of Mahapola Scholarship

The Mahapola Scholarship always brings to mind the undergraduates of our country. Many people think that the Mahapola scholarship is offered only to those who follow their higher education at Universities.
However, today the Mahapola scholarship is awarded not only to undergraduates of our universities but also to thousands studying at other higher educational institutions under the Ministry of Higher Education.

Accordingly Development Lotteries Board lends a helping hand to those following their education at higher educational institutes such as the University of Colombo, Computer School of the University of Colombo, Sripalee Campus, University of Peradeniya, University of Kelaniya, University of Sri Jayawardana Pura, University of Moratuwa, University of Jaffna, Vavuniya Faculty, University of Ruhuna, Eastern University, Trincomalee Faculty, South Eastern University, Rajarata University, Sabaragamuwa University, Wayamba University, Institute of Indigenous Medicine, Gampaha Wickramarachchi Ayurveda Institute, Uva Wellassa University, and the Swami Vipulananda Instutute of Aesthetic Studies.

Other institutes to which Mahapola Scholarships are awarded

• Buddhist and Pali University of  Sri Lanka
• Bhikkhu University of Sri Lanka
• Law College
• Technological Institutes (NDT)
• National Institute of Social Development
• Open University of Sri Lanka
• Sri Lanka Institute of Advanced Technological Education

The Development Lotteries Board is the body which provides financial support to you, who have completed higher education, as well as all the other sons and daughters of the country, who follow their education at the above institutes.
Education is the only path that we have to see the light of dawn amidst various barriers, difficulties and challenges. Therefore, the Development Lotteries Boards, without any hesitation, invests the money of the people, who indirectly contribute to this social care programme by buying their ticket, in the Mahapola Scholarships Fund, extending its blessing to the younger generation of the country.

Today you, who have completed higher education with the support of Mahapola Scholarship, may be a person with a success story. You may be a significant figure on the ladder of any profession. You never have seen a simple person who peddles lotteries. You may have no experience of buying a lottery ticket during the past period. However, you cannot forget the roots of your success.

You can never forget the fact that, once, you held a Mahaploa scholarship. Students by the thousands are following their higher education under the shelter of the Mahapola Scholarship. It is the truth, that no one can deny. The Mahapola Scholarship will further lend its hand for the benefit of the future generations of our country.

Today you, who saw the dawn yesterday with the help of Mahapola Scholarship, may have enough funds to manage the education of your children. But we need to protect Mahapola Scholarships for the benefit of the sons and daughters of under-privileged families who are dreaming of fulfilling their children’s necessities, under bitter conditions.

Therefore, you can make your contribution now to enhance the scholarship fund, which was created by a humble man of people called Lalith Athulathmudali. The few coins you spend to buy a Development Lottery Board’s lottery will open a new path to a flourishing, bright future for the country.

Mahapola Trust Fund is the helping hand of the sons and daughters of the country yesterday, today and tomorrow. It will provide a guarantee for the education of the country. Therefore, the buyer of a lottery ticket will be the indirect provider, whilst the Development Lotteries Board makes its utmost contribution for this valuable social care programme.

When you open your pocket to buy a lottery ticket, DLB will have the opportunity to strengthen the Mahapola Trust Fund for the future of the country. In return the Mahapola Trust Fund will have enough funds to increase its contribution to the enhancement of children following their higher education.

This is the true story of Mahapola Scholarship.
Now it is high time for you to perform your duty to the country.

Achala Piyarathna

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Mindfulness for corporate leaders

Mindfulness for corporate leaders

WHO has identified stress
as the “health epidemic
of the 21st century”

We spend more time working than doing anything else, and researchers have found that, on average, this results in the least happy hours of our lives. In knowledge-based industries, the stress in working life accounts for a hefty part of work-place absences and huge losses in productivity.

In the current economic climate, employees are under pressure to perform with limited resources. According to business insiders, companies in the USA lose over USD 300 billion every year due to workplace stress. The American Institute of Stress states that 80% of workers feel stress on the job, and need help in learning how to cope with it. In the UK, Health and safety executives say, stress-related illnesses among employees cause businesses lose GBP 530 million a year. According to Medibank, research in Australia shows that employees are absent for 3.2 working days each year due to stress, costing the Australian economy about AUD 14.2 billion.

Effective working environment

Therefore, it is clear that employees’ mental health has a direct impact on the success and effectiveness of the company. Research into neuroscience and psychology shows the importance of “mental capital and wellbeing”. This new perspective is, increasingly, helping business leaders to see that the cognitive and emotional resources of organisational team members determine the health, resilience and future performance of their organisations.

One of the approaches that is used globally to overcome stress is mindfulness practice. Mindfulness training has been at the vanguard in organisations keen to experiment with innovations that develop the internal resources of individuals, and keep their minds healthy. As businesses invest in employees’ professional skills and physical health, mindfulness training as been at the forefront in benefitting all employees, across a broad spectrum of wellbeing.

Mindfulness is a natural capacity, present in all of us. It involves paying purposeful attention to our experience, with attitudes of openness and curiosity. We are all familiar with a distracted state of mind, often described as being on “autopilot”. This default inattentiveness from present experience can mean we react to life out of habit rather than care and consideration. When we spend more time alive to our experience, we unlock our potential for learning and growing to respond creatively to life and to corporate challenges.

With the speed of distraction today, our attention is under constant siege. We have entered the attention economy. Research shows that 47% of the time we are mentally off- task; said another way, we spend half of our time on autopilot. What if we could get a second ahead of distractions and avoid autopilot? What if we could overcome our addiction to action and multitasking? The good news is we can. The key is to train the mind to be more focused and clear. We do this through corporate mindfulness.

What is it?

Mindfulness originated in Buddhist meditation techniques, such as outlined in the Satipatthana Sutta (The discourse on establishing of mindfulness). Although it is a millennia-old idea, it has been re-invented in order to address present issues in our modern society. As mindfulness has reached most aspects of human life over the past decade, it has expended beyond its spiritual roots and, with its adoption into modern psychological theory, it has developed into a secular training method, subject to many scientific trials.

The mechanism behind mindfulness is based on how it changes your mind-set from a fixed mind-set to a growth mind set. A fixed mind-set is when an individual believes their qualities, talents or intelligence are simply fixed traits. Employees with a fixed mind-set tend to avoid challenges, give up easily, see efforts as fruitless or worse, ignore useful negative feedback and feel threatened by the success of others. As a result of a fixed mind-set, these individuals may plateau early and achieve less than their full potential.

Leading researches into mindfulness have established that it enables employees to focus on what they experience in the moment, inside themselves, as well as their environment, with an attitude of openness, curiosity, and care. We are all mindful sometimes, but through mindfulness practice, we can cultivate this faculty and refine it so that we may harness it to a greater degree.

Apart from the benefit of reducing stress in the workplace, mindfulness provides many more advantages, such as reduced rumination, boosts to working memory, less emotional reactivity and even relationship satisfaction. As these benefits will certainly lead to a better quality of life, they will also improve our empathy, love and compassion. It is apparent that these benefits of mindfulness practice will provide the ultimate outcome of a peaceful mind and immense happiness. On the contrary, individuals who possess a growth mind-set will embrace challenges, persist in the face of setbacks, see effort as the path to mastery, learn from criticism and find lessons and inspiration in the success of others. These individuals will end up reaching ever-higher levels of achievement. Therefore, employing more individuals with a growth mind-set will lead to better achievement in organisations.

In the corporate world

There are numerous potential business benefits to mindfulness training. It is important to establish one or more key benefits that reflect your organisation. Mindfulness assists in three key areas of workplace functions: well-being, relationships and performance. It also helps to enhance working relationships become resilient, and improves performance through leadership, decision making, organisational transformation and creativity through innovation.

Mindful practice will also help an individual to choose between two paths, which are learner path and judger path. We tend to take the judger path naturally. This is due to lower awareness of our surrounding and to how our mind-set was moulded since childhood, to judge most of the things around us; which can be people, situations or even material objects. Mindfulness will help us to deviate from this common mind-set and perform well in our life.

Leaders who are mindful tend to be more effective, in understanding and relating to others, and motivating them toward shared goals. Mindfulness can help to reduce stress anxiety and conflict, and increases salience and emotional intelligence, while improving communication in the work place.

As Janice Marturano, former vice president at General Mills, and founder and executive director of the Institute for Mindful Leadership says in her book Finding the space to lead, “a mindful leader embodies leadership presence by cultivating focus clarity, creativity and compassion in the service of others.”

An introduction to mindful activities

This is a simple exercise in mindfulness. take a piece of paper and write down all the thoughts came into your mind reading this article. if you don’t remember, it is better if you could go back and read it, and then notice the thoughts that came into your mind while reading this article.

Mark the thoughts relevant to the article and the irrelevant thoughts that came into your mind. You will be able to see that there are lot of thoughts irrelevant to the article or to the subject of mindfulness have come, as well as a lot of judgemental thoughts.

To get better understanding regarding the relationships of mind, external environment and mindfulness, let us do another simple activity. Choose a paragraph from the article and try to read it again. Then try to memorise the words in the paragraph. Afterwards, read it again word by word, well focused and you will realise there were words that you have missed. What you have done is to skim over the paragraph, rather than reading it properly, which is why you have missed out these words.

This is how your mind works. This is how your daily life works. You tend to skim through rather than attending to details. Therefore, there is a great tendency to miss out most important details. Mindful practice makes your mind slow down the process of skimming and makes it more attentive to details around you. Consequently, mindfulness practice will help individuals to be more productive and effective in their working environment as well as in their daily life.

Being a mindful practitioner, you will be able to understand what is occurring at the present situation and to attend effectively. A more unobstructed and calmer mind-set will allow the individuals to improve their creativity and critical thinking; we will be able to overcome the situation in the country.

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Dr Sampath Gunawardena on clearing your mind

Dr Sampath Gunawardena on clearing your mind

In Philip K. Dick’s story “We Remember It For You Wholesale”, the protagonist, fantasising on and on about a trip to Mars, visits a corporation specialising in memory implants and tries to live through that fantasy. Unfortunately, as the technicians at that corporation (tellingly called Rekall) realise for themselves, the man has already paid a visit to that planet: he’s a secret agent and what’s worse, a secret agent on the run who’s unaware of his true identity. First written in 1966, just before Neil Armstrong walked on the moon, the story was a landmark in science fiction, and 24 years later it was turned into a film: Total Recall. It seems to have outlasted its popularity, but the science and technology behind implanting good memories hasn’t.

Although Dr Sampath Gunawardena doesn’t specialise, much less practice or dabble, in memory implants, he claims to have perfected a form of physio-psychotherapy that leaves convalescent patients free of negative energy and full of good memories. Unlike the stuff of science fiction potboilers, this method is based on a fusion of Western and Eastern, particularly local, psychology; there are no machines, no technicians, and no pills. Since Dr Sampath believes this will have an impact on our tourism sector and, on that count, investment environment, OSL – The Investment Magazine decided to have a small chat with the man who claims he’s found a solution not to the problems of life but to the problems of everyday living – the two being clean different.

Dr Sampath, a medical practitioner at Karapitiya Hospital in Galle, gained much of his knowledge of this form of therapy through observation of his patients, especially from grief-counselling the survivors of the 2004 Boxing Day Tsunami – a cataclysm which, he admits, proved a turning point in his life. The effects of grief on a person’s abilities gave him an insight into how the body works, as a holistic entity. Studying the subject closely, relating it to empirical evidence from his counselling sessions, he arrived at the present form of his remedy through trial and error. He removes the mental barriers that people have erected for themselves in response to outside stimuli.

The “method” as such, as he details it for us, is both comprehensive and simple. According to Dr Sampath, “what we call life, or pana, is dependent on energy.” Academics, physicians, health experts, and mental health professionals have, as he puts it, focused on how the levels of energy within a person can change his mood and personality. This, however, isn’t the be-all and end-all of the matter: as important as the energy levels within a body is the energy varga, or type. “Put it this way. When we are in love, we inculcate one kind of energy within ourselves. Same goes for other emotions: they correspond to specific forms of energy. Once we learn to reduce the effects of negative emotions, we are one step towards a healthy, happy, fulfilled life. In other words, the objective should be to purge out negative energy.”

For his part Dr Sampath has travelled wide and far, and picked up bits and pieces of what he’s pieced together so far. Having visited Thailand, Singapore, and the United States (five times to the latter country, where he met experts in the field from over 75 countries at a mental health symposium), he came to understand that any technique that aims at purging someone of mental ailments must be simple, practical, and firmly results oriented. Obviously, much of what passes for mental health care in the country leaves much room for improvement. “We need to keep up with the latest strides in knowledge in this field. Not just for the sake of being up to date, but because this being a fast moving world, we need quick and drastic solutions.”

The remedy he’s found out and perfected, as he tells us, goes through three broad stages: lectures, coaching, and practical treatment. “We begin with a series of lectures that cleanse the individual of naraka sithuvili [bad thoughts]. We do follow up sessions where we check up on patients to see how they are progressing. Next, we take this remedy to the individual level by coaching them on how to keep at bay negative emotions. Believe me, this is important.

“Once these two are done we move to practical treatment, which falls under three categories: physical therapy through dieting, sleep control, and exercise; bodily therapy by seawater; and mental therapy, the aim of which is to control and restraint seven negative factors in a person’s mental build-up. What are these factors? Well, five main ones in the form of the stress of leaving work unfinished, unhappy memories, jealousy, envy, and fear; and two subsidiary ones in the form of cunning and the stress of retaining unnecessary information.”

A person who has successfully “passed” through these stages has, accordingly, been cured: “When he or she is through, he or she is considered to be ‘clear’.” The use of Scientological jargon (in the dictionary of the Church of Scientology a person said to have reached a higher state of consciousness is also termed as “clear”) there startles me, though it is a relief, to say the least, that what Dr Sampath does cannot be considered a cult (religious or secular).

In any case the term is convenient shorthand for the transition a patient makes from negative, unclear energy to positive, clear energy: “We basically equip him with the tools he needs to eliminate naraka sithuvili. That is how he gets close to, and ultimately realises, a happy, fulfilled life.”
Given that he claimed the treatment has potential for the tourism sector, I ask him next as to how tourists, expecting the unexpected away from their shores, can seek solace in his method when in Sri Lanka.

The first point Dr Sampath makes is that other things aside, “tourists spend a considerable amount of money here.” As he points out, “they look for something new, which they can’t get in their country, just as when we go there we seek new experiences in Disney World and other leisure resorts.” In other words, he notes, they want good memories.

While memory implants, strictly speaking, are not on the doctor’s plate, he does admit he offers something quite close: “My treatment, if correctly followed, can and will ensure that when you leave this country, you will leave it with good, clear as crystal memories. Once we purge you of negative, bad energy, the energy left in you enables you to enjoy and recall more distinctly the sights, the sounds, and the smells of our paradise island.

That is why I say we have a big potential in the tourism sector.” As a last question, then, I ask him whether he and his team has gone to authorities with their miracle cure. While as of yet they haven’t, he does feel (as, in a way, we do) that “there’s hope for the future, despite the situation tourism in Sri Lanka is in currently.”

Uditha Devapriya

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Solar power in Vavuniya

Solar power in Vavuniya

Vydexa (Lanka) Power Corporation Offers Environmentally Friendly
Energy Solutions

The Energy sector – especially its renewable energy components such as solar energy – is an important segment of investment for the Board of Investment of Sri Lanka (BOI). Energy is important for both the public and for economic and industrial development.

Vydexa (Lanka) Power Corporation (Pvt) Ltd has set up, under the BOI, a 10 MW solar photovoltaic power plant in Kaththansinnakulam, in Vavuniya. The facility consists of 35,721 numbers of 350 W solar photovoltaic (PV) modules established on a land of 54 acres (22 ha).

The PV modules are fixed on a single-axis tracking system, which is capable of tracking the path of the sun throughout the day. This is the first project of this nature established in Sri Lanka and it uses 100% labour from local villages. The facility has therefore played a key role in uplifting the living standard of the people of the region.

Another important factor that needs to be taken into consideration is that this renewable energy project is extremely environmentally friendly, and has resulted in saving 3,800 tonnes of diesel annually to generate the equivalent amount of energy from thermal sources. Furthermore 16,000 te of carbon dioxide emission have been reduced annually, as a result of the use of solar energy.

Opportunity

In addition, as a result of this project, the local infrastructure has also been upgraded, including improvements to the road network, street lighting, religious places and even new direct and indirect employment opportunities created.
The solar photovoltaic collectors are normally mounted on a fixed slope in large installations, or as individual collectors to track the sun throughout the day and year. Tracking of the sun is continuous.

Solar Farms are generally set up on barren or unutilised lands. This is an opportunity to put to productive use any excess lands by setting up on such lands, large solar energy facilities. In the Vavuniya facility, it was done on a land previously used for gravel excavation.

Solar power offers new options for energy needs for a nation such as Sri Lanka which needs to industrialise in order to develop and create new opportunities for its population without sacrificing its pristine natural environment which is also a national asset in achieving that endeavour.


Dilip S Samarasingha
Director(Media & Publicity)
Board of Investment of sri lanka

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Global  Recession Imminent

Global Recession Imminent

Economist Dr Howard Nicholas foresees

Record-breaking audiences listened to Dr Howard Nicholas’ seminar on “The Current State and Future Directions of the Global and Sri Lankan Economies” at the Lakshman Kadirgamar Institute in Colombo on 11 July, as well as to a subsequent lecture at the University of Colombo. His two-part presentation dealt firstly with the trends in the global economy Dr Nicholas has had a long and distinguished teaching career, teaching business economics and financial markets in academic institutions in various countries – including most recently China and Vietnam. He is invited regularly to give lectures on the global economy. At a time when the world economy appeared to be riding high, Dr Howard Nicholas forecast a recession. Soon afterwards, the Global Financial Crisis (GFC) of 2007 occurred, as he had predicted. He is also known for his early warnings of the Asian Crisis of 1996-8, the global recession of 2001-3 and a little-known crisis in the Chinese economy in 2015. Now, once again, he envisages a global recession, driven by a world-wide debt crisis.

Power shift

Dr Nicholas points out that there has been a massive shift in global economic power, “as the place of the West is being taken over by the Rest.” Underlying this is a massive shift in global wealth over the past three decades. The advanced economies’ share of global gross domestic product (GDP), as measured by purchasing power parity (PPP) has declined from over 60% in the early 1990s to 40% today, while that of the developing countries (including emerging markets) has increased, reversing the previous relative position.

There has also been a regional shift in the distribution of GDP between the developing countries, with the shares of Africa and South Asia stagnating around the 10% mark, while that of Latin America has declined from 35% to converge on the South Asian level. Conversely, East Asia’s share has almost doubled from the below that of Latin America to almost 60%. Within East Asia itself, there has been a shift, with China’s share rising from 10% in 1992 to nearly 60% in 2017. Hence, it is clear that China has been driving the shift in global wealth.

It has also become the world’s largest manufacturer, pushing the USA, the Eurozone and Japan into second, third and fourth place. Manufacturing, Dr Nicholas explains, underlies “living standards, which are about the material basis of our existence – the material products (and services) we purchase to improve our well-being, and most material products are manufactures. Services, such as catering, tourism and the like are founded on the production of manufactures, while others such as finance support the reproduction of the material base of the economy.”

Countries that dominate the world economy are those that manufacture, and manufacturing has been driving global growth. By building on manufacturing, China has become the world’s largest retail market, displacing the USA. Thus, world economic power has shifted to East Asia, led by China.

Long Cycles

Dr Nicholas also referred to “long cycles”, a concept explored first by the Dutch economists Jacob van Gelderen and Salomon de Wolff, and expanded upon by Soviet Economist Nikolai Kondratiev, after whom the Austrian economist Joseph Schumpeter named them “Kondratiev Waves”. A typical business cycle, he explains, consists of a business cycle peak and a business cycle trough, on either side of the equilibrium level with expansion above and recession below. He itemises two types of cycle which he finds relevant: the Juglar cycle, which last 7-11 years and are driven by fixed capital investments; and the Kondratiev wave, which last 50-60 years and are driven by major innovations.

Dr Nicholas asserts that combining the shorter Juglar Cycle with Kondratiev cycle provides us with a long cycle of about three Juglar cycles. describes four such long cycles so far, starting with the Industrial Revolution, based on different technologies as prime movers.: First, 58 years from 1790, peaking in 1814, with a trough in 1848; Britain being the hegemonic power; and the primary technology being canals.

Second, 45 years from 1848, peak 1872, trough 1893; hegemonic power Britain; technology: railways, steam. Third, 47 years from 1893, peak 1917, trough 1940; hegemonic power: Britain; technology: steel, combustion engine, electricity, chemicals, telephone. Fourth, 80 years from 1940, peak 1975, trough 2019/20; hegemonic power USA; technology: electronics, plastics, aerospace, nuclear energy

This model can predict the direction in which the economy will move: the next long cycle should be less than 50 years starting in 2020, peaking about 2040 and with a trough about 2065, with either China, or an East Asia led by China as the hegemonic power. The technologies of this “Fifth Technological Revolution” he forecasts as the internet, biotechnology, and robotics. However, before the technological revolution marking the start of a new cycle, the previous long cycle ends in a trough, signifying a depression or recession. The US economy, Nicholas points out, has been in a de facto recession for the past decade.

“The problem is,” he says, “that at the bottom of all long cycles when you have a major technological change, you have a lot of unemployment. The skills we used to have which gave us jobs in the previous generation are no longer valid.” The true unemployment rates are being hidden by statistical manipulation. For example, the US government gives a figure of about 4% for the unemployment rate. However, the official statistics do not count the unemployed who, being discouraged at not finding jobs, stop looking actively for employment. Taking these numbers into account, the actual unemployment figure is closer to 21%.

Elephant in the room

The elephant in the room, Dr Nicholas states, is a great monetary and fiscal experiment in deficit spending, especially by China and the USA, which is propping up the global economy, but which has been making it increasingly unstable.
Central banks have been “printing money”: the assets of the “Big Four” (The US Federal Reserve, the European Central Bank, The People’s Bank of China, and the Bank of Japan) have risen from less than USD 5 trillion to USD 20 trillion, representing growth from less than 15% of GDP to over 40%.

The Central Banks do not control the quantity of cash in the system, but only the rate. Putting money into the system cause interest rates to fall. With global GDP growth at 2% over 9 years, printing money grew at 300%. So global debt is at historic highs, but interest rates are at historic lows because of printing money. The quality of debt has fallen, as has corporate yield. For the first time in history, people are paying governments and banks to hold their money. Economic growth is predicated on fixed capital growth, not working capital, overdrafts or loans. What is happening at present is that borrowing is taking place for speculation, when there should be lending to businesses for productive investment. A huge “asset bubble” has been created, making the rich richer, but hurting the poor and creating global financial instability. Pension funds are being, most dangerously, invested in speculation on the stock market. All the world’s wealth funds (including oil-rich Norway and the Middle East countries) are investing in only a few US firms, such as Google, Apple, Microsoft, and Amazon.As a corollary. Governments and central banks are increasingly controlled by finance sectors. All the US presidents who are elected are those receiving the highest amount of funds for campaigns. Hence, there is no incentive to reduce the bubble by increasing fixed capital investment.

Therefore, in the next couple of years, he predicts a massive recession, massive budget deficits, more quantitative easing and a rise in protectionism. The USA and China may try to delay the deluge with a trade deal, and there might be an agreement on more budget deficits. However, the writing is on the wall.

Christine Arumugam-Pillai

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FAST TRACK DIALOGUE

FAST TRACK DIALOGUE

To assist German investors in Sri Lanka

The Sri Lanka – Germany Fast Track Dialogue, with the objective of addressing central issues faced by German Enterprises operating in Sri Lanka under the BOI as well as to facilitate new investments; took place recently at the premises of the Ministry of Development Strategies and International Trade.

Development Strategies and International Trade Minister Malik Samarawickrama led the Sri Lankan delegation, assisted by Board of Investment of Sri Lanka Chair Mangala Yapa, and Ministry of Development Strategies and International Trade Additional Secretary W A D S Gunasinghe.

Also present were members of key Sri Lankan institutions whose inputs were essential to ensure a rapid resolution of the matters discussed.
German Ambassador in Sri Lanka Jörn Rohde led the German delegation, assisted by Delegation of German Industry and Commerce in Sri Lanka (AHK) Chief Delegate Andreas Hergenröther. Companies B Braun Lanka Pvt Ltd., DHL, Keells Pvt Ltd, Eskimo Fashion Knitwear (Private) Ltd., Go Vacation Sri Lanka (Pvt) Ltd., (Den Touristk), Hellmann MAS Supply Chain (Private) Limited, Kramsli Lanka (Pvt) Limited, Ceylon Oxygen Limited and Würth Lanka participated in the dialogue.

Minister Malik Samarawickrama welcomed the German delegation. He stated that Germany was a very important trading partner for Sri Lanka, with a volume of trade totalling EUR 1.2 billion. The Minister added that there had been an important trade and investment delegation to Germany in 2018, but that recent events had impacted on the progress made in taking economic relations even further.

High standards

Minister Samarawickrama commended Germany for establishing a culture of punctuality, precision and high standards of integrity. He added that, on the Sri Lankan side, institutions such as BOI and EDB were making a strong effort to facilitate business and eliminate bottle-necks faced by investors and exporters.

Ambassador Jörn Rohde stated that economic relations should ideally resemble the German autobahns, providing speedy solutions to all issues. Germany welcomed any effort aimed at improving Sri Lankan’s business climate and also the resolution of any issues faced by German SMEs.

He wanted to see a return to the level of tourist arrivals to Sri Lanka, which had declined since the Easter Sunday events.

Minister Samarawickrama reassured the German side, adding that security had been strengthened at the airport and hotels. Furthermore, a tourism promotion campaign will be held in Berlin to address tourists and travel agents and educate them about Sri Lanka. A total of eight leading tourism-generating countries were targeted for a recovery plan. Four tourism road shows will be held in Berlin, Stuttgart and other German cities.

The issues specific to German investors to which solutions were being sought include the registration of disinfectant products under the National Medicine Regulatory Authority (NMRA), VAT refunds for several German Companies, issues relating to the recovery of the tourism industry, issues relating to Cargo handling, monies owed to German Companies, tender procedures and payment of demurrages.
Many of these outstanding matters were resolved, or studied with a view to solution, within a specified timeframe.

Dilip S Samarasingha
Director(Media & Publicity)
Board of Investment of sri lanka

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Sri Lanka  must  industrialise

Sri Lanka must industrialise

Leading economist tells
Sri Lanka’s business leaders

A larger-than-expected crowd turned up at Colombo’s Lakshman Kadirgamar Institute to listen to Sri Lanka’s star economist Dr Howard Nicholas deliver a lecture on “The Current State and Future Directions of the Global and Sri Lankan Economies”. The event, organised by ETIS Lanka, together with George Stuart Capital, Daily FT, and Hardtalk, on 11 July.

An Associate Professor at the Institute of Social Studies (ISS) of Rotterdam’s Erasmus University, Dr Nicholas has wide-ranging teaching experience in business economics and financial markets in a number of countries, especially in Asia. He won the best-teacher award at ISS in every one of the 18 years since its inception.

Born in Colombo’s Slave Island, brought up on an estate in Kalutara district, and educated at St Anthony’s, in Kandy, he moved to the West with his parents at eight years of age. Dr Nicholas followed his parents’ admonition to be Sri Lankan despite his British passport, and returned to the land of his birth in 1987, helping to set up the Institute of Policy Studies, and then moving to the University of Colombo to help set up a post-graduate faculty of economics and to develop post-graduate training in economics.

He has had substantial policy experience in Sri Lanka, having worked closely with the Ministry of Finance and Planning on a number of different projects and being lead author in the 2005 UNDP study Pro-poor macroeconomic policies in Sri Lanka. He returns from time to time to speak on economic trends, this country usually being the first place at which he reveals a new trend.

The following is a report on the part of his talk which focussed on Sri Lanka.

Optimistic

In 1990, optimistic about Sri Lanka’s future under the pro-manufacture economic programme of the then president, Ranasinghe Premadasa, he invested his money in equity in the country, advising everybody else to do the same.
“President Premadasa started this aggressive export-orientated development strategy,” he says, although “A lot of us didn’t like Premadasa, because he was brutal in some ways… We knew that if this continued Sri Lanka would reach developed country status in 10 to 15 years.”

The demise of Premadasa saw an end to the export-led industrialisation strategy, and since then government after government has ignored it, so Dr Nicholas has had no interest in investing in Sri Lanka.

He pooh-pooh’s the theory of comparative advantage, saying it was taught by rich countries to poor countries to get the latter to do what the former wanted them to. The theory posits that if everyone does what they are good at, and exchange goods, then all the parties would benefit and can thus grow. However, he rubbishes it, describing it as riddled with theoretical and empirical flaws. He lambasts the hypocrisy inherent in the theory of free trade, since whenever it suits the advanced countries, they refuse to liberalise trade in areas they consider vital, protecting their market.

Under-performed

He notes that Sri Lanka’s economy has underperformed in comparison to its peers. It has not grossly under-performed, but the system lacks dynamism. This is primarily due to a structural shift in the economy, away from agriculture and industry towards services. Manufacture has been losing its share of industry, as construction has surged ahead. Although there has been a construction boom and financial services growth, the manufacturing sector has been neglected.

However, the construction boom is losing steam. Meanwhile, Sri Lanka’s share of world trade has stagnated, and its share of the global export markets has stagnated. Sri Lanka is losing the global garments and textile export market share. its export engine is losing steam and the government is not granting any concessional facilities to propel growth. Industrial goods have declined in their share of merchandise exports, in comparison to agricultural goods. More importantly, exports’ contribution to the current account balance has declined, and together with the decline in overseas workers’ remittances, the tourism sector has increased in importance. These two sectors are now the two major avenues of foreign exchange earnings.

Tourism is far more dependent on the vagaries of climate and terrorism than the others, and especially on the economic health of the advanced nations whence the tourists come, so the economy is now dependent on an unstable component. The events of Easter Sunday and the disruption caused to the tourism sector, especially brought home the absurdity of a strategy based on a precarious foreign exchange-earning industry, and the lack of diversity in the economy.

Sri Lanka must diversify. The country needs to see a shift towards manufacturing to enhance export dynamism. Manufacturing is at the core of any sustainable growth of an economy. All the global superpowers in history became powerful due to the growth of their manufacturing dominance.

“China has taken over as the world’s largest manufacturer,” Dr Nicholas points out. “It also has the largest retail market. China is driven by massive technological change. We are in the middle of a gigantic technological change. We know Huawei and 5G are between 3 and 5 years of ahead of anyone else in the world. Huawei has 94 % of all the patents on 5G. They can say they don’t want Huawei but they are holding the patents.”

Prospects

No country has ever developed without export-oriented manufacturing and as there is a massive market in the developing world, Sri Lanka should focus on export manufacture-driven economic growth. He also says that, although Singapore is often cited as an example for Sri Lanka to follow, that country has not prospered so much because of trade, but that its economy is driven by manufacturing.

In the short-term, Nicholas predicts weakness in economic growth along with the rest of the world, pressure on reserves and the exchange rate as tourist arrivals fall sharply and world import growth slows, and increasing domestic price level, depending on exchange rate. The extent to which expansionary fiscal policies may be pursued, will be limited by balance of payments constraints.

“Sri Lanka could become one of the beneficiaries of the continuing relocation of production from advanced to developing countries (also away from China),”in the long-term, he says. “The extent to which Sri Lanka can benefit from the relocation away from advanced countries will depend on how successful it is in developing its own manufacturing base and shifting production to higher value-added products in the long run.”

Sri Lanka‘s equity market has performed weakly, and in order to draw in foreign direct investment, the country should be able to point to a thriving manufacturing sector. He cites the example of Vietnam (where he has served as an adviser), which has diversified exports heavily into manufacture. Both Vietnam’s exports and imports have increased rapidly to about 1.2% of global trade. It is able, unlike Sri Lanka, to benefit from the China-US trade dispute, especially in the crucial electrical machinery and mechanical appliances sectors. This is due to the government’s whole-hearted commitment to a strategy of export-based manufacturing.

Savithri Guruge

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THE ICE PACKS HEAT UP WILL “TECHNOLOGICAL FIXES” WORK?

THE ICE PACKS HEAT UP WILL “TECHNOLOGICAL FIXES” WORK?

The recent heat wave in the Northern Hemisphere has brought a foretaste of what global warming – the ongoing long-term increase in the Earth’s average temperature, an aspect of climate change – can be like in future.

A recent study by the Union of Concerned Scientists, using 18 climate models to predict changes in heat and humidity across the contiguous USA, found that it will face a substantial rise in the number of extremely hot days. Even if something is done to reduce greenhouse gas emissions (blamed for climate change) this will occur, but if nothing is done, the impact could be far more harmful.

The heat wave engulfing Europe is heading north, which may have disastrous consequences. Unprecedented wildfires have been raging north of the Arctic Circle, so large that they are visible form space, causing climatic devastation.

“The northern part of the world is warming faster than the planet as a whole,” reported the World Meteorological Organization (WMO). “That heat is drying out forests and making them more susceptible to burn.” The resultant wildfires, it said, released a minimum of 50 megatonnes of carbon dioxide, greater than Sweden’s annual emissions.

The heat wave could also speed up the melting of the Arctic ice cap, particularly the crucial ice sheet covering 80% of Greenland – if this were to melt, it could cause a cataclysmic rise in sea levels, effecting all the world’s coastal cities. The recurrent flooding of seaside roads along the southwest coast of Sri Lanka may be a consequence of this – with dire ramifications for Sri Lanka’s tourist trade.

Artificial snow

Climate scientists in Singapore warn that the city-state’s coastal defences should be strengthened as a measure against sea-level rise. An increase in global temperatures of 0.5°C may lead to a 10cm rise in sea level, according to a study by a team led by Professor Adam Levermann, of the Potsdam Institute for Climate Impact Research in Germany, which says that the West Antarctic ice sheet has begun a “self-sustaining ice discharge.” It says that the more than 3-metre concomitant sea level rise may cause severe problems in highly-populated coastal areas, including metropolitan cities – such as Colombo, Galle and Jaffna in Sri Lanka.

Melting of the sea ice in the Arctic can also accelerate climate change. A recent scientific paper indicates that the white surface of the Arctic ice pack is key to reflecting solar rays away from the Earth and reduce temperatures, preventing the faster heating up of the dark oceans. The shrinking of the polar ice cap, already at a record this year, may be worsened by the heat wave. Losing this ice cover would be the same as adding 1 trillion tonnes of carbon dioxide to the atmosphere.

The acceleration in the melting of the ice caps is causing scientists to study how to ameliorate the effects. Professor Levermann, of the Potsdam Institute for Climate Impact Research, told Reuters news agency that “We are already at a point of no return if we don’t do anything.” Levermann’s team of climatic researchers has come up with a radical proposal to thicken the melting ice by creating a layer of snow artificially. They suggest using over 12,000 wind-powered pumps to spray cold sea water onto the surface of the West Antarctic ice sheet, to create snow.

However, they warn that carrying out their proposal practically “would mean an unprecedented effort for humankind in one of the harshest environments of the planet.”

Particulate mist

This is just one of the less extreme schemes for offsetting the effects of climate change, which underline the growing anxiety among scientists. Harvard University professors David Keith and Frank Keutsch hope to launch a small-scale atmospheric experiment to test the feasibility of geo-engineering, i.e. altering the climate deliberately. This would be the first such experiment outside the laboratory.

They expect to launch a balloon, equipped with propellers and sensors, to high altitude. There, it would spray a fine mist of sulphur dioxide, alumina or calcium carbonate into the upper atmosphere. The sensors aboard it would then measure how much the mist particles reflect, how they scatter or combine and how they react with atmospheric compounds. This could lead towards scattering particulate matter on a large scale, in critical areas of the atmosphere, to reflect the sun’s rays before they can heat up the lower atmosphere.

However, one section of the scientific community is apprehensive that such experiments can legitimise the idea that there can be a “technological fix” for the effects of global climate change and prevent meaningful action being taken to prevent it, or at least slow it down. There are also fears that these experiments could lead to other, unforeseen problems, or to their use as weapons for intimidating smaller nations.

Savithri Guruge

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