CA Sri Lanka’s CEOs Forum plays nexus role to bridge gap between government and business community

The Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) organised a CEOs Forum to provide clarity on the current debt situation, whilst also helping the dynamic business community gain a better understanding on the government’s strategy and way forward to navigate through the ongoing situation.

Delivering the welcome speech at the forum titled, “Debt situation of Sri Lanka: What is ahead of us?” at Shangri-La Colombo, President of CA Sri Lanka Mr. Manil Jayesinghe said that the aim of the forum was not to delve about the past, but to focus on where the country is heading in the future. “The debt situation has been a topic which has been on everyone’s mind, and CA Sri Lanka took the lead to organise this forum because the time was apt to clear uncertainty and obtain clarity.”

Mr. Jayesinghe said that the end objective of this forum was to provide the necessary support to the business community to take things forward once they have received the required clarity from the government in terms of policy.

State Minister of Money & Capital Market and State Enterprise Reforms Hon. Ajith Nivard Cabraal, who was the guest speaker at the event said that the business community must help the government for the government to help them. “You must help us for us to help you. This a two-way operation,” he said.

He said that CEOs must develop new ideas and make investments. “We didn’t say there is COVID and wait without passing the law for the Colombo Port City Commission, instead we made it a priority because we wanted investments to come in. Even during the war, we kicked off major projects, and didn’t wait till the war was over to start them.”

He urged the community to look at the long term instead of focusing only on the short term. Minister Cabraal said that at some point COVID will be a thing of the past. He agreed that whilst there may be a lull now, he reminded that when compared with history, one must remember that one year is a relatively short period of time, although it may be a difficult year.

“But good years will come, so you must hold on. This should be considered as a period to consolidate. We must stay on course and not lose wickets, and then when the time is right, we must hit sixers,” Mr. Cabraal said.

The panel session brought together eminent speakers comprising of Governor of the Central Bank of Sri Lanka Professor W. D. Lakshman, Chairman of the Ceylon Chamber of Commerce Mr. Vish Govindasamy, Executive Director of Verité Research (Pvt) Ltd Dr. Nishan de Mel, and Managing Director of Fitch Rating Agency Mr. Maninda Wickramasinghe, while the session was moderated by Mr. Jayesinghe. The event attracted some of the top CEOs of the country.

Sharing his views, Prof. Lakshman said that there is a policy plan in place which the government is pursuing, and the Central Bank is supporting and in the next six months it should show if the plan is working. “In the policy plan, there is a heavy focus placed on exports, domestic production as well as entrepreneurship and SME activities.”

According to Mr. Lakshman these are some of the activities which were neglected in the past or the past policies mainly focused on trade depended on activities, where the country consumed more than it earned. “But we are planning to change this,” he added.

Mr. Govindasamy, said that the business community right now needed a serious level of confidence from the government. “They (government) need to tell us that this is the plan, and this is what we are going to do, and you go ahead and do what you can do. This must be strongly communicated.”

He said that the business community is seriously concerned and consumed over how the debt situation. According to Mr. Govindasamy, three of Sri Lanka’s major foreign exchange earners; tourism, remittances, and apparels took a major blow following COVID.

“COVID taught the world it can no longer depend on large supply bases, and lot of countries were hit because they were depended on either China or India. Therefore, most companies are now looking to diversify, and we must take advantage of this opportunity and attract some of the world’s largest companies to Sri Lanka. But to achieve this, the government must provide the necessary confidence and ensure policy consistency because only then can we attract such companies to the country,” he said.

However, Dr. de Mel, said that the fact that Central Bank had to change foreign exchange related policy 18 times in 2020, whereas it changed it only four times in 2019 and five times in 2018 and already six times in 2021 doesn’t help the confidence building process.

“People begin to wonder whether the plan is not working out, which is why the government has to continue to change policy on foreign exchange regularly, because if it was working as per the plan then these could have been anticipated and it could have been fixed in advance,” he said

Mr. Wickramasinghe underscored the need for Central Bank to kick start a dialogue with rating agencies as practiced in the past. “In 2008 and 2011, when Sri Lanka recorded rating upgrades, Central Bank spearheaded a committee which held dialogues with rating agencies. I think it’s time to get this group going because the timing is perfect to have such a dialogue.”