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National Business Excellence Awards- 2008:

Cargills achieves Excellence in Knowledge Integration

Deputy General Manager (Retail, Accounting Systems and Controls) Dilantha Jayawardena accepting the award for Best Economic Performance.

General Manager- Retail, Cargills (Ceylon) PLC Senaka Amarasinghe accepting award for excellence in Trading category.

Cargills (Ceylon) PLC bagged two prestigious awards at the recently concluded National Business Excellence Awards 2008 organized by the National Chamber of Commerce. The company was adjudged the winner for 'Best Knowledge Integration' and also clinched the 'Trading' category award.

Director of Human Capital Development Dr. Sunil Nawarathna notes that the company has consistently focused on innovation and knowledge integration as a thrust area in achieving success. "Cargills is a business that looks beyond conventional business wisdom. Our thinking has evolved to meet our goals of creating social value and we need to innovate and consistently absorb new knowledge and technology to create value at every level of our business," he said.

Cargills has established its own Business Intelligence Unit as well as Training and Capacity Building entities to complement the overall focus on innovation and knowledge integration.

A key area that Cargills concentrates on is rural youth development which aims to harness the energies of young people towards building a new generation of professionals in the Food and Agribusiness sector.

"Today Sri Lanka depends on the foreign exchange sent home by young men and women who work as unskilled workers in the Middle East and other countries.

"As a company we therefore focus on developing the skills of rural youth through the Albert A. Page Institute of Food Business which we established as a non profit venture," Dr Nawarathna said. Since its inception in 2007, The Albert A. Page Institute trains more than 3,000 young people every year gearing them with internationally accredited training.

Lucky winners dine with Coca-Cola brand ambassadors

Coca-Cola Beverages Sri Lanka Limited together with McDonald's conducted a unique and exciting competition in which everyone who entered the competition was a winner.

The range of prizes included free dining with the two Coca-Cola Ambassadors Mahela Jayawardena and Kumara Sangakkara at four McDonald's outlets, Grand Stand tickets to the India vs. Sri Lanka cricket matches and free Coca-Cola at the McDonald's outlets.

This competition initiated and conducted during the Indian cricket tour of Sri Lanka in July and August was an effort to boost the enlivening and enthusiastic atmosphere surrounding cricket tournaments in Sri Lanka by rewarding the numerous cricket fans with the above prizes.

All customers who purchased a Combo meal at McDonald's were eligible to participate in the scratch and win competition and were entitled to the range of prizes.

100 lucky winners were selected from the four McDonald's outlets in Colpetty, Nugegoda, Welisara and Rajagiriya and were granted the privilege of dining with the Coca-Cola brand ambassadors Mahela and Kumar recently. 150 lucky winners were also rewarded with Grand Stand tickets for the India vs. Sri Lanka cricket match played in August in Colombo, while approximately 10,000 lucky winners walked away with free Coca-Cola.
 

Ruhunu Expo '08 shines at Hambantota

T.K.Premadasa Deputy Director/ Marketing Sri Lanka Export Development Board

Minister of Export Development and International Trade Prof. G.L. Peiris has announced at a Press Conference held in Colombo recently that Sri Lanka Export Development Board under purview of his Ministry is planning a series of Expo Exhibitions to encourage the rural producers to find avenues of opportunities for their products to be presented to the global market.

The premier exhibition "Ruhunu Expo' 08" with thematic of Gamen Lowata will take place on December 13-14 at the Tzu Chi National School, Hambantota.

Hambantota fishery harbour

Hambantota is a prominent region in the South glorifies a proud history with a prestigious cultural heritage of high quality. Sri Lanka ruled by the kings in the ancient era had been demarcated into three territorial provinces namely Ruhunu, Maya and Pihiti.

The entire Southern Province together with Ratnapura, Moneragala, Badulla and Batticaloa districts were under the administration of Ruhuna. It is testified by the great chronicles that Ruhuna was named after Prince Rohana who first ruled the province. He was one of the princes accompanied by Baddakachchyana. Magama was the capital of Ruhuna.

Dr K.Kularatnam in his article written to the History of Ceylon Vol. I Part I, a book published by the University of Peradeniya has declared that ancient Magama is presently known as Tissamaharamaya area. The successive rulers from time to time changed the administrative divisions to facilitate their governance. In the process of demarcating the administrative districts in the island, the British colonial rulers re-established Hambantota as one of the districts under Southern Province.

The historical importance in respect of Hambantota remains extraordinary. It should be hailed that the country stood steadfastly a United Sri Lanka with prudent guidance by King Dutugemunu the great hero who reigned from Magama. The name of Hambantota will be written large in letters of gold in the history of Sri Lanka as the resplendent city that produced great patriots like King Dutugemunu, King Saddhatissa and President Mahinda Rajapaksa.

Numerous spots of attraction depicting the cherished value of culture and economy and areas of natural assets available in this region have been earmarked. By the mention of the name Hambantota, it recollects the famous Salt Lake with many other stories linked to Salt Industry. Arthur C. Dep in his book titled 'A History of Ceylon Police Vol.1 stylishly narrates the memorable stories of people charged with theft of salt and how they were taken to courts.

Hambantota was recognised not only as a maritime silk route but also as an attractive beach with sandy mounds strategically used by the British rulers for their defence at the war front. Dr L.R.Brohier in his book "Seeing Ceylon" stated in 1803 that a small regiment of the British Army attacked Kandyan forces defending themselves behind Hambantota sandy mounds.

Bella Sidney Woolf, the sister of Leonard Woolf in her book 'How to see Ceylon' written in 1914 describes the attraction of beauty by the radiance of the sun on Hambantota coastal region. Besides many pleasing stories, Leonard woolf in his novel 'Village in the Jungle' has described the harshness and acridity of the people over the challenges by a long spell of dry zone sans sufficient rainfall.

The sight of the dead bodies of animals constantly found in the forest caused by severe drought prevailing in the region was inexplicable according to Dr Brohier. Until recently, people thought that only Curd, Kalu Dodol and products of salty fisheries could be purchased on their way back home from Kataragama.

Special attention on development was drawn to those areas overlooked for decades since gaining Independence in 1948 in spite of numerous attempts made by leading politicians of the relevant electorates.

Today Hambantota has become the fastest developing city in the country not only due to the accelerated programme of urbanisation but also due to the enormous development of infrastructure involved. The commencement of building an International Airport and an International Harbor patently manifests the potential needs for development in commercialisation.

The city will reach the apex in appraisal of vast development recognised by the international community in the very near future. Admirably this project would benefit the residents of this region with employment and economic boost in their living conditions, an inspirational impetus for migration from other parts of the island to Hambantota.

Sri Lanka Export Development Board (EDB) excelled in export development has taken necessary precautions on a strategy mainly to emphasise the need for equal distribution of export turn over to rural areas and to decentralise the operation with opportunities open to rural production and build their lifestyles. EDB has already initiated a series of progressive measures in this respect towards development of export production.

In an attempt to win this goal of achievement EDB has decided to strengthen the regional network by the establishment of branch offices and organising a series of Expo Exhibitions. The new branch office of EDB will be opened in Hambantota shortly and it will cover the regions of Moneragala and Ratnapura too. The purpose of this new office would be to identify new resources, develop available resources in the region for export market and to encourage people to improve their skills to compete with the global market.

Moreover EDB has also decided to organise Expo exhibitions at provincial level with a prudent insight on rural development in export under the theme Gamen Lowata or Rural Resources to Global Market. In this context arrangements have been made to have the first Provincial EXPO Ruhunu Expo'08 in Hambantota on November 13-14 at Tzu Chi National Scholl, Hambantota.

The main objectives of this exhibition would be to strengthen the current operational system of export in the region, identify the potential products and services, encourage the producers to associate with the established direct exporters and motivate the producers too for direct exports. This nature of strategy will create a new regional export culture for the producers to acquaint with buyers to initiate business on their own soil.

Ruhunu Expo'08 is not a meeting place for entertainment or just a display of products by the export companies. Participation at a Trade Fair of this nature is a professional approach on promotion of marketing development, not only demands the finest opportunity in sharing responsibility at an international trade fair but also gains invaluable experience on dealing with the international business community. Hambantota with the surrounding area is rich in various resources as fisheries products, agricultural products of cashew, tea, cut flowers and foliage and gems etc.

The exhibition will be opened for two days as scheduled and will be engaged on initiating negotiations with the exporting producers and other professionals on trade. EDB organises Samatha Piyasa also known as Monthly Exporters' Forum with the intent of reaching solutions for export related issues. EDB will organise mini Samatha Piyasa at the Ruhunu Expo to provide suitable opportunity for representation of the related issues faced by Provincial Export Community before the Ministers for a progressive solution.

Arrangements are being made for presentation of awards to the business community in the area an inspirational move in appreciation of their tremendous contribution made towards the development of exports in the best interest of the entire nation.

Seminars and workshops on export development based on the academic aptitude of the rural producers have been planned to widen their knowledge on the areas such as product and market development. Ruhunu Expo'08 extends a golden opportunity for rural folks to purchase export products of high quality at a reasonable price.

Ruhunu Expo'08 is a momentous share of contribution by the EDB as a responsible partner of Hambantota Navodaya in its effort to expand the development structure in this native at village. The laudable priority of attention portrayed by the exhibition would embolden rural producers venturing into new avenues for expansive advancement of their business.

Embraced with a massive construction of an International Airport, International Seaport, monumental irrigation projects and an abundance of enriched greenery, Hambantota Navodaya the accelerated development programme of Hambantota and the suburbs demonstrates to the entire world of the new model of progression against the challenges.

Hambantota could be projected as the City of Prosperity for the next generation.

Crisis in the tea industry, a rejoinder

Over the past few weeks, the Tea Industry has attracted considerable media attention due to the sharp decline in prices at the Colombo Tea Auction and the consequent implications on every sector of the Industry.

Whilst there is no denying that a crisis does exist, it is the Industry’s view that various misconceptions and distortions have been created through reports, which represent personal perceptions or ambiguous views, attributed to sources, both within and outside the Industry, who have, additionally, been misquoted and, hence, do not necessarily epitomize, either partly or wholly, the true situation. This has led to negative publicity and misleading signals being disseminated to the Industry.

The Colombo Tea Auction, held under the auspices of the Ceylon Chamber of Commerce, the Precedent Business Chamber in the country, established in 1839, and managed by the Colombo Tea Traders’ Association, the Apex Body of the Tea Industry, established in 1894, is the world’s largest single-origin tea auction and is acknowledged as the most professionally, transparently and efficiently conducted. An average of 6 million kilograms of tea, spread over 10,000 or more separate invoices are sold each week at 50 auctions held each year.

Prices realised at the Colombo Tea Auction are consistently, on average, much higher than those of other tea auction centres. Since the second half of last year, the Colombo Tea Auction has seen extraordinarily high prices, which contributed to the unique achievement of the export earnings on tea exceeding the US. Dollars One Billion value last year.

Notwithstanding the fact that Ceylon Tea is synonymous with the finest quality available and has the largest diversity of speciality teas catering to every conceivable niche market, the prices realised over this 12 month period were considered more than gratifying.

The crisis commenced, coinciding with the global economic melt-down, which precipitated a crash in all commodity prices, in August this year.

Since the alacrity of this sharp plunge in prices in such a short time frame was as unexpected as it was overwhelming, the uncertainty it created left a large percentage of teas offered at the auction unsold, in the absence of equitable bids.

The decline in prices, so swiftly, and the large volume of unsold teas caused a cash-flow crisis right through the supply chain. This is a very simplistic analysis of the dilemma facing the Industry, which is far more complex and is attributable to a wide combination of factors.

The Government, in consultation with all stakeholders, formulated a strategy of intervention to bring stability to the market and restore international confidence in it.

Through consensus, some very effective measures were identified for implementation, on potentially salutary rationales. Of course, not all the measures proposed for implementation had the desired results.

However, the resilience of the Tea Industry once again emerged, as it has in innumerable instances in the past. It should be stressed that the envisaged relief was not to take the form of “hand-outs”, but rather temporary assistance to tide over a grave hiatus in normal market conditions.

On the directive of the President, the Sri Lanka Tea Board entered the auction two weeks ago and purchased a little under one million kilograms of tea at a value of Rs.230 million, to strengthen the market.

The proceeds of these purchases were belatedly settled to the Brokers, who, in compliance with the Auction By-Laws, were compelled to make payment, in the interim, with their own resources, to the producers, for the teas sold through their catalogues to the Tea Board.

It is comprehensible that Treasury formalities would engender an element of delay in the release of these funds. However, the implications of this delay were far-reaching and served to compound the problem.

The Tea Board action is understandable and achieved a reduction in the percentage of tea remaining unsold, whilst injecting some much needed cash flow requirements to the Auction process. However, the plans for eventual disposal will have to be discussed with the Trade, so as to ensure that any export will not interfere or cause confusion with the well established sales channels and existing agency agreements.

The import of teas to many Middle Eastern countries and the USSR [prior to its dismantling], which was controlled by the State some years ago, has now been liberalised in sympathy with the concept of “Free Trade” adopted the world over. Therefore, the avenue of Barter Trade between friendly countries is not available any more.

Media reports predicted that the collapse of the Tea Industry was imminent, that the over one million people dependent on the Industry will be cast into destitution, that the crisis could only get worse and that the world had abandoned tea drinking.

However, these prophesies of doom have now been replaced by over-optimistic declarations that the crisis is behind us and all is well with the Tea Industry. This is not the case! The Tea Industry has still many trials to face before it can return to normality.

A very sensitive aspect in this scenario is the lot of the smallholder, the backbone of the Industry, who supplies about 70 per cent of the raw material [green leaf] for the manufacture of the end-product - Black Tea. If they are compelled to neglect good agricultural practices on account of the diminishing returns on their crop, the long-term consequences could be devastating.

Meanwhile, the manufacturers - the Private Tea Factory Owners’ and the Regional Plantation Companies - have to contend with depleted working capital, which is severely affecting their multifaceted operations.

The Brokers, who have advanced funds to the producers on the basis of the higher prices that prevailed, find that they have no means of recovering their dues because the teas either have sold at much lower values or remain unsold.

Buyers are carrying stocks of tea at prices well above the current market, on which interest is fast accruing at phenomenal rates. This has heightened their cash flow problems.

The Industry is conscious of all these impediments and is bracing itself, with a degree of confidence, to meet the challenges that will confront it, supported by the relief strategies proposed by the Industry stakeholders.

(Colombo Tea Traders’ Association)
 

Market report

The global banking industry has suffered blow after blow starting with the Subprime crisis.

Despite standing to the pressures, the Sri Lankan banking sector has not entirely escaped the crunch that’s plaguing the global banking industry. The disposable income of the public has plummeted due to the high taxes and the cost of living. The bank deposit bases have taken a severe hit reflecting in an evenfall in the lending quantities.

The fall in the lending coupled with higher non performing loans reported in this quarter, we feel would push the margins of the banking industry even further down in the medium run.

The ‘double whammy’ on the sector would seemingly continue. The 3Q earnings of the banking sector reported so far has shown higher Gross Non Performing Loans percentages across the board showing greater denting of asset quality.

While National Development Bank (NDB), Hatton National Bank (HNB) and DFCC bank (DFCC) are yet to announce for the quarter ended September 08, we have a comparison on the asset quality and the efficiency indicators of the Banking sector.

SC Securities (Pvt) Ltd.

Special seasonal offers from SLT

Sri Lanka Telecom, is offering special offer for SLT Citylink CDMA , SLT Megaline and SLT Broadband services during this festive season. This special promotion period is on from 16 November to 31 December 2008.

This special promotion unveiled to popularize SLT's latest communication services and use of broadband Internet among a cross-section of the people.

SLT made these attractive offers including reduced connection fees, free registration for broadband connections, special discounts on broadband connections and free ADSL modems and ADSL routers which SLT received very high demand during SLT promotional campaign carried out time-to-time.

With the SLT Citylink CDMA telephone service, customers will be offered, post paid Citylink-V and CitylinkNet, Pre-paid Citylink for special prices and offers.

SLT owns and operates the largest CDMA (Code Division Multiple Access) network with the highest number of base stations in Sri Lanka to date.

With the aim of providing wireless access for rural development, the company has 271 base stations, enabling coverage of 92% of the island in geographic terms.

SLT Megaline offers four packages, Bronze, Silver, Gold and Platinum. A 10% discount on any telephone equipment purchased from the teleshop is on offer for new Megaline customers and many other offers.

SLT Broadband offers three packages: Entr‚e, Home and Office. Customers will be privy to free registration, a 10% discount on any ADSL CPE (Customer Premises Equipment) purchased from teleshops for new Broadband customers and also free ZTE ADSL modems for existing SLT dialup customers. The deployment of the company's broadband wireline technology, ADSL continued apace in the year 2008.

SLT has expanded its customer base by 100% to reach 100,000 customers by year-end 2008. ADSL technology is capable of placing top of the line broadband services and exciting value added services at the command of the customer services such as broadband internet, VoIP services, IPTV, Video on Demand, e-Learning and gaming among others.

Today SLT's island wide broadband network enables high speed internet access from the suburbs and rural areas to the more urban areas of the island.

ADSL 2+ is the access technology, carrying the broadband service forward which supports a downstream bandwidth of up to 23 Mbits/s and an upstream bandwidth of 1 Mbits/s.