Sri Lanka’s external sector displayed a mixed performance in June 2018. Even though the lowest trade deficit so far during the year in absolute terms was recorded in the month of June, the trade deficit widened significantly in comparison to June 2017 as the growth in import expenditure outpaced the increase in export earnings. Earnings from tourism increased notably in June 2018 continuing the growth momentum observed since the beginning of the year, although workers’ remittances declined during the month in comparison to June 2017. The financial account of the Balance of Payments (BOP) was supported by the fifth tranche of the Extended Fund Facility of the International Monetary Fund (IMF-EFF) and the third tranche of the divestiture of the Hambantota Port, however, outflows of foreign investment from the government securities market and the secondary market of the Colombo Stock Exchange (CSE) exerted some pressure on the BOP.

Attention of the Central Bank of Sri Lanka has been drawn to recent media reports and the corporate disclosure to the Colombo Stock Exchange (CSE) by East West Properties PLC, the parent company of Weligama Hotel Properties Limited (WHPL).

The Employees’ Provident Fund (EPF) Department received a letter from the Chairman of WHPL in June 2018 to sell its stake in WHPL to HPL Properties Group. Subsequently, the EPF Department held several discussions with WHPL in this regard. Accordingly, the Monetary Board of the Central Bank of Sri Lanka has decided to obtain a valuation of EPF’s equity stake in WHPL and the above valuation process is currently in progress.

A comprehensive valuation would be essential to determine the value of EPF’s stake in WHPL prior to divesting, in order to ensure an adequate return to the Fund to maximize the benefits for its members. Therefore, the EPF wishes to reiterate that it has taken necessary measures to obtain a valuation.