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 Business

  In Brief     Supplement

 


Bradley Emerson

SL base for CIMA's regional expansion

CIMA in its quest to grow in South Asia and in the Middle East has made its Secretariat in Colombo the launching pad for regional expansion.

"CIMA's goal is to increase annual new global registrations from the current 20,000 to 60,000 by 2015; "Bradley Emerson, CIMA's South Asia & Middle East Director told The Sunday Leader.

In this connection CIMA London was looking at South Asia, Latin America, China and the Middle East as the new growth markets.

In this part of the region only Colombo has a fully fledged Secretariat for CIMA, said Emerson.

It's therefore cheaper for CIMA London to make Colombo its base to expand regionally, rather than open separate offices in individual countries in the region, he said.

The key is to open CIMA tutorial schools in those targeted countries, said Emerson.

Emerson who overseas CIMA's South Asia & Middle East operations whilst based in Colombo said that since last year he has been able to get a commitment from the Maldivian government to sponsor 100 O' Level passed students annually to do the CIMA exams.

He said that 10,000 students annually pass the O' Level in the Maldives. "But there are vacancies for only 2,000 students for the A' Level. "This was the unique selling proposition I made to the Maldives, and they accepted it," he said.

Emerson has already established a tutorial school in the Maldives with the assistance of CIMA qualified Sri Lankans working in the archipelago to teach CIMA to those students.

In his quest to fulfil London's aspirations, Emerson is also looking at the Pakistani and Bangladeshi markets with populations of 160 million and 150 million each respectively.

"We, together with ACCA went to Pakistan 10 years ago, but whereas ACCA has made inroads, we have been barely staying afloat in that market," said Emerson.

In this regard Emerson has been able to tap 10 colleges in Lahore and Karachi that teach ACCA to include CIMA as well in their curriculum. Literacy in Lahore and Karachi is over 80%, said Emerson. And both those cities have a combined population of 18 million of whom 54% are under 19 years, he said. Further, English is the medium of instruction in those cities, opening a vista of opportunities to CIMA, said Emerson.

"I want to increase annual registrations from 250 to 1,000 from Pakistan this year," he said.

He also said that this year he will be working on the Bangladeshi market as well.

 "I have contacted a couple of Sri Lankan investors in Bangladesh to invest in CIMA education by providing the necessary infrastructure, and the response has been positive," said Emerson.

Bangladesh is a market that is drawing huge amounts of foreign direct investment. And with the country's recent return to democracy, sky's the limit there, he said. Commercial Bank, after investing in banking assets in Bangladesh is reaping a windfall there.

It was one of their former senior managers, Harris Premaratne who was instrumental in the Bangladeshi venture, said Emerson, a former banker. Premaratne is currently the CEO of Sampath Bank.

In Sri Lanka too Emerson is working with the Labour Ministry to get government sponsorship for 100 unemployed graduates to follow the CIMA Foundation course now known as Certificate of Basic Accounting.

That certificate alone is enough for a student to find employment in the business process outsourcing industry, he said. The cost per student for this foundation course is Rs.80,000; he added.

 Sri Lanka after UK is CIMA's second biggest market.

CIMA took off in Sri Lanka after the 1971 insurgency which disrupted university education here, said Emerson. As a result, students, whilst waiting for university entrance over an over-extended period of time, opted to do CIMA then, he said.

CIMA has also opened a branch in Dubai and is now looking at expanding to Oman and Bahrain as well, Emerson said.

"India is a difficult egg to crack, though we have established a branch office in Mumbai, "he said.

They may be having only 1,000 CIMA qualified members. That is because the local accountancy body is powerful, and wields a lot of clout, Emerson said.

But with time, when India realizes the value of the CIMA qualification, that market will open up, then sky will be the limit for CIMA, he said.


$ gains SL cents 70 to Rs. 114 in spot trading 

CB curbs on forex trading election ploy

Central Bank's (CB's) ploy to minimize banks' exposure to overnight foreign exchange (forex) trading by cutting down limits by 50% last week in order to strengthen the rupee is an election ploy, market sources who did not want to be named told The Sunday Leader.

"This is an election ploy to bring down the cost of living by having a strong rupee, thereby making imports less expensive," they said.

Overnight forex trading limits among commercial banks are fixed by the CB.

Sri Lanka being a trading country is dependent on imports to keep the economy going and a weak rupee would make imports more expensive, the sources said.

Cutting down banks' exposure to forex trading is a step geared for next month's Wayamba and Central Province provincial council elections by having a control on prices of imported goods, they said.

However despite those controls, due to the two state owned commercial banks buying US dollars from the market, the dollar gained by 70 Sri Lanka cents at Friday's trading to be quoted at Rs. 114 at spot trading..

"CB's recent controls on banks' exposure to forex trading, artificially curbs the market's appetite for the US dollar, thereby hoping to take the pressure off the rupee," they said.

In the three month from September to November the CB expended over US$ one billion by making available to the market dollars first at Rs. 108, then at Rs. 110 and afterwards at Rs. 112 per dollar unit during this period in order to keep a check on a steep rupee depreciation.

But with reserves sufficient for only two months of imports, the CB then stopped intervening in the forex market which then saw the dollar going past the Rs. 113 mark.

This resulted in the CB last week introducing new controls to curb the demand for dollars in the market by cutting banks' overnight dollar positions by 50%, which, at least temporarily has halted the rupee slide for now.

But the flip side is that a strong rupee is hurting exports.

"High inflation and interest rates coupled with an over-valued rupee are hurting exporters," Tanky Wickremaratne, Chairman Hayleys plc, one of the country's diversified export companies said.

Inflation and interest rates in the country are at over 20%.

By far the worse of the two evils is inflation, said Wickremaratne

 However, competitor companies in other parts of the world face no such disadvantages, he added.

 "Our margins are being squeezed as a result," said Wickremaratne.

"The tariff 'advantages' that we enjoy in exporting to our markets are also enjoyed by our competitors, so there is no advantage," said Wickremaratne.

The advantage may be to garment exports because of the duty free entry allowed into the EU market which their competitors however may not be enjoying, he said.

 "But the disadvantages we face are high inflation and high interest rates and an overvalued currency which, however our competitors are not burdened with," added Wickremaratne.

Things are being made worse due to the global recession with no end in sight, he said.

Hayleys are into the export of agro and coir products, activated carbon, textiles and gloves.


Public not warned of Golden Key

Banks have lifted their suspension on lending to Seylan Bank and there is no run on the bank, Central Bank (CB) Governor Ajith Nivard Cabraal told reporters on Wednesday.

A representative of one bank which had suspended lending to Seylan confirmed that what Cabraal said was true. "We lifted the suspension after CB assurance," the source said.

CB on Monday took over the management of Seylan and appointed a new Board after there was a run on the bank, posing a systemic risk to the financial stability in the country, the CB said.

This was after the collapse of Golden Key Company due to a credit card scam. Both Golden Key and Seylan Bank are Ceylinco Group companies.

Cabraal was however unable to give a clear answer as to why the CB in their recent advertisements which warned the public in placing their moneys in unregistered financial institutions, failed to highlight Golden Key Company as one of those, whilst at the same time highlighting others.

But he said that certain amendments have been proposed to the Registered Finance Companies Act so that unregulated finance companies could be brought to book by the CB.

Since the appointment of the new Board, Seylan's shares have gained by 81% to close at Rs. 28.50 as at December 31, 2008.

Cabraal said that former Seylan Bank Chairman Dr. Lalith Kotelawala was happy that CB took over the management of his bank.

Cabraal had no objections if the Ceylinco Group sold their equity stake in Seylan to another party, estimated at 53% by market sources. Various names are touted in this regard vis-…-vis DBS Bank Singapore, Lanka Orix Leasing Company plc and the John Keells Holding Group, which together with Central Finance operates Nations Trust Bank plc.

On the negative side is the high staff numbers at Seylan when averaged on a per branch basis, in comparison with its peers. But on the plus side, Seylan has 7% of the country's total commercial bank loan portfolio, the sources said.

CB may have management control over Seylan for a maximum period of six months, which however may be extended afterwards.

Cabraal said that depositors with other Ceylinco Group companies registered with the CB and which were providing financial services had nothing to fear with regard to the safety of their money. But Cabraal said that he could not vouch for the same in regard to financial institutions that were unregulated by the CB.

On the Ceylon Petroleum Corporation hedging contract, he said that the CB has completed their investigations, but refused to give details with regard to their findings.


Rates artificially stifled

Upward pressure on rates continued at Wednesday's Treasury Bill (T. Bill) Primary Auction despite Central Bank (CB) intervention to stifle rates.

Whilst bids for the re-issue of T. Bills of a 91 day tenure were rejected (Rs. 1,295 million worth of bids were received for this tenure) at this auction, ostensibly because the market was asking for higher rates than that which the CB was prepared to pay, weighted average yields of the 182 day and 364 day tenures increased by eight and four basis points (bp) to 18.57% and 19.12% respectively.

Re-issuing of T. Bills to the market is a popular method that the government adopts to meet its borrowing needs, with the CB acting as its facilitator.

This auction was for the re-issue of Rs.5,000 million worth of maturing T. Bills of which Rs. 2,949 million was reissued to the market while bids for the balance (Rs. 2,051 million) rejected. Rejection of bids means three things: Either the CB got captive funds to invest in the same at rates lower than that which the market was demanding or the CB invested in the same by issuing new paper money to the Treasury in lieu or it was a mix of the first two options.


US$ 500mn., Sovereign Bond liability hidden

Central Bank (CB) on Tuesday released a handout concerning the government's foreign commercial debt situation. However the statement excludes the US$ 500 million Sovereign Bond that the government sold to the international market in 2007.

It was only on Friday that CB Governor Ajith Nivard Cabraal, when he unveiled the Bank's Fiscal and Monetary roadmap for the year said that they would be transparent in their activities.

Meanwhile, the CB release said: " Last year  the Government settled several external foreign currency commercial loan obligations amounting to US $ 175 million.   Those payments included:  (a) settlement of a US$ 100 million syndicated loan arranged by the Citicorp Investment Bank (Singapore) Ltd., in December 2005; (b) settlement of the balance of US$ 25 million out of a loan obtained through Citibank in September 2003 with the assistance of NEXI Japan and (c) repayment of US$ 50 million loan obtained from the ICICI Bank India in October 2007 through the National Savings Bank. 

Since new external foreign currency commercial borrowings during 2008 was limited to only US $ 150 million, total external foreign currency commercial debt stock declined from US $ 485 million at end 2007 to US $ 460 million at end 2008.

Foreign investments in rupee denominated Treasury bonds and Treasury bills which was at a value of Rs 50 billion (US$ 443 million) at end 2007 increased to Rs 70 billion (US$ 620 million) by early September 2008.  However, the aggravation of the turmoil in international financial markets resulted in the withdrawal of foreign investments of Rs 46 billion (US $ 407 million) since mid September 2008 to end 2008. Accordingly, foreign investments in rupee denominated Treasury bonds and Treasury bills by end 2008 recorded a value of Rs 24 billion (US$ 213 million) which is a net reduction of approximately US$ 230 million from the value as at end 2007.  However, the Central Bank was able to manage such outflow of foreign currency without any adverse effect due to the consistent and prudent build up of reserves during the period of the inflows.

On this basis, the government's external commercial net debt liabilities stock has declined by about US $ 255 million during 2008 thereby substantially reducing the government's exposure to foreign exchange risk.   Therefore, it is clear that the recent media reports attributed to various analysts which have claimed that the government's external commercial borrowings have been rising are clearly misleading and erroneous. "


The spectre of Cancer

In its first year of operation,  Ceylinco Radiation Treatment Unit has helped hundreds of cancer patients in Sri Lanka to battle the disease with the latest equipment and techniques available.

The unit houses Sri Lanka's first Linear Accelerator, the international Gold Standard in the delivery of accurate intensity-modulated radiation therapy for the treatment of many forms of cancer. Here, the unit's Medical Director Dr. Sarath Abeykoon elaborates on some of the types of cancer and the treatment available. 

Q: In layman's terms, what is cancer?

A: Cancer is the uncontrolled growth of abnormal cells in the body. Cancerous cells are also called malignant cells. Cancer may affect people at all ages, but the risk for most varieties increases with age.

Q: What are some of the commonest cancers in Sri Lanka?

A: The commonest cancers among Sri Lankan males are head and neck cancers, of which the most predominant is oral cancer. Leukemaeias and lymphomas lie second and lung cancer follows a close third. Oesophageal cancer, colo-rectal cancer and prostate cancer constitute the other major cancers in males.

Breast cancer is the most common cancer amongst females while uterine cervix cancer lies second. Oesophageal cancer, ovarian cancer, leukemaeias and lymphomas, thyroid and head and neck cancer constitute the other major cancers in females.

Q: Lets start with breast cancer. In Sri Lanka, breast cancer accounts for about 22% of all cancers in women. How is this detected and cured?

A: Physical examinations and, past age 40, annual mammograms can detect up to 90% of cases in women. Well-funded research efforts have brought breast cancer therapies closest to personalized medicine. The first targeted cancer drug Herceptin was designed to seek and destroy breast cancers containing the HER2/ neu protein. The latest test, Oncotype Dx, a 21-gene screen can predict the likelihood that a woman's cancer will recur and even whether she will respond to chemotherapy.

No other cancer comes with so many treatment options which means more women than ever before can, and will continue to survive the disease. Ceylinco Healthcare Centre (CHC) is equipped with breast cancer screening facilities and offers mammography tests and more information on this disease as well.

Q: How is Lung cancer diagnosed and treated?

A: At present doctors are investigating whether X-rays or spiral CT scans are better at finding lung cancers early. When it comes to treatment, until targeted drug therapies emerged in the past decade, traditional cancer therapy could do little for lung cancer patients. But certain forms of the disease depend on blood vessel and growth factory agents, all of which can now be eliminated with anticancer drugs. Other compounds that block insulin growth factors are being studied.

Survival rates remain stubbornly low, but smarter treatments combined with better screening tests may soon raise those percentages. The best way to avoid the disease is by not smoking. However, there has been a reduction of lung cancer cases over the last two decades due to greater awareness of the repercussions of smoking.

Q:What is colo-rectal cancer? Is it curable?

A:Cancer of the colon or rectum is also called colorectal cancer. Caught early, it is often curable. Symptoms can include blood in the stool, narrower stools, a change in bowel habits and general stomach discomfort. However, a victim may not have symptoms at first, so screening is important. People over 40 years of age should be screened periodically for colorectal cancer. Colonoscopy screening should normally be done once in five years and in high-risk cases, frequent screening is essential. Treatment include surgery, chemotherapy, radiation, or a combination.

Q: What are the treatments on offer for oral cancer?

A: Oral cancer treatment may include surgery, radiation therapy or chemotherapy. Some patients have a combination of treatment.However, over the next decade the incidence of oral cancers amongst males and females may show a reduction. This could be attributed to the younger generation giving up the betel chewing habit as a result of an improvement in their educational and social standards.

Q: What can you tell us about Ovarian Cancer?

A: The majority of ovarian cancers are diagnosed late, after the cancers have spread. Only about 20% of women are diagnosed early, when the disease may be curable. There is no definitive screening test for early ovarian cancer. Regular pelvic examinations, sometimes supplemented by ultrasound examinations or blood tests for cancer-related markers have been routinely used for ovarian cancer screening, but none of these tests are specifically able to detect ovarian cancer. Traditionally, it was believed that ovarian cancer does not produce any characteristic symptoms until the tumor is widespread and that early symptoms of ovarian cancer were not recognizable.

Q:  Isn't Thyroid cancer also common among Sri Lankan men and women?

A: Yes, generally, among women. Thyroid cancer is unique among cancers. In fact, thyroid cells are unique among all cells of the human body. They are the only cells which have the ability to absorb Iodine. Iodine is required for thyroid cells to produce thyroid hormone, so they absorb it out of the bloodstream and concentrate it inside the cell. Most thyroid cancer cells retain this ability to absorb and concentrate iodine. This provides a perfect treatment strategy. Radioactive Iodine is given to patients with thyroid cancer after their cancer has been removed.

Q: What about uterine cervix cancer?

A: Cancer of the uterine cervix is a condition when the cells of the cervix undergo abnormal growth. Early detection is the key to treatment and cure. Because of the slow progression of cancer of the cervix, it can be detected early and thereby prevented. Most often, treatment for uterine cancer involves surgery and radiation therapy. Sometimes radiation therapy is combined with chemotherapy. This is called Chemoirradiation. With these treatments death rate has been greatly lowered in recent years mainly because of early detection. However, it is hard to limit the effects of therapy so that only cancer cells are removed or destroyed, because treatment also damages healthy cells and tissues, it often causes unpleasant side effects.

Q:What is Oesophageal cancer and what is the treatment?

A:Oesophageal cancer is a serious form of cancer that starts in the inner layer of your esophagus, the 10-inch long tube that connects your throat and stomach. The most common symptom of esophageal cancer, usually occurring late in the disease, is difficulty swallowing and a sensation of food getting stuck in your throat or chest. Oesophageal cancer treatment depends on the type, location and stage of cancer as well as on your age, overall health and personal preferences. Decisions about therapy can be particularly complicated because various combinations of surgery, chemotherapy and radiation may be more effective than any single treatment.

Q: How about Prostate cancer?

A: A blood test for the prostate-specific antigen is the most common screen. A physical examination can also pick up changes in the gland's size or shape. Talking about treatment, doctors can cut out contained growths while radioactive seeds implanted in the tumor can destroy it from within. Newer beam devices can focus radiation on the prostate from outside the body. Hormone therapies can also shrink growth and stall the cancer. Prostate is one of the more curable cancers as long as it is detected early.

Q: What about brain cancer? How is it identified and what is the treatment?

A: This is somewhat rare in Sri Lanka. There is no screening test for brain cancer and symptoms such as headache, blurred vision and seizure are often the first signs. When it comes to treatment, surgery, radiation and chemotherapy are the standard anticancer measures. However, growths in the brain are difficult to reach with these methods and researchers are testing a number of potentially more effective ones, including harnessing immune cells via vaccination, heating up the tumors and cutting off the cancer's blood supply using targeted drug therapies.

These new treatment options have only recently started to emerge, but a better understanding of the molecular mechanisms behind brain cancer could push survival from months to years.

Q: What are the facilities that are offered by CHC and its radiation treatment unit?

A: CHC is equipped for oral, breast, colorectal, stomach and cervical cancer screening. Tests such as mammography, colonoscopy, endoscopy, laryngoscopy, ultrasound screening and x-ray are performed at the centre in comfortable and pleasant surroundings. Our state-of-the-art radiation treatment unit which began operations one year ago, houses the country's only operational Linear Accelerator for the delivery of Intensity Modulated Radiation Treatment. This unit also offers Brachytherapy, radioactive Iodine Treatment and Chemotherapy.


MNC expands to K'gala

Allianz Lanka realised plans for reaching out to the people of the provinces with the opening of its first provincial branch in Kurunegala.

 The Kurunegala office is located at Negombo Road, Kurunegala and is headed by Allianz Zonal Manager Nishantha Bandara. Allianz Kurunegala is equipped with all facilities for Life and General business and is serviced by an experienced team of sales, front office and underwriting professionals trained to internationally benchmarked Allianz standards of customer service and underwriting.

In her welcome address, Allianz Lanka CEO Surekha Alles affirmed, "We are delighted to be able to now offer our customers in the Wayamba Province the benefits, facilities and the same financial security enjoyed by our customers in Colombo. Today is a milestone in the careful strategy for expanding our business in Sri Lanka. Kurunegala is one of Sri Lanka's most developed and dynamic provinces and we are convinced that this is the ideal point from which to spearhead our branch expansion."

Chief Guest-Wayamba Province Chief Secretary G.B. Jayasundera expressed his satisfaction that a multinational insurer of the stature of Allianz had chosen Kurunegala to set up its first branch office.

Allianz Lanka is backed by the global strength of Allianz SE, one of the world' s largest financial services providers with experience since 1890 in providing innovative insurance, asset management and banking services to over 80 million customers in more than 70 countries. The Allianz Group has over Euros one trillion in assets under management and is ranked 19th among Fortune 500's listing of top global corporates in 2007, over half of whom insure with Allianz.

The local subsidiary successfully set up General insurance operations in Sri Lanka in 2005, and already has an impressive track record of achievements, with many 'firsts' in performance in just three years and a fast growing customer base of large multinationals, local corporates, small traders and individuals. The success of its General insurance business in Sri Lanka prompted parent company Allianz SE to set up Life operations in the country in October 2008, following approval in July last year of its application to start Life operations in Sri Lanka by insurance regulator Insurance Board of Sri Lanka.


CF A+ ( LKA) rating reaffirmed

On the eve of the 51st anniversary of Central Finance Company PLC (CF), it maintains the best rating amongst registered finance companies.

 Fitch Ratings Lanka has affirmed the Company's National Long-term rating at 'A+ (lka)'. "The Outlook is Stable", Fitch Ratings Lanka announced in a press release. 

A Company spokesman said, "In continuing to enjoy the A+(lka) rating for the past three years, CF has proved its strong financial position, good asset quality, solvency and strong capital position relative to peers in the financial sector."

Over the past half century, CF has expanded to become one of the most respected financial services companies in the country. Starting with a modest capital of Rs. 170,000, CF has Shareholder funds of Rs.6.6 billion (as at end September 2008).  Profit after tax has exceeded a billion rupees in the past three years recording Rs 1,048 million in 2007/08, increasing from Rs 1,024 million in the previous year. Operating income increased from Rs 1,003 million to Rs 1,066 million in 2007/08.

Prudent financial polices in addition to complying with guidelines and norms specified by the Central Bank of Sri Lanka (CBSL) has supplemented the inherent strength of the Company .A consistent policy of re-investment of earnings continue to strengthen its capital base, the highest in the sector.  

The establishment of strict credit controls coupled with an effective network of branches ensures timely and efficient collection of receivables which has resulted in positive trends in lowering non-performing loans. Skilful management of financial resources and the priority given to the development of human resources at all levels has helped the Company to build stability and strength over the years.

This has been endorsed by Fitch saying, "Well-defined credit policies and stringent recovery procedures have translated into asset quality that is amongst the best in the Registered Finance Company (RFC) sector in Sri Lanka." The statement further says: "CF's NPL (defined by Fitch as loans in arrears for over three months)/gross loan figure was 9.8% at H109 (FYE08: 8.3%), while the corresponding ratio at the six-month NPL level was 3.2% at H109 (FYE08: 3.3%). CF also had an additional provision for NPLs in arrears between three to six months-more prudent than the required regulation."

Fitch pointed out that "Consequently, Net NPL/Equity ratio was 21.6% at H109 (17.3% at FYE08)", while adding "Although the majority of CF's assets are financed by customer deposits, growth has been increasingly funded by bank borrowings (17% of the funding mix at H109 versus 7% at FYE05). Interest rate swaps of LKR 2.6 bn at FYE08 (40% of borrowings at FYE08) have minimised market risk. Internal capital generation was strong with high margins, low cost structures (cost/income ratio was 41% in H109) and a strong retention policy; overall capitalisation remained strong at 22% of assets at H109."

Meanwhile, CF's policy of diversifying into new ventures has paid dividends. CF Insurance Brokers (Pvt) Ltd, for instance continues to be the country's leading insurance broker. The investment in its associate company, Nations Trust Bank PLC (NTB) has brought in encouraging returns.  NTB's net interest income increased by 23% in 2007  to record Rs 2,110 million. Profit after tax of Rs 505 million showed an increase of 56% over the previous year.


Emerson refutes allegations

A CIMA official refuted allegations that he had not furnished the necessary documentation pertaining to his former employment.

CIMA South Asia & Middle East Director Bradley Emerson told The Sunday Leader that he had provided the necessary testimonials at the interview for the CIMA SL CEO post.

Subsequently Emerson was promoted to the position of CIMA South Asia & Middle East Director. He is based in Colombo.

Emerson was responding to allegations made by a former CIMA SL Division President that he had not furnished the same.

U.N. Jinasena, in a letter to Tony Woodcock, who was sent recently by London to review CIMA's operations here had said, "the local CIMA President who was in office at the time of recruitment of Emerson had confessed at a meeting of past presidents that he had not called for references from former employers of Emerson which was compulsory considering this high profile post of the CIMA SL Division."

Emerson who said that he was headhunted, was appointed to the post of CIMA SL Division in 2007.

Prior to his appointment he had served as Deputy CEO PABC Bank, from which post he had resigned, when he was headhunted by CIMA.

 London recently suspended the local Council on alleged governance matters.

Emerson also refuted another allegation made by Jinasena that his Communications Manager Radley Stephens had been "derogatory & insulting" in an e.mail sent to CIMA SL Division President Ms. Gowrie Shanker (now suspended).

Emerson claimed that Stephens' email was in no way derogatory or insulting in regard to a reply Stephens had sent her concerning a press statement from London, to be circulated among the media here.


Apollo to make Rs. 60 mn.,

Lanka Hospitals Corporation plc. (LHCL), the holding company of Apollo Hospitals, Colombo,  net earnings grew by 175% year on year (yoy) to Rs.18.83 mn., in the second quarter (2Q)ended September 30, 2008, while revenue grew by 24% yoy to Rs. 617.68 mn., during this period. Revenue during the first half of 2009 (1H09) increased by 26% yoy to Rs. 1,169.41mn., with significant growth seen from the inpatient segment.

  Cost of services increased by 17% during the six months to Rs.375 mn., which could be attributed to high cost of drugs. Staff costs rose by 30% partly owing to a salary revision made in June 2008.

  Due to the bleak economic outlook, including factors such as inflation, interest rate volatility, utility and energy costs, operating expenses rose by 19% during 1H09.

  Long term liabilities reduced by 44% to Rs.341mn., and finance cost reduced by 70% to Rs.27mn., during the 1H owing to funds received from the rights issue.

  Almost a 160% increase in net profit in 1H09 to Rs. 36.379 million boosted interest cover to

13.58 times from a mere 1.16 times a year ago.

  LHCL is concentrating in developing centres of excellence, instilling best skills and facilities in key areas and investing in improving customer service, John Keells Stock Brokers in a report said.

"With the company's improving performance and increasing potential for healthcare services we revise the company's earnings upwards to Rs.60 mn., for FY09,"the report added.


Bad year for vehicle imports

Government's withdrawal of the vehicle permit scheme offered to senior government officials and the high fiscal levies on vehicle imports are expected to result in a sharp decline in demand for high end models.

The increase in the Letters of Credit margin on vehicle imports from 100% to 200% would entail a substantial increase in working capital, and the additional borrowing requirement would increase finance costs of United Motors Lanka plc, (UML) John Keells Stock Brokers (JKSB) in a statement said.

High costs of credit and the global economic downturn would further depress the local demand for brand new vehicles as well. "We expect UML to record a decline in earnings of Rs 204 mn., in  financial year 2009 (FY09), JKSB said.

UML witnessed a 37% drop in earnings year on year (YoY) for the first half of 2009 (1H2009) ended September 30, 2008 to Rs 68 mn.,  while earnings for the quarter (Q) were 43% lower at Rs 36 mn.

A combination of high import taxes and the appreciation of the Japanese Yen against the Sri Lankan rupee led to an increase in the prices of Mitsubishi vehicles, adversely impacting on demand.

The vehicles division recorded a slight decline in revenue to Rs 2,707mn., while PBIT for the segment was Rs 243mn, 5% down for the 1H2009.

The repairs and services division recorded a153% revenue growth to Rs. 260 mn., while PBIT for the segment was up at Rs 52 mn. The spare part sales accounted to Rs 469 mn of turnover which was 13% higher than the comparative period last year while PBIT for the segment was increased by 8% to Rs 123 mn.

The parent company United Motors Lanka plc recorded a turnover of Rs. 2.27bn., in 1H which was a marginal increase from last year. Sales volumes were affected by increases in vehicle prices as well as a shift in demand towards less expensive models such as the Mitsubishi L200 Single Cab which has considerably altered the sales mix.

The company's fully owned subsidiary, Unimo enterprises Ltd (UEL) launched  "VIVA" to its Perodua range in August and the brand is expected to generate significant profits in the next Q. However UEL incurred a Rs. 6 mn., loss compared to a Rs 20mn., loss in 1H2008.

Other fully owned subsidiaries UML property development, Orient Motor Company Ltd and Orient Financial Services Corporation recorded post tax profits of Rs 14 mn., Rs. 4.5 mn., and Rs 8.3 mn., respectively. However the jointly controlled entity TVS Lanka Ltd., suffered a Rs 24.3 mn.,  loss as it sought to consolidate its motorcycle business and gain market share.


Successful marketing, the Obama way

By Shiraz Latiff*

Americans once again recently demonstrated their unique capacity for self-renewal by electing the first black as head of state, not much more than a generation after the country's African-Americans were accorded full civil rights.

In electing Barack Obama president by a solid margin, accompanied by a congress with the biggest Democratic majority since the 1970s, Americans signalled a dramatic change in the direction of the world's sole superpower

However, if we re-wind this scene two year's back, today's achievement by Obama would not have been thought to be possible.  What we are talking today is the success of a presidential campaign that was executed with clinical perfection.  Barack Hussein Obama,  two years ago was a relatively unknown name of a young upstart senator and lawyer with an excellent oratorical acumen and a mountain-sized ambition to succeed in life. 

If you consider him as a branded product on the shelf, he had all the demerits that a marketer could attribute to a disastrous brand.  A black man born to an immigrant Kenyan father and an American mother in a country where racism is rampant despite all the egalitarian rights given by the Constitution.  A middle name, Hussein, loathed by all Americans, especially both the Bushes, senior and junior.  His father, though a non-practicing Muslim, not only extended his genes but his Muslim name to his son. A Muslim, by all means, whether practicing or none practicing, is considered a potential Al-Qaeda sympathizer or even a potential recruit in most American minds.

Drawbacks

With all these drawbacks, how did Obama pull off an emphatic win over the war-hero turned business-heir apparent-long-standing senator-saviour of USA from the clutches of terrorism, John McCain.  Any marketing or PR guru would have first told him to re-brand himself, viz, change the name to something more American and re-position himself to the demand of the country, viz, Country First, or liberation from terrorism, like McCain did.

But what did Obama do that we all marketers can learn from.  Though he might not have borrowed that euphemistic bible of marketing from Kotler, he seems to have done all that a good marketer would have done all the way.

Obama's hybrid segmentation of the market singled out the exact target markets to focus on.  Demographically, he targeted the young voters, who were either moderate or liberal, instead of the conservative middle-aged and the elderly.  The exit polls as per CNN showed 66% of 18-29 and 54% 30-44 age groups had indicated voting for Obama.  He targeted the Blacks and the Hispanics who expected an Obama to be able to relate to them as a minority himself.  Exit Polls showed 95% Blacks and 66% Hispanics voted for him.  

Geographically, the South was heavily biased in favour of  his opponent due to historical reasons of white dominant mentality.  Other regions were more of a tie as per the Exit Polls.  Therefore, his segmentations did not concentrate much on geographical demarcations except for last minute campaigns in the toss-up states.

However, psychographically, he focused on the moderate and the liberals who wanted a change from the Bush era and focus on the economy.  Exit Polls again showed 60% of the moderates and 88% of the liberals voted for Obama.

His weakness was inexperience in the political system.  Barely two years into his term as a Senator, he could not have boasted of a strong CV in the political arena to outweigh his opponents.  However, he targeted the right market segments as discussed above, whose expectations were not an experienced politician with a 'silver' bullet but a pragmatist with a promise to 'Change' and bring fresh thinking to the country and the economy. 

Change

Two years ago Obama correctly identified that the overwhelming sentiment in this presidential election would be a desire for change.  America's yearning for change focused most closely on dissatisfaction with the economy and the wars in Iraq and Afghanistan. McCain was never able to distance himself from the Republican calamities of the past eight years even though he had a right to be considered at least as much an agent of change as Obama.

His Unique Selling Proposition was 'Change that we can Believe in.'  Though his opponent's 'Country First' was deemed to have appealed strongly to patriots, it was not the expectations of the target market, which constituted the majority in the country.  McCain kept on improvising with his slogan and the pay-off lines expected the tide to turn towards it.  When all else failed, he expected the blonde Sarah Palin to give him that touch of magic, which she did, but for a brief respite.  People did get carried away with her charm and glamour but it was not sufficient to convince the voters to handover the presidency to McCain. 

Once the initial euphoria died down and the reality set in, there was Obama still touting the 'Change' slogan.  He did not change his focus when he saw the sudden rise in the ratings for McCain.  His consistent message paid off and the voters not only remembered him for what he was offering but also trusted him for being consistent in his message and offerings.

When modern day elections are always full of sleaze funding and scandals, Obama not only refused to accept Federal funding but also did not run after major donors to fill his campaign coffers.  He was ably supported by the co-founder of Facebook Christopher Hughes as the Director of Online Organizing to mobilize the online community to create a 70 million member  army of bloggers, fundraisers, and volunteers who were hooked up by e-mail, blogs, chat rooms, and pocket networks. They not only worked tirelessly for Obama but also contributed a mere USD 5 each to the campaign fund.  This initiative gave him the best of the money that any Presidential nominee received in years and the biggest ever volunteer group, mind you majority of them young, working tirelessly for his campaign.

If Obama can market himself with such clinical precision without re-branding or re-positioning himself to suit the current thinking, but to change the minds of the prospects to his thinking, isn't he the greatest marketer of them all in the contemporary politics or business, for that matter.

My analogy of his political campaign in a marketing context was for the purpose of getting our marketers to think outside the box and learn from the parallel avenues that are available in the world. 

*The writer is CIM Sri Lanka Region Chairman and Asst. Vice President-Service Quality and HSBC Electronic Data Processing Lanka (Pvt) Ltd.


New Board takes over

Seylan Bank PLC's newly appointed Chairman Eastman Narangoda together with the new Seylan Board comprising  Nihal Jayamanne (PC),  Lalith Withana  and  Naomal Gunawardena  assumed duties  in  the new year by lighting the traditional oil lamp at Ceylinco Seylan Towers.

Narangoda told the staff that he together with the other Board members would provide guidance and directions to make Seylan a stronger bank and a leading player in the financial  services industry and expressed his confidence that this new partnership will drive the bank to greater heights.

Jayamanne also addressed the staff.

Thereafter the Board and Seylan's senior management led by Chief Executive Officer Ajita Pasqual partook of the traditional new year kiribath and other sweetmeats.

The Director Board also met with the Corporate Management and outlined steps for the future.


Pep up drink

Suri Trading Company (Pvt) Ltd are the sole agents in Sri Lanka for Kotra Pharma (M) Sdn.Bhd Malaysia, a leading manufacturer of Pharmaceutical and Nutricuticals under the trade name Appeton.

About eight years ago Suri Trading introduced Booster Energy Drink in 240ml cans to the Sri Lankan Market. Booster being an effective lime flavoured energy drink became popular.

 Managing Director/CEO.Sujeewa Suriyaaratchie a young persevering entrepreneura and his team at Suri left no stone unturned to make Booster a household name in Sri Lanka.

Sports people love to drink a Can of Booster to pep up their lost energy.

Today Suri Trading has introduced their latest quality product under the Booster umbrella, Booster "Blitz," a fizzy, rejuvenating, energizing, revitalizing and refreshing, energy drink in cans and sachet form to the local market.

Booster Blitz presented in 250ml tall cans is a sweet lime flavoured drink. Energy required is derived from the presence of Vitamin B6 & B12.The manufacturer, Kotra Pharma confirms Booster Blitz is a Halal product certified fit for Muslims by Islamic Food and Nutrition Council of America.

Booster Blitz revitalizes lost energy of sports people after intense physical activities and refreshes those after tedious mental activities, at the end of hard days' work.

Booster Blitz in sachets contain 6 g., in powder form, is available for the first time in our country. This product which gives a fizzy effervescence when added to a glass of water is a sugar free energy drink.  Therefore it is helpful in the management of Diabetes and Obesity. Nevertheless it contains United States Food & Drug Administration approved sweetness which provides a taste of sweetness without added calories. As such Booster Blitz powder (6gr) in sachets is suitable for diabetics and low calorie intake patients. You can welcome your visitors by adding a sachet of Booster Blitz powder to a glass of chilled or normal water.

This new product with its powerful energizing qualities having and unmatchable lime flavour is sure to dominate the energy drink market within a short period of time, says Suriyaaratchie. 

Practical experience

Chief engineers and Masters may now once again, join as full corporate members (MIMarEST) of Institute of Marine Engineering, Science and Technology (IMarEST), rather than being Associate members (AMIMarEST).

The IMarEST approach to membership is not based on academic qualifications; it has to be a combination of academic and practical professional experience. The "exact mix" varies from person to person. (Marine Talk)


275 Cancer detections

Some 275 people who tested positive for cancer after coming to Ceylinco Healthcare Centre (CHC) for screening have had or are undergoing treatment.

Seven years after CHC began operations as Sri Lanka's centre of excellence for screening for many forms of cancer, it has helped thousands of Sri Lankans protect themselves against the dreaded disease by opting for early detection.

Having performed nearly 9,000 mammograms over this period, close to 26,000 have visited the centre for screening over the past seven years, about 14,000 of them in the last three, the Centre's Senior Medical Officer Dr. Shyama Fernando said.

Now a well-known landmark at Park Street, Colombo, the Centre which celebrated its 7th anniversary last month (December) said it was particularly pleased with the progress it had made in combating the spread of breast cancer.

To mark its 7th anniversary, the Centre organised a get-together for regular visitors to offer them a day full of fun and knowledge. Participants had an opportunity to have a free consultation with an Oncologist. The programme also included presentations on hydrotherapy, beauty culture and cookery. The invitees were provided a healthy breakfast and a lunch and enjoyed a musical session.

Fernando said that although the Centre at the start primarily targeted cancer patients, its services were extended to screening packages for a variety of health problems including diabetes and heart problems, making it a comprehensive health centre.

She said the Centre has also become popular among people in the outstations, where medical screening facilities are virtually non-existent.

The Centre has dedicated Wednesday to offer all services within a day for those who book early. "On this day, visitors can undergo screening, collect their test reports and also meet their doctor and discuss further management of disease," Fernando said.

"We are the only Centre that does needle biopsies and gives reports on the same day, thus helping the patient to see the surgeon and discuss further treatment according to the report."

Further enhancing its services, an ultra-modern Radiation Treatment Unit was set up a year ago. This unit houses the country's first Linear Accelerator, the international Gold Standard in the delivery of accurate, intensity-modulated radiation therapy for the treatment of many forms of cancer.

Set up in affiliation with the Washington Hospital Centre, CHC is equipped for oral, breast, colorectal, stomach and cervical cancer screening as well as for genetic testing to identify high-risk families.

Bringing together the expertise of a Breast Surgeon, Oncologist, Radiologist, Pathologist, Counsellor and a team of trained support staff, the unit offers tests such as mammography, colonoscopy, endoscopy, laryngoscopy, ultrasound screening and x-ray in comfortable and pleasant surroundings.


Increased efficiency

MacGREGOR’s hopper and blow pump bulk handling systems for offshore supply             vessels can achieve capacity increases of up to 75 % compared with a conventional bulk tank set-up.

The two main tasks of a bulk handling system-storage and discharge are performed by two separate units in a hopper and blow pump installation. Cargo is received and stored in a hopper, whereas discharge is performed by a blow pump using compressed air. Technical solutions based on this concept have been employed on cement carriers for the past 20 years. (Marine Talk)


In Brief

Inflation: 22.6%

Inflation as measured by the new Colombo Consumers' Price Index (nCCPI) registered an annual average change of 22.6% last month, a marginal 0.4 percentage points decline over that of November.

Meanwhile inflation as measured by the point to point change in the nCCPI registered a figure of 14.4% in December 2008, a 1.9 percentage points decline over that of November.

Central Bank (CB) Governor Ajith Nivard Cabraal who unveiled CB's Fiscal and Monetary Policy Roadmap for the year on Friday, said that annual average inflation would come down to single digit level by the middle of the year.

Average annual inflation will be 9% this year, he added.

Inflation vs., interest cost

Raw materials form the biggest component in the cost of production (CoP), Central Bank (CB) Governor Ajith Nivard Cabraal said.

Cabraal who unveiled CB's Fiscal and Monetary Policy Roadmap for the year on Friday said that while raw materials cost comprise 35% of the CoP in Sri Lanka, the interest component averaged 2.6%, while at the upper end it was 4.4%.

He further said that in the CoP cost structure, salaries and wages occupied 12.5% and power & energy (6.7%).

Cabraal therefore said that what was important was to tackle inflation and not the interest cost. "Inflation impacts all aspects of CoP," he said. (See also this page's main story)

Hedging

Hedging is good as long as it's done properly- Central Bank (CB) Governor Ajith Nivarrd Cabraal referring to Ceylon Petroleum Corporation's hedging operations when he unveiled CB's Fiscal and Monetary Policy Roadmap for the Year on Friday.

5-5.5% growth

Economic growth this year will be between 5-5.5%.

However, with the recent policy stimulus it will go upto 6%.

This was said by Central Bank (CB) Governor Ajith Nivarrd Cabraal when he unveiled CB's Fiscal and Monetary Policy Roadmap for the Year on Friday.

The first three quarters of last year witnessed a 6.5% growth rate on average.

He also said that last year's budget deficit was 7%, while unemployment at the end of the third quarter of 2008 stood at 5.2%, while Debt to GDP ratio in 2008 was 78%.

Cabraal further said that a bank would be permitted to open a branch in the Western Province (WP), provided they agree to open two more outside the WP. 

New CEO

Ceylon Chamber of Commerce's (CCC's) Chief Operating Officer Harin Malwatte succeeded Prema Cooray as CCC's Secretary General/CEO from January 1, 2009.

Cooray will assume duties as Managing Director/CEO of CCC Solutions (Pvt) Ltd., a fully owned CCC subsidiary which will handle project related activities.

Malwatte a former soldier thereafter worked for a multinational company and a leading Sri Lankan tea packaging and exporting company.  He also worked for the Plantation Human Development Trust as CEO/Director General.

Three to oversee CIMA

CIMA London will appoint a three member interim committee to oversee its affairs here this week.

Recently the UK Secretariat suspended the local council on grounds of alleged governance matters.

CIMA South Asia & Middle East Director Bradley Emerson refused to divulge the names of those members.

 Air powered vehicles

Air France KLM will begin a six-month trial of zero-emission-compressed-air powered passenger-carriers at Paris de Gaulle and Amsterdam Schiphol in spring 2009, evaluating them for safety, ergonomics, deployment, reliability and maintenance.

Operating costs for the four-seat AirPods, developed by Motor Development International, are extremely low, said the airline-launch user of the vehicles.

Airline privatization

Greece's Transport Ministry named investors that have expressed interest in buying components of state-run Olympic Airlines.

They include Chrysler Aviation, Goldair, Ellaktor, Hellenic Cargo, Iberia, Italian MyAir, Kuwait's Fouad Al Ghanim Group, Athens Airways, Qatar Airways, Sky Europe, SkyOne and Swissport. The tender ended October 31 and is expected to conclude by last year end.

The privatization plan won EC approval in September. (Washington Aviation Summary)

Yacht design

Following the success of the World Superyacht Young Designer Award 2008 competition, The Royal Institution of Naval Architects in association with Boat International and Camper & Nicholsons International invite entries for the 2009 competition to find the world best young superyacht designers.

The competition will be open to anyone who is studying for a degree or other qualification in a subject related to yacht or small craft design, or who graduated from such a course within three years of the closing date of entries. (Marine Talk) 

Rs. 135.7 bn., new money released

Central Bank (CB) Treasury Bill (T.Bill) holdings as at last year's end increased by 11.2% week on week (WoW) to Rs. 137,596 million.

This increase in the 15 week period from September 18 to December 31 is a jump from Rs. 1,911 million to Rs. 137,596 million, a 7,100% increase in CB's lending to the Treasury in the period under review.

Increase in CB T.Bill holdings means an equivalent increase of new money being lent to the Treasury, in this instance Rs. 135,685 million.

The danger of new money entering the system is that it fuels demand side inflation.

Negative BoP

The country is likely to end up with a negative balance of payments (BoP) position last year, Central Bank (CB) Governor Ajith Nivard Cabraal said.

Cabraal who unveiled CB's Monetary and Fiscal Policy Roadmap for this year on Friday, said that exports which grew by 12.8% in US dollar terms on a year on year (YoY) basis in the first eight months of last year, saw this momentum decelerate, with the first 10 months of last year showing a YoY growth momentum of only 9.5% during this period.

In contrast, imports during the first 10 months of last year grew by 31.3% on a YoY basis, with oil imports alone contributing to 37% of this growth.

Cabraal further said that the current account deficit, mainly on account of the country's high oil bill, shot up to US$ 3,009 million in the first nine months of last year as compared with a figure of Rs. 986 million during the commensurate period the previous year. (See also the main story on page 21)

CB sells short term T.Bills

The Central Bank (CB) which rejected offers for Treasury Bill (T. Bill) purchases of 91 day tenure at Wednesday's primary auction, however sold short term T. Bills of 21 and 28 day tenures to the market on Thursday, thereby raising Rs. one billion each on weighted average yields of of 17% and 17.1% respectively from both of these tenures.

Originally amounts of Rs. two billion and Rs. three billion were offered for those two parcels, market sources said. At the previous week's T. Bill primary auction CB sold T.bills of 91day tenure at a weighted average yield of 17.33%. (See connected story found on page 21)

Canvassing the diaspora

Foreign holdings in Treasury Bonds (T. Bonds) as at end of last year were Rs. 17, 572 million (US$ 154.1 million).

The Central Bank has allowed foreigners to invest in both T. Bonds and T. Bills outstanding upto a maximum of 10% of those amounts.

Central Bank (CB) Governor Ajith Nivarrd Cabraal  unveiling CB's Fiscal and Monetary Policy Roadmap for the Year on Friday, said that the government will be canvassing the Sri Lanka diaspora to invest in government securities.

Victories boost market

Treasury bond yields of 2010 maturity fell below 21% at Friday's secondary market trading  which market sources attributed to the feel good factor created by the fall of Kilinochchi.

Meanwhile the market experienced a Rs. 10 billion surplus in inter-bank borrrowing due to the Central Bank keeping away from the foreign exchang market.

CB yields to rates over 20%

Thursday's Treasury Bond (T. Bond) primary auction for T. Bonds of three years and three months maturity saw the market successfully demanding yields above 20% (20.10%), with the Central Bank (CB) succumbing to selling T. Bonds more than that which was originally announced for this tenure.

The auction was initially for the issue of only Rs. 500 million worth of T. Bonds to the market, but the CB ultimately ended up selling Rs.  700 million worth of  T. Bonds.

Issuing of T. Bonds is a popular way that the Treasury, facilitated by the CB, borrows from the domestic market to meet its expenditure needs.

The other T.Bond tenure which was of a two year tenure saw the market successfully bidding for yields (weighted average yield) of 21%. CB eventually sold only Rs. 200 million worth of T.Bonds of this tenure to the market, though it was originally announced that they would be selling Rs. 500 million worth of T. Bonds of this tenure as well to the market.

4th dividend

Ceylon Tobacco Company plc has declared a 4th   interim dividend of Rs. 4.80 a share less withholding tax. Excluding dividend date January 13, 2008 and payment date January 26, 2008.

Alitalia privatized

The acquisition of Alitalia assets by Compagnia Aerea Italiana (CAI) was approved by the Italian government and the European Union (EU) and the new Alitalia was expected to take off  last month.

The European Commission appointed a trustee to oversee the sale.  "This process will lead to the emergence of a private airline, smaller in size but more efficient," said EU Transport Commissioner Antonio Tajani.

The Commission ruled that CAI would not be liable for repaying a euro 300 million government loan made to Alitalia; the loan will be repaid from liquidation proceeds.

The rescue plan does not constitute state aid, but represents a real privatization, said Tajani; Ryanair said it would appeal the "corrupt and biased" decision. (Washington Aviation Summary)

Relocates

Nations Trust Bank PLC (NTB) recently relocated its branch in Battaramulla to a more spacious & easily accessible location.

NTB Director/CEO Zulfiqar Zavahir said, "The Bank continues to add to its increasing branch network across the country in its steadfast commitment towards delivering greater levels of convenience for its customers."

The new branch located at Pannipitiya Road, Battaramulla  offers customers banking services 365 days of the year with extended banking hours for added ease and convenience. 

"The Bank at Your Doorstep" service recently launched by the Bank will continue to be a key driving factor to the Bank's customers.

NTB is one of the fastest growing banks in Sri Lanka today. The Bank has 36 branches, 11 leasing centres, 41 ATMs, six Personal Banking Centres as well as Internet Banking. Using the Nations Trust debit card, customers may access their accounts countrywide and internationally through ATMs of other banks which have the Cirrus/Maestro facility. They are also the sole issuers and acquirer for American Express credit cards in Sri Lanka.

Handling dangerous goods

A new edition of the International Maritime Dangerous Goods Code, the standard guide to all aspects of handling dangerous goods and marine pollutants in sea transport has been published by the International Maritime Organization in hard copy, as a download and as an internet subscription.

The new edition includes the changes in Amendment 34-08 adopted by the Maritime Safety Committee in May 2008. (Marine Talk)

Solutions for passenger delays

A Department of Transportation, USA (DOT) task force has developed a model contingency plan for use by airlines and airports to develop individualized plans that would address the needs of passengers subject to lengthy ground delays aboard aircraft and a return to an airport terminal.

The voluntary guidelines contain no fixed limit on how long passengers can be delayed before being allowed to deplane, disappointing consumer groups. Among task force recommendations: Airlines are advised to update passengers every 15 minutes, make refreshments and entertainment available when practical, make reasonable efforts to keep airplane restrooms usable and provide a secure room for passengers from overseas flights to avoid the need for security checks when re-boarding.

Representatives of airlines, airports, consumer groups and DOT served on the task force. Most major airlines and airports have instituted their own passenger protection guidelines, but DOT is advancing a regulation that would require airlines to have airport-specific plans in place to ensure that passengers are treated appropriately during extended tarmac delays. (Washington Aviation Summary)

Improved safety

Applied Weather Technology (AWT) announced that its Route Optimization            Service used by ships to help identify the most efficient routes to their destinations now includes technology that helps AWT's Route Analysts warn ships at sea of the potential for resonance, a physics phenomenon that can cause ships to severely roll and lead to crew injury and cargo loss.

The severe motion alerts/resonance alerts are based not only on the weather, but also on the vessels' size, draft, stability, heading and wave conditions.

Deactivating vessels

Germanischer Lloyd has developed a guide outlining major methods and procedures involved in ship lay-ups.

 Deactivating vessels in an effort to save costs requires planning and investment in the process. It is imperative that ships are laid up technically correctly to reactivate the ship successfully when economic conditions are more favourable.

 The guide gives technical assistance to shipowners focusing on the maintenance of class, ship's safety as well as the maintenance of operability. (Marine Talk)


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