BUSINESS

Private company to launch Colombo-Jaffna flights

 By Mandana Ismail Abeywickrema

AirLanka International Limited will begin domestic flights from Colombo to Jaffna on May 1, becoming the first domestic tour operator since the signing of the ceasefire agreement between the government and the LTTE, to take to the air.

The first flight, using a 120 seater Illusion 18, which has the capacity to carry twice as much the passengers as now being transported to the north - will take wing from Katunayake to Jaffna. This flight which will mainly operate as a passenger aircraft will have space for cargo as well.  There will be two domestic flights operated between Colombo and Jaffna per day. Speaking to The Sunday Leader, Chairman, AirLanka International, Nahil Wijeysuriya stated that the company will also begin a courier service to deliver small packages as personal packages to the north. But, Wijeysuriya expects that with the opening of the A9 highway, transporting goods and packages would be mainly done through land routes.

As for cargo requirements, AirLanka International will use its Antonov 12 - 18 ton passenger craft, which is at present flying on a route covering Dubai, Pakistan, India, Sri Lanka, Male and Dubai, said Wijeysuriya.

AirLanka International is also awaiting government approval to begin flight operations to foreign destinations which are not serviced by Srilankan Airlines. Wijeysuriya explained that the company will initially operate flights to destinations that are not serviced by Srilankan Airlines and then venture in to other destinations competing with Srilankan Airlines.

Wijeysuriya explaining further stated that Karachi, Sharjah, Rome, Frankfurt are some of the destinations not served by Srilankan and these will be covered by AirLanka International once it begins operations.

Managing Director, AirLanka International Limited, Vajira Wijeysuriya speaking to The Sunday Leader, explained that their company would be the first low cost airline in the Asian region. Vajira stated that so far, low cost airlines have only been operated in European countries and AirLanka International will be the first operator of such flights in this part of the region.

Explaining further, Wijeysuriya said that Srilankan Airlines has a staff of about 4,000 and flies only eight aircraft, which makes a head count of 500 people per aircraft. Wijeysuriya reiterated that Srilankan has leased aircraft for Rs. 100 million, while AirLanka will lease its aircraft for only Rs. 50 million. Wijeysuriya added that after the September 11 attack on America, the price of aircraft have gone down drastically. "There are about 3,000 aircraft just parked in the Mojave dessert," said Wijeysuriya, adding that AirLanka will lease an Airbus A300 for overseas flights.

With a touch of humour, Wijeysuriya added that AirLanka will not encourage its managing directors to be extravagant like those of Srilankan. Vajira stated that AirLanka has the ability to offer competitive prices to its customers as the company's overheads are far below that of Srilankan.

Highlighting the issue of national carrier, Wijeysuriya stated that Srilankan should not be considered the country's national carrier as it is managed by Arabs. AirLanka, he says, on the other hand is owned and managed by Sri Lankans. Therefore, he explained that the government cannot give national rights to Arabs. "Bilateral agreements for passengers are only signed between the government and the national carrier and by looking at the issues highlighted above, Srilankan Airlines' position as the national carrier arouses much doubt," said Wijey-suriya.

Wijeysuriya went on to say that officials of Srilankan Airlines blamed the Katunayake Airport attack by the LTTE for the loses recorded last year. But, in reality, Srilankan received a sum of Rs. 6 billion on insurance, said Wijeysuriya.

When asked how long it will take for AirLanka to begin its flights to foreign destinations, Wijeysuriya said that they could begin flight operations as soon as they receive government approval. Wijeysuriya added that there have been rumours that Srilankan Airlines has plans to re-name the airline as Camel Air. "The national carrier should be owned by Sri Lankans and not by Arabs."

Wijeysuriya explained that AirLanka's logo will be its web address - airlanka.org - and will not use any particular symbol to represent the airline. Vajira added that people have made requests to begin AirLanka domestic flights to other parts of the island and the company has plans to begin flights to Trincomalee and other cities in the near future.

As for the response received so far, Wijeysuriya stated that the airline has received a lot of support from the public and the domestic flights have a backlog of 500 already. Even most of the Srilankan staff are in support of AirLanka, Wijeysuriya elaborated.

East-West Group of Companies is the main shareholder of AirLanka International Limited and is a subsidiary of East - West Enterprises.

Touchwood achieves targeted turnover

Touchwood Investments Ltd (TIL), the pioneer forestry investments company, has listed its ordinary shares in the Colombo Stock Exchange under the category 'investments and trusts.'

TIL has achieved its target turnover of Rs. 38 million for the financial year 2001/2002 and it has budgeted turnover for 2002/2003 at Rs. 58 million. Chairman, TIL, R. Maloney states that TIL will declare its first dividend this year.

TIL's Initial Public Offer (IPO) of 800,000 ordinary shares at par value of LKR 10 was the first IPO for the year and the first IPO to be oversubscribed since 2000. "This is a direct indication of the confidence placed by the public and corporate sector in TIL shares," states Maloney.

The principal line of business is marketing and managing investments in mahogany plantations in Sri Lanka, with a business plan to plant and harvest 2000 acres of mahogany on a 17.5 year harvest cycle. This will amount to 2% of world mahogany plantations.

Since its inception three years ago, TIL has emerged as the leader of this specialty finance product, with over Rs. 65 million already invested by the public. The TIL mahogany investments have been considered as one of the best options available for retirement, children's future needs or for corporations which need to offset long-term liabilities, the company states.

Over 40,000 mahogany trees have been planted in 150 acres located in the Ratnapura District, on sites specially selected by TIL for growing mahogany.

ComBank: "Lower interest and convenient settlement"

"THE ComBank International credit card is now an important item in the personal banking product portfolio of Commercial Bank among savings, current, deposit and personal loan account holders of the bank and a few selected non account holders. The ComBank International Credit card has grown to achieve a niche clientele. ComBank International has achieved this within a short period of two years, and our clients consist of a higher income earning category when compared to the other card issuers in the industry," said Asst. General Manager (Operations), Commercial Bank, M. Bandaranaike.

Bandaranaike said that the bank's computer linked network of 100 branches islandwide makes the whole process of application, issue and settlement very convenient. There is freedom of handing over card applications at any of the 100 branches, Customer Service Points (CSPs) or Super Market Banks (Minicoms). "Our network could be used extensively by the cardholders to settle outstandings, apply for enhancements, clarify issues relating to the credit cards, etc. Further, our 24-hour telephone customer service line - ComLine gives the security to cardholders to report lost cards, inquire on balances, etc.," he said.

Many factors differentiate ComBank credit cards from other issuers. "The low risk profile of our cardholders makes it possible for us to offer a lower rate of interest. Where more aggressive issuers of credit cards charge an interest rate of 3.2% per month, our card, ComBank International is offered with interest as low as 1.75% per month," said Bandaranaike.

Business Matters

Business Matters sponsored by Commercial Bank of Ceylon and telecast over Rupavahini Channel EYE, tomorrow, April 29 at 10 pm will feature:

 Interview with Dr. Nadeem Ul-Haque, resident representative of the IMF, conducted by Parakrama Dissanayake on: 'Globalisation and its impact on developing countries; government's role in the economy; good governance,' an other economic issues.

 'Mlesna to capture international market': An interview with Anslem Perera, managing director, Mlesna Ceylon Ltd., conducted by Neidra Williams.

CPC on price increase

The Ceylon Petroleum Corporation has stated that the price increase of Rs. 2 on all petroleum products was necessary due to the steep rise in the price of crude oil and the exchange rate. When prices were revised last month (March 22) the crude oil price averaged $ 19.39 per bbl and the exchange rate averaged Rs. 93/75 for a US dollar during the month of February.

The latest price revision (April 22) was necessary because, the average crude oil price in March rose to $ 23.43 per bbl and the average exchange rate rose to Rs. 94.83 for a US dollar. "During March crude oil prices increased by over $ 4 and the exchange rate increased by over a Rs. 1 per dollar. Since an increase of crude price by a dollar and the increase of the value of a dollar by a rupee results in a loss to the CPC of Rs. 2000 million and Rs. 1000 million respectively, we had no option but to raise prices," the CPC states.

As a measure of relief to the consumer, the government has taken the following measures in the recent budget:

(a) CPC contribution to the government by way of taxes reduced from Rs. 23,000 million to Rs. 20,000 million (b) Kerosene price fixed without excise duty.

"Unfortunately, by this price increase, CPC cannot fully recover the losses it will incur due to the recent increases in crude oil prices and the exchange rate, and will have no option but to revise prices again next month," the CPC further states.

DY&R ties-up with Advantage

By Kumudu Amarasingham

In the business of ideas, it is the best and only the best, that count. When two great corporate minds meet and merge, onlookers tend to pause and observe. A lot is expected - often too much. Especially when it is about who sells most of another's product - which is what advertising is about - the stakes are very high.

But Advantage-DY&R brand communications, the new company that was formed after Rediffussion DY&R, India, acquired a controlling stake at Advantage - one of Sri Lanka's leading advertising agencies - is confident they can deliver the goods.

Rediffusion is India's fifth largest advertising agency while Dentsu of Japan is the  single largest agency in the world. Together with Young and Rubicam, a WPP company they plan to revolutionise advertising in Sri Lanka.

And to help in this venture they possess, apart from the very creative team at Advantage, a unique tool known as the Brand Asset Valuator (BAV). This is an extensive study of brands conducted with over 40,000 people in over 27 countries worldwide. And it is the only one of its magnitude.

To help them further along the path, several partner companies such as Wunderman (customer relations management); The Media Edge (total media communications), Burson-Marsteller (public affairs/public relations) and Landor (strategic brand communication) have also joined in to provide focused solutions and cover every aspect of brand communications.

Rediffussion DY&R's clients include international brands such as Colgate-Palmolive, Daikin, Ericsson, ING Insurance, Nike, Thompson, Maruti, Taj Hotels... the list goes on. Locally, Advantage has provided solutions for companies such as Singer, People's Bank, DFCC Bank, The Maharajah Group, Maliban and many more. That much is expected from this new development cannot therefore serve to shock many. 

To gain more insight into this venture and indeed to find out more about the man himself, The Sunday Leader spoke to Diwan Arun Nanda, founder and co-chairperson of Rediffussion India. A man with a treasure-trove of experience, talent and indeed, guts, Nanda is and has been one of the key figures in advertising in India for a long time. He was responsible for the late Indian Premier Rajiv Gandhi's campaigns from 1982 till his tragic assassination in 1991.

Q: Beginning with the merger, why Advantage?

A: First, it is not a merger but equity: we have obtained just over 50 percent of Advantage. As for why Advantage; because they're respected, they have a good reputation, good clients and a lot of talent.

Q: Why take over instead of starting an agency here?

A: Well for one thing it is difficult to set up from scratch. More importantly however, advertising is about knowing the mindset of the local population intimately. How they think, what turns them on and off, why they say and do things a certain way as opposed to another, and so on. It is also important to respect local nuances and culture. We believe no one can do this better than the locals themselves. Hence I feel the leadership should be local.

Q: What do you bring in to the local scene; in what ways do you hope to benefit Advantage?

A: Definitely new technology, training and ideas. We plan to take people to our offices abroad for training and also send experts over here. Exposure is very important in this field - you must keep up with trends and be one step ahead of them.

Q: What do you feel about the local advertising industry?

A: Honest opinion? Definitely improvable. There is a need for more ideas, more creativity. It is not just about technology. What you need is a few rebels. People who are not afraid to be different, to take a chance! People who don't believe in norms!  Also it is important for the client to be more demanding - to raise the standards. There is a difference between good and good enough. There is a much bigger difference between good and great.

Q: How would you define great?

A: You don't need me to define great. The viewer does that all the time. When an advertisement brings a chuckle or a smile to your face - when it appeals emotionally, touches you and remains in your mind - that I think is great.

Q: Why is the burn-out rate so high in advertising?

A: Because you have to constantly create under pressure. It is a very stressful job that demands the best out of you all the time. It is a young person's job and always will be.

Q: You said it is important to take a risk, what is the greatest risk you've ever taken?

A: I think it was in 1973 when at the age of 28 I left a great job with a rising reputation at Unilever to form Rediffussion. I had no clients, no office and no money - just lots of confidence. It was tough at first because every time I tried to get one client they would ask for proof from another and I was like 'how am I supposed to prove myself if you don't give me a chance!' But 10 years down the line we were winning almost every award for advertising in India.

Q: What is the most memorable moment of your career?

A: The most memorable and also the saddest moment was the assassination of Rajiv Gandhi, whose campaign I handled from 1982 onwards. He is undoubtedly one of the greatest men I have ever known. Logical, respectful, open minded and humble - he was the ideal client and a good friend. I had just taken a break when I heard the news of his demise - if not I would have been there. Such is life. However, I never have or will take up another political campaign again. Emotionally it was just too draining.

Q: There has been a lot of criticism levelled at the advertising industry over the exploitation of women and children. Comment?

A: Using a woman or a child just to get attention is not done - it is base. Having said that I honestly do not feel that responsible and truly creative advertisers resort to or need to resort to such base tactics.

Micro - Sri Lanka's first 'home made' car

The Micro is the first ever car to be manufactured in Sri Lanka - fully designed, developed and prototyped locally. The Micro car project was initiated and aimed at providing a 'national' car which is a safe, economical, environmentally- friendly and affordable for the masses of  the country, where it would be possible for the majority of our people to own a car and satisfy the need for individualised transport. This project would be advantageous to the nation in terms of:

Foreign expenditure savings, and help support economic returns by being the only low cost vehicle with added benefits such as low operation and maintenance costs, direct and indirect sources of  income, self employment opportunities and a natural boost to the local automobile industry.

Micro will provide a safe and economical mode of transport, as a positive response to traffic congestion, substantially reducing transport infrastructure expenditure. The project will  provide well over 3,000 direct employment opportunities and more than 8,000 jobs indirectly, with self employment potential for well over 35,000, as a tangible solution to public transportation.

With Micro Cars pioneering the automobile industry in Sri Lanka, international manufacturers may also gain confidence to look at Sri Lanka as an option to set up assembly plants. The project will be an eye-opener to these manufacturers by opening possibilities to export from Sri Lanka, especially due to the country's proximity to all the major shipping routes in the region. The project will also encourage local industry into component manufacturing to support automobile manufacturing and assembly.

Transmec is the developer of this groundbreaking venture. Micro is the brainchild of its Chairman/CEO, Dr. Lawrence Perera, an automobile engineer by profession. The company's existing operation, whilst focusing on vehicles, has diversified into other areas including transportation solutions, power generation and e-commerce.

The Micro is an aerodynamically designed ultra-light modern city car, with seating for five, excellent fuel economy, and a simple yet technologically-advanced RTM composite body. The car is not only built for local roads and tastes, but also designed to meet international standards.

The easily repairable body offers excellent crash protection, whilst eliminating problems of corrosion.

Despite its lightness and simplicity, the Micro comes complete with four doors and all the conveniences of a modern car. Fitted with a dual-fuel gasoline/LPG 4-stroke environmentally-friendly engine, it is suitable for unleaded fuel and offers excellent fuel economy.

"Today, we have our very first 'national car,' developed 115 years after the invention of the first automobile. An achievement to mark a new millennium and a new future. A car which every Sri Lankan can be proud of," said Dr. Perera.

Now the pre-production cars  are being  manufactured and will be ready to be launched to the general public by the third quarter of 2002. With the correct infrastructure in place, commercial production for the local market will commence by the fourth quarter of 2002.

Taking a leaf from national history, the Micro badge is symbolic of the national flag and all that the lion stands for. In this adaptation, the lion's head is stylised to give a contemporary, dynamic appearance to mark the beginning of a new future spearheaded by the Micro.

Growth of HNB's digital outreach a priority

Hatton National Bank, which has the largest digitally connected branch network in the country with HATNANET, considers the addition of more locations a priority, in its effort to bring the benefits of on-line banking to more people.

'Anywhere banking' means that customers can access HNB's services at any customer centre, no matter where the accounts really are. HATNANET, which is also a digital trading floor, can be utilised by external organisations to conduct mutual business deals on a common platform through HNB's IT infrastructure.

Hatton National Bank has taken upon itself a commitment to make as many people as possible "bankable." This was underlined some years back, with HNB's 'Gami Pubuduwa' scheme, which is still an innovative rural credit scheme.

The latest additions to the growing list of customer centres that are now on-line are at Geli Oya, Peradeniya and Thalawathugoda. HNB believes these would, idealistically, represent a part of the new responsibilities of the bank in the wake of new technology: to attract more people - especially the young - to the dynamics of banking, instilling in youth an entrepreneurial spirit, helping businesses to begin, consolidate and grow.

These, in time, will no doubt lead to regular usage of the many innovative on-line products HATNANET offers such as e-commerce, Business 2 Business, m-commerce, fully automated banking, kiosks, etc.

St. Anthony's moves into the east

St. Anthony's Consolidated, a leading marketer of consumer appliances, commenced distribution of all Sanyo, Cosmo and BPL products sold by them to consumers in the east, when they signed a distributor agreement with Nazeela Hardware & Electricals in Kattankudi.

According to a market survey conducted by the company, the return to normalcy in the east and surrounding areas have lead to a demand for basic electrical items such as refrigerators, televisions, and other household items.

St. Anthony's Consolidated together with Nazeela Hardware & Electricals will jointly develop a network in Oddam-aradi, Valachchanai, Eravur, Batticaloa, Katta-nkudi, Kalmunai, Akkarai-paththu, Ampara and Samanthurai. A service centre too will be established shortly. St. Anthony's who have been in the electronic business for the past three decades, have the agency for all products manufactured by Sanyo, Cosmo and BPL in the far east and in India.

Customers will have the option of obtaining their products directly or else via a hire purchase scheme which has been arranged with the Peoples Bank as well as the Bank of Ceylon.

Pictured is Managing Director, St. Anthony's, S.R. Gnanam handing over the distribution agreement to Proprietor, Nazeela Hardware, A. Ajwath.