Bumpy road ahead for our rubber

By Feizal Samath

Rubber prices are becoming unremunerative in Sri Lanka as world markets crash on the currency fluctuations hurting major East Asia producers and a trading mechanism backed by both producers and consumers is threatened with collapse, trade sources say.

The currency turmoil is putting pressure on major producers to pull out from the International Natural Rubber Organisation (INRO) which operates a mechanism to ensure stable prices for producers and consumers.

"The problem is that the intervention price - the price at which the buffer stock manager buys or sells - has been distorted for the first time in the life of INRO because of the currency turmoil in the three major producing countries - Thailand, Malaysia and Indonesia," said Tom Ellawela, chairman, Colombo Rubber Traders Association.

He said that this "may-buy, must-buy" mechanism does not have a safeguard built in to look after distortion in pricing as a result of currency fluctuations.

Ellawela said that INRO has commissioned a study to see whether a compromise could be worked out between the intervention price and currency fluctuations.

According to reports from overseas, INRO's existence was put in doubt two weeks ago after Malaysia said it plans to leave the organisation and Thailand — the world's top producer and exporter of natural rubber — indicated it may follow suit.

The announcement was made at the end of the three-day meeting of the Association of Natural Rubber Producing Countries (ANRPC) in Bangkok. The two countries were unhappy with INRO after the agency turned down a demand by rubber producing members that intervention prices be raised.

ANRPC comprises Thailand, Indonesia, Malaysia, Singapore, India, Sri Lanka, Papua New Guinea and Vietnam. The meeting was held to discuss key members' stance on INRO memberships and alternative price support mechanism to replace it.

INRO has both producers and consumers like the United States, Russia and Japan as its key members.

Ellawela said that the buffer stock mechanism operated through the International Natural Rubber Agreement (INRA) since 18 years ago is meant to ensure a balance between supply and demand. Through this mechanism, the buffer stock manager releases quantities from the buffer stock to soothe sharp rise in prices and buys when prices fall, when there is a surplus.

"This has worked perfectly until the currency crisis emerged," Ellawela said.

Other rubber traders said that the INRO crisis was likely to be felt here. "Anything that affects the major producers is bound to affect Sri Lanka," one dealer noted.

Local RSS rubber prices are up now compared to six months ago but the prices of crepe - which has a niche market - have fallen compared to three months ago due to the East Asian currency crisis.

Traders said that Malaysia and Indonesia were producing a grade of rubber that is similar to Sri Lanka's top-of-the-market crepe rubber and consumers were now picking up the cheaper substitute in preference to crepe.

Rubber production has been stagnant for the last 10 years due to many reasons. Last year's output was 105 million kgs against 112 million kgs in 1996.

Ellawela, however, pointed out that on the positive side the domestic consumption of natural rubber has increased over the years and now about 40 percent of local output is utilised locally, adding value to exports.

Rouble troubles tea exporters

Tea exporters to Russia are unable to get their credit limit extended from banks as repayments have slowed down from the buyers.

The Central Bank said it was unable to stand guarantee to bank credit to exporters.

Exporters are short of about US$ 40 mn in credit to continue sales to Russia and a meeting has been set with the Finance Ministry, to obtain a government guarantee against fresh credit limits.

The trade is worried that if the local credit situation is not resolved and exports stopped or curbed to Russia, other producers may step in to grab this lucrative market.

"This is going to hit tea prices," Rajiv Casie Chetty, of CT Smith Stockbrokers said. "It would effect companies exposed to tea industry, who showed good results last year and during the first two quarters of this year," he said.

Japanese aid for textile training

By Shafraz Farook

Rs 100 million in Japanese aid has been received by the Textile Training and Services Centre for quality Improvement.

Titled "Quality Improvements of Sri Lanka's Textile and Clothing Products" this program plans to develop the textile and clothing industry of Sri Lanka with impact to increase in value addition, competitiveness, etc. of products through improvements of quality of fabric and clothing.

The centre has also achieved 9002 status in preparation to this program. JAIC has helped greatly to hasten the achievements of this milestone. At present they are able to meet the standard requirements of many countries.

The centre claims that this program will play a very big role in meeting the challenges of the post quota free trade in Textile and clothing by the year 2005.

They are the first organization to acquire this status for testing of textiles and garments in Sri Lanka and also the first Government institute to obtain this status voluntarily for one of its services.

Lanka gets ready for Expo 2000

Representatives of the Expo 2000 International Trade Fair co-ordination unit from the Federal Republic of Germany recently called on Kingsley T. Wickremaratne, Minister for Internal and International Commerce for preliminary discussions on Sri Lanka's participation at the Hanover trade fair.

Sri Lanka Federation of Chambers of Commerce in association with the Ministry of Internal and International Commerce will run the Sri Lanka Pavilion at Expo 2000 as they have done recently at Lisbon in Portugal, an official communique from the Ministry of Trade states.

Export Development Board will act as the focal point for co-ordination with the ministry, the chambers and the exporters community who will participate at the exhibition.

Explaining in detail the on-going planning for this biggest event for the trade sector in the year 2000, Stefan Sckell told the gathering: "The selected theme for the exhibition - human kind, technology, and nature - is to draw world attention to the inter-relationship and the interdependency of these factors and the need to maintain a harmonious balance among them as we approach the next millennium.

"We consider that this will be the world's largest exposition of goods and services with the participation of more than l75 countries from all over the world.

At least 40 million people are expected to visit the exhibition," the communique says.

The unique feature of the exhibition will be the Thematic Section where countries will be encouraged to display on-going projects on themes such as 'sustainable development'.

Already the grand jury has selected one project from Sri Lanka to be located in this area with special sponsorship from the German government," said Stefan Sckell. Rouble troubles

Of bugs and the new Millennium

By Rohan Wijeratne

The Year 2000 problem is simple but over whelming.

Almost all older computer systems and their software, PC's and their software and the hundreds of millions of embedded semiconductor chips, could crash on January 1, 2000, because the new year will appear as '00' in the standard two-digit year field.

This '00' will be read and be interpreted by these systems as being the year 1900 and not the year 2000.

The problem, while technical in nature, is primarily a business problem, with many organizations facing the risk of Year 2000 induced interruptions or failures of their core business processes.

The problem is time. Time is running out and many organizations may not be able to renovate or replace all of their mission critical systems in time.

Time is needed to identify all the occurrences of this problem - time to make the corrections and, most important, time to conduct proper testing.

January 1, 2000 is not a deadline that can be moved

The Millennium 'bug' is not really a bug, but a design limitation imposed by technology and society in general. This problem started many years ago when computers had limited memory and storage space.

Programmers saved space wherever possible by storing the minimum amount of data needed for the systems to function. One area in which they saved space was in representation of the date.

Unfortunately this design limitation affects millions of computer programmes in your traditional Management Information Systems such as Payrolls etc.

This problem affects not only mainframe computers and their software but also Personal Computers and every piece of hardware that contains a microchip.

The latter are the type of systems in bank vaults, power generation systems and telecommunications systems, to name a few.

The problem is extremely serious, because all types of organizations rely on dates and date processing. Furthermore, there are so many pogrammes and systems that have to be checked and certified in order to be free of this problem.

The problem may affect your organization through the business supply chain, since you buy goods and services from some businesses and you sell goods and services to others. If your trading partners fall, you suffer critically too.

From a technical point of view, it should also be pointed out that January 1, 2000 is not the only problem. February 29, 2000 is also a problem because 2000 is a leap year. The rules for what is and what is not a leap year have been known to us for a long time.

The rules are:

a. If the number of the year is divisible by 4 then the year is a leap year,

except

b. If the number of the year ends in 00 then the year is not a leap year;

however

c. If the number of the year ends in 00 and the year is divisible by 400 the year is a leap year.

Generally, computer programmes that take into account leap years, follow only rules 1 and 2, and therefore, will not treat Year 2000 as a leap year. Therefore, February 29, 2000 will be a problem for these systems.

The basic technical problems are:

• One second after the date 31/12/99 and the time 23:59.59, the date computer systems should read 01/01/00 and the time should read 00:00.00. But it may not.

• In many cases the year is represented by only the last two digits of the year. Therefore, calculations will produce errors because 99 plus 1 is not equal to 00 - it is equal to 100, and because 00 is less than 99.

• In embedded systems which operate continuously, the problem may show itself as an equipment failure on January 1, 2000 and you may not be able to identify whether or not the problem will occur before it actually happens.

• Embedded systems which are not in continuous use, may not operate correctly when they are switched on for the first time in the year 2000.

• Although the application may not be date and time dependent, the hardware and software on which the application has been developed or is running may have this date problem.

If we look at embedded systems they generally fall into four categories and of these the more relevant to our discussions are:

• Sub groupings with a timing function such as traffic controllers, telephone exchanges, elevators and diagnostic and realtime control systems. These generally are small components in a larger system which may have a PC and a database.

A good example would be a medical device that is monitoring the vital signs of a patient.

• Computer systems used in manufacturing or process control, which is where a computer is connected to plant or machinery so that there can be overall control and monitoring.

These systems are the ones that could be most affected, similar to commercial systems.

Embedded systems exist in Manufacturing Plants, Water and Sewage Systems, Power Stations, Power Grid Systems, Refineries, Surveying and Location Equipment, Planes, Air Traffic Control Systems, Radar Systems, Fire Control Systems, Air Conditioning and Ventilating Systems, Elevators, Security Systems, Vaults, Door Locks, Telephone Exchanges, Telephone Switches, Telephone Systems, Automated Teller Machines, Pacemakers, X-ray Equipment and Satellites, to name just a few.

Impact on Application Software

Most of the application software that is in use in our small to medium scale organizations are either developed in RPG, COBOL or dbase/Clipper.

More recent implementations of software have been using Informix or Oracle databases and development tools such as Developer/2000 for Oracle.

We also have databases that have been developed using PC packages such as Lotus, Paradox, Access etc.

When looking at the xBase family of products such as dBase, Clipper, FoxPro etc., each has its unique problems. When dBase is sold, although it is possible to have the year in the full 4-digit form, the default used is the 2-digit format.

Therefore, unless programmers have been far-sighted and have reset this in their programmes the problem remains.

In Clipper Summer '87 and version 5.x, if the command SET CENTURY ON is not specified then it is likely that the year is in 2-digit format. Even if SET CENTURY ON is in the programme, you have to be careful to make sure that screen entry and screen display and printouts are also set for the full four digits.

In the case of Clipper version 5.x, if the L UPDATE () function is used, there could be a problem when it wraps to zero, because there is only one byte in the DBF header to store the two-digit year.

In the case of FoxPro if you have SET CENTURY OFF and you attempt to use MCDATE as part of a Date Get it will be impossible to enter 02/29/00 because FoxPro intercepts it as an invalid date.

It intercepts it as an invalid date because 02/29/00 is interpreted as being in 1900, and since 1900 was not a leap year, it rejects the entered data.

Even the big database package such as Informix and Oracle could have this problem because of the methods used by programmers. Although the database packages themselves do not have this problem, they all give the option of setting the date either to the 2 or 4 digit standard.

Of course, in the last year or so, programmers have been aware of the Y2K (Year 2000) problem and have explicitly stopped using the 2-digit format. However, one never knows whether all new systems are immune to this problem, because old habits die hard.

Tools for testing

There are many tools available for testing, including source code scanners. There are also many companies marketing tools, and the best approach is to go into the internet web site http://www.year 2000.com and identify the tools that are appropriate to your individual environment.

I will identify a few such products, but first, I must stress that I have not used these, and am naming them only because these appear on various web sites that are devoted to the Y2K Issue.

The one that seems to be generating a lot of attention is a product that has been developed by Fidelity Insurance Co., of the USA. This is reported to have the capability of scanning code written in any language and on any platform.

However, languages on which it is reported to have been actually used are: C/C + +, SQL (Sybase, Microsoft, SQL Server, Oracle), Visual Basic, Powerbuilder, PL/1, MS Access, MS Excel, Delphi, COBOL, Assembler, UNIX Shell, HTML, JavaScript, REXX and RPG.

Unfortunately, this is an American Company and there are no known agents or distributors in Sri Lanka. Similarly a free analysis tool is available from another company named Bozeman Legg Inc., which can be used to scan source code and database files of FoxPro, Paradox and Powerbuilder. It is reported that this product can be tailored for other languages as well.

The most important files that you need for scanning are the source code files - the files, as they were before they were compiled into executable files. If you don't have these, you could use a decompiler but inevitably, what the decompiler will generate by will not be very clear, since there will be no comments and the variable names may be artificial.

In situations where source code is missing the only solution is to use the application as a base to design a new system.

Even if you have the source code and do use a scanner to identify the references to dates, there is no scanner that can identify innovative methods of manipulating dates. The following are a few examples:

• Dates stored in character fields as YYMMDD

• When a numeric field representing a date as YYMMDD is multiplied by 100.0001, the last 6 digits convert that to MMDDYY.

• When the date is multiplied by 10,000.01, the middle six digits give DDMMYY.

Actions to be taken by customers and suppliers

Year 2000 compliance as defined by the Taskforce 2000 of the UK means:

"the ability for continued normal use of a system or item of software, such that neither performance nor functionality of the system or software is affected by any changes to the date format caused by the advent of the Year 2000. In particular,

1. Year 2000 compliance shall mean that no value for current date will cause any interruption in the operation of the system;

2. All manipulations of time-related data shall produce the desired results for all valid date values within the application domain and in combination with other products, prior to, through and beyond Year 2000;

3. Data elements in interfaces and data storage will permit specifying the century to eliminate data ambiguity without human intervention, including Leap Year calculations; and

4. Where any date element is represented without a century, the correct century shall be unambiguous for all manipulations involving that element.''

You also need to obtain supplier assurance and statements of compliance because it is not practical or cost effective to carry out compliance checks within the organization.

The web site for the IEE in the UK has some draft guidelines. In such cases you should ask the supplier for the following information. This is a general guideline and will have to be refined to suit your own organizational environment.

a. A statement of compliance, which indicates whether the product is date-sensitive, including Year 2000 compliance.

b. A decription of the compliance checking methodology used by them (e.g., static code walkthroughs, checking tools, physical tests, factory acceptance test logs and site acceptance test logs).

c. A description of tests conducted.

d. An assurance of the suppliers continuing services and the availability of these services.

However, you should be careful in relying on the vendor for these assurances because:

• The supplier could have gone out of business or may not be contactable.

• The supplier may not respond or may respond in a way that may make you doubt the assurance given or may even reply that they cannot assure you.

If the supplier responds you need to assess the following:

• Does the reply answer your specific question or do you receive a standard reply?

• Do any of their commitments have conditions attached?

• Will the supplier be in business after the Year 2000?

• Does the assurance statement relate only to standard applications and their use, and if so has your version been modified by you or the supplier at any time in anyway?

• Does the statement cover interfaces to other systems or devices and does your particular system require such coverage?

• Is the proof of compliance adequate?

You need a structured approach and strong and rigorous Year 2000 Programme Management to decrease the risks.

There are five key tasks that need to be performed in an organization in addressing this problem. These are:-

Awareness:

Define the problem and gain senior management support and ownership. Establish a Year 2000 programme team and develop an overall strategy. Make sure that everyone in the organization is fully aware of the issue.

Assessment:

Assess the impact on the organization. Identify core business areas and processes, inventory and analyze systems supporting these core business processes, prioritize their conversion or replacement and develop contingency plans to handle data exchange issues, lack of data, and bad data. Identify and secure the necessary resources.

Renovation:

Convert, replace or eliminate selected platforms, applications, databases and utilities. Modify interfaces.

Validation:

Test, verify and validate converted or replaced platforms, applications, databases, utilities. Test the performance, functionality and integration of converted or replaced platforms, applications, databases, utilities and interfaces in an operational environment.

Implementation:

Implement converted or replaced platforms, applications, databases, utilities and interfaces. Implement data exchange contingency plans if needed.

Remember that this is not a technical matter but a business matter.

We are today in September 1998. We have no more than one year left to carry out the 1st four phases outlined above. We need at least six months to perform the implementation phase.

Since we could be so far behind in addressing the problem, we need to have, in addition to a programme as stated above, a contingency plan in place, in case we are unable to complete the above five phases by June 1999.

We need to plan for business continuity. The four key tasks in a Contingency plan are:

Initiation:

Establish a business continuity project group and develop a high level strategy. Develop a master schedule and define milestones and above all get the total support of top management.

Impact Analysis:

Assess the potential impact on the organization's core business processes. Define failure scenarios and perform risk analysis on each core business process.

Contingency Planning:

Identify and document contingency plans and implementation modes. Define triggers for activating contingency plans and set up business resumption teams for each core business process.

Testing:

Validate the business continuity strategy. Develop and document contingency test plans. Prepare and conduct tests. Update disaster recovery plans and procedures.

Alternatives to tools

There are two alternative techniques, which can be used if you do not have the tools and if you have no option but to retain the 2-digit format, and if you have plentiful programmer resources.

I must stress that the following strategy, now becoming recognized cannot really be covered in full here. Furthermore, these address only the traditional information systems and not embedded systems, and also assume that you have access to the source code of your software.

I must stress that these should be used as a last resort because you are only buying time and would not have addressed the underlying problem.

These are relating to what is called ''time shifting strategies''. These are based on two central facts: (1) analysis and implementation efforts are reduced; and (2) it is inherently Year 2000 compliant so that successfully proving current year regression establishes future compliance for the length of the time shift involved.

Time shifting strategies shift the data back in time to avoid the century boundary altogether. Let me explain.

The problem with continuing to maintain 2-digit year is that 2000 is greater than 1999 but 00 is less than 99. By shifting the dates back in time, typically by a multiple of 28 years we end up with 1972 is greater than 1971, and 72 is greater than 71.

Therefore as long as we are consistent in applying this time shifting for all dates, we receive the same results for the same inputs and the application will work until 2027 or 2055.

Once all stored data is in the 21st century we can turn off the time shifting. There is drawback in that if we use time shifting, we CANNOT store dates prior to 1929.

It is very important to realize that encapsulation is a technique for obtaining the correct results from current data. If we subtract 1997 from 2001 we want the result to be 4. In obtaining this result of 4 it does not matter whether we subtract 1997 from 2001 or 1993 from 1997 or 1969 from 1973.

The best way to try to understand this is to think of encapsulation as a time warp where the year has been shifted back by the warp constant of 28 (or 56) years. Inside this time warp, everything is 28 (or 56) years earlier, while outside everything is current dated. As data crosses the time warp boundary they are consistently shifted back coming in and forward going out.

The two types of encapsulation are Programme Encapsulation and Data Encapsulation. In Programme Encapsulation we change the data but not the programme. In Data Encapsulation we do not change the data but change the programme.

Data Encapsulation works on a programme by programme basis while Programme Encapsulation works on a system by system basis.

I must stress that using encapsulation does not eliminate the need to follow standard Repair Methodoloties which are generally made up of the following phases of Assessment, Modification, Testing and Deployment. In summary, encapsulation is not a permanent solution for the Year 2000 problem.

It only buys time to complete the redesign and replacement of a system, or is a first step to full date expansion.

(The writer is Director/Chief Operating Officer of Millennium Information Technologies.

(Courtesy Achievers Magazine.)

Will SMI sector deliver the goods?

By Rohan B. Fernando

A great deal is being talked about various concessions and incentives granted to the Small and Medium Scale Industrial (SMI) Sector during the last couple of years.

There is no doubt that the industrialists in the SMI Sector do appreciate in all its sincerity, the genuine efforts made by the PA Government in this connection, since it assumed office four years ago.

Above all, the very fact a government in power appreciated the political, economical and social importance of the SMI Sector, is by itself, a substantial boost, since this sector has continued to receive step-motherly treatment under most of the governments, which came to power after independence.

The capability of the SMI Sector to create a large number of employment opportunities, using indigenous raw materials, without much environment pollution, speaks volumes for the prudence of selecting the SMI Sector on a priority basis for sustainable development.

It is estimated that the SMI Sector already contributes 65% of the employment opportunties available in the industrial sector at present. If a rapid development in the SMI Sector could be ensured, there's no doubt that we would be able to provide employment not only to a large portion of the unemployed youth in the country but also to the substantial number who enter the job market each year.

The most advantageous factor in selecting the SMI Sector for a rapid development effort, is the low capital intensiveness of the Sector. At a time when the country is compelled to allocate a large slice of its revenue for security, it is not surprising that we do not have very much resources left, to invest in massive development projects.

In this context there is nothing better than the SMI Sector to ensure and stimulate development with least amount of investment.

In a crisis situation like this, we should not only ensure that there is development but also that the benefits of such development is spread all over the country on a more equitable basis. Here too the SMI Sector is capable of delivering the goods.

Several important measures have already been taken during the last couple of years to ensure a rapid development in the SMI Sector. Such measures include setting up of several industrial estates, improving some of the infra-structural requirements, providing incentives for technological advancement, introducing several new SMI loan schemes etc.

However, one serious problem faced by this Sector, which has not received the attention of the government, has negated most of its good efforts and intentions.

That is the failure on the part of the government to provide relief to the existing idustrialists who are burdened with a massive loan commitment by virtue of the fact that they borrowed at a time when the general rate of interest in the country was as high as 18% to 26%.

That was the time that there was no SMI scheme for concessionery financing and the industrialists were compelled to borrow from banks at prevailing commercial rates.

Although the new industrialists who enter the industrial sphere now, are at an advantage with the facility to borrow at interest rates ranging from 10% to 14% under concessionery loan schemes, the existing industrialists are struggling to come to terms with the heavy interest burden.

Several fore-closures, bankruptcies and retrechments of staff have become the order of the day. No positive measures have been taken to provide relief to those in trouble and to those who are on the verge of facing such an unforutunate situation.

The danger signals, such crisis situations send to prospective industrialists, has compelled them to think not twice but several times before embarking on an industry.

Thus it is doubtful that the country would benefit by the several positive measures and encouragements offered to the SMI Sector unless the government steps in and does something positive to grant relief to the existing SMI industrialists.

If immediate steps are not taken, not only the measures already taken would become futile but we would not be able to avoid a very serious economic and social problem which could arise as a result of a total collapse in the existing small industry base.

It is high time to take positive steps to avoid a repetition of what happened to the textile industry happens to the SMI Sector, which would be very much more disastrous and catastrophic than the impact of the crisis in the Textile Industry.

Corporate Profile

MLL: modest gains and strategy for better future

By Company Watcher

"The lack of consistency and uniformity in reporting the cost of impaired credit or net provisions has resulted in a palpable distortion of the true performance of the leasing industry", says Chairman of Mercantile Leasing Limited (MLL) N U Jayawardena. Describing it as a subject of critical importance, he urges the Central Bank to stipulate an industry standard for a new provisioning methodology before it is too late. He hopes that the proposed Finance Leasing legislation will become a reality in the very early future.

'We continue to operate in a market where there is relenting competitive pressure from banking institutions resulting in a progressive erosion in profit margins for all. Risk management thus assumes fundamental importance", he states in his annual review to shareholders.

He outlines the core elements of a sound policy as:

(1) diversification, (2) informed decision-making, (3) strong financial and operating controls, (4) conservative accounting policies and (5) an independent review progress.

"The need to adhere to time tested principles cannot be overemphasized", he says.

Describing the last financial year as marking the end of one chapter and the beginning of another, Mr. Jayawardena comments that while operationally MLL has recorded rather modest gains during the year, the real achievement was the successful conclusion of negotiations for a better future characterized by a far-reaching strategic re-orientation.

Last year, MLL produced an after tax profit of Rs 40.1 million reflecting an increase of 33% over the previous year. The Group profit (net of tax) at Rs 40.4 million recorded a 27% increase. The value of leasing business transacted during the year totalled Rs 354 million fractionally above the previous year's figure of Rs 342 million. Mr Jayawardena attributes this moderate growth in new business to a conscious policy decision to apply maximum credit restraint in the context of an uncertain and depressing environment. He emphasises that the nature of the operation requires equal or greater focus on collections as for new business. A dividend of 15% to the shareholders has been recommended, continuing MLL's unbroken record of annual dividend distributions with an average of not less than 15%. A sum of Rs 17. 5m. will be transferred to the Tax Equalization Reserve and another Rs 10m. to the General Reserve. A balance of Rs 3m. will be retained as profit to be carried forward.

Referring to the search for "first class business partners" who are prepared to join MLL for an enduring relationship contributing ultimately to shareholder value, Mr Jayawardena records that this aim has been accomplished. The National Development Bank (NDB), the largest financial institution in the country and the International Finance Corporation (IFC), an affiliate of the World Bank and the largest multilateral source of loan and equity financing for the private sector have become partners of MLL combining the resources and capabilities of two leaders in their respective financial markets providing a solid foundation for MLL's future strategy.

While recording his appreciation of the initiative taken by the IFC to support the issue of medium-term debt instruments, Mr. Jayawardena describes the NDB as "a trusted ally for a long period". The rationale for alliances is that it makes possible for partners to focus their resources on enhancing their core competencies while leveraging complementary capabilities. Over time such collaboration can even be, if nothing else, a learning mechanism through which a junior partner can expand its knowledge and capability base", he stresses.

In line with these developments, MLL has restructured the business units to be able to focus its services more effectively on the needs of the customers and on the markets it operates.

The new business units have clear objectives in market positioning, allocation of resources and expected results. According to Mr. Jayawardena, the realization of organic growth has been MLL's central objective.

"We recognize the imperative need for critical mass, an extensive delivery system, facilities for cross-selling and ability to exploit economies of scale. To achieve these objectives we require an efficient and innovative organization with a decisive approach to identify and exploit market opportunities".

The timing of this change assures for us relative security from the imponderables surrounding the Year 2000 date change", he assures.

MLL has created two business units - the Leasing Division and the Business Finance Division. This has been done with the aim of providing a complete cashflow service targeting two complementary segments of a specific market. Realizing the intensity of competition in the financial services industry in Sri Lanka, MLL has identified the need to increase its ability to offer to the market more innovative solutions to meet its fast growing needs. The newly created Business Finance Division will develop Factoring as a key revenue earner to the Company.

"New business is the key to growth and we court it aggressively. We consider each customer transaction as a potential sales opportunity. Satisfied customers are our greatest source of new business. We encourage them to invite their own customers to use our needs-based services", the Company says explaining its mission "to provide cashflow for business".

SLBDC to train estate youth

The Ministry of Livestock Development and Estate Infrastructure in collaboration with the Sri Lanka Business Development Centre (SLBDC) is conducting an Entrepreneurship Development Programme for 30 plantation youth upto September 8, at Co-operative Holiday Home, Nuwara Eliya.

This is a residential training programme and the main objective of this programme is to develop entrepreneurial competencies of the participants to enable them to embark on other income generating or self-employment initiatives. Consequently these measures are expected to upgrade their standards of living and improve their quality of life.

The training methodology is called competency based economies through formation of entrepreneurs (CEFE). This has been developed by the German Agency for Technical Co-operation (GTZ) and successfully implemented in more than 60 developing countries including Sri Lanka.

More Business * BUSINESS DIARY * Oberoi, father of Indian Hoteliering turns 100 * Agro-Marine marks 25 years in export * A policy with children in mind * Hemas Garments' second opens * Sunquick wins award for excellence * ISO 14000, users form association * Browns Road Show * What triggered the current Asian economic crisis? * Award fires Ace Cargo to do better * New logo for Hayleys * Stock market on ETv and Swarnavahini * Appointments Gillette winner back with Rs. 3.89 lakhs * New Head takes over at ITI * Oram Shipping starts Col/Cal feeder service * Lubserve of Caltex launched * P&O Nedlloyd move to switch ratings condemned * Hongkong Ferry to lose franchise * Taiwan to relax rules on cross-strait shipping * Watching Falcons from Hotel Sigiriya *

Business contents page