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Bombs shatter investor confidence By Sunimalee Dias

Business, tourism community expresses concern over security lapses; Stock market loses Rs. 16 b in value

The trishaw exploded bomb in Colombo yesterday killing 8 and injuring 10 others sent shockwaves through business circles as the Colombo bourse suffered the biggest single day drop in recent weeks and lost Rs. 16 billion in value while the private sector was alarmed over security lapses.

The ASPI plunged by 53 points and the MPI by 77.8 points as investors sold out in panic after a trishaw laden with Claymore bombs exploded at 1.10 pm along Ananda Coomaraswamy Mawatha, Colombo 3. The apparent target was Pakistani High Commissioner Bashir Wali Mohamed who was traveling in his car but he escaped unhurt,

The only redeeming feature in the market was the low turnover suggesting that panic selling eased after the death toll was known.

Business leaders were quick to condemn the attack but called for improved security and early start to peace talks.

Federation of Chamber of Commerce and Industry of Sri Lanka (FCCISL) President Nawaz Rajabdeen speaking to the Daily FT said, "We from the business chambers are now making arrangements with the chambers of the North and East to lobby for a genuine peace in order for development in this country."

Stating the blast that occurred as a "very tragic" incident, it was noted that "this is the first time that they have come to assassinate a foreign diplomat…for which the international community should take a stand on this and condemn this."

In this respect, it was noted that the business community and other individual professional intellectuals should team up and lobby for a genuine peace in order for economic development.

"The international community should take a stand on this and condemn this act," he said adding that "this sort of incidents will affect tourism, international conferences, and people will be concerned about the serious security lapse in the country."

The Ceylon Chamber of Commerce (CCC) Chairman Mahen Dayananda said that "significant concern" was expressed in the aftermath of the bomb explosion in the capital.

"There is a lot of concern particularly with regard to security and it took a turn for the worst with the incident in Colombo," he said.

A "certain amount of insecurity has set in" within the business community following this incident and the recent violence as well, he said.

"The incident itself was of a fairly serious nature considering that it happened in the heart of the city during lunch hour, accordingly there is serious concern amongst members of the business community in relation to the incident itself," he said.

"The private sector condemns in the strongest possible terms all acts of violence against members of the public," he said. The chamber expressed their deepest sympathies to the families of those who lost their lives in this terrible incident.

The tourism industry, one of the most sensitive sectors of the economy, is expected to be adversely affected in the wake of the incident that occurred yesterday, Tourism Ministry Secretary Dr. P. Ramanujan told the Daily FT yesterday.

He said that while there definitely could be an adverse effect on tourist arrivals, the extent to which this sector could be affected is yet to be seen.

In the recent past there have been a few cancellations, he noted in view of the recent violence that erupted in the North and East.

Stock market analysts said low turnover predicted investor sentiment that was evidently "cautious", but circumstances were such that they were unable to pull out at the low prices as they would inevitably incur heavy losses, an analyst explained.

They also expressed concern over whether the security situation could escalate into a full scale war or not, analysts said.

In this respect, it was pointed out that "modest activity" is expected over the rest of the week.

-Daily Mirror

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August 15, 2006 - Posted by | Media Journalism, News, News and politics, World News

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