The Kiwis, shot out for 188, hit back to remove swashbuckling opener Sanath Jayasuriya first ball and Marvan Atapattu and Aravinda De Silva by the fourth over to make it 5-3.

Ranatunga and opener Romesh Kaluwitharana, however, saw off the crisis with a 127-run partnership for the fifth wicket as Sri Lanka cruised home with more than eight overs to spare.

Kaluwitharana was eventually run out in the 30th over for 48 and the recalled Roshan Mahanama departed soon after for seven, but Ranatunga remained unflappable.

New Zealand paceman Simon Doull gave Sri Lanka a scare when he had Jayasuriya caught superbly off the inside edge by wicket-keeper Adam Parore with his first delivery.

Parore, who top-scored with 54, took another catch when Atapattu edged a wild shot in Doull's second over.

Then, in the fourth over, De Silva edged a drive off Geoff Allott to second slip where Nathan Astle accepted a low catch.

South African challenge

Sri Lanka now clash with South Africa on Friday for a place in the final of the limited-overs tournament featuring the nine Test-playing nations.

Ranatunga attributed the early collapse to lack of practice.

"We are a bit out of touch at the moment, but we have three days now to discover our form before the semi-final," he said.

Muttiah Murlitharan: Yet another superb spell

Sri Lanka's win was set up by off-spinner Muttiah Murlitharan who sliced through New Zealand's batting.

The spinner, playing for the first time since his 16-wicket haul in the Oval Test against England in August, finished with 3-31 in 10 overs.

Murlitharan had Matthew Bell stumped in his first over. He then bowled Alex Tait and had Daniel Vettori caught behind.

The Kiwis folded with a ball to spare after three batsmen were run out and the last six failed to get into double figures.