BOI showcases Sri Lanka’s investment potential to Chinese firms
Daily FT: Board of Investment (BOI) Director General Renuka Weerakone made a compelling case to Chinese businesses to capitalise on Sri Lanka’s growing investment and trade opportunities at the recently concluded ‘Sri Lanka – China Trade and Investment Forum 2025.’
The high-profile forum was attended by China’s Commerce Minister Wang Wentao, Chinese Ambassador to Sri Lanka Qi Zhenhong, and 115 delegates representing 77 Chinese companies, underscoring the strategic significance of deepening bilateral economic relations.
Weerakone reaffirmed Sri Lanka’s openness to foreign investment and its readiness to work closely with Chinese businesses across high-impact sectors.
She assured that the BOI acts as a longstanding partner for foreign investors, offering smooth facilitation throughout the investment process. With over 1,200 foreign companies already operating under the BOI framework across sectors such as manufacturing, apparel, IT, tourism, food processing, logistics, and infrastructure, she said Sri Lanka is well-positioned to welcome new entrants.
“The investment flow to Sri Lanka through Chinese companies so far is about $ 3.5 billion and it has contributed to the creation of around 5,000 job opportunities for local citizens,” she pointed out.
To further attract investment, Weerakone detailed a suite of incentives including a reduced 15% corporate income tax for export services, enhanced capital allowances of 100-200% over extended periods, and duty exemptions on raw materials and project-related imports.
“Companies operating under the Commercial Hub Regulation also benefit from exemptions on Customs duties, VAT, CESS, and excise levies, with a special Green Channel mechanism in place for high-performing, export-oriented firms,” she added.
She also elaborated on entry thresholds for non-BOI companies to qualify for BOI benefits, including provisions for both the transfer of local shareholding to foreign investors and the infusion of additional capital.
“For example, export-oriented manufacturers must meet a $ 1 million threshold via share transfer or $ 250,000 through new capital infusion, with mixed development projects requiring $ 5 million,” she said.
Underpinning her appeal was a clear articulation of Sri Lanka’s investor-friendly environment; she noted the country allows 100% foreign ownership, full repatriation of profits, and investment protection guaranteed by the Constitution.
In addition, it was noted that Sri Lanka is a signatory to the World Bank’s Multilateral Investment Guarantee Agency (MIGA), has bilateral investment protection agreements with 26 countries, and offers double taxation relief agreements with 45 others.
The BOI Director General also underscored the island nation’s geographic advantage, skilled workforce, and high quality of life.
She pointed to preferential market access through the EU Generalised Scheme of Preferences Plus (GSP+) scheme, enabling zero-duty exports of over 6,400 products to 27 EU countries, as well as free trade agreements with India, Pakistan, Singapore, and Thailand, and participation in regional pacts like South Asian Free Trade Agreement (SAFTA) and Asia-Pacific Trade Agreement (APTA).
OSL take:
Sri Lanka’s ongoing economic expansion and the target of becoming a regional hub have all expanded the business/investment opportunities in the country’s key economic sectors. While there has been much interest among foreign businesses/investors to explore the growing opportunities in Sri Lanka, local authorities are also engaged in promotional campaigns overseas to attract foreign businesses/investors to explore the many business/investment opportunities in the country. It is in such a backdrop that the BOI has carried out a programme to present Chinese businesses/investors the many opportunities in Sri Lanka. China and Sri Lanka enjoy strong bilateral and trade ties with many Chinese businesses already operating in Sri Lanka. China has also placed Sri Lanka prominently in its Belt and Road Initiative (BRI), thereby further indicating the growing opportunities in Sri Lanka. The county’s strategic positioning in the Indian Ocean, the many trade agreements as well as trade concessions enjoyed with many foreign countries and the increasing business conducive environment in the country have all boosted Sri Lanka’s image as an emerging business destination in the South Asian region. Also, the growth and profits recorded by Chinese businesses already operating in Sri Lanka have added to Sri Lanka’s attraction among Chinese businesses/investors. Therefore, Chinese businesses/investors could explore the expanding opportunities in Sri Lanka while also looking at expanding operations through local collaborations. Other foreign businesses/investors interested in doing business with China could look at setting up bases in Sri Lanka to engage with Chinese businesses using the preferential treatment received by Sri Lanka in China.
| Article Code : | VBS/AT/20250613/Z_1 |