Sri Lanka gains foreign direct investments worth $ 800 million
The Morning: Sri Lanka has entered into $ 800 million worth of Foreign Direct Investment (FDI) agreements for 35 projects in the first quarter of 2024, Investment Promotion State Minister Dilum Amunugama said.
Speaking in an interview with Derana TV on 5 August, he said that in 2023, Sri Lanka signed $ 1.2 billion worth of FDI agreements after entering the International Monetary Fund (IMF) programme.
He added that in 2024, the Treasury has set out an FDI target of $ 1 billion while by the end of the first quarter, the country has signed $ 800 million worth of FDI agreements.
He said that the signed agreements include 35 projects mainly relating to tourism, agriculture, energy, mineral sands and logistic sectors.
“There are ongoing discussions on projects worth several million dollars,” Amunugama said.
However, he said that at one point there was a situation where Sri Lanka could surpass the target and achieve $ 2 billion in 2024, “but questions remain of what will happen to the investor environment with the announcement of the elections,” he added.
Further, he said that investor confidence was built up, especially with the recently passed Economic Transformation Act (ETA) which the investors have looked into.
“With the legislation (ETA), we could reach an annual target of $ 5 billion (In FDIs),” he said.
Also, on Port City, he said that Sri Lanka has managed to pass all the regulations required for the economic zone.
He noted that the cabinet has already approved 20 businesses of strategic importance (BSIs) for Port City while 50 more are ready to be presented for cabinet approval after having discussions with 300 BSIs overall.
OSL take:
Sri Lankan authorities are engaged in overseas promotional campaigns to attract foreign direct investments to the country. Apart from economic resilience and the ongoing economic activities, Sri Lanka’s geographical positioning in the Indian Ocean and the strong trade ties enjoyed by the country with many foreign countries all serve to attract foreign businesses/investors to the country. Local authorities have also formulated many incentive schemes to foreign businesses/investors exploring opportunities in Sri Lanka. The Sri Lankan government has also shown great interest in getting the necessary approvals for many projects presented by foreign businesses/investors, including Cabinet approval where necessary. The growth and business potential in Sri Lanka is evident by the interest shown by foreign businesses/investors to explore the expanding business/investment opportunities all key economic sectors in the country. Foreign businesses could also look at forming collaborations with local businesses with the aim of further expansion.