Sri Lankan government fast tracking liberalization through reforms to boost investments
The Sri Lankan government is looking at fast tracking liberalisation through legislative reforms due to the identification of bottlenecks to investment both domestic and foreign.
Finance Minister Mangala Samaraweera has made this observation making a statement in Parliament at during second reading of the budget.
Samaraweera has reportedly said that prime amongst these constraints include limitations in access to affordable and productive land, labour, and capital.
“There are vast tracts of land in the country that are tied up in completely unproductive use or are in fact abandoned,” Samaraweera has said.
“The land legislative reforms we propose are with a view to freeing up this unproductive or unused land for productive use for investment, for enterprise.”
Samaraweera has said that today’s labour laws dictate and restrict working hours of women and men and do not reflect modern working conditions including technological innovations that enable work from home or remote work.
“We intend to modernise these laws to enable our men and women to have more choice in their working conditions and how they work,” the Minister has said.
“This will make it easier for companies to hire people and create jobs.”
According to the Finance Minister, capital markets have miserably failed the country’s SMEs and entrepreneurs.
He has reiterated that capital market liberalisation does not mean unfettered opening up of markets.
“In the past, successive government’s role in financial markets has been in owning and operating numerous banks and financial institutions,” Samaraweera has said.
He has noted that most of these have failed to provide access to affordable capital for SMEs and entrepreneurs.
“The business of government is not in doing business. This is especially so when the government’s legacy in running SOEs is an accumulated debt of Rs1.4 trillion.”
He has added that that through this budget they want to create the platform to empower Sri Lankan businesses to enter global value chains and compete in global markets.
“Towards this end, we have proposed significant investments in encouraging the export sector,” Samarawwera has said.
“More than 20% of our exports are agricultural exports and the Budget provides significant support to this sector.”
The government has also announced the immediate removal of 1,200 para tariffs as a starting point.
The Sri Lankan government has expressed its seriousness in boosting foreign investments to the country through its budget proposal to fast track liberalisation through legislative reforms. The government has also looked at introducing new programmes to up lift its Enterprise Sri Lanka policy. Given these programmes Sri Lanka undoubtedly would be the best destination for investors to look at investment opportunities or open up businesses.
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