Skyline
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Sri Lanka, which is situated at the crossroads of major shipping routes connecting South Asia, Far East and the Pacific with Europe and the Americas, is ranked as the most liberalized economy in south Asia.
Strategically located next to the fast growing Indian subcontinent with close proximity to Southeast Asia and the Middle East, the island has adapted open market free economic policies, and successive governments have further liberalized the economy, leading to deregulation, greater privatization and opening the economy to international competition.
Its transparent investment laws aim to attract foreign direct investments. Sri Lankan commercial laws are based on British laws and country has a highly independent judicial system.
The country has a dynamic and resilient private sector, which if necessary can be joint venture partners for foreign investors. However, foreign investors are allowed to own 100 percent ownership of an investment. Concessions granted under an agreement with the Board of Investment — for qualifying investment projects — remain valid over the lifetime of the enterprise.
Reflecting the strength of Sri Lanka’s human capital and strong consumer market growth is the nation’s 94.2 percent literacy rate population, higher than that expected for a third world country and one of the highest literacy rates in Asia. Extensive investment in public education has produced a workforce that is not only competent but intelligent, trainable and comfortable with high tech production and services. Approximately 50 percent of the students who have completed higher education are trained in technical and business disciplines. English is widely spoken and is the main language used by the business community. Well educated and energetic, skilled and semi-skilled human resources are readily available at competitive wage rates. Sri Lanka has mostly had strong growth rates in recent years. According to Central Bank of Sri Lanka (CBS) the economic output (GDP), expanded to 8.3 percent during the year of 2011 (est.), compared to over the previous years 8.2 percent growth rate. With an economy worth $56 billion (2011 IMF estimate) and a per capita GDP of about $5400 (PPP), in GDP per capita terms, it is ahead of other countries in the South Asian region.
The country’s Central Bank Governor Ajith Nivard Cabraal said early this year that the country will make enormous changes in 2012 and beyond if it is positioned itself properly. He reiterated that 2011 was a challenging year but amidst tense global developments, the Sri Lanka’s economy was able to deliver the promised results. He said the country’s external sector will further undergo more fundamental changes making export inflow $12.5 billion in 2012. The tourism industry is expected to bring $1.2 billion and foreign direct investment is set to reach $2.0 billion. Meanwhile, the major contributions toward growth in 2012 are expected from three sectors namely agriculture, industry and services. The agricultural sector is expected to expand at 7.3 percent compared to 2.0 percent in 2011 with expected expansion in new cultivation in the north and east. Another 9.8 percent growth in fishing is expected due to favorable weather conditions and improvement in marketing and infrastructure facilities. The industry sector is expected to expand at 9.0 percent compared to 10.1 percent in 2011.A 12.2 percent growth is expected in the construction sector in infrastructure development work by the government and the tourism sector. An 8.2 percent growth is expected in domestic trade due to growth in domestic and agricultural sector. Financial services will expand by 8.2 percent owing to the expanding economic activities.
Sri Lanka is on the fast track for economic growth in 2012 while its transparent investment laws aim to foster foreign direct investments. Total foreign ownership is permitted across almost all areas of the economy and safety of foreign investment is guaranteed by the constitution. Existence of a transparent and sophisticated legal and regulatory framework covering all prerequisite business law enactments and bilateral investment protection agreements with 27 countries and double taxation avoidance agreements with 38 countries are some among the favorable investment regulations.
Following the announcements of opening Shangri-la hotels in Colombo and Hambantota in 2014 and 2013 respectively, the cabinet ministers have approved yet another deal with The US-based hotel chain Sheraton Group to invest $300 million in a leisure project in Sri Lanka, the nation’s information department said Dec.1. 2011. The mixed development project including a hotel in Colombo will be built on five acres of state land which will be given on a 99-year lease for 73.5 million US dollars in a deal approved by the cabinet of ministers. Also planning to invest $115 million in a hotel and shopping complex in Colombo is the Singapore’s department store giant Mustafa Center, (Source: Ministry of Economic Development December 2011) In a major boost to Sri Lanka’s international investment profile and its FDI inflows, Japan’s top multinational conglomerate Marubeni Corporation is returning to Sri Lanka. Marubeni wants to recommence operations in Sri Lanka in the due course. Marubeni, which was already active in Sri Lanka for 25 years, closed its operations on May 1, 2008 citing unfavorable economic conditions.
Marubeni’s return is also expected to boost Sri Lanka’s FDI inflows further. The diversified multinational conglomerate is engaged in diversified trading activities. In that, it handles imports and exports of food materials, food products, textiles, materials, pulp and paper, chemicals, energy, metals and mineral resources, transportation machinery and offshore trading.
India and Sri Lanka signed 5 bilateral agreements on Jan. 17, 2012, worth over $703 million, largely involving financial assistance from the giant neighbor boosting housing, railway and water supply. Indian investors are exploring emerging markets such as Sri Lanka as they offer higher returns than investments in developed countries whose economies are slowing down, PriceWaterhouseCoopers (PWC) officials told a forum in Colombo. Many Indian companies have shown a keen interest in infrastructure, financial services, tourism and healthcare in Sri Lanka.
Airport and Aviation Services Limited (AASL) Chairman Prasanna Wickramasuriya said that the building of the $190 million Hambantota Airport is on schedule. Qatar Airways, one of the five star airlines in the world, has consented to operate flights to the country’s second international airport at Hambantota from next year. Aviation Minister Priyankankara Jayaratne said they had discussion in this regard with Qatar authorities recently, who responded positively with the said matter. He said that in addition, Fly Dubai, a budget airline operating from Dubai will also be operating flights to the country’s second international airport in Hambantota.
As the Sri Lankan consumer spending increases consumers are aggressively moving toward lifestyle products that have now become essentials and engaging in impulse buying. The large-scale buying of vehicles with over 50 percent of Sri Lankan households owning at least one vehicle in Sri Lanka. (There are around three-million vehicles in use island-wide). Vehicle sales and registrations have risen sharply following duty cuts for all categories of vehicles, including hybrid and electric vehicles.
Sri Lanka’ s competitive labor costs, highly-ranked political stability in the region with the government’s emphasis on efficiency, competitiveness, infrastructure developments, and reduction of state budget deficits, further show the nation’s investment appeal. The counties robust performance in difficult times showed that it could actually come out stronger from any international financial crisis. Its strong economic growth, and favorable demographics make it a great country for investors.
It has launched an ambitious program of physical infrastructure development to completely upgrade the sea, air, road, power and telecom backbone of the country. The Sri Lankan government has declared its intention to develop the country as a leading regional aviation, navigation and trading hub in South Asia. Therefore, the development of maritime and aviation transportation is at the forefront of the government’s infrastructure development agenda. The focus of these developments is to expand the capacity and improve the efficiency of existing ports through modernization and construction of new ports and airports in strategic locations.
The Colombo South Port expansion project with three terminals, each terminal having capacity of 2.4 million TEUs per annum, will increase the capacity of the Colombo Port by 160 percent upon completion. Over 50 percent of the construction work of the breakwater has been completed. The first terminal, a join venture between the Sri Lankan Aitken Spence Group and China Merchant Holdings Ltd, is expected to be ready for operation in 2013.
The ceremonial berthing of the first vessel to the ‘Magama Ruhunupura Mahinda Rajapaksa Port’ was held on Nov.18 last year, commissioning the first phase of the Port by President Mahinda Rajapaksa.
The vessel “Jetliner,” followed by a sailing ship and a Sri Lankan cargo ship made their maiden entry to the seaport.
The sailing ship symbolized the proud maritime history of the country while the cargo ship showcased the commencement of industrial and commercial activities of the port.
The Port will become an active port in the country and already 27 investors have requested to start projects.
The Port, which lies within 10 nautical miles from the major Indian Ocean shipping routes, will be significant for the East-West shipping trade. Thus, international ships will soon enter the southern Port making it Sri Lanka’s second international Port.
The 126-km-long Southern Expressway is the longest expressway recently commissioned in Sri Lanka. The four-lane highway from Colombo to Matara is a catalyst for the economic and social development of the Southern region and promotion of and inter-regional transport network.
Enterprises flourish in Sri Lanka as foreign direct investments surge - Arab News
-------------
Shipping Hub, Aviation Hub, Commercial Hub is Ready!
Next> Educational Hub....Many Famous Universities will be here soon.
Strategically located next to the fast growing Indian subcontinent with close proximity to Southeast Asia and the Middle East, the island has adapted open market free economic policies, and successive governments have further liberalized the economy, leading to deregulation, greater privatization and opening the economy to international competition.
Its transparent investment laws aim to attract foreign direct investments. Sri Lankan commercial laws are based on British laws and country has a highly independent judicial system.
The country has a dynamic and resilient private sector, which if necessary can be joint venture partners for foreign investors. However, foreign investors are allowed to own 100 percent ownership of an investment. Concessions granted under an agreement with the Board of Investment — for qualifying investment projects — remain valid over the lifetime of the enterprise.
Reflecting the strength of Sri Lanka’s human capital and strong consumer market growth is the nation’s 94.2 percent literacy rate population, higher than that expected for a third world country and one of the highest literacy rates in Asia. Extensive investment in public education has produced a workforce that is not only competent but intelligent, trainable and comfortable with high tech production and services. Approximately 50 percent of the students who have completed higher education are trained in technical and business disciplines. English is widely spoken and is the main language used by the business community. Well educated and energetic, skilled and semi-skilled human resources are readily available at competitive wage rates. Sri Lanka has mostly had strong growth rates in recent years. According to Central Bank of Sri Lanka (CBS) the economic output (GDP), expanded to 8.3 percent during the year of 2011 (est.), compared to over the previous years 8.2 percent growth rate. With an economy worth $56 billion (2011 IMF estimate) and a per capita GDP of about $5400 (PPP), in GDP per capita terms, it is ahead of other countries in the South Asian region.
The country’s Central Bank Governor Ajith Nivard Cabraal said early this year that the country will make enormous changes in 2012 and beyond if it is positioned itself properly. He reiterated that 2011 was a challenging year but amidst tense global developments, the Sri Lanka’s economy was able to deliver the promised results. He said the country’s external sector will further undergo more fundamental changes making export inflow $12.5 billion in 2012. The tourism industry is expected to bring $1.2 billion and foreign direct investment is set to reach $2.0 billion. Meanwhile, the major contributions toward growth in 2012 are expected from three sectors namely agriculture, industry and services. The agricultural sector is expected to expand at 7.3 percent compared to 2.0 percent in 2011 with expected expansion in new cultivation in the north and east. Another 9.8 percent growth in fishing is expected due to favorable weather conditions and improvement in marketing and infrastructure facilities. The industry sector is expected to expand at 9.0 percent compared to 10.1 percent in 2011.A 12.2 percent growth is expected in the construction sector in infrastructure development work by the government and the tourism sector. An 8.2 percent growth is expected in domestic trade due to growth in domestic and agricultural sector. Financial services will expand by 8.2 percent owing to the expanding economic activities.
Sri Lanka is on the fast track for economic growth in 2012 while its transparent investment laws aim to foster foreign direct investments. Total foreign ownership is permitted across almost all areas of the economy and safety of foreign investment is guaranteed by the constitution. Existence of a transparent and sophisticated legal and regulatory framework covering all prerequisite business law enactments and bilateral investment protection agreements with 27 countries and double taxation avoidance agreements with 38 countries are some among the favorable investment regulations.
Following the announcements of opening Shangri-la hotels in Colombo and Hambantota in 2014 and 2013 respectively, the cabinet ministers have approved yet another deal with The US-based hotel chain Sheraton Group to invest $300 million in a leisure project in Sri Lanka, the nation’s information department said Dec.1. 2011. The mixed development project including a hotel in Colombo will be built on five acres of state land which will be given on a 99-year lease for 73.5 million US dollars in a deal approved by the cabinet of ministers. Also planning to invest $115 million in a hotel and shopping complex in Colombo is the Singapore’s department store giant Mustafa Center, (Source: Ministry of Economic Development December 2011) In a major boost to Sri Lanka’s international investment profile and its FDI inflows, Japan’s top multinational conglomerate Marubeni Corporation is returning to Sri Lanka. Marubeni wants to recommence operations in Sri Lanka in the due course. Marubeni, which was already active in Sri Lanka for 25 years, closed its operations on May 1, 2008 citing unfavorable economic conditions.
Marubeni’s return is also expected to boost Sri Lanka’s FDI inflows further. The diversified multinational conglomerate is engaged in diversified trading activities. In that, it handles imports and exports of food materials, food products, textiles, materials, pulp and paper, chemicals, energy, metals and mineral resources, transportation machinery and offshore trading.
India and Sri Lanka signed 5 bilateral agreements on Jan. 17, 2012, worth over $703 million, largely involving financial assistance from the giant neighbor boosting housing, railway and water supply. Indian investors are exploring emerging markets such as Sri Lanka as they offer higher returns than investments in developed countries whose economies are slowing down, PriceWaterhouseCoopers (PWC) officials told a forum in Colombo. Many Indian companies have shown a keen interest in infrastructure, financial services, tourism and healthcare in Sri Lanka.
Airport and Aviation Services Limited (AASL) Chairman Prasanna Wickramasuriya said that the building of the $190 million Hambantota Airport is on schedule. Qatar Airways, one of the five star airlines in the world, has consented to operate flights to the country’s second international airport at Hambantota from next year. Aviation Minister Priyankankara Jayaratne said they had discussion in this regard with Qatar authorities recently, who responded positively with the said matter. He said that in addition, Fly Dubai, a budget airline operating from Dubai will also be operating flights to the country’s second international airport in Hambantota.
As the Sri Lankan consumer spending increases consumers are aggressively moving toward lifestyle products that have now become essentials and engaging in impulse buying. The large-scale buying of vehicles with over 50 percent of Sri Lankan households owning at least one vehicle in Sri Lanka. (There are around three-million vehicles in use island-wide). Vehicle sales and registrations have risen sharply following duty cuts for all categories of vehicles, including hybrid and electric vehicles.
Sri Lanka’ s competitive labor costs, highly-ranked political stability in the region with the government’s emphasis on efficiency, competitiveness, infrastructure developments, and reduction of state budget deficits, further show the nation’s investment appeal. The counties robust performance in difficult times showed that it could actually come out stronger from any international financial crisis. Its strong economic growth, and favorable demographics make it a great country for investors.
It has launched an ambitious program of physical infrastructure development to completely upgrade the sea, air, road, power and telecom backbone of the country. The Sri Lankan government has declared its intention to develop the country as a leading regional aviation, navigation and trading hub in South Asia. Therefore, the development of maritime and aviation transportation is at the forefront of the government’s infrastructure development agenda. The focus of these developments is to expand the capacity and improve the efficiency of existing ports through modernization and construction of new ports and airports in strategic locations.
The Colombo South Port expansion project with three terminals, each terminal having capacity of 2.4 million TEUs per annum, will increase the capacity of the Colombo Port by 160 percent upon completion. Over 50 percent of the construction work of the breakwater has been completed. The first terminal, a join venture between the Sri Lankan Aitken Spence Group and China Merchant Holdings Ltd, is expected to be ready for operation in 2013.
The ceremonial berthing of the first vessel to the ‘Magama Ruhunupura Mahinda Rajapaksa Port’ was held on Nov.18 last year, commissioning the first phase of the Port by President Mahinda Rajapaksa.
The vessel “Jetliner,” followed by a sailing ship and a Sri Lankan cargo ship made their maiden entry to the seaport.
The sailing ship symbolized the proud maritime history of the country while the cargo ship showcased the commencement of industrial and commercial activities of the port.
The Port will become an active port in the country and already 27 investors have requested to start projects.
The Port, which lies within 10 nautical miles from the major Indian Ocean shipping routes, will be significant for the East-West shipping trade. Thus, international ships will soon enter the southern Port making it Sri Lanka’s second international Port.
The 126-km-long Southern Expressway is the longest expressway recently commissioned in Sri Lanka. The four-lane highway from Colombo to Matara is a catalyst for the economic and social development of the Southern region and promotion of and inter-regional transport network.
Enterprises flourish in Sri Lanka as foreign direct investments surge - Arab News
-------------
Shipping Hub, Aviation Hub, Commercial Hub is Ready!
Next> Educational Hub....Many Famous Universities will be here soon.
