Why Invest In Sri Lanka

  • Fertile Investment Environment
    • First South Asian country to open its economy in 1976
    • Stable democracy
    • A government that is committed to free market principals
    • Highly literate, skilled and trainable labor force
    • Lucrative trade privileges to EU, USA, India and Pakistan
    • Significant investment in infrastructure which is an ongoing function
    • Diverse natural beauty that can be leveraged to build a competitive tourism product
    • Well regulated, mature stock market which has been in existence since 1896
  • The Dawn of Peace
    • Despite war conflicts a steady average growth of 6.4% within the last 5 years (up to 2008)
    • Global slump opens entry window ahead of next wave
    • Vast growth prospects for tourism
    • Significant opportunity to build retail and finance services
    • Excellent infrastructure despite the war, only drawbacks in inland roads
    • Overlooked domestic business opportunities
    • Government commitment to build the agriculture industry to reduce dependence on food imports
  • A Wide Open, Free Market Economy
    • 100% foreign ownership of companies is permitted
    • Foreigners can lease land for 99 years
    • Attractive investment incentives: 5-15 year tax holidays
    • Dollarized economy, no forex or repatriation controls
    • Laissez faire approach to price controls and subsidies
    • Concession on import duties
    • Liberal licensing (e.g. 11 domestic and 11 foreign commercial banks, 34 finance companies, 5 cellular operators)
    • WTO, AFTA, ASEAN trade benefits

Sri Lanka was the first country in South Asia to pursue open economic policies. This is set to pay rich dividends as most participants in the economy accept it as a pre-condition for economic growth. This will ensure policy stability in the long term within a democratic framework. During the war years many avoided visiting Sri Lanka and perceived it to be a very poor country that suffering the evils of a typical war-ravaged nation. Despite the war, it is remarkable that the country has been able to post strong economic growth, and to maintain almost first world social indicators. Today it has become a middle-income country with an ambitious but realistic plan to upgrade its infrastructure. Sri Lanka with a land mass of over 65000 square kilometres and a population of around 20 million is located just 22 miles south of the Indian sub continent; its location so close to an emerging economic powerhouse itself is likely to exert a positive influence on economic development in the country. Sri Lanka not only leads the South Asian region in terms of a wide array of social indicators like infant mortality, life expectancy, literacy etc, but also is not far below the levels achieved by some of the developed countries in the world in terms of some of these key indicators. Despite the civil war, Sri Lanka has recorded very satisfactory rate of growth, averaging about 6.4 percent in the last six years and has a GDP of US $ 42 billion with a per capita income of US$2014. It is significant to note that the per capita income doubled in a period of about five years while war was raging on most fronts. Now with the end of hostilities and rapid development projects on ground, policy makers are confident and are targeting to ensure that Sri Lanka again doubles its GDP by 2015. This will lead to significant domestic demand led market opportunities. The most opportune moment for investors to enter the economy is now, considering the positive factors already enumerated and the policy initiatives that are already in place and likely to continue unchanged under the new government. A paradigm shift in the investor sentiment and confidence is visible, brought about by the slashing of risk premiums on commercial transactions, surging foreign reserves of over US $ 5.2 billion, a stock market that is out performing all others in the region, and a sovereign credit rating that has shown improvement.

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