Government lifts FDI prospects as investor confidence wanes

The Sri Lankan government is taking every possible step to improve Foreign Direct Investment ( FDI) prospects which have become bleak owing to a weak unified response against the Easter Sunday terror, government economic advisors said.

The country will have to face many challenges at present even before embarking on the track of its vision 2025 for economic prosperity; they said adding that the nightmare has just begun.

FDI flows in the next two years is likely to come down despite reform and economic stability efforts by the government, a senior advisor said.

A targeted approach is required to attract foreign investors who would not only bring in capital but also support the country to integrate with global value chains through their established networks, a high official of the Central Bank said.

Finance Minister Mangala Samaraweera recently noted that “investors must understand that the fundamentals of the economy have not substantively changed despite the possible negative short term impact for both FDI and portfolio investment.”

He appealed to foreign investors “not to put off their upcoming investments in Sri Lanka and reiterated the Sri Lankan government's commitment to provide fullest support for them to commence their business in the island.”

Sri Lanka attracted FDI amounting to US$ 2.3 billion last year, Development Strategies and International Trade Ministry statistics revealed.