FDI jumps 80% Jan-Sep BoI hopes for US$ 1.36B by year end

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By 2017-12-08

By Mario Andree

Foreign Direct Investment (FDI) to Sri Lanka has increased 80 per cent during the first nine months of this year to US$ 795.5 million, from US$ 444.5 million a year ago.

Though the Board of Investment (BoI) claims the agency managed to surpass the total FDI inflow in 2016 during the nine months ended September this year, the Central Bank annual report highlighted that, in 2016, the country received a total FDI of US$ 1,079 million; a value of US$ 898 million if loans were excluded.

The BoI estimates FDI to reach US$ 1.36 billion by the end of this year; US$ 140 million short of its new Chairman's expectations.
According to the BoI, the manufacturing and services sectors received FDI worth more than US$ 397 million, while the infrastructure and utilities sectors received US$ 352.5 million.

China has been ranked as the largest investor in the country, with a share of 35 per cent to date, followed by India (16.4 per cent) and Singapore (9.3 per cent).

Other countries in the top ten list included Netherlands, United Kingdom, Japan, Malaysia, Sweden, and Australia.
The Board of Investment says that several steps have been taken to streamline and strengthen the investment approvals and facilitation process over the past few months, and these measures have begun to show results.

Recently, BOI Chairman Dumindra Ratnayaka said that Sri Lanka was on track and would get FDI worth over US$ 1.5 billion by the end of this year, paving the way for US$ 2 billion next year and US$ 5 billion by 2020.

Understanding the dire need to increase FDI, the Government also introduced a road map titled 'Sri Lanka Means Business' in July this year, outlining the strategic direction it was taking to improve the 'Ease of Doing Business' ranking.
The Government is continuously urging investors to start businesses in Sri Lanka, though it is not in a position to provide tax incentives as provided by the previous regime, which attracted several large-scale projects.

However, though the Government said that it would cease handing out such tax incentives, the Ministry of Development Strategies & International Trade offered two companies involved in the Hambanthota Port restructuring project tax incentives spanning 25 years.

Recently, BOI Chairman Dumindra Ratnayaka said that Sri Lanka was on track and would get FDI worth over US$ 1.5 billion by the end of this year, paving the way for US$ 2 billion next year and US$ 5 billion by 2020.

Understanding the dire need to increase FDI, the Government also introduced a road map titled 'Sri Lanka Means Business' in July this year, outlining the strategic direction it was taking to improve the 'Ease of Doing Business' ranking.
The Government is continuously urging investors to start businesses in Sri Lanka, though it is not in a position to provide tax incentives as provided by the previous regime, which attracted several large-scale projects.

However, though the Government said that it would cease handing out such tax incentives, the Ministry of Development Strategies & International Trade offered two companies involved in the Hambanthota Port restructuring project tax incentives spanning 25 years.

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