CCI urges foreign parties to invest in Sri Lanka’s construction industry

By Cassandra Mascarenhas

The pace of activity in the construction industry has slowed down due to constraints caused by the high cost of finance fuelled by the rise in interest rates, the devaluation of the rupee that have resulted in imports being more expensive and the lack of FDIs coming into the industry, stated Chamber of Construction Industry Sri Lanka (CNCI) President Deshabandu Surath Wickramasinghe.

These views were aired at a seminar held by the chamber for a trade delegation visiting Sri Lanka from the Building Construction Authority Singapore. The 15-member delegation made this visit in order to understand the country’s construction industry better and to network with industry members.

“However, the local construction industry, particularly specialist and major contractors, are almost at capacity or at full capacity and are engaged in a variety of projects which include infrastructure and other building projects – that is a good catalyst to find out that there is movement within the industry,” Wickramasinghe added, on a more positive note.

“The consultants are not so busy but are hopeful that FDIs for joint venture projects will increase and therefore generate more work. On the other hand, product manufacturers and suppliers of building materials are enjoying the prevailing buoyancy in the market due to many hotel projects occurring in different parts of Sri Lanka. The Sri Lankan construction industry welcomes different foreign parties to get involved in joint ventures with their Sri Lankan counterparts.”

He noted that the presence of the Singaporean delegation is heartening with their vast experience and added that the CCI would be pleased if the delegation could participate in projects and trading in Sri Lanka for the mutual benefit of both sides.

Sri Lanka currently has several projects on offer ranging from large, medium and small scale, both public and private sector projects, giving foreign investors plenty of opportunities.

The area of tourism includes the construction of several hotels island-wide; on the commercial and residential side, development has already commenced with several other projects under construction in the pipeline.

Urban regeneration is another area that the Government is pushing due to the fact that a lot of prime land is occupied by underserved buildings; therefore it is now the Government’s policy is to develop these. 

“The problem is finance – FDIs are yet to come. While infrastructure is being upgraded on a regular basis, a lot more has to be done especially in the road and transport sector. We are aware that Singapore has advanced technology and we can therefore learn and upgrade our own technology through joint venture projects between the two countries,” asserted Wickramasinghe.

“Today Sri Lanka enjoys an ideal climate for development, not only in the capital city but in other parts of the country as well. There is a huge amount of work to be done particularly in infrastructure and that is what the Government is doing but there is a lot of potential for the private sector to get involved in such activities.”

Sanken Lanka Ltd. Managing Director Ranjith Gunathileke assured the visiting delegation that investing in long term investments in Sri Lanka is safe as the country is now politically stable and therefore investors should not have doubts about the long term returns from these sectors.  “While there are many opportunities, the constraints are a bit political. There are a lot of procedures to follow, the bureaucracy is very strong but nothing is impossible to achieve and the situation is getting much better. Investors should come with proposals and finance facilities to gather the projects. At the moment only one or two countries – mainly China, is making use of the opportunity,” observed Gunathileke.

 – Pix by Nirmala Dhananjaya