Tuesday, 21 January 2014 00:01
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Tells investors they are welcome in any part of SL
Country ready to accommodate local and foreign investment
Guarantees investments protected by Government Shares five measures by Government to make investments safe
By Shabiya Ali Ahlam
Nearly five years since the end of the war, Justice Minister Rauff Hakeem lamented that Sri Lanka is yet to overcome the perceived negativity linked to the 30 year old conflict but sounded a note of optimism that the country remains attractive for investors.
“Although the Government in its efforts to promote investments in post-conflict Sri Lanka is yet to overcome the perceived negativity associated with the 30 year war, the nation is poised to allow potential investors to engage in lucrative businesses in any part of the country,” Minister Hakeem told the well attended, inaugural ‘Invest in East’ forum in Colombo on Friday.
Sri Lanka having undergone massive a transformation is now more ready than ever to accommodate foreign and local investments, emphasised Hakeem at the event where Minister of Economic Development Basil Rajapakse was chief guest.
“I wish to say that investors have absolutely nothing to worry about. All investments are protected by the Government of Sri Lanka allowing the freedom to engage in profitable businesses in any part of the country,” a confident Justice Minister told the audience.
To give further assurance to potential investors while encouraging them to invest in the country, Hakeem shared five legal and constitutional measures the Government has taken in this regard.
Firstly he pointed out that in addition to foreign investors being assured a safe environment in the country, the safety of foreign investment is guaranteed by the Constitution, Article 157 referred to as the Constitutional Guarantee of Investment Protection.
Secondly, with Sri Lanka being a party to bilateral investment agreements with over 20 countries, investments already made under these agreements are protected for several years. The nation being a founding member of the Multilateral Investment Guarantee Agency (MIGA) he said further safeguards investors against commercial risks.
Thirdly, as the nation is part of a number of several bilateral regional trade agreements, such as with India and Pakistan, this effectively increases market access for Sri Lanka exporters. Opining that value added exports to the neighbouring markets have enormous potential, Minister Hakeem emphasised that investors have the advantage of using such agreements to reach bigger markets via Sri Lanka.
Fourthly, with Sri Lanka moving towards becoming a commercial hub, the Finance Act No. 12 of 2012 enables entrepot trading, transhipment, provision of front end services to regional manufacturers, provision of logistical service such as bonded warehouses, and the establishment of local and global buyers in specified custom areas in Sri Lanka which will not be subject to the provision to the custom ordinance and the Import and Export Act.
Lastly, in terms of capital market investment, he observed that foreign investments in the local equity market are open to country and regional funds that are approved by the Securities and Exchange Commission (SEC). Special provisions, Hakeem said have also been made by the Central Depositors System to accommodate foreign clients operating in time zones different to that of Sri Lanka and stressed that the Colombo Stock Exchange (CSE) permits free transfers between accounts in the systems.
“The Government of Sri Lanka has taken a host of measures to assure investments are secure and can operate in a free market. The Government in its policy framework is also committed to create a clear policy environment for all investors and entrepreneurs with various privileges and special incentives,” expressed Hakeem.
