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Thursday, 30 October 2014 01:00 - - {{hitsCtrl.values.hits}}
Text and Pix by Nisthar Cassim
The Sri Lanka Business Forum 2014, organised by NWS Holdings Ltd., successfully concluded in Tokyo last week with a record number of participants enlightened about the post-war resurgence and potential for future growth opportunities.
Held at the Hotel New Otani in Tokyo, the forum attracted nearly 200 participants who listened to the progress of post-war Sri Lanka from a macro and corporate perspective and the emerging new opportunities for investments, partnerships, tourism and trade.
The forum was part of NWS’s goal of increasing Japanese investments to $ 500 million by the end of 2015 after having facilitated over $ 300 million in Japanese investments since the end of the conflict in Sri Lanka. Previously NWS Holdings, owned by Japanese investor Takashi Igarashi, held investment promotion events in 2011 and 2012 in Tokyo. Last week’s event was the most successful in terms of participation, despite adverse weather in Tokyo on that day.
The participants were informed about Sri Lanka for four hours at the forum and thereafter attended a networking reception.
The event’s Chief Guest was Sri Lanka’s Consul General in Osaka, D.W. Aluthgamage while NWS Holdings Chairman Takashi Igarashi and Toyohiko Murakami, the Chairman of Bansei Securities Ltd., which is one of the new investors in post-war Sri Lanka facilitated by NWS Holdings.
The forum also saw participation by a Sri Lankan private sector delegation comprising Softlogic Holdings Plc, Just in Time Technologies Ltd., Jetwing Hotels Ltd., Hsenid Software International Ltd., Speedmark Transportation Lanka Ltd., Pan Asia Banking Corporation and Dior Properties and Investments Ltd. These companies were represented at chairman/MD and director levels.
The Softlogic team comprised Financial Services Sector Head Ifthikar Ahamed, Softlogic Holdings Head of Corporate Finance and Treasury Hiran Perera and Head of Strategy Chinthaka Ranasinghe. The Jetwing Group was represented by Director Jerome Auvity, Just In Time Group by Chairman Jit Warnakulasuriya and Chief Technology Officer Navin Seneviratne, hSenid Software International by Managing Director Dinesh Sapramadu, Speedmark Transportation Lanka by Chairman Sunil Malawana and Director Commercial Sujan Malawana while the Dior Investments and Properties team comprised Nataraj Ramaiah and Vikram Nataraj. Takashi Igarashi also represented Pan Asia Bank on whose board he is a director.
Among the sectors promoted for Japanese investors at the forum were ICT, tourism, retail, healthcare, logistics, property development and financial services.
The forum was also timely as it was held a month after the historic visit by Japan’s Prime Minister Shinzo Abe to Sri Lanka, which gave bilateral ties a big boost. The visit of Premier Abe also figured in some of the speeches and presentations by the Sri Lankan delegation.
Given the national importance of the NWS initiative, a special pre-recorded message from Investment Promotion Minister Lakshman Yapa Abeywardena in Japanese was aired for the benefit of participants.
Passionate speech by Consul General in Osaka
Sri Lanka’s Consul General in Osaka D.W. Aluthgamage made a passionate and effective speech also in Japanese which received widespread applause from the participants.
He spoke of the post-2004 tsunami and post-war development spearheaded by President Mahinda Rajapaksa’s ‘Mahinda Chinthana’, after he assumed office in 2005.
“One third of the island nation was battered because of the war and another one third of the island was devastated by the tsunami. However, despite those debacles, the Sri Lankan economy has accomplished rapid development, and the speed was much faster than post-war economic growth in Japan. It is because Sri Lanka has excellent human resources and is located strategically in the best position among Africa, the Middle East and other Asian countries,” Aluthgamage emphasised.
With regard to the latter, he explained how Japan could use Sri Lanka to serve the one billion plus market in South Asia using the Free Trade Agreements with India and Pakistan.
Aluthgamage also noted that considering the development in just five years, the future potential of Sri Lanka was greater after the end of the 30-year-old conflict in the country.
“I always hear people asking ‘are you making money?’ (Moukari-makka?). This is a kind of stereotypical Osakan greeting. When I think of the growth speed of the Sri Lankan economy, I make a definitive statement ‘Yes! You can make money in Sri Lanka’,” said the Consul General in Osaka, Aluthgamage amidst laughter and applause from the Japanese participants.
Takashi speaks of post-war rebound and opportunity
In his presentation, Takashi said Sri Lanka is as safe as Japan, and as immaculate as Japan. “When we measure the degree of a country’s maturity, safety and cleanliness could be important guidelines,” he added.
He said that Sri Lanka’s economy is rapidly improving and post-war the GDP has grown over 7% with 2014 first half growth estimated at 7.8%.
“This places Sri Lanka’s GDP growth as the highest in the South Asia region,” Takashi pointed out, adding that the growth was fuelled by the services sector including tourism and industrial sectors including apparel, construction and exports.
The NWS Holdings boss also said monetary policy has been well managed with low inflation, low interest rates, and stable exchange rate apart from stability in the financial services sector.
“For example the inflation rate has been maintained below 5% for the past year, a drop from 17% in 2012,” he said adding that the monetary and fiscal policy have contributed to the control of the inflation rate.
Takashi also said the improving prosperity of Sri Lanka is evident by the fact that foreign reserves have reached a record $ 9.2 billion this year. Focusing on attractiveness of post-war Sri Lanka for foreign direct investments, Takashi said year to date approvals have topped $ 1 billion.
“All these numbers clearly show that the Sri Lankan economy is very positive,” he added.
He also highlighted a host of other advantages of Sri Lanka including the high literacy rate and quality workforce and vastly improved socio-economic infrastructure in the country.
Takashi also said the leisure and sightseeing sector is flourishing in Sri Lanka now, and investment to this sector is bullish as the numbers of tourists are increasing annually with 1.3 million visitors achieved in 2013, thereby boosting the demand for new hotel rooms. ”It is said that Sri Lanka needs 45,000 rooms by the end of 2016, but we just have 17,000 rooms at this point,” he added.
The NWS chief also listed several mega infrastructure projects completed in recent years and those underway by the Government some with the assistance of the Japanese Government and the private sector.
Lankan corporate pitch for Japanese interests
Several of the participating Lankan companies made brief presentations for the benefit of Japanese investors at the forum. Their English speeches were translated into Japanese simultaneously.
Softlogic Holdings’ Financial Services Sector Head Ifthikar Ahamed gave an overview of the group which began operations in 1991 and is now a diversified conglomerate engaged in retail, ICT, financial services, healthcare, leisure and automobile.
Ahamed detailed strong future prospects in all of the key sectors in tandem with post-war revival in Sri Lanka. Several planned expansion and future projects under each sector were also shared.
He said the focus of Softlogic in 2015 and beyond included to grow the core sectors; rationalise portfolio to give maximum leverage for core sectors, restructure balance sheet structure and convert already gained EBITDA into core shareholder value through high growth areas.
Just In Time Holdings Chief Technology Officer Navin Seneviratne highlighted the group companies comprising Just In Time Technologies, MS Technologies, Techsys / IBPO / W2N, GIS Solutions, and SAP Academy. The Tokyo Forum was told that JIT has experience in large ICT projects since the group has been operating since 1996 as a flagship ICT Systems Integrator as a 100% owned entity.
JIT also has extensive domain knowledge in the banking and financial services industry, Telco, government and defence and undertakes consultancy, systems integration, project delivery and project management business. Seneviratne also shared some of the milestone projects undertaken by JIT.
JIT and hSenid are looking for opportunities in Japan’s ICT market, considered the second biggest in the world after the US’.
Speedmark Transportation Lanka Commercial Director said that since its establishment in 1988, the company has grown itself to be a highly professional company offering global transportation solutions, logistics, supply chain management and all other affiliated services.
“This achievement has also led Speedmark to become one of Sri Lanka’s top international freight and logistics providers with a host of innovative services to meet the demanding needs of the modern business world,” Malawana added.
The forum was told that Speedmark is ranked among the top three IATA agents in Sri Lanka and has an employee base of over 100 experts with outstanding records of accomplishment within the industry.
Jetwing Hotels Director Jerome Auvity, made a very vivid presentation on post-war tourism revival, the paradigm shift and structural developments within the industry as well as the leisure giant’s own expansion plans. He added that the Sri Lankan tourism industry was racing ahead to recoup lost opportunities due to the 30-year-old conflict.
“Sri Lanka is truly a miracle,” Jerome, a Frenchman, told the Japanese participants. He said during the past five years tourist arrivals had risen by an exponential 146% which is described as “an unparalleled achievement globally.”
“This growth”, he noted, “confirms Sri Lanka is on the move.”
Jerome said that with eight UNESCO Heritage Sites, natural beauty and diversity, all of which can be enjoyed within a short span of time, make Sri Lanka a true wonder of Asia. “Sri Lanka is great for investments and growth,” the Jetwing director added.
The presentation on Pan Asia Bank was done by Director Takashi Igarashi. He told Japanese participants that PABC has been in operation for nearly two decades and is one of the fastest growing banks in Sri Lanka with a network of 78 branches offering the full range of retail, SME and business banking products and services. PABC is backed by one of the largest conglomerates in Sri Lanka.
“PABC is the only banking institution in Sri Lanka which has a major Japanese shareholding stake,” Takashi told the Tokyo Forum referring to the 15% stake held by Bansei Securities and the only bank in Sri Lanka that has two Japanese nationals among the Board of Directors. At the forum, PABC promoted the Special Foreign Investment Deposit Account (SFIDA) that is specially designed for foreign currency depositors for non-Sri Lankan citizens and non-resident Sri Lankan citizens. It said SFIDA is an easy and flexible way to invest in foreign currencies, offering a total tax-free return.
Bansei boost for Sri Lanka
In concluding the forum, Bansei Securities of Japan Chairman Toyohiko Murakami said his group was privileged to have participated at the event in a big way for the first time due to the strong business relationship with NWS Holdings.He revealed at the Tokyo Forum that Bansei Group introduced Sri Lankan’s government bonds to Japanese investors three years ago, and the total sales had already exceeded Rs. 20 billion.
Noting that several such investors were present at the forum, Murakami said they were not mere investors but playing a key part in the future development of Sri Lanka by investing in Sri Lanka Government Bonds.Murakami also said, encouraged by Sri Lanka’s future potential, Bansei has made an equity participation in a local commercial bank PABC, succeeded in M&A and listing of a local hotel on the Colombo Stock Exchange and donated a memorial bell to the Colombo Stock Exchange.
“We have progressed on the path as a pioneer and now enhanced our business to manage a securities finance company and a consultant company in Sri Lanka,” said Murakami who is also the Chairman of the Sri Lankan venture Bansei Holdings LK Ltd.
“Sri Lanka is increasingly attracting interest in Japan while Prime Minister Abe visited the country in September,” Murakami added.
At the forum a special tourism promotion initiative took place with SriLankan Airlines offering one of the lucky participants a free air ticket to travel to Sri Lanka as the first prize on a business card draw and two-night stay at a Jetwing Group Hotel and Bansei by Hotel J in Hikkaduwa as the second and third prizes.
Significant success
NWS Holdings Managing Director Viraj Malawana said the response to the 2014 forum was unprecedented with record participation and interest from Japanese companies. “To have attracted nearly 200 investors and representatives from Japanese companies is significant. This is the best forum we have done as confirmed by the number and profile of participants. We also had a good mix of Sri Lankan companies who are enterprising and keen to tap the potential to source Japanese investments and business,” Viraj added.
The Sri Lanka Business Forum in Tokyo by NWS Holdings was done in collaboration with Japan’s A2 Media Ltd.
So far the Japanese investments facilitated by NWS Holdings include around Rs. 25 billion in Government bonds promoted by Bansei Securities, which now has a 15% stake in Pan Asia Bank and diversified into tourism as well as an over Rs. 11 billion worth acquisition of controlling interest in Expolanka Holdings Plc by Japan’s logistics giant Sagawa. Recently NWS Holdings also gave a big boost to promote Japanese golf tourists in to Sri Lanka by bringing Japan’s famous 17,000-member strong Taiheiyo Club and the Royal Colombo Golf Club together for a reciprocal membership program.
Japanese investors in SL Govt. Bonds hail Osaka Consul’s participation
NWS Holdings Chairman and Japanese investor Takashi Igarashi (left) with Sri Lanka’s Consul General in Osaka D.W. Aluthgamage and NWS Holdings Managing Director Viraj Malawana at the Sri Lanka Business Forum held last week in Hotel New Otani in Tokyo
Several Japanese who have invested in Sri Lanka Government Bonds last week hailed the participation of Sri Lanka’s Consul General in Osaka D.W. Aluthgamage at the Sri Lanka Business Forum in Tokyo, organised by NWS Holdings Ltd.
“We have invested in Sri Lanka Government Bonds during the past year based on the recommendations by Bansei Securities and the attractive returns. We wanted to see or listen to a Government representative at the Sri Lanka Business Forum in Tokyo. The presence of and speech in Japanese by Sri Lanka’s Consul General in Osaka Aluthgamage was very valuable and we are very encouraged,” a group of Japanese investors who attended the NWS Holdings Forum in Tokyo told the Daily FT.
Following the introduction by NWS Holdings, Bansei Securities clients have invested over Rs. 20 billion in Sri Lanka Government Bonds. At the Tokyo Forum last week were around 70 such investors who have collectively invested over Rs. 7 billion in Sri Lankan Government Bonds.
Investment Promotion Minister Lakshman Yapa Abeywardena’s video message being aired at the forum
A NWS spokesman said Investment Promotion Minister Lakshman Yapa Abeywardena and Sri Lanka Ambassador in Japan Admiral Wasnatha Karrannagoda were invited to participate at the Tokyo Forum. Whilst Ambassador Karannagoda was away from Japan on an official engagement, an apparent diplomatic dilemma saw Minister Abeywardena not being able to attend despite being in Japan at the same time. This was because he was engaged at an Investment Promotion seminar organised by the Board of Investment in partnership with Bank of Tokyo-Mitsubishi UFJ and the Embassy of Sri Lanka in Japan on the same day and time when NWS Holdings forum took place. The minister didn’t show up for the reception that followed NWS Forum either.
It was pointed out that the Government and the relevant authorities should have treated the NWS Forum with importance and attended it since it was bringing together not prospective investors alone but also existing investors and that too in Government Bonds. A ministerial or high-level diplomatic participation would have shown that the Sri Lankan Government treated existing Japanese investors seriously and gave them due recognition.
However, a pre-recorded video message from Minister Abeywardena was played at the opening of the NWS Forum. Official sources said NWS was intimated about the minister’s inability to attend prior to the forum hence the release of a video message.
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