Trade & Investment
From The Report: Sri Lanka 2019
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Trade and investment activities in Sri Lanka benefit from the country’s location along busy Indian Ocean trade routes, abundant agricultural and industrial exports, and a young, skilled workforce. Just 19 km separate its southern-most port from a global shipping lane carrying two-thirds of the world’s oil and half of its container shipments. This makes local ports a natural staging post for cargo destined for India and Pakistan, with some 30% of the former’s container traffic currently trans-shipped through Sri Lanka. The country has also been making strides in attracting international stakeholders to develop trade, transport and logistics infrastructure, becoming a major destination for foreign direct investment (FDI) in the process. Higher inflows have benefitted the broader economy; 2018 was the highest year on record for FDI, with $2.3bn worth of investments made. This chapter contains interviews with Parag Khanna, Founder and Managing Partner, FutureMap; Champika Malalgoda, Director-General, Board of Investments; and Thilan Wijesinghe, Chairman, National Agency for Public-Private Partnership.

Articles from this Chapter

Overview

Trading up: Foreign investment and free trade agreements help to shore up logistics potential
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Trade and investment activities in Sri Lanka benefit from the country’s location along busy Indian Ocean trade routes, abundant agricultural and industrial exports, and a young, skilled workforce. Just 19 km separate its southern-most port from a global shipping lane carrying two-thirds of the world’s oil and half of its container shipments. This makes local ports a natural staging post for cargo destined for India and Pakistan, with some 30% of the former’s container traffic currently…

Interview

Asian future: Parag Khanna, Founder and Managing Partner, FutureMap, on Asian development and the advantages of slow, steady growth
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Interview:Parag Khanna How will the geopolitical rise of larger economies such as China and India shape the development of smaller Asian economies? PARAG KHANNA: India’s economy is only one-fifth the size of China’s, but it is primed to experience at least one or two decades of rapid and continuous growth. However, the Association of South-East Asian Nations has a larger GDP than India, and it receives more foreign direct investment than China, so it is also a crucial pillar of both the…

Interview

Asian future: Parag Khanna, Founder and Managing Partner, FutureMap, on Asian development and the advantages of slow, steady growth
OBG
plus

Interview:Parag Khanna How will the geopolitical rise of larger economies such as China and India shape the development of smaller Asian economies? PARAG KHANNA: India’s economy is only one-fifth the size of China’s, but it is primed to experience at least one or two decades of rapid and continuous growth. However, the Association of South-East Asian Nations has a larger GDP than India, and it receives more foreign direct investment than China, so it is also a crucial pillar of both the…

Analysis

Seal the deal: Despite much promise, a recent free trade deal with Singapore has yet to be implemented
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With a key geostrategic location in the Indian Ocean, international trade is a natural focus for Sri Lanka. The country has signed on to a variety of bilateral and multilateral free trade agreements (FTAs) over the years, with the most recent being the Sri Lanka-Singapore FTA (SLSFTA) in January 2018. Yet, as 2019 began, the SLSFTA ran into a number of challenges, shedding light on the pros and cons of such arrangements. Key Partner At that time of signing, Sri Lanka was Singapore’s 36th-largest…

Analysis

Preferred partners: Exports boom after the EU reinstates Generalised Scheme of Preferences Plus status
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Export industries received a welcome boost in May 2017, when the EU reinstated Sri Lanka’s Generalised Scheme of Preferences Plus (GSP+) status, which had previously been rescinded over human rights concerns in 2010. GSP+ status removes the majority of import duties on Sri Lankan goods entering the European single market, providing access to over 500m potential consumers. The move has been widely welcomed in Sri Lanka, where it served once again to highlight the importance of the European…

Interview

Strategies for growth: Champika Malalgoda, Director-General, Board of Investments (BOI), on mitigating risks and optimising exports
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Interview:Champika Malalgoda How will volatility in the domestic market impact short-term foreign direct investment (FDI) inflows, and how will the BOI mitigate risk? CHAMPIKA MALALGODA: The BOI’s actions have helped to maintain an upward-trending FDI inflow over recent years. However, reinvestments from existing investors are playing a substantial role in achieving rapid and considerably higher economic growth in the country by bridging the gap between domestic savings and investment.…

Interview

Power in partnerships: Thilan Wijesinghe, Chairman, National Agency for Public- Private Partnership (NAPPP), on the importance of collaboration
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Interview:Thilan Wijesinghe What factors are most important when undertaking successful public-private partnerships (PPPs)? THILAN WIJESINGHE: The most important aspect of undertaking successful PPPs is attracting the right skills and working collaboratively with public sector officials, who bring their own special skill set. Prior to embarking on PPP projects, evaluations must be carried out by the Ministry of Finance (MoF) – including the NAPPP, the Department of National Planning, the…