Sri Lanka this Friday (17 March) made its strongest effort to woo interest from Hong Kong-based companies, fund managers and investors, highlighting recent macroeconomic progress as well as measures to boost higher inclusive growth from which foreign firms could benefit.
The concerted effort by the private and public sector was made at the full-day Sri Lanka Investment Summit in Hong Kong, organised by the influential Finance Asia magazine in partnership with multiple stakeholders including Standard Chartered Bank and Asia Securities.
Nearly 250 representatives from Hong Kong-based companies, fund managers and investors attended the summit held at the iconic Ritz-Carlton Hotel, the world’s tallest. Hong Kong, which itself is a hub and economic success, boasts of an economy worth over $ 300 billion, over four times that of Sri Lanka, with a per capita income of $ 36,000. Chief Guest Finance Minister Ravi Karunanayake and Sri Lanka’s Ambassador in China Dr. Karunasena Kodituwakku as well as a host of private sector business leaders, public sector officials and existing foreign investors spoke at the event.
They made a compelling case as to why Sri Lanka must be considered a new destination for investments from Hong Kong-based companies.
Karunanayake, who headed straight to the summit from the airport after arriving in Hong Kong only last morning, in his speech highlighted some of the salient democratic and macroeconomic achievements of the unity Government led by President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe. He pointed out that despite differences of opinion as expected in a coalition, the two parties were working together for the collective good with consensus-oriented politics and policies.
As proof of success so far, the Minister read out a host of positives from Fitch’s recent action by which it revised Sri Lanka’s rating outlook from negative to stable as well as the IMF’s statement following the recent review mission.
“We are proud of the progress made and we will ensure to be a partnering nation of the success stories unfolding in the Asian region,” Minister Karunanayake added.
The unity Government’s success in improving fiscal and financial discipline leading to a lower budget deficit was emphasised as well as the aggressive efforts to reduce the massive debt burden brought upon by the previous regime. Reforms as well as the restructuring of some of the loss-making national projects such as the Hambantota Port and Airport as well as state-owned enterprises were also touched upon by the Minister.
“We are aggressively promoting Public Private Partnerships and a greater private sector role in generating future growth,” Karunanayake told the Hong Kong summit.
“We are on course to achieving economic prosperity through accelerating growth with social inclusion. Our aim is to achieve a high quality growth which is central for sustainable development,” said the Finance Minister, assuring that the Government would not hesitate to initiate appropriate policies and measures as and when required to usher in the required development.
“We have done what we have said so you can believe the country and the Government and more importantly its policies,” Karunanayake said, adding that the time was opportune for foreign investors to secure diverse opportunities in Sri Lanka.
The Government’s efforts to enter into FTAs with China, Singapore, Japan and Korea, apart from expanding an existing deal with India, were emphasised to drive home the point among Hong Kong investors that geographically, the strategically-located Sri Lanka would be a very attractive hub to tap into opportunities in South Asia and Southeast Asia.
The impending return of the GSP Plus benefit to better serve European markets was also highlighted. The planned Colombo International Financial Centre and Dedicated Economic Zones in Hambantota were among other initiatives shared with participants of the Hong Kong summit.
Minister Karunanayake said potential new investors would have a “crucial role to play” in the overall effort to create a prosperous Sri Lanka and assured the Hong Kong summit’s participants that Sri Lanka’s future offered a “win-win” situation for investors and the Government.
“We will continue to support the private sector in whatever possible way so that private sector economic activities will foster,” the Finance Minister added.
He also revealed that the Government was envisaging Foreign Direct Investments of around $ 4 billion this year.
Sri Lanka’s Ambassador in China, Dr. Kodituwakku, called for greater investments, pointing out that FDI and an export-led growth strategy were key for Sri Lanka’s future. He also spoke about how Hong Kong FDIs gave a big initial boost to China to open up its economy.
“Just like many other Asian countries have transformed their economies with the back of FDIs, Sri Lanka too wishes to transform its economy with the support of the FDI into a strong economy in which all Sri Lankans are able to enjoy a high standard of living,” the Ambassador emphasised.
Excellent investment destination
IMF Resident Representative in Sri Lanka Eteri Kvintradze, who figured in a panel discussion, said Sri Lanka was a compelling story and was at a critical juncture hence more private sector-led growth was needed.
She also listed several key achievements of the Government aided by the structural reforms under the IMF’s ongoing $ 1.5 billion support program as well as future challenges to further improve Sri Lanka’s growth prospects.
The Board of Investment’s Director General Duminda Ariyasinghe also made a very strong case why Sri Lanka must be seriously considered by Hong Kong investors.
Summit co-chairman Standard Chartered Bank Sri Lanka CEO Jim McCabe described Sri Lanka as one of the fastest-growing economies and an excellent destination for investments. The other co-chairman Asia Securities Chairman Dumith Fernando also pitched for more Hong Kong investments.
The summit involved a large number of Sri Lankan business leaders and professionals as well as longstanding and new foreign investors in Sri Lanka such as Singer Asia, apparel giant Courtaulds, World Bank private sector investor arm IFC, the Shangri La Group, Indoocean Developers Ltd/Altair, China Merchant (CMPort)/Colombo International Container Terminals, China Harbour/CHEC Port City Colombo Ltd., BPO operator WNS Global Services, Creation Investments and ADM Capital, as speakers or panellists as well as participants to reinforce the message that the time is right for global investors to consider Sri Lanka.
Some of the companies represented include Hemas Holdings, MAC Holdings, Commercial Bank, Sri Lanka Insurance Corporation, Commercial Credit and Finance and Lynear Wealth.
Standard Chartered Bank was the international lead sponsor of the summit. Asia Securities adds its special brand of insight to the summit as lead sponsors and CHEC Port City Colombo, Altair and MAC are all onboard as distinguished corporate sponsors. The Daily FT is the official media partner. Supporting organisations include the Ceylon Chamber of Commerce, the American Chamber of Commerce and the Oxford Business Group. Cathay Pacific was the official airline. This is the second summit by Finance Asia, an influential industry magazine, with the previous one held in Singapore last year.