Businessmen optimistic of foreign investment inflows

by Gamini Warushamana

Amidst the escalating violence and war risk business magnates have expressed hopes of foreign investment inflows to the country and uninterrupted functioning of the key economic sectors including tourism.

Representatives of the Sri Lankan business delegation who attended the Sri Lanka investment round table in UK together with the Minister of Investment Promotion Rohitha Bogollagama explained the results of the event to the media. The round table discussion was held in Marlborough House, London recently parallel to the Serendib 2006 Sri Lanka trade exhibition.

Aitken Spence Managing Director Rajan Brito said that his company invested Rs. 2-3 billion as new investments in the tourism sector and did not see a significant setback in the industry due to the violence. Brito said that Sixpence, the world's largest tourist operators are ready to invest in Sri Lanka and they are long-term investors who foresee a long future and therefore there is no doubt about the sustainability of the sector.

The terrorists will not target tourists and violence will only restrict tourist zones in the East. There is a slight decline in the number of tourist arrivals today but it is not as a result of the violence. The tsunami is one reason while this is the off season, he said.

Violence of this nature is common all over the world, as far as the tourism is concerned be it in Egypt or Bali, the situation is the same, Brito said.

Minister Bogollagama said that this is not a strange situation in the country. We have been experiencing this situation for the last 25 years. The worst affected era was the early 1990s. At that time Sri Lanka was isolated by the world. Today the situation is different and the international community endorses the government's stand. Today the whole world is against terrorism.

The Minister and the Sri Lankan business delegates of the round table discussion said that their discussions with their UK counterparts were successful and they could promote Sri Lanka as a viable investment destination for UK investors. As an immediate result of the round table discussion, the BOI approved Grange Hotel project will be set up at Rathgama in Galle.

Discussions were held with Marks & Spencers to set up a logistics hub in Sri lanka. Setting up a knit fabric manufacturing project by Clarkson Knitting and IT/BPO project by Logica CMG are the other two projects agreed upon, the minister said.

The feedback received by the BOI was extremely positive. Many British enterprises indicated a keen interest in investing in Sri Lanka. The mission also strengthened the existing relations between the private sectors of both nations and offered greater potential for joint ventures in addition to the FDI, the minister said.

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Sri Lanka is seeking British investment in new areas which can employ more educated people in professional fields since the country follows British standards. The country is eyeing second generation Business Process Outsourcing (BPO) in the fields of Medicine, Accountancy, Legal and banking where local professionals are available.

As a result of being a British colony from 1796-1948, most of the professions in Sri Lanka follow the British standard and it is an advantage in the second generation BPO business. The second generation BPO is high end professional services. Sri Lankan delegates representing IT companies and banks have discussed with British companies and concluded one BPO project.

Rajan Brito said that there is much potential in the medical tourism sector. Sri Lanka follows The British standard and we have UK qualified doctors. Since the medical services in the UK are extremely expensive we can outsource these services, Brito said.

CEO of the DFCC Bank Nihal Fonseka said that UK's top 25 BPO companies participated in the round table discussion and they held three meetings with them. Fonseka said that discussions were held at two levels. Firstly it was with leading BPO companies to set up their branches here and secondly to provide services to middle scale companies in the UK.