UK companies express interest in investing in SL

Eighteen months after the end of the conflict huge opportunities are open in Sri Lanka and UK companies are willing to invest here, said Country Risk Analyst of the Export Credit Guarantee Department (ECGD) of UK Olwen Renowden.

She was addressing the media at the British High Commission office in Colombo last week. Two officials of the ECGD were in Colombo on a fact finding mission.

Renowden said that over 20 UK companies have expressed their interest in investing in Sri Lanka. Universities are willing to set up their campuses. Other sectors that they have expressed interest in are ICT, tourism and infrastructure projects.

The ECGD is the official export credit agency of the UK and it works closely with exporters, project sponsors, banks and buyers to help UK exporters of capital equipment and project-related goods and services to win businesses and invest overseas.

An ECGD backed financing facility enables UK companies to obtain credit by providing a 100 percent guarantee to British based banks inrespect of loans extended.

In response to increased demand, ECGD has recently increased its level of cover available for Sri Lanka, from C150m to C200m.

The ECGD is therefore geared to offer support to UK exporters in projects aimed at rebuilding the country’s infrastructure and its economy.

Renowden said that UK banks are willing to invest in emerging economies. Especially after the financial crisis now we are re-balancing our economy.

The risks in developing countries such as Sri Lanka are common and we look at external debts of the country, public financing and tax bases. Economies may be vulnerable to risks due to government financing.

The objective of our visit to Sri Lanka is to study about the country’s economy and understand risks, challenges and opportunities in Sri Lanka after the end of the conflict.

We look at two factors; firstly new opportunities have opened after the end of the conflict and secondly the keen interest shown by UK companies in investing in Sri Lanka. Since opportunities in Sri lanka are higher, high external debt of the country is serviceable compared to a country in a conflict.

Neighbouring a fast growing economy as India is a great advantage to Sri Lanka in trade and investment, she said.

Renowden said that ECGD is looking at different models to support small, medium and large scale projects.

UK is the second largest trading partner of Sri Lanka and last year Sri Lanka’s exports to UK exceeded US$ 1 billion while imports from UK was over $200 million. Last year over 100,000 British tourists visited Sri Lanka.

Current projects under consideration for the ECGD support include a water supply project, flood protection projects, slope stabilisation measures and more bridges.

The Greater Colombo Waste Water Management Project, due to start by the end of this year, is alone worth over œ200m.

The Colombo Port Expansion Project, nation-wide upgrade of electricity transmission, overhaul of highways and rail networks and the development of Sri Lanka’s fishing and marine industry are other projects that UK companies have shown interest in.

GW