[Development]

Lanka moves up World Bank Index:

Positive developments reap dividends

By Shirajiv SIRIMANE

When President Mahinda Rajapaksa's Mahinda Chinthana asked the masses to 'repose faith in him' to take the country on the path to be the 'Wonder of Asia', some considered it as another 'election promise'.

In the first instance, many both locally and globally believed that the Government would never be able to end the 30-year terrorism.

When peace was achieved with the world's biggest humanitarian operation, the world was astonished as superpowers were spending trillions of dollars in their battle to end terrorism, to no avail.

The world also believed that Sri Lanka would take at least five years to clear the 336,000 deadly landmines that were laid, but this too was completed in two years at the rate of 500 mines per day. Next the world focused on the resettlement of the 300,000 displaced persons; this target too was successfully achieved in two years.

The country also achieved an eight percent growth rate and doubled its per capita income within five years.

For almost two decades, key development projects such as the Norochcholai power plant, Upper Kotmale hydro power project, Hambantota and Oluvil Ports and the Colombo South Harbour development projects, Colombo-Matara expressway and the building of a second international airport were confined to discussions and plans.

World Trade Center area

After almost 30 years, the subject of an expressway to the Colombo Airport was discussed and in 2000 a consortium once again got off the ground. However, this time around too, financial constraints put barricades to the project and it was stalled again. With the rapid expansion of the Colombo Airport and tourism booming, quick access to the Colombo Airport was a crying need. VVIPs, investors, tourists as well as the public do not have nearly two hours to waste, travelling from Colombo to the airport.

Major projects

However, after Mahinda Rajapaksa was elected President, all these projects got off the ground. Some major projects such as Norochcholai was completed and the first stage of the Colombo-Matara Highway up to Galle would be opened this year while the rest of the project would be completed next year.

The Colombo South Harbour is being developed under the Port Development Project and the second and third phases of the Colombo Port Development Project will enhance the total capacity upto 13 million TEUs with each terminal having a 2.4 million TEU capacity.

The Colombo-Matara Highway

Hambantota Port

Colombo Harbour

A new bus from Ashok Leyland which has wheelchair accessibility

Construction work of Phase II of the Hambantota Mahinda Rajapaksa Port is ready to get under way and under this phase, it is expected to deepen the channel further and add six more berths including a container terminal.

On a proposal made by Minister of Industry and Commerce, Rishad Bathiudeen a dedicated industrial zone for manufacturing of pharmaceutical products is to be established in Kurunegala at a 48-acre block of land to promote the local pharmaceutical industry.

The value of pharmaceutical products annually consumed in the country is Rs. 40 billion and the Government is the biggest consumer, representing well over 35 percent of the domestic consumption. It is around Rs.15 billion.Over 10 reputed pharmaceutical manufacturers have already expressed their willingness to invest in this industry.

The Colombo International Airport's domestic terminal will be opened next March, mainly cater to the growing domestic air traffic market in Sri Lanka.

Domestic terminal

Chairman, Airport and Aviation Services (AASL), Prasanna Wickramasuriya told the Sunday Observer that they were converting the former SriLankan Airlines catering building for this purpose. "AASL would invest Rs. 250 million for this domestic terminal," he said.Wickramasuriya said with tourism picking up and high spenders patronising Sri Lanka and investment and development taking place in the regions, the demand for domestic travel had increased.

In addition much needed infrastructure by way of roads, transport, health and other key factors too were falling into place.

Economy-friendly legislature was introduced which has made Sri Lanka an investment paradise. Sri Lanka made paying taxes less costly for businesses by abolishing the turnover tax and social security contribution and by reducing the rate of corporate income tax, value added tax and nation building tax.

Sri Lanka Ports Authority (SLPA) Chairman Dr. Priyath B. Wickrama said the Colombo Port and the Ruhunu Magampura Mahinda Rajapaksa International Port in Hambantota will attract over US$ five billion in investments through the private sector by 2015. Over US$ three billion has already been invested in the port sector through funds from Asian Development Bank, People's Republic of China, India, Denmark and Japan. "Other than this, private sector organisations from various countries have committed to invest a total of US$ 2.2 billion in the areas of manufacturing, assembling, warehousing and handling," he said.

He said they have already received offers worth US$ 1.2 billion to invest in the Port of Colombo and around US$ one billion for the Hambantota Port. It has been estimated that distribution of Asian container volumes will be 55 percent from East Asia, 18 percent from South East Asia, 14 percent from North Asia, 9 percent from South Asia and four percent from West Asia including the Middle East.

Global ranking

These efforts have not gone unnoticed with the World Bank placing Sri Lanka in the 89th position in the global ranking from 183 countries, as one of the best places to do business on the 'Doing Business Index.' The Maldives is ahead of Sri Lanka in the ranking and India finished at 132nd position while Pakistan (105), Nepal (107), Bangladesh (122), Bhutan (142) and Afghanistan (160) were also behind Sri Lanka.

This achievement again clearly underlines the investor confidence the international community has for Sri Lanka. The Ceylon Chamber of Commerce (CCC) said they were pleased that Sri Lanka has taken a quantum leap in its overall ranking in the 'Doing Business Index' of the World Bank. Sri Lanka has risen nine points from 98/183 last year to become 89/183, sending out positive signals for investors and the business community.

"There has been a remarkable increase in some key areas such as dealing with construction permits, protecting investors and trading across borders.

The country has risen from 169th position to 111th position with regard to dealing with construction permits for 2012 while in protecting investors Sri Lanka is ranked in the 46th position as opposed to the 74th position for 2011.

The country also stands at the 53rd position in trading across borders for 2012. These achievements on the part of the country indicate that the peace dividend has indeed paid off and the efforts made by the authorities to improve our ranking have borne positive results," the CCC said.

The Doing Business Index analyses regulations that apply to an economy's businesses during their life cycle, including start-up and operations, trading across borders, paying taxes, and resolving insolvency.

The aggregate ease of doing business rankings are based on 10 indicators and cover 183 economies.