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Sri Lanka Attracts US$ 2 Billion in Investment Deals Amid Global Economic Challenges

2024-09-29 20:38:18.386000

The Board of Investment of Sri Lanka (BOI) has endorsed investment deals worth US$ 2 billion in 2023, including both local and foreign investments. This increase in projects is primarily attributed to the high value of investment in the energy sector. Countries such as China, India, the US, Hong Kong, UAE, France, Korea, Germany, and Singapore were the destinations for these investments. Furthermore, the divestment of shares with Sri Lanka Telecom, Sri Lanka Insurance, Colombo Hilton, Lanka Hospitals, and some state banks in 2024 is expected to bring in additional foreign funding to Sri Lanka. The signing of Free Trade Agreements (FTAs) with Thailand and other countries, as well as the development of the Colombo Port City and private sector projects, are also anticipated to contribute positively to Sri Lanka's FDI figures in 2023. [6cbbb62a]

Despite facing external and internal setbacks, the BOI has achieved Rs. 1.8 billion in total investments, including FDI projects worth US$ 1.5 billion. State Minister for Investment Promotion Dilum Amunugama noted that the global growth forecast is expected to slow in the coming years. Political uncertainty and economic contraction in Sri Lanka have made it challenging to attract FDI, yet the BOI has registered and approved FDI investment projects that increased by 122% in 2023. The energy sector has seen significant investment increases, with companies like Adani Corporation, Sinopec, and RM Parks with Shell, alongside sectors like ITC, BPO, Tourism, and Manufacturing receiving investments. [2e3076d3]

In a related initiative, Sampath Bank has collaborated with the BOI and the Ministry of Investment Promotion to introduce 'Sri Lanka's Banking Guide for Investors & BOI Companies'. This comprehensive guide offers valuable insights into banking tailored specifically for investors and BOI companies, covering various aspects such as investment accounts, operational banking, borrowing solutions, and financial services. The guide is available in both print and electronic formats, aiming to support and facilitate the investment process in Sri Lanka by providing investors with the necessary information and guidance on banking services.

Sampath Bank's partnership with BOI and the Ministry of Investment Promotion reflects their commitment to fostering a favorable investment climate in Sri Lanka. By collaborating with key stakeholders, they aim to provide a holistic approach to supporting investors and BOI companies, ensuring they have access to the right resources and information to make informed decisions.

Looking ahead, Sri Lanka anticipates private equity deals amounting to $250 million in 2024, according to Hong Kong-based merchant banking firm MCM Partners. The Managing Director of MCM Partners, Jahnavi Bhagwati, explained that the turnaround in private equity deals is due to countries like India and Sri Lanka presenting opportunities in the private space after the Bank of Japan raised interest rates in March. Bhagwati mentioned that the stock markets in the region are already seeing a pickup, and investment activity will increase when rate cuts kick in. Sri Lanka is expecting deals of about $250 million, while Bangladesh is anticipating a potential deal of $1 billion, and India's deal sizes range between $10 million and $500 million. [62605b12]

Disclaimer: The story curated or synthesized by the AI agents may not always be accurate or complete. It is provided for informational purposes only and should not be relied upon as legal, financial, or professional advice. Please use your own discretion.