The 8th EU- Sri Lanka investor dialogue consolidates economic relations and resolves important matters
The 8th EU- Sri Lanka investor dialogue consolidates economic relations and resolves important matters – The liberalization of shipping sector was discussed.
The 8th EU-Sri Lanka investor dialogue was held at the Ministry of Development Strategies and International Trade recently. Many of the earlier outstanding matters had been resolved through dialogue and the joint efforts of the Sri Lanka and EU authorities.
Hon. Malik Samarawickrama Minister of Development Strategies and International Trade who chaired sessions and led the Sri Lanka delegation stated “we are making an effort on our side to clear all issues. I wish to thank the Ambassadors for their support and co-operation. I am very pleased that we have made considerable progress in resolving outstanding issues and building up our relations with the European Union on a solid foundation”. The Minister added Sri Lanka has a new budget that is very liberal and that is also pro trade and pro-investment. “The budget includes many reforms that cover all segments of the Sri Lanka’s population including the lower income groups, public officials, armed forces. It is a good budget. I wish to thank the ambassadors present for all their support.”
H E Tun Lai Margue, Ambassador of the European Union replied “we are very pleased to meet again and I agree with the Minister that we have managed to resolve many of the issues that existed between Sri Lanka and European Union. Among the matters which were discussed was the need to always ensure transparency when it comes to tendering procedures. In addition, we would like to see a more liberal approach with regards to the shipping sector. This is important in the light of Sri Lanka’s effort to become a major shipping hub.
Minister Samaraweera informed the EU delegation that Sri Lanka was looking at liberalizing the shipping sector. In the first stage foreigners will be permitted to own 60% of the shipping companies. This was very important to build up confidence in the European Union for Sri Lanka. It is also a factor that impacts significantly on the attraction of FDI inflows to a country”.
Minister Samarawickrama was assisted by Hon. Nalin Bandara, Deputy Minister of Development Strategies and International Trade, Mr S T Kodikara, Secretary Ministry of Development Strategies and International Trade, Mrs. Champika Malalgoda, Director General of the BOI Mrs. Indira Malwatte, Director General of the Export Development Board and Mr. Mangala Yapa, Technical Advisor to the Ministry. The Sri Lanka institutions present were the Board of Investment of Sri Lanka, the Department of Public Finance, Ministry of Digital Infrastructure, Sri Lanka Customs, Ministry of Health, Ministry of Ports & Shipping, Civil Aviation Authority of Sri Lanka, Inland Revenue Department, Department of Fiscal Policy and the Department of Emigration and Immigration.
Ambassador to the European Union H E Tun Lai Margue was assisted by senior officials of the European and their respective missions.
A number of important decisions were taken at the Dialogue.
It was decided by the Minister that a high level meeting with the EU side and the Minister of Ports Shipping, Finance and International and representative of Maersk would discuss the bidding process for the East Terminal.
The EU would monitor the implementation of the decision by Sri Lanka to allow 60% ownership of shipping line in Sri Lanka. The question of VAT reimbursement for 2018 will be taken up with the Department of Inland Revenue.
The Sri Lankan side will raise the issue of customs duties payment relating to blocked containers with the Finance Ministry.
Other areas of agreements covered the payment of dues, the effect of noise pollution, VAT an imports for exports and the fast track facility accorded to a company.
At a macroeconomic and strategic level the European Union represents an important source of investment for Sri Lanka.
In the period 2005 – 2016, EU enterprises operating under BOI invested an estimated US$2.5 billion in Sri Lanka.
The bulk sectors for investment were manufacturing (other than textile and apparel) valued at US$ 557 million; textile and apparel manufacture (US$ 327 million); telecommunications (US$ 617 million): Airline services (US$ 325 million); and power generation (US$ 255 million).
The leading European Union countries in terms of FDI to Sri Lanka are the United Kingdom with 90 projects under BOI (of which 54 exporters), Germany (42 projects, 31 exporters), the Netherlands (29 projects, 14 exporters), Sweden (20 projects, 13 exporters) Italy (18 projects, 14 exporters, France (13 projects, 10 exporters) and Belgium (10 projects of which 6 exporters).
The EU-Sri Lanka dialogue is therefore a vital forum that offers considerable opportunities for attracting European investment to Sri Lanka.
Dilip S Samarasinghe
Director (Media & Publicity)