"Sri Lanka expects a billion dollars of FDI in 2011" says BoI Chief

Lanka Business Online
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Sri Lanka is expecting more than a billion US dollars in foreign direct investments in 2011 led by a booming leisure sector, after the end of a three decade war made the country more attractive, an official said.

"Our expectations (for 2011) are well over a billion (US dollars)," Board of Investment chief Jayampathy Bandaranayake said.

A three decade war ended in 2010 but actual FDI disbursements were 'very close to' 2009, he said. In 2009 when the intensity of the conflict reached its height foreign direct investments fell to 384 million dollars.

In the first quarter of 2010 there was a 30 percent drop in FDI due to a series of elections in the island, Bandaranayake said.

The International Monetary Fund earlier forecast at least 725 million US dollars of FDI this year.

On Friday Bandaranayake signed a 150 million US dollar investment agreement with Dialog Axiata which is expected to invest the money in expanding its network over the next two years.

Dialog had become the top foreign investor in the country clocking up a billion US dollars by December 30, and the latest investment will push it to 1.2 billion dollars, officials said.

BOI director Duminda Ariyasinghe said most of the cash would come into leisure and infrastructure.

Though information technology and business process outsourcing was generating high quality jobs and attracting a lot of interest the actual dollar values were smaller, he said.

Several high profile foreign leisure and property investments have already been announced, including 500 million dollar projects by Hong Kong based Shangri La and a CATIC, a Chinese state firm.

The two firms also will spend 500 million US dollars to buy state land.

© LBO