Revamped BOI focused on attracting ‘anchor investors’
Strengthening of government auction system viewed positively
People keen to invest in Sri Lanka, will understand that a lot has been done in strengthening the government auction system and the EPF operations, Central Bank Governor Dr. Indrajit Coomaraswamy said.
“The Task Forces on the eight pillars on Ease of Doing Business and a revamped BOI more focused on attracting ‘anchor investors’ for identified sub-sectors in Sri Lanka, he said will also boost investor confidence. He hoped that investors will look to more than newspaper headlines.
“Investor confidence has not been shaken by the Treasury Bond issue, Dr. Indrajit Coomaraswamy said yesterday in answer to fears that the long drawn out issue might have hampered and discouraged foreign investments into the country.
Addressing the media on the recent Monetary Policy Review of the Central Bank, the Governor explained that during his visits to ‘road shows’ in March this year, the issue had not been raised as a concern by the business community.
Investments however have been slow to come in and despite a ‘good fiscal performance and improving macroeconomic conditions’, the Central Bank said they only expected “modest recovery in the domestic economy in the period ahead”.
As the Central Bank chose to continue with its present tight monetary policy, Dr Coomaraswamy said they “did not expect to raise interest rates at a time when growth was below potential” and he expected economic growth to be no more than 4.5 percent by the end of this year.
“We need investment for economic growth and there are no short cuts for that. We need to create an investor climate and build investor confidence”, said the Governor as he stressed that the domestic private sector needed to be more robust for growth to pick up.
“There are signs and some of our perception indices are beginning to show that there may be a bit of upturn in business sentiment”, he further explained but this sentiment was higher among foreign investors than local,
“When you take foreign investors, we have got USD 388 million flowing into our government securities and another USD 246 million into our Stock Exchange. When the ISB was floated in March, it was seven times oversubscribed.
These are positive changes”, he said but added that we were yet to see significant FDIs coming in to the country.
The short term money is coming in and that is a good start, next step is for people to be comfortable enough for FDIs to come in, explained Governor Coomaraswamty as he expected a positive outlook with the initiation of the Colombo Port City and Hambantota Port Agreements.
Bond Commission to sit sans vacation
The Commission investigating the bond issue will be sitting without a vacation to conclude proceedings.
Perpetual Treasuries will commence evidence on August 8. The court vacation begins on August 11.
However, the commission decided yesterday that it will continue to sit throughout the period with no vacation.