The Board of Investment (BOI) continues to strengthen its foundation and lead the orchestration in attracting market transforming FDI in order to realise the vision set out by the government of Sri Lanka to double GDP in this decade.
Six thrust sectors, Manufacturing, ICT, Tourism & Hospitality, Agri & Food Processing, Infrastructure, and other selected services have been identified for focus in attracting FDIs, as they offer the greatest impact to the Sri Lankan economy and its citizens to capitalise on.
Two main foundational pillars being “Country Attractiveness” and “Revamping the BOI” will aid the focus given to these thrust sectors. For “Country Attractiveness” to take place, the BOI recognizes that the creation of a compelling investment climate, attracting targeted investments, providing potential investors with end-to-end investor support, and fostering and nurturing partnerships with key public & private stakeholders must take shape. Process monitoring, embracing technology, and of course, most importantly, developing the organization and its people will form the focus of the agenda on “Revamping the BOI”.
These timely strategies are currently being executed at a time when enhancing FDI continues to remain challenging for Sri Lanka, especially against a fiercely competitive landscape, that is both global and within South and SouthEast Asia.
Moreover, the BOI was able to secure projects worth over $2.3Bn in value in 2020 despite the global challenges, and the effects of the pandemic. Transformational changes were simultaneously initiated on both the economic landscape of the country as well as the BOI organization. The establishment of two dedicated zones – one for Pharmaceuticals in Hambantota, and the other for Textile Manufacturing in Eravur are cases in point.
The zone in Eravur will be operational in September 2021 and has already secured its first investment project approximating US$35mn, with additional investors already reserving land. Once operational, the zone will localize a significant quantum of fabric related imports which approximate US$2bn. It will also generate 5000+ employment opportunities for a region that otherwise ranks high on youth unemployment relative to the rest of the country.
The Sri Lanka Investment Forum (SLIF) 2021 was yet another strategic intervention that took place in collaboration with the Ceylon Chamber of Commerce (CCC) and Securities & Exchange Commission (SEC). Considered a marque public-private partnership project, SLIF was initiated to support transformational change in investment for Sri Lanka, further outlining additional policy changes and orchestrations that are needed and ongoing, to create and secure a compelling investment climate to attract sustainable FDI to the country.
Aggressive and targeted actions of leading international promotion agencies (IPA) around the world have reinforced the need for IPAs to invest strategically in promotion-based activities in order to not only secure a greater share of a contracted FDI, but even to ring-fence investments they already have in pipeline. This is especially relevant in a scenario where the global FDI pool has dipped by over 40% owing to the situation at hand, with more than 1,000 IPAs worldwide competing for this reducing FDI stock. Such campaigns should not only be adequately funded, but they must also be professionally executed with a combined public-private sector expertise, if they are to yield exponential results. It is in this context that the BOI along with ICTA and other critical agencies were identified by the Cabinet as entities that require an infusion of specialised professional skills from the private sector.
A Committee therefore headed by the Secretary to the Treasury was appointed to review and recommend proposals to meet the objectives of entities such as BOI. Accordingly, upon the presentation of the said proposals, Cabinet approval was thereafter granted to recruit professionals on contract basis to select positions identified and for the formation of a special unit to be set up. Professionals who would be recruited to this unit would need to possess deep business knowledge, international exposure, and a proven track record of identified private sector-based industry and domain specific skills, in addition to professional and academic qualifications.
Currently, the BOI is amidst operationalising this strategy approved by the Cabinet. It will generate the much-needed competitive strength when compared against regional IPAs, and these professionals will work hand-in-hand together as one team with experienced senior talent in the organization on governmental affairs.
This talent infusion is part of a broader agenda that is deeply focused on building an enabling, cohesive and globally competitive organization, and a strong public-private partnership. Other thrusts actioned already include the secondment of private sector professionals to the BOI for short term exposure programmes and vice versa. As paperless contact is the way of the future, simultaneous focus on a digitization drive has also been initiated to facilitate a seamless customer experience for all requests received. Accordingly, an online customs documentation system has been actioned along with online payment platforms, with projects underway to introduce an online process for investor project submission and approval as well.
Supported by way of winning talent, a performance-oriented culture, and the implementation of efficient internal systems, the BOI is accelerating efforts to take advantage of emerging investment opportunities for Sri Lanka.