Investor confidence

The fact that the BOI was able to attract foreign investment worth US$ 865 million last year despite the world economic recession speaks volumes for the confidence reposed in the country's stability by foreign investors, to rise to the challenges which has buffeted Sri Lanka on many fronts.

It is also a testament to the prudent economic policies pursued by the present Government. That attractive incentives have been offered to foreign investors in the face of grave financial constraints - particularly the astronomical war expenditure which had been gobbling up a huge chunk of the national budget over the years, has also heightened the confidence of foreign investors.

With prospects of peace looming in the horizon this confidence is bound to multiply which would auger well for the massive development blue print drawn for the country in the post war scenario.

According to Information and Media Minister Anura Priyadharshana Yapa the BOI anticipates attracting foreign investments worth US one billion during the current year. Presenting a set of regulations in Parliament to offer tax concessions for facilitating this process the Minister made reference to the growth achieved in the apparel, industrial and IT sectors as being the primary fields that had attracted foreign investments last year.

That the investors have not turned away from Sri Lanka due to the protracted civil war is also a clear indication that security had not been a key factor as harped on by some dooms day prophets.

Of course there were times when investors packed up and left particularly during the second uprising of the JVP during the late 80's. That was a time of anarchy when dead bodies were strewn on road sides and floating in rivers. There is no such situation today and even the isolated bombing incidents last year had not frightened off investors as seen from the foreign investment quantum we have received.

But the Government should exercise care and be selective with the type of investments. Care should be taken not to bring down investors that would be a threat to local industries. Like a former Indian Prime Minister said about foreign investments 'microchips yes. potato chips no'. This should also be our own credo.

There was also a time when fly by night companies landed in this country to loot our resources and vanish from the scene in the shortest possible time. That was a time when the country was in the grip of a liberal ethos which allowed for the robber barons to come in and do as they please. There were even foreigners employed to draw zebra crossings on our roads, a task which could easily be accomplished by our locals. Here too we have to strike a balance.

There was also a time when our labour was milked dry by foreigners to amass huge profits for themselves. The Free Trade Zones were veritable sweat shops where worker rights were suppressed by foreign employers who made a quick buck and flew the coupe.

None of these complaints are heard today and the workers have always come under the benign eye of President Rajapaksa himself a vociferous Trade Union leader during his days as a budding politician.

Therefore we today have a friendly investment climate as well as a contended work force who have had all their rights and privileges restored. Our workers too have graduated from being small players to being highly skilled personnel who are in big demand abroad. They could ideally be absorbed into the projects of the foreign investors in Sri Lanka. This, while helping retaining this pool of talent in the country could also benefit us economically.

The steps taken to provide incentives for the growth of local industries too is a move in the right direction. The BOI has made arrangements to grant Rs. 650 million this year to encourage small scale entrepreneurs. While foreign investment is important from the point of view industrial expansion and employment generation it is the indigenous economy that will always bail out the country in a tight situation. This is seen in the food drive launched by the Government some time ago that stood us in good stead during the world food crisis that even dealt a blow to most developed countries.

What the Government should strive to do is promote more and more joint collaborations between foreign and local industries so that we would be able to adapt to the latest methods and developments in various sectors where the country would stand to gain on the long run. This could help us one day stand up on our own feet and be prominent partners in the field of global trade.