The World Bank has said Sri Lanka can push forward policies that will enable the country to build back better with stronger measures post the Covid 19 crisis to attract much-needed Foreign Direct Investment (FDI).

Faris Hadad-Zervos, World Bank Country Director for Sri Lanka, Nepal and Maldives said Sri Lanka is capable of meeting its goal of attracting USD five billion FDI by 2025. Higher levels of FDI would also strengthen exports, foster growth and assist the country to put its debt on a more sustainable footing.

“We believe this is entirely doable given the country’s rich natural resources, strategic location, highly literate workforce and opportunities for investment in tourism, IT-enabled services, logistics, high value-added apparel and food services among others.”

However, for Sri Lanka to leverage these competitive advantages, Hadad-Zervos called for the country to focus on comprehensive reforms to increase productivity and competitiveness, ColomboPage reported.

"We have identified that in some sectors such as textile and clothing, IT and manufacturing Sri Lankan firms have been expanding their footprint and have been able to become very competitive globally and move up the value chain to more sophisticated products and markets. Here you are showing your potential so I think the discussion we need to have is clear,” he said while speaking at a program in Colombo.

“The Government needs to set in place a collective set of policies and practices that make up an investment ecosystem, ranging from improvements of the investment climate, elimination of unnecessary regulatory burdens to enhancing the predictability of laws and responsiveness of bureaucracy to deliver effective FDI services,” he said.

Sri Lanka is currently placed 99th in the latest Ease of Doing Business rankings compiled by the World Bank. Hadad- Zervos pointed out FDI has a huge role to play in helping Sri Lanka leverage its potential and diversify its export and investment sources.

Many Sri Lankan companies have already tapped into this opportunity and have become global players in multiple markets.

The Country Director called for policymakers to focus on export earnings in comparison to overall GDP and track its growth consistently to identify what policy changes are needed to improve competitiveness and reach. He also advocated a fresh look at tariff systems and improved access to intermediate imports needed for export value addition.

(SAM)