FDIs go up a modest 17 per cent in 2021

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Sri Lanka has only received US$ 784 million as foreign direct investment in 2021, up 17 per cent compared to US$ 670 million received in 2020 as per data issued by the Central Bank of Sri Lanka.

“Reflecting the continued uncertainty driven by the Covid-19 pandemic as well as domestic circumstances, FDIs including foreign loans to DIEs remained modest in 2021, similar to the previous year,” the Central Bank said.

FDIs, excluding foreign loans to Direct Investment Enterprises, amounted to USD 598 million in 2021, in comparison to USD 434 million recorded in 2020.

On a sector wise basis, major FDIs were received by projects related to telecommunications, property development, textiles and hotels sectors.

According to the Central Bank majority of the FDIs came into already established Direct Investment Enterprises.

Despite the moderation in FDIs in 2021, going forward, FDIs are anticipated to materialise particularly to the Colombo Port City and the Hambantota port project, the Central Bank said.

Further, efforts are also underway to monetise underutilised assets under the Urban Development Authority, which will also contribute to the FDI flows to the country, the bank said.

Sri Lanka has been finding it difficult to attract foreign direct investments into the country. However, the Board of Investment is planning to attract US$ 5 billion by 2025, though it failed to achieve its target of US$ 1.5 billion last year.

According to the BOI during the first three months of this year projects worth US$ 1.4 billion have been inked with the agency for projects and several companies are eyeing for investment opportunities.

By Mario Andree