FDI down 31% Jan-Sep

By Mario Andree

Foreign Direct Investments (FDI) continued to decline due to unforeseen events such as the COVID-19 pandemic during the first nine months of last year ended September, plummeting 31 per cent.

According to data released by the Central Bank of Sri Lanka, during the first nine months the country received only US$ 548 million as FDI, down 31 per cent compared to US$ 793 million received a year earlier.

In 2019, Sri Lanka’s total FDI inflows, including foreign loans received by BoI companies, amounted to US dollars 1,204 million, down 44 per cent compared to US$ 2.14 billion received in 2018.

The Government received US$ 1.46 billion during 2018 and 2019 after signing the lease agreement for the Hambantota Port.

The Central Bank attributed the decline in FDI over 2019 to the weakened investor sentiments with increased uncertainties in the aftermath of the Easter Sunday attacks and political developments.

Further, the COVID-19 pandemic which was assumed to have been brought under control is keeping investors away as both economic and private sector growth was slowing down considerably.

Despite the slowdown in the short term, the Government hopes that the Hambantota Industrial Zone, the Colombo Port City, the hotel sector and mixed development sector will attract significant cash inflows in the coming years.

The current regime soon as it came into power pledged to revamp the self-proclaimed one-stop-shop, Board of Investment (BoI), citing that it was not carrying out its duties in a proper manner.