SL has US $18bn investment potential: Report | Sunday Observer

SL has US $18bn investment potential: Report

Sri Lanka has investment opportunities worth US$18 billion in climate-smart sectors in cities and infrastructure over the next 12 years to 2030, as a result of plans to meet climate targets under the Paris Agreement, a new report has identified.

The report by IFC, a member of the World Bank Group, on Thursday, states that Sri Lanka has a potential investment opportunity of US$ 2.5 billion between 2018 and 2030 in Renewable Energy of which $ 981 million will come from wind power $679 million from small-scale hydro, $464 million from biomass, $190 million from large hydro, and $104 million from utility solar.

On the other hand, IFC estimates an investment opportunity of almost US$ 8.4 billion in Sri Lanka’s green buildings sector, of which $6.8 billion will come from the residential sector and $1.6 billion from the commercial sector while there is at least $326 million worth of opportunities in Sri Lanka’s transport sector, more than $2.7 billion in urban wastewater management and US$3.5 billion in solid waste management.

“We also need to have a comprehensive approach to creating markets for climate business in key sectors. That means putting in place policy frameworks, promoting competition, and building capacity and skills to open new markets,” said IFC CEO, Philippe Le Houérou.

The report cautions, that without significant investment in climate resilience in sectors such as renewable energy, transport, green buildings, urban water, climate-smart agriculture, and municipal solid waste, Sri Lanka is at risk of losing about 1.2% of annual GDP growth per year by 2050 due to climate change.

It further highlights that given the country’s fiscal challenges and ambitious energy, transport, and waste management infrastructure plans, there are many opportunities for the private sector to fill this investment gap. The private sector has an important role to play, particularly in urban development, industrial parks, and PPPs for large-scale project implementation, the report identifies.

“The only way that South Asian countries can take advantage of these climate investment opportunities is with a strong and engaged private sector,” Houérou added.

A recent joint assessment by the Asian Development Bank and the United Nations Development Program has, however, determined that Sri Lanka is on track to achieving its renewable energy target, projecting an estimated 15 GW of wind energy and 16 GW of solar energy towards its projected 34 GW requirements in 2050, with the balance coming from hydro and biomass power plants.