EU-Sri Lanka investor dialogue : Liberalisation of shipping sector discussed | Sunday Observer

EU-Sri Lanka investor dialogue : Liberalisation of shipping sector discussed

The eighth EU-Sri Lanka investor dialogue was held at the Ministry of Development Strategies and International Trade recently. Many of the earlier outstanding matters had been resolved through dialogue and the joint efforts of the Sri Lanka and EU authorities.

Minister of Development Strategies and International Trade, Malik Samarawickrama, the leader of the Sri Lanka delegation said, “We have made considerable progress in resolving outstanding issues and building up our relations with the European Union on a solid foundation.”

Sri Lanka’s new budget is very liberal and that is also pro trade and pro-investment. “It includes many reforms that cover all segments of the Sri Lanka’s population including the lower income groups, public officials and Armed Forces. It is a good budget. I wish to thank the ambassadors present for all their support, he said.

Ambassador of the European Union Tun Lai Margue said, “Among the matters which were discussed was the need to always ensure transparency when it comes to tendering procedures. We would also like to see a more liberal approach with regard to the shipping sector. This is important in the light of Sri Lanka’s effort to become a major shipping hub.”

Minister Samaraweera said that Sri Lanka was exploring the possibility of liberalising the shipping sector. In the first stage foreigners will be permitted to own 60% of the shipping companies.

This was very important to build confidence in the European Union for Sri Lanka. It is also a factor that impacts significantly on the attraction of FDI inflows to a country.

Deputy Minister of Development Strategies and International Trade, Nalin Bandara, Secretary Ministry of Development Strategies and International Trade, S. T. Kodikara, Director General of the BOI, Mrs. Champika Malalgoda, Director General of the Export Development Board, Mrs. Indira Malwatte, and Technical Advisor to the Ministry, Mangala Yapa were also present.

The Sri Lanka institutions represented were the Board of Investment of Sri Lanka, the Department of Public Finance, Ministry of Digital Infrastructure, Sri Lanka Customs, Ministry of Health, Ministry of Ports and Shipping, Civil Aviation Authority of Sri Lanka, Inland Revenue Department, Department of Fiscal Policy and the Department of Emigration and Immigration.Senior officials of the European Union and their respective missions were also present.

A number of important decisions was taken at the dialogue.

It was decided by the Minister that a high level meeting with the EU side and the Minister of Ports Shipping, Finance and International and representative of Maersk would discuss the bidding process for the East Terminal.

The EU would monitor the implementation of the decision by Sri Lanka to allow 60% ownership of shipping line in Sri Lanka. The question of VAT reimbursement for 2018 will be taken up with the Department of Inland Revenue.

The Sri Lankan side will raise the issue of Customs duties payment relating to blocked containers with the Finance Ministry.

Other areas of agreements covered the payment of dues, the effect of noise pollution, VAT an imports for exports and the fast track facility accorded to a company.

At a macroeconomic and strategic level the European Union represents an important source of investment for Sri Lanka.

From 2005–2016, EU enterprises operating under BOI invested an estimated US$2.5 billion in Sri Lanka.

The bulk sectors for investment were manufacturing (other than textile and apparel) valued at US$ 557 million; textile and apparel manufacture (US$ 327 million); telecommunications (US$ 617 million): Airline services (US$ 325 million); and power generation (US$ 255 million).

The leading European Union countries in terms of FDI to Sri Lanka are the United Kingdom with 90 projects under BOI (of which 54 are exporters), Germany (42 projects, 31 exporters), the Netherlands (29 projects, 14 exporters), Sweden (20 projects, 13 exporters) Italy (18 projects, 14 exporters, France (13 projects, 10 exporters) and Belgium (10 projects of which six are exporters).