The Oman Ministry of Oil and Gas has assured the government that it would go ahead with its investment in the oil tank farm and refinery in Hambantota, said Development Strategies and International Trade Deputy Minister Nalin Bandara responding to queries on the current status of the investment in the South at an Export Development Board (EDB) Forum last week.
“The Silver Park Oil Refinery and Oman Ministry of Oil and Gas will not back down on the investment in Sri Lanka which they consider to have enormous potential for growth,” the Deputy Minister said.
The Deputy Minister’s response comes in the wake of the statement issued by Oman a fortnight ago that it had not agreed to an investment in Sri Lanka which the Board of Investment of Sri Lanka (BOI) had confirmed at a media briefing the same week.
“Those who criticise the investments in the South will be embarrassed when they visit the area and see the investments reaching fruition. The former regime promoted investments that ended up as white elephants which the present government had to turn into viable projects,” the Deputy Minister said, adding that the Indian company is a diversified conglomerate with a turnover of over US$ 7 billion.
The BOI, the apex body responsible for investments coming into the country, is confident it would surpass its target of US$ 3 billion in Foreign Direct Investments (FDI) this year with the US$ 1 billion investment pledged on a steel factory in Trincomalee and US$ 100 million on a cement grinding and blending plant in Hambantota, a joint venture investment between Ceylon Steel Corporation and the Onyx Group of Companies, UAE.
The country received US$ 2.3 billion in FDI last year, the highest on record, which was, however, still below the target of US$ 2.5 billion expected for the year.
Since 1978, the value of foreign direct investments that had come into the country was around US$ 17 billion of which around $ 5-8 billion had come after 2015.
“Those who say the government is selling the country’s assets to China are mistaken. Investments from Singapore and Oman disprove their claim,” the Deputy Minister said, adding that the investments on the projects are much larger than the investment on the Hambantota port, providing over 4,500 job opportunities with an output of around 200,000 barrels of refined oil per day.
When asked about the impact of the power cuts on industries and investments, the Deputy Minister said tenders have been called for the 300 MW power plant at Kerawalapitiya and the operation of the LNG plant in Hambantota will help ease the crisis.
EDB Chairperson Indira Malwatte said the National Export Strategy (NES) has a major impact on exports which has been growing steadily.
“We are confident of achieving the US$ 20 billion target this year,” Malwatte said.
Export income last year was US$ 17.1 billion, a 42 percent increase over the past three years.
However, exporters at the forum expressed displeasure over bureaucratic red tape and delays in solving their problems that make exports less competitive in the global market. The lethargy and inefficiency of state officials to expedite approvals have a negative bearing on export oriented industries and investments for exports.
Officials of Sooriya Resorts and Spa Tangalle said that they are unable to renew the hotel licence due to the negative attitude of the Department of Wildlife Conservation authorities who have been haggling over the issue for the past several months. The Resort is said to lack a separate storm water drainage system.
A local investor who had invested on a manufacturing facility in the Central Province regrets for not having invested in Bangladesh or in another country that offers more facilities to investors as he had failed to secure the land for the past two years.
Exporters say that each time they attend a forum, a new official represents the institution from which they seek answers to their issues. They said there is no consistency in the process which results in delays.