Govt plans to achieve high FDIs this year | Sunday Observer

Govt plans to achieve high FDIs this year

5 January, 2020
Shehan Semasinghe
Shehan Semasinghe

The current government has already won the confidence of local and foreign investors to achieve a higher rate of Foreign Direct Investment (FDI) this year and thereafter which the past administration failed to achieve, State Minister of Development Banking and Loan Schemes, Shehan Semasinghe told a media briefing last week to counter accusations of the United National Party that the sale of a three-acre land in Colombo was not an outright sale but a 99-year lease.

He said the UNP miserably failed to lure in either local or foreign investors during its tenure and is now on a desperate bid to bring disrepute and discredit the good work of the present administration.

“We will achieve much higher FDIs this year and in the years to come with a strategic plan to win the confidence of investors on the country which is now poised for an accelerated growth backed by the policies of President Gotabaya Rajapaksa who had a convincing victory at the elections,” the State Minister said.

However, when queried about the FDI targets for the year, the State Minister neither revealed the targets nor the road map to achieve higher investments hyped by the present dispensation but went on to belittle the outlook presented by Fitch Ratings stating that it is not the first time such ratings have been made.

“We had, unlike in the previous regime which neglected the economy, recorded an over six percent economic growth rate before 2015. How could those who by their shortsighted policies failed to record over three percent growth of the economy point a finger at this government that it has embarked on a selling spree of state land and its resources.

“The present government condemns the allegations of the sale of a prime land in Colombo which is a fabrication by those who are bankrupt. The new government will neither sell any State land nor any of its resources as pledged by both the president and the prime minister. It has provided a host of relief such as tax concessions despite the mounting debts to be repaid up to 2024,” the State Minister said.

The government last month leased out a three-acre land located between the Beira Lake and Shangri-La Hotel in Colombo for a US$ 250 million mixed development project to Perennial Real Estate Holdings Limited, an integrated real estate and healthcare company based in Singapore.

The project will comprise a 30-storey commercial tower, 700 residencies and facilities for retail and food outlets.

However, the move came under heavy criticism by the non governing parties that the current government has gone back on its pledge that it would neither sell nor lease state lands to foreign companies and that all unsolicited projects would be cancelled.

JVP MP Vijitha Herath said last week that the government has reneged on its promises within a short span of coming into power.

When asked how could the government sustain the tax concessions and moratoriums granted to SMEs when it has to repay US$ 4.8 billion this year to settle a total loan component exceeding US$ 14 billion in the next four years the State Minister said there is no problem with regard to the repayment of the debt as that has been looked into well by the government.

When queried as to why the government did not reject the Millennium Challenge Corporation (MCC) agreement as it promised to do so before the election, Semasinghe said that there is nothing wrong in revisiting an agreement prior to signing or rejecting it. This should be the same with any agreement and that is how this government when in the opposition looked at the Singapore FTA.

“However, for certain we will not sign the MCC agreement,” the State Minister said adding that national interest will be given priority over any initiative undertaken by the government.

On the moratorium extended for SMEs the State Minister said an appropriate decision on the matter will be taken soon to put the small and medium sector entrepreneurs back on their feet.

The government is mulling extending the 12-month capital moratorium on non performing loans of SMEs to interest payments due to the difficulties faced by SME businessmen in meeting interest payments.

- LF