BOI Chief gets tough
Senior staff at the Board of Investment (BOI) has been given strict directions by its Chairman Upul Jayasuriya to refrain from communicating ‘negative’ vibes to foreign investors without informing him.
“I instructed them that saying ‘no’ to foreign projects should be vetted by me before going to the respective investors,” he told the Business Times noting that this came to such a state owing to certain blunders by some staff at BOI.
He said this discussion with some senior staff of BOI happened early this month.
What brought about this discussion was when a Malaysian eco friendly tourism project, Nature’s Glory slated to create 2,000 jobs was rejected for bureaucratic reasons. “These issues could have been sorted, but at times we are used to following the book,” he said but refused to give more details.
He also mentioned that a US$ 30 million cotton wool plant wasn’t given the green light for a reason that could’ve been sorted out. These events had prompted the BOI chief to get tough with the staff. He said that now both these projects are ongoing after he had personally got involved and sorted out the red tape along with the BOI officials.
He also said that in the event there’s a negative response to a certain project, all investors are requested to get in touch with his office.
The country’s investment promotions agency is batting low foreign direct investment and is now in a quagmire with countervening taxes imposed by countries like the US on exports from BOI firms. The agency is already under pressure to attract FDI.
Officials said that because of the World Trade Organisation (WTO) agreement that Sri Lanka is party to which limits them from taxing firms, the FDI attracting agency is at a catch 22. As Sri Lanka has signed this WTO trade pact, when the BOI grants tax concessions to firms that want to set up here, at the point of import of their goods they’ll be taxed. So this doesn’t make economic sense for them. “This applies only to new firms but we are not on a good footing right now,” one official explained.