BOI promises angel investors ease of approvals in Sri Lanka
While the start-up ecosystem in the country is booming with many angel investors looking for opportunities around the world to invest, the Board of Investment (BOI) in Sri Lanka promises the ease of getting the approvals on time. It will be a one stop shop for investors, says Duminda Ariyasinghe Director General of the BOI.
Delivering his address on ‘Showcase of Sri Lankan Opportunities’ at the Asian Business Angel Forum held at the Cinnamon Lakeside in Colombo last Wednesday and Thursday, Mr. Ariyasinghe made the promise.
He said, “Key for the BOI of Sri Lanka is to make sure an investment will make a significant profit. BOI will be a one stop shop to investors especially in the technology and start-up sector because they do not require very comprehensive approvals but they are keen projects that can be started within a few days after approval. The process starts from the first point of communication to helping investors with the project application, making sure the approvals are done seamlessly, set up and find a location in terms of commercialization once the project starts and so on.”
Sri Lanka is not the only option for investment, noted Mr. Ariyasinghe while elaborating that the current government is private sector mindset-driven unlike the previous regime’s model. The BOI is not only focusing on hotels, apartments and condominiums, but investments on adventure theme parks and other tourists’ attracting venues in the country. “There are many natural attractions in the country but we also need man-made elements just like in Singapore to attract tourists,” he said.
Almost 100 per cent of construction in Colombo are private sector driven both local and foreign, apart from some of the mixed development projects. The government wants the private sector to play an active role in infrastructure development, he noted.
Mr. Ariyasinghe also stated that the BOI also provides seamless validation to the entire investment process. “Under the new Inland Revenue regulation, whatever the investment made, you can have a capital write-off against it. You don’t have to pay tax for profits you make up to the invested amount. It will be like a tax holiday however based on the invested amount. What you import during your project implementation stage will be duty free on capital goods. If it’s an export driven company you have that exemption on capital goods and raw materials throughout the entire period of operation.”
Apart from that the BOI also helps with visas, he pointed out. “A very seamless process so that immediate visas can be granted to any investor and employee who is required to enter the country. There are lots of countries importing foreign workers but Sri Lanka has not got to that stage yet. We need to recognize and control the white and blue collar workers to adjust according to the workers that are already here in Sri Lanka. You will have to navigate through that process,” he noted.
Mr. Ariyasinghe also emphasised that when the Shangri-La Colombo project was presented to the founder of Shangri-La Hotels and Resorts, Robert Kuok, he had told the staff that they were not aggressive enough. He said, “Colombo is going to emerge as the most important global city between Singapore and Dubai. The plans you make in Colombo needs to reflect that and as a result the investment was approximately doubled from US$280 million to $600 million for the whole project.”
There are also three other major developments in Sri Lanka totaling to $2 billion. This is the type of long term potential, people with foresight have seen even many years ago. The rest of the world is also taking note of that now, he added.
He also referred to an article that was published in the Financial Times London about Chinese President Xi Jinping’s One-belt-one-road initiative. The article was focused on a project which is destined to be 100 per cent profitable from day one and that is the large investment China had made in the Hambantota Port.
The strategic location and all positive factors China saw in Sri Lanka shows a lot of confidence amongst the smart people. The article further elaborated that given the scale China would be able to bring down some of the largest port operators, infrastructure companies, manufacturers, petroleum and so on to locate in Sri Lanka which in turn will alter trade routes, said Mr. Ariyasinghe.