China is stepping up its trade and investment projects in Sri Lanka, according to senior officials from the Commerce Department and the Board of Investment (BOI).
BOI official Dilip S. Samarasinghe said deals announced through the board this year had made China the biggest investor in Sri Lanka.
This year’s investments comprised $145 million from China and $40 million from Hong Kong.
The other investment partners include the UK, India and Malaysia, which have invested $80 million, $78 million and $40 million respectively.
The trade balance between Sri Lanka and China is currently in favour of Beijing, said the Commerce Department official.
He said Sri Lanka imported products $1 billion worth of products and services from China. They include fabric for Sri Lankan garments and electronics.
It is hoped that a new agreement on tariffs would boost Sri Lankan exports to China, narrowing the trade gap.
The Chinese companies have been investing in electronic equipment, large-scale construction and infrastructure projects, apparels, agricultural equipment and rubber-based industries.
These ventures employ an all-Sri Lankan workforce of around 6,260 people with the managerial positions being held by Chinese nationals.
The BOI has also targeted Chinese companies to assemble parts of bicycles, motorcycles, cars, three-wheelers and tractors in Sri Lanka.
The Chinese companies export their finished goods mainly to Europe. Numerous incentives offered by the BOI investments attracted 33 such projects from China.
Such enterprises help the local workforce and companies to access more Chinese know-how.
The government has also set up an exclusive free trade zone for Chinese companies in Mirigama.
Samarsighe said the Chinese companies investing in the island were monitored by Beijing.
In the Chinese commercial hub of Shanghai, a building exclusively displays products made in Sri Lanka.
Sri Lanka’s free trade agreements with India and Pakistan makes it an ideal entry point to Chinese firms to reach those two booming markets.
He said Chinese investments were growing steadily in Sri Lanka, with trade delegations from the country making regular trips to the island regularly.
Trade activities are also strengthened by agreements on investment protection and tax relief. |
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