Country Overview

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Population : 20.33 Million (2012)

GDP: US$ 59.42 Billion (2012)

Main Languages Spoken: Sinhala, Tamil, English

Literacy Rate: 94.2% (2011)

Society

A multi ethnic, multi religion, multi cultural society

Main Ethnicities: Sinhala, Tamil, Muslim

Main Religions: Buddhism, Hinduism, Christianity, Muslim

Has a well educated, literate population. Highest literacy rate in South Asia

Geography

Strategically located on the Indian Ocean

Part of the Ancient Silk Route. Sri Lanka was considered “The Gateway” between the east and the west.

Approximately 65,000 square kilometers land area

Economy

GDP of US$ 59.42 Billion (2012) and GDP growth rate of over 6% (2012)

Recently graduated to “Middle Income” country category

Most liberalised economy in the South Asia

Government

Democratically elected government with head of government being the executive President

Current government holds two thirds voting power in the parliament

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Why You Should Invest in Sri Lanka

Strategic Access to Key Markets in the World

  • Only country in the world that has Free Trade Agreements with both India & Pakistan
  • Already giving you Free Trade access to approximately 25% of world’s population
  • Free Trade Agreement being negotiated with China which is expected to be finalised in early 2014

Geo-Strategic Location

  • Situated at the crossroads of major shipping routes connecting South Asia, Far East, Pacific, Europe and America.
  • 50% of all container traffic and 70% of the world’s energy supplies pass within sight of the Sri Lankan coast.
  • Over 48,000 international flight movements via Sri Lankan air space in 2012

Strong Booming Economy

  • Maintaining strong GDP growth rates consistently in the past 4 years
  • Recently graduated to the middle-income country category
  • Government aims to Make Sri Lanka a global strategic hub in five key areas: knowledge, commercial, naval & maritime, aviation, energy

Attractive Business Environment & Government Policies

  • Most liberalized economy in South Asia
  • Open market Free Economic policies
  • Foreign investors are allowed 100% ownership of their investment

Modern Infrastructure

  • Most advanced telecommunication infrastructure in South Asian region. Four fixed line and five mobile operators
  • Three international submarine cables keeping Sri Lanka connected 24 X 7 X 365
  • High mobility road network and an ambitious freeway construction plan
  • Largest port in south Asia and many deep water ports around the country
  • State-of-the-art airport and aviation facilities

Foreign Investment Protection

  • Safety of foreign investment is guaranteed by the constitution
  • Bilateral investment protection agreements with 28 countries and double taxation avoidance agreements with 38 countries.
  • Transparent and sophisticated legal and regulatory framework
  • Sri Lanka is a founding member of the Multilateral Investment Guarantee Agency (MIGA)
Sri Lanka: Bilateral Investment Treaties
Australia Republic of Korea Belgium-Luxembourg Kuwait
China Malaysia Czech Republic Netherlands
Denmark Norway Egypt Pakistan
Finland Romania France Singapore
Germany Sweden India Switzerland
Indonesia Thailand Iran United Kingdom
Italy USA Japan Vietnam

 

Foreign Investor Support

Sri Lankan government has already established a comprehensive Foreign Investment Support framework as well as a viable legal infrastructure to safeguard foreign investments and the interests & rights of foreign investors.

  • Safety of foreign investment is guaranteed by the constitution
  • Bilateral investment protection agreements with 28 countries and double taxation avoidance agreements with 38 countries.
  • Transparent and sophisticated legal and regulatory framework
  • Sri Lanka is a founding member of the Multilateral Investment Guarantee Agency (MIGA)

Investment Protection Agreements & Double Taxation Avoidance Agreements with many Countries include :

USA , Australia ,China, Uk ,Japan,India,Belgium,Canada , Denmark,Germany ,Ireland,France ,Mauritius ,Singapore ,Switzerland ,Nepal,UAE,Poland,Italy ,Romania ,Qatar etc.

Priority Areas of Investment

  • Commercial Buildings / office complexes / hospitals
  • Urban Housing / Town center development
  • Water Services
  • Industrial estate, special economic zones or knowledge cities
  • Sanitation / Waste Management
  • Investment Incentives
  • Warehousing and Storage facility
  • Internal Water ways / Transport

Foreign Investment Deposit in Banks

What is EFIDA?

EFIDA or Elegant’s  Foreign Investment Deposit Account is one of the most attractive deposit accounts scheme  in Our linked banks specially designed for foreign currency depositors. It’s the best way to enjoy best interest rates on your money. (only for the tax free countries) What’s more FID is exempt from income tax, withholding tax and debit tax giving you a total tax free return.

How does FIDA work in Sri Lanka?

There is no minimum balance requirement for this account. You have the option of maintaining a foreign currency account or converting your foreign currency deposit to Sri Lankan rupees and enjoying a higher interest rate. SFIDA accounts are exempted from income tax, withholding tax and Debit tax.

SFIDA – Guaranteed Return on your deposit

If you wish to maintain your deposit in Sri Lankan rupees we can allocate a conversion rate by booking ahead. Forward booking is a special mechanism introduced by standard chartered bank which allows you a guaranteed return on your deposit.

FIDA Eligibility
  • Citizens of foreign states and Sri Lankan citizens residing outside Sri Lanka
  • Corporate entities incorporated outside Sri Lanka
  • Foreign institutional investors such as country funds, mutual funds and regional funds
  • Citizens of foreign states holding temporary visa to live or work in Sri Lanka
  • Sri Lankan citizens employed overseas
2013 Investment Climate Statement
BUREAU OF ECONOMIC AND BUSINESS AFFAIRS
April 2013
Report
Openness to, and Restrictions Upon, Foreign Investment

Positive Trends for Investment

With the 2009 end to Sri Lanka’s long-running civil war, the country has an historic opportunity to take advantage of its peacetime stability, geography, educated workforce, and scenic beauty. The Government of Sri Lanka (GSL) has set ambitious goals for economic development – aspiring to GDP growth rates over 8% and developing economic hubs in ports, aviation, commerce, knowledge, and energy. With a relatively open investment climate and financial system, moderately stable monetary policy, improving infrastructure, and world-class local companies, Sri Lanka has many of the ingredients to progress economically. For some U.S. and foreign investors, Sri Lanka’s frontier market has been fertile ground for both direct and capital investments.

Most of the current economic potential is in the tourism sector, with Sri Lanka designated as Lonely Planet’s top destination in 2013, and major international hotel chains opening in Colombo and around the country over the next few years. Tourist arrivals reached 1,000,000 in 2012. Investors are capitalizing on Sri Lanka’s environment, culture, religious history, and wildlife to attempt to attract high-end tourists, especially from the growing markets in India and China. Chinese tourist arrivals in Sri Lanka increased 58% in 2012 alone. The ports are another important driver of growth, with the Colombo Port being one of the most active and efficient in the region, and the country situated at the crossroads of global shipping lines.

Ample scope exists as well for an expansion in the information technology/business processing operations (IT/BPO) sector. With a growing and aspirational middle class, investors see opportunities in franchising, retail, and services, as well as light manufacturing. Investments with an export dimension have the most potential. Reconstruction in the North and East, and infrastructure development throughout the country, including new ports and roads, are also fuelling growth. Sri Lanka’s free trade agreements with India and Pakistan offer preferential access to those markets, and Sri Lanka maintains friendly relations with all its neighbors in the region. The capital city of Colombo offers expatriate managers a good quality of life, with excellent international schools, good housing, and decent urban conditions relative to the region. Political stability and the cessation of the war have allowed the government and population to focus on rebuilding their economy and society.