Doing Business in Sri Lanka Colombo. Economy Foreign Trade

Course summary Doing Business in Sri Lanka

Sri Lanka, officially the Democratic Socialist Republic of Sri Lanka (known as Ceylon before 1972) is an island nation in South Asia, located about 31 kilometers (19.3 mi) off the southern coast of India. It is home to around 21 million people.

Famous for the production and export of tea, coffee, coconuts and rubber, Sri Lanka boasts a progressive and modern industrial economy and the highest per capita income in South Asia.

The island's strategic location in the Indian Ocean on the major air & sea routes between Europe & the Far East is an advantage to positioning Sri Lanka as a global logistics hub.

The service sector is the largest component of GDP at almost 60%. In 2008, the service sector growth slowed to 5.6% from over 7% in 2006-2007. Telecom, trading, transport, and financial services were the main contributors to growth.

Sri Lanka depends on a strong global economy for investment and for expansion of its export base, and the global slowdown has proved to be detrimental to Sri Lankan growth.

President Rajapaksa's broad economic strategy was outlined in his election manifesto "Mahinda Chintana" (Mahinda's Thoughts), which now guides government economic policy.

Sri Lanka hopes to diversify export products and destinations to make use of the Indo-Lanka (India - Sri Lanka CEPA) and Pakistan-Sri Lanka Free Trade Agreement and other regional and bilateral preferential trading agreements.

Example of the course Doing Business in Sri Lanka:

Foreign trade
- Exports: $7.0 billion
- Main export products: garments, tea, rubber products, jewelry and gems, refined petroleum, and coconuts.
- Major export markets: United States, U.K., India.
- Imports: $9.6 billion.
- Major suppliers: India, Singapore, Hong Kong, China, Iran, Malaysia, Japan, U.K., U.A.E., Belgium, Indonesia, South Korea, U.S.

Sri Lanka's free trade zones have been the linchpin of economic development and inflow of foreign direct investment into Sri Lanka. Malaysia emerged as the major investor in 2006 with an investment of over US$ 55 million. Over 50% of all Indian investments in SAARC countries are located in Sri Lanka. The United Kingdom is one of Sri Lanka's major investors. Singaporean investments are characterized by the diversity of the sectors of the enterprises. They are involved in the production of flour, animal feed, high rise buildings, IT, ... Hong Kong investments in Sri Lanka are essentially in the garments and textile sectors.

Brandix is the largest exporter of apparel in Sri Lanka. As the holding company of the Brandix Group of companies, it is engaged in developing, manufacturing and marketing end-to-end apparel solutions to global fashion superbrands. The Group employ over 25,000 people directly.

Sri Lanka Telecom is one of the country's most valuable blue chip companies with an annual turnover in excess of Rs 40 billion. Whilst Global Telecommunication Holdings N.V. of Netherlands owns 44.9% stake in Sri Lanka Telecom (SLT) immediately after conclusion of their mandatory offer to the shareholder of SLT on 2nd June 2008 and 49.5% is owned by the Government of Sri Lanka.

International Economic Relations. Sri Lanka is member of: South Asian Association for Regional Cooperation (SAARC), Bay of Bengal Initiative (BIMSTEC), Ocean Rim Association for Regional Cooperation (IORARC), Asia-Pacific Trade Agreement (APTA), Asian Clearing Union (ACU), Boao Forum For Asia (BFA), Asia - Middle East Dialogue (AMED), Asia Cooperation Dialogue (ACD), Asian Development Bank (ADB), Economic and Social Commission for Asia and the Pacific (ESCAP), Colombo Plan, United Nations, Commonwealth, World Bank, International Monetary Fund ...

Sri Lanka was placed 102nd (Medium Human Development Category) out of 182 countries in the Human Development Indicators constructed in 2009, ahead of Philippines (105th), Vietnam (116th), Indonesia (111th), India (134th), Pakistan (141st) and Bangladesh (146th).

India - Sri Lanka Comprehensive Economic Partnership Agreement (CEPA):

Sri Lanka is a multi-ethnic, multi religious country with a diverse & rich culture. The Sinhalese, the majority community, comprise 74.0% of the country's estimated 19.7mn population. The two official languages are Sinhala & Tamil. Because of its location in the path of major sea routes, Sri Lanka is a strategic naval link between West Asia and South East Asia, and has been a center of Buddhist religion and culture from ancient times.