Reduce corruption to boost FDI - EU Ambassador

Sri Lanka should try to reduce red tape and minimize corruption to bring in more foreign direct investments to the country, said Ambassador of the Delegation of the European Union to Sri Lanka and the Maldives, Tung Lai-Margue.

He was speaking at a seminar on the current of state of affairs in terms of EU policy on Government of Sri Lanka’s commitment to comply with international conventions.

He said that corruption too has to be eliminated and the business community can play a major role by not offering ‘bribes’ to get their matters attended to.

“One of the most important things that can be done to eliminate corruption is to severely punish wrongdoers which would be an example for others to refrain from doing so.”

He said that in addition foreigners must be allowed to purchase land in Sri Lanka for their investment.

Sri Lanka should also look at offering long-term visas to investors and also charge less income tax from them at least in the initial stage of the investment. Foreign entrepreneurs investing in Sri Lanka should be given tax holidays for at least three years after starting their businesses.”

The EU Ambassador also said that some of the recent steps and targets set and taken by the government are very encouraging. “This includes the Vision 2025, National Export Strategy, new Inland Revenue Act and the proposals for a new constitution.

There have been positive accomplishments such as the passing of the Right to Information Act, establishment of the Office of Missing Persons, and commencing a process of constitutional reforms. However, reports from various UN agencies and national and international civil society committed to supporting reforms indicate that the reforms have not progressed as expected and desired. He said that after the lifting of the fisheries ban, exports to EU has been increasing and similarly apparel exports too are increasing.

Meanwhile Deputy Minister Policy Planning and Economic Development Dr. Harsha De Silva said that the regaining of GSP Plus and the lifting of the fisheries ban have resulted in an upturn in order books for the European markets.

He said that world labour laws and working conditions are changing and in Sri Lanka too this is happening especially with extended working hours and also flexi hours which has already started in Battaramulla. “We observe that Sri Lankan women workforce of 35% is one of the lowest in Asia and we hope that new labour laws would help to increase this figure.”