News
Foreign investors seek greater legal certainty before investing in Sri Lanka
German Industry and Commerce in Sri Lanka Chief Delegate Andreas Hergenrother (Pic by Nishendra Silva)
German companies in discussion regarding potential upcoming investments here
by Sanath Nanayakkare
Legal certainty was a fundamental principle for foreign investment across the world, important even for potential German investors, Andreas Hergenröther, Chief Delegate of German Industry and Commerce (AHK Sri Lanka) told The Island yesterday:
“The reliability of the legal framework in Sri Lanka is essential for foreign investors. We have seen many changes since the beginning of 2020; so many gazette notifications and operating instructions which appear quite confusing for foreign investors and trading partners,” he said.
Elaborating Andreas said: “Of course, we understand that there is a scarcity of foreign currency in the country. On the other hand, it has to be understood that foreign companies operating in Sri Lanka need a clear framework which they can rely on. We hope that when the Covid-19 situation improves, there will be a coherent, transparent investment and trade policy for foreign investors to continue their businesses without uncertainty. They need an operating framework upon which they can plan on their mid-term and long-term prospects. This is very necessary because investors do not want to invest in a scenario that they do not fully understand”.
“For Foreign direct investors including German investors the reliability and predictability of legal frameworks are of very high importance not only with regard to Sri Lanka but worldwide. We fully understand the current situation in the aftermath of Covid-19 where decision makers need to make quick decisions and sometimes the impact of these decisions may not be foreseeable or predictable, but the continuous changing of the business landscape is a major challenge, because what investors mostly need is legal certainty. This fact was further confirmed at a survey we conducted among 160 CEOs and representatives of German companies and their Sri Lankan partners”.
“Of course, Sri Lanka is a sovereign country. Every country has to find its own way to promote foreign direct investment and even during the pandemic, we received some requests for potential investments in Sri Lanka. These requests were much related to certain product groups that are on very high demand and they are also related to free market access to mainly Pakistan and India. Sri Lanka offering free trade access to these two countries is a clear advantage, but it would give much more advantage if Sri Lanka would have free trade agreements (FTAs) with South East Asia (ASEAN), People’s Republic of China and East Asia. Such broad-based market access would definitely increase the potential of Sri Lanka to promote its foreign direct investments”.
“Currently these potential investors are gathering information about Sri Lanka and how they could run their operations from here. Once the airport reopens these investors will be keen to come to Sri Lanka and hold detailed talks with the decision makers here”.
“With regard to these investors’ wish to invest in Sri Lanka, AHK Sri Lanka has initiated talks with Sri Lankan institutions – mainly the Bureau of Investments (BOI). These companies are currently evaluating the situation and will likely visit here to see the ground realities for themselves before making the decision to invest”.
“These companies are from the medical sector, rubber related sector and another one in the field of logistics; namely a Multi-Country Consolidation service. There is another ongoing project in the field of chemicals. These companies are continuously having discussions with the authorities here. In fact, AHK Sri Lanka initiated talks at the time of the lockdown via video links with Sri Lankan decision makers on particular challenges facing German companies in Sri Lanka as well as upcoming projects”.
When asked to name these companies, Andreas said “it should remain confidential as the talks are still at an initial stage”.
“Once the health crisis improves, the decision makers of these companies will visit Sri Lanka to evaluate the legal framework. AHK Sri Lanka and German investors are very satisfied with the talks they have had with Susantha Ratnayake- the Chairman of BOI. He is doing everything he can to support the investors to come here and we have a very close relationship with the BOI. In fact, German companies have been in close contact with the BOI”.
“A level playing field is something very important to build confidence in foreign investment. In this context, we have supported a lot in the initiative of liberalization in the field of freight forwarding and shipping in Sri Lanka. In this regard, we held many conferences as we strongly believe that once foreign ownership will be possible in the field of freight forwarding and shipping, more foreign direct investments will come to Sri Lanka. And with those freight forwarding and logistics companies, their key customers will also follow suit. This convergence would enable Sri Lanka to transform from a transshipment hub into a ‘true logistics and a trading hub’. And then the ideal would be to have companies here that assemble, manufacture and/or make value addition under the scheme of Multi-Country Consolidation.
“The minimum capital requirement for Multi-Country Consolidation in Sri Lanka is US$ 3 million and US$ 5 million for Entrepot Trade. The potential investors are not ready to put three or five million dollars on the table. When it comes to investing, companies in the freight forwarding sector want to have full ownership and not be a minority shareholder of 40%. Currently the law [in Sri Lanka] allows maximum 40% shareholding for freight forwarding and shipping companies”.
When asked why the foreign companies in the freight forwarding sector wanted full ownership, Andreas said, “These companies have reporting obligations and internal compliance rules which have been made more severe in the past years, therefore, it is important for them to determine the processes and operations inside the companies according to their standards. Furthermore, companies compare different Foreign Direct Investment Destinations in the world. Nowadays most of the ‘hub-countries’ offer full ownership to freight forwarders and encourage investments under the scheme of Multi-Country-Consolidation”.
The Delegation of German Industry and Commerce in Sri Lanka (AHK Sri Lanka) was officially inaugurated on 27th March 2018, with the purpose of enhancing the bilateral economic relationship between Germany and Sri Lanka. AHK Sri Lanka is part of the German Chamber Network supported by the Federal Ministry for Economic Affairs and Energy. With 142 locations in 92 countries around the world, the members of the German Chamber Network (AHKs) offer their experience, connections and services to German and foreign companies. AHKs are located in all countries of particular importance to German companies and are closely connected to the Chambers of Industry and Commerce (IHKs) in Germany. Together they support German companies with building up and extending their business relations to foreign countries, representing in total 3.6 million German companies.
During the past years, AHK Sri Lanka) has been a reliable partner for many Sri Lankan institutions such as BOI and EDB. Committed to investment and export promotion, more than 20 business delegations have been organised in both directions. Further, AHK is planning to take four business delegations to promote exports in the sectors of agriculture/food, PPE, rubber, and energy efficient industrial solutions in the fourth quarter of 2020,
On 21st of August AHK Sri Lanka will organize a joint webinar with Deutsche Bank and Allianz on ‘Planning and Risk Mitigation in Times of Economic Uncertainty’.
News
National Communication Programme for Child Health Promotion (SBCC) has been launched. – PM
Prime Minister Dr. Harini Amarasuriya stated that the Government has commenced necessary measures to maintain preschool education under a framework, align preschool education with a unified curriculum, conduct teacher training in a systematic manner, and ensure quality standards.
The Prime Minister made these remarks on Saturday (10) at the Temple Trees, participating in the launch of the National Communication Programme for Child Health Promotion, aimed at promoting social and behavioural change (SBCC) among early childhood children. The programme is jointly organized by the Health Promotion Bureau, the Ministry of Women and Child Affairs, the Ministry of Education, Higher Education and Vocational Education, UNICEF, and the Clean Sri Lanka Programme.
Addressing at the event, Prime Minister Dr. Harini Amarasuriya stated:
“Early Childhood Development (ECD) has a major impact on a country’s human development and future progress. It is a widely accepted fact that a child’s future depends largely on early childhood development. Many aspects essential for a child’s growth occur within the first five years of life. The experiences, care, and love a child receives during this period are decisive.
The social integration, relationships, and environmental influences experienced in early childhood form the foundation for shaping an individual as an adult. Early childhood development influences life to an extent that it becomes difficult to change when it grows into adulthood.
The responses of adults to children’s actions, the way they interact with them, and the care they provide are extremely important. Therefore, early childhood development should never be viewed as the sole responsibility of parents. It is a collective responsibility of all citizens.
No child can be raised into a good citizen by parents alone. In all our lives, beyond our parents, there have been many who influenced us, showed us love, and provided care. It is due to the collective support of all these individuals that we have reached where we are today. The government views child care as a social responsibility. Supporting a child, providing care, ensuring protection, education, and health facilities are social responsibilities. In this regard, the intervention of the Clean Sri Lanka Programme to communicate these values to the public is important.
The role of the preschool teachers plays a special and vital role for children. The love, care, attentive listening, and responses children receive during this stage are decisive for their development. Teachers carry out a crucial intervention in the lives of children. An education policy on early childhood development has been formulated, with UNICEF providing technical assistance. Steps are being taken to operate preschool education under a single framework, align it with a unified curriculum, systematically conduct teacher training, and ensure quality standards.
Recognising early childhood development as a specialised area within education, the Prime Minister affirmed that the relevant interventions will be made accordingly.
Addressing the event, Minister of Women and Child Affairs, Ms. Saroja Paulraj stated that the Ministry has identified the standardisation and development of early childhood development as a primary goal for the year 2026. She noted that children who leave the warmth of their mother’s embrace and father’s shoulder and come to preschool teachers expecting the same love and care from their teachers. Conveying that warmth through words and expressions is a responsibility entrusted to teachers. The love and safe environment children receive shape their ability to love the environment and respect others.
Minister of Health and Mass Media, Nalinda Jayatissa, also addressed the gathering, stating that the goal of the government is to build a beautiful future generation capable of leading the country, free from the various hardships and challenges faced today.
He emphasised that creating a healthy population is a challenge, particularly in preventing non-communicable diseases. Children aged three to five today will become a generation aged 18 to 20 by 2040. Continuous and comprehensive programmes such as this are essential to protect that generation from non-communicable diseases. In some instances, interventions are required even during the preconception and prenatal stages.
He further highlighted that preschool and early childhood development centre teachers shoulder a tremendous responsibility in driving a major transformation in the country’s future.
The event was attended by the Governor of the Sabaragamuwa Province, Ms. Champa Janaki Rajarathne; the Governor of the Uva Province, Attorney-at-Law Kapila Jayasekara; the Governor of the North Central Province, Wasantha Jinadasa; the Governor of the North Western Province, Thissa Kumarsiri Warnasuriya; the Deputy Minister of Women and Child Affairs, Dr. Namal Sudarshana; the Member of Parliament, Dr. Najith Indika; the Representative of the United Nations Children’s Fund (UNICEF) in Sri Lanka, Ms. Emma Brigham; the Secretary to the President, Dr. Nandika Sanath Kumanayake; the Senior Additional Secretary to the President (Finance and Economic Affairs), Mr. Russell Aponsu; the Additional Secretary to the President (Clean Sri Lanka), S. P. C. Sugishwara; Secretaries to Ministries; Provincial Chief Secretaries; the Commanders of the Tri-Forces; officials of subject-related ministries; provincial council officials; preschool teachers; preschool children; and parents.

(Prime Minister’s Media Division)
News
Level I landslide early warnings issued to the Districts of Badulla, Kandy, Matale and Nuwara-Eliya extended
The Landslide Early Warning Centre of the National Building Research Organization (NBRO) has extended the landslide early warnings issued to the Districts of Badulla, Kandy, Matale and Nuwara-Eliya till 1600hrs today (11).
Accordingly, the LEVEL I YELLOW early warnings issued to the Divisional Secetaries Divisions and surrounding areas of Lunugala, Meegahakiwula,Welimada, Kandaketiya, Hali_Ela, Badulla, Uva Paranagama in the Badulla district, Minipe and Ududumbara in the Kandy district, Wilgamuwa, Ukuwela, Ambanganga Korale, Rattota and Laggala_Pallegam in the Matale district, and Nildandahinna, Walapane, Mathurata and Hanguranketha in the Nuwara-Eliya district will be in force until 1600hrs today (11)
News
Experts: NPP education reforms unsuitable for SL
Proposed education reforms have drawn sharp criticism from education professionals, teacher unions and student organisations, who warned on Thursday that the changes risk undermining child safety, widening inequality and imposing unaffordable costs on parents.
Addressing a press conference in Colombo, Dr Ayomi Irugalbandara of the Faculty of Education at the Open University of Sri Lanka said the proposed reforms appeared to be largely modelled on foreign education systems without adequate consideration of local realities.
She took particular issue with proposals to integrate social media use into the school curriculum, noting that several developed countries have moved in the opposite direction by preventing children under the age of 15 from accessing social media platforms.
“Most of these modules are not appropriate for this country,” Dr Irugalbandara said. “We warn parents that these reforms place children at risk.”
Concerns were also raised over digital content linked to the revised curriculum. Inter-University Students’ Federation Convener Madushan Chandrajith said the Grade Six Information and Communication Technology (ICT) module included QR codes that directed students to a controversial YouTube channel.
“Who will take responsibility for children accessing such content?” he asked, calling for clear accountability mechanisms for material linked through digital platforms used in schools.
Secretary of the Workers’ Struggle Centre, Duminda Nagamuwa, criticised the government’s approach to the reform process, comparing it to the fertiliser policy introduced under former President Gotabaya Rajapaksa. He alleged that the authorities were pushing ahead with education reforms despite opposition from academics, teachers and other stakeholders.
Nagamuwa also highlighted the economic burden on families, noting that Sri Lanka’s poverty rate had increased from 12.5 percent to 25 percent. He questioned how parents were expected to afford smartphones or tablet computers required for students to access QR code-linked educational content.
“The government is asking parents to bear costs they simply cannot afford,” he said.
Ceylon Teachers’ Union General Secretary Joseph Stalin said schools had already begun collecting money from parents in anticipation of the reforms, including funds to purchase smart boards.
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