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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’.
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Bambalapitiya Railway Station renovated under the “Dream Destination” project opened to the public
Prime Minister Dr. Harini Amarasuriya stated that Sri Lanka is now creating a common dream as a nation and that the Government’s objective is to make public transport the convenient choice for the people. The Prime Minister made these remarks while participating in the ceremony held to open the renovated Bambalapitiya Railway Station under the “Dream Destination” project.
The renovated Bambalapitiya Railway Station was opened to the public on 10 September under the “Dream Destination” project, jointly implemented by the Ministry of Transport, Highways and Urban Development and the Sri Lanka Railways Department in line with the Clean Sri Lanka national programme. Prime Minister Dr. Harini Amarasuriya participated in the occasion.
The Prime Minister also inspected the renovated railway station, as well as the new pedestrian overpass providing access to the railway station, constructed by the Road Development Authority for which the Dawoodi Bohra community in Sri Lanka contributed Rs. 60 million.
Addressing the gathering, the Prime Minister expressed her special appreciation to the Bohra community for taking the initiative to renovate and provide the people with improved facilities at the Bambalapitiya Railway Station, a busy and well-known location in the Colombo District.
She stated that the renovation of public spaces and the provision of improved facilities have contributed to generating greater interest and a more positive perception of public transport among the people.
The Prime Minister also expressed her appreciation to the Minister of Transport, Highways and Urban Development, the Deputy Ministers and the staff for their contribution towards improving public transport services and attracting greater public interest towards these services.
The development of a country is not determined by the number of private vehicles it has. It is determined by the manner in which people use public transport. The Government’s objective is to improve the public transport service, which has disappointed the people for many years, and create a situation where people feel that public transport is more convenient and safer than using a private vehicle. The Government’s commitment to public transport is clearly demonstrated by the increased allocation of funds for the sector. The ’Dream Destination’ programme is another significant initiative under this effort, bringing together State institutions and the private sector to contribute to national development,” the Prime Minister stated.
“A country does not belong only to the Government. A country is the home for everyone who lives in it. It is the responsibility of all of us to contribute to that home through our knowledge, labour or resources. For a long time, we did not have a common dream as a country. Today, we feel that such a dream is beginning to emerge.
“We have a collective dream. The journey towards that dream is the collective journey we have begun together to build our country, which is our common home.
“What we witness here today is the active participation of our people, our diverse communities and the private sector in this journey. Such collective participation is essential to moving a country forward. Therefore, we deeply appreciate this contribution.
“The Bohra community reminds us today of the importance of this collective spirit. We have now embarked on a collective journey. We share a common dream of what our country should be, what the future of our country should look like and what kind of experience life in our country should offer. The Clean Sri Lanka national programme further strengthens these objectives,” the Prime Minister further stated.
Addressing the gathering, Deputy Minister of Urban Development Eranga Gunasekara stated that increased funding would be allocated to the Sri Lanka Railways Department for development activities next year. He noted that public transport and railway services had not previously received sufficient attention from the Government, but that this would change moving forward.
“Our transport services are progressing step by step, and the railway system is a key component of this development. Accordingly, on the instructions of the President, we will commence the electric railway system, which has long been a dream for our country, next year. We expect to introduce electric railway services from Maradana to Makumbura, from Maradana to Panadura and from Maradana to Ragama. We will also commence work to extend the Kelani Valley railway line from Avissawella to Ratnapura.
He also appreciated the contribution made by private institutions towards the “Dream Destination” project without seeking any promotional benefits in return.
Speaking on behalf of the Dawoodi Bohra community, Khuzaimah Jefferjee stated that the Dawoodi Bohra community, which has been part of Sri Lanka’s social, cultural and economic landscape for more than 150 years, believes that being a citizen of the country means more than simply living in the country. It means contributing to the country, caring for it and leaving behind a better country for future generations.
He said that, as part of this responsibility, the community had taken steps to renovate, modernise and beautify the Bambalapitiya Railway Station. He added that the community hopes these efforts will make the daily journeys of passengers a cleaner, safer, more convenient and dignified experience.
The occasion was attended by the Deputy Speaker of the Parliament of Sri Lanka Dr. Rizvie Sally, Deputy Minister of Religious and Cultural Affairs Muneer Mulaffer, Mayor of the Colombo Municipal Council Vraie Cally Balthazar, Secretary to the President Dr. Nandika Sanath Kumanayake, Secretary to the Prime Minister Pradeep Saputhanthri, General Manager of Sri Lanka Railways Padmapriya, Janab Amil Saheb Ibrahim and representatives of the Dawoodi Bohra community, officials of the Clean Sri Lanka programme and several others.


[Prime Minister’s Media Division]
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Steps being taken to reduce paper usage in parliament and the public sector through digitalisation – PM
Prime Minister Dr. Harini Amarasuriya stated that steps are being taken to reduce the use of paper in Parliament and the public sector through digitalisation.
The Prime Minister made these remarks in Parliament on Thursday (10 September) in response to a question raised regarding digitalisation and the use of paper.
The Prime Minister further stated:
“The total expenditure incurred in 2023, 2024 and 2025 for the provision of Hansard reports, Order Books, Agendas and other parliamentary printed materials provided to Members of Parliament and Ministers for use within the Chamber is Rs. 45.3 million in 2023, Rs. 58.7 million in 2024 and Rs. 73.1 million in 2025.
All these printed materials have been produced based on requests made by Parliament. At the same time, a programme is currently being developed to reduce the use of paper.
In accordance with a request made by the Secretary to the Treasury to the Secretary-General of Parliament, the Committee on Parliamentary Business considered the possibility of submitting reports to Parliament solely in digital format in the future. It was decided to conduct a survey to ascertain the preference of each Member of Parliament. Based on the results of the survey, arrangements will be made to provide relevant documents digitally to Members who prefer digital copies, while printed copies will be provided to those who prefer printed versions.
Following the completion of this survey, arrangements will be made to implement the programme on a date to be determined by the Committee on Parliamentary Business.
Similarly, all ministries and government institutions are currently taking steps towards digitalisation while reducing their use of paper. However, this process will take some time. In this manner, particularly the exchange of files and many other such processes can be facilitated through digital systems in the future.
For example, in the Ministry of Education, applications for leave submitted by university lecturers for overseas travel were previously submitted to the Ministry in printed form. The entire process has now been digitalised. The Ministry, through the University Grants Commission, provides approval for such leave applications through a digital process. Ministries across the government are taking similar measures. We believe that once digital systems are fully established, we will be able to significantly reduce the use of paper.
Responding to a question regarding measures to reduce the weight of schoolchildren’s bags, the Prime Minister stated:
The weight of students’ books will be reduced through the activity-based learning process introduced under the new education reforms. Since the books will be kept in the classroom, students will no longer need to carry them back and forth. They will only need to take the books home at the end of the term after completing their work.
From 2027, a module-based learning process will be introduced for Grade 6. Modules will not consist of large textbooks; instead, students will be provided with modules relevant to each subject for the particular term. Therefore, this system will significantly reduce the weight of schoolchildren’s bags.
[Prime Minister’s Media Division]
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INS Udaygiri departs Colombo concluding formal visit
The Indian Naval Ship (INS) Udaygiri departed the Port of Colombo today, 11 September 2026, following the successful completion of a four day official visit.
On her departure, the Sri Lanka Navy bade farewell to the ship in accordance with time-honoured naval traditions.
During the visit, naval personnel from both navies engaged in joint initiatives to strengthen bilateral ties. These included a friendly volleyball match, a beach cleanup along the Galle Face
promenade, and a training exercise on Visit, Board, Search, and Seizure (VBSS) conducted by the Sri Lanka Navy Special Boat Squadron (SBS).
As part of the visit, the Indian Navy handed over a consignment of spares and supplies to the Sri Lanka Navy. Visiting crew members also toured key tourist attractions in and around Colombo.
Official interactions of this nature aim to enhance cooperation and knowledge-sharing between the two maritime forces, supporting joint responses to evolving regional maritime challenges.
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