• Lauds optimistic relationship with SL over a journey spanning 21 years
• Envisions spreading CG investment avenues into other business verticals
• Asserts first priority for Government will be restructuring country’s debts
• Warns there is no short-term solution to promise people significant relief
• Calls on international community to help Sri Lanka build on its strengths

Reiterating his confidence in Sri Lanka despite its ongoing economic crisis, Nepalese billionaire, Member of Parliament, and CG Corp Global Chairman Binod Chaudhary let his actions do the talking by investing in Sri Lanka’s financial sector recently.

CG Corp Global’s subsidiary CG Capital Partners Singapore acquired 70.84% of Union Bank Colombo (UBC) in December 2022, marking the group’s debut into the local financial sector. The announcement of the transaction to the Colombo Stock Exchange on 1 December 2022 resulted in the bank’s share gaining 13.3% to close at Rs. 8.50.

CG Corp Global doesn’t plan to limit its investments in Sri Lanka to hospitality and financial services alone – the group also envisions spreading its investment avenues here.

In an interview with The Sunday Morning, Chaudhary – a longstanding champion of Sri Lanka – asserted that the group had always continued to explore investment opportunities while being a firm believer in the country’s growth potential.

“Given the enabling investment environment of Sri Lanka, the group envisions to spread its investment avenues into other business verticals – financial services to start with right now,” he revealed.

UBC is one of Sri Lanka’s 12 listed banks with a market capitalisation of Rs. 9.1 billion. CG Capital Partners is a private equity company incorporated in Singapore under the umbrella of CG Corp Global. 

Chaudhary’s first noteworthy investment in Sri Lanka was in the hospitality sector in 2001, when he invested in the Taj Samudra Colombo even as the war was raging in Sri Lanka, due to which other investors were shying away from the country. That investment marked Chaudhary’s foray into the hospitality sector, which has since grown to encompass 11 properties in six countries.

Following are excerpts of the interview:

Affirming your faith and confidence in Sri Lanka, you’ve decided to invest in Sri Lanka once again, despite the ongoing uncertainty. What drove this decision?

The group has always continued to explore investment opportunities while being a firm believer in the growth potential of Sri Lanka.

I envisioned having over 200 hotels within our ever-expanding hospitality portfolio. My infinite optimism in expanding into Sri Lanka started in early 1996, at a time when a raging civil war signalled a mass exodus of businesses and terrified potential investors away from the country.

At a time when there was indeed an economic recession and the economy was in the doldrums, I felt very confident that Sri Lanka had the potential and hence investing in this country was apparent.

In Sri Lanka itself, through its properties and operations, CG employs over 1,000 employees. Since 2001, CG is assured of the optimistic relationship it has created with Sri Lanka through this journey of 21 years. As of today, it holds investment in 13 hotels within the nation. 

Sri Lanka is going through very tough times and struggling to mobilise foreign funds and investments even through the International Monetary Fund (IMF). Banks are under tremendous pressure as are the borrowers. 

Given the enabling investment environment of Sri Lanka, the group envisions to spread its investment avenues into other business verticals – financial services to start with right now. CG has been able to attain strong expertise and on ground experiences and evidently, the financial services arm of CG has grown immensely due to the visionary leadership and progressive yet sound investments. 

Having laid such a strong foundation for financial services in Nepal since 1995, the group is assured in its core competence developed over the years and seeks to reflect the same in the transitioning yet burgeoning ecosystem of Sri Lanka.

The acquisition of 70.84% of Union Bank Colombo marks CG Corp Global’s entry into Sri Lanka’s financial sector. Why did you pick this industry and this bank in particular?

CG Corp Global has played part and parcel in Sri Lanka’s economy since 2001. The group made its first investment in the iconic Taj Samudra (2001) and over the years it has invested in several properties.

The group has an ever-increasing presence within Nepal in commercial banking, insurance, investment banking, remittance, financial solutions, and other peripheral services. The group has a demonstrated history of investing, setting up strategies, and building management capabilities in financial institutions as an industry leader.

CG’s roots in Nepal have helped it to understand and empathise with the challenges small countries face with respect to their economy, which has helped it cement its position in Sri Lanka. Despite all economic setbacks, we have decided to take a plunge into Sri Lanka. We know it’s going to be tough, but that’s the extent of confidence and our deep-rooted close ties with Sri Lanka.

Your first investment in Sri Lanka was in 2001 during the war, when you invested in the Taj Samudra Hotel and thereby entered the hospitality industry. How has the investment paid off?

At the time of the war when CG invested in these assets, there were literally bombs flying on top of the roof of the assets. At that point in time, the hotel rates were well below $ 50. Today you can see that the rates are above $ 120. 

The land value itself is the most prized land parcel in all of Sri Lanka. Even when we look at from the point of view of the investment potential, it is yet to be unearthed with the utilisation of the land areas that are there which are unutilised in terms of further development, which is in the plans, and in terms of the property itself, which is already performing as one of the leaders in the market today.

Across all coveted travel and hospitality ratings, reviews, and listing platforms, the Taj Samudra, Colombo is always on top. 

How do you view the current situation in Sri Lanka and what is your advice to the Government and the people of Sri Lanka on getting Sri Lanka back on track?

While Sri Lanka as an the island nation was always strategically located at the crossroads of major shipping routes to South Asia, the Far East, and the continents of Europe and America, making the country a convenient port of call for shipping lines and airfreight services, a few wrong political decisions have turned it into an economic mess, with no medicine, short supply of food and fuel, and the country running out of cash.

The first priority for the new Government will be to restructure Sri Lanka’s huge debts. There is no short-term solution that promises the nation’s people significant relief and no guarantees that the country will continue to rally together rather than descend into violence.

The international community needs to work together to help Sri Lanka through an extended recovery period and give its citizens some confidence that a decent life will eventually return. It will be a test case as other countries face similar problems in the years ahead. 

Which areas should Sri Lanka prioritise in terms of attention and investment in the year ahead as it looks to emerge from the ongoing crises?

Global investments are a function of stability, business processes, and ease of doing business. Sri Lanka faces the prospects of years of privation and scarcity, but it has strengths as well—an educated workforce, a social safety net, and a long history of democratic governance.

The international community needs to help Sri Lanka build on those strengths and try to prevent another descent into self-destructive violence that would threaten the country’s future for the long-term.