FDIs from Europe show gradual uptick
By Yakuta Dawood
Foreign Direct Investment (FDI) from European countries has picked up gradually with their contribution to overall FDIs Sri Lanka received in the past few years showing an uptick as per the data provided by the Board of Investment (BOI).
The BOI figures provided on request by The Sunday Morning Business show that in 2019, the contribution from European countries rose by 7% in comparison to the total contribution of 6% in 2018 by successfully attracting a total amount of 13% of FDIs from EU member countries out of the overall FDIs received that year.
Accordingly, the BOI in 2020 received 15% of its overall FDIs from EU countries and then witnessed a gradual increase up to 18% as of the third quarter of 2021, amidst the prevailing Covid-19 pandemic.
Out of the total investment of $ 558 million received by Sri Lanka as of the third quarter of 2021, EU member countries had invested a total of $ 100.88 million.
Further, as per the statistics sent by the BOI, the Netherlands was the largest investor from EU member countries as of the third quarter of 2021 with total FDIs of $ 38.670 million to Sri Lanka, followed by Luxemburg with a total of $ 30.741 million and Sweden with a total of $ 10.130 million.
The EU member countries have invested a total of $ 2,306.11 million within the period from 2005 to the third quarter of 2021. However, the final figure of 2021 is yet to be issued by the BOI in the near future.
Meanwhile, we spoke to the Delegation of the European Union to Sri Lanka and the Maldives, Head of Political, Trade and Communications Section, Deputy Head of Mission Thorsten Bargfrede to gain insight into the development assistance provided by the EU thus far.
Responding to an email sent by The Sunday Morning Business, Bargfrede stated that over the last 20 years, the EU had supported Sri Lanka with over EUR 1 billion in development and humanitarian assistance, including more than EUR 200 million in recent years.
According to him, the assistance provided by the EU has helped communities affected by the tsunami and the ethnic conflict as well as vulnerable people in other parts of the country.
Commenting on future plans in Sri Lanka, Bargfrede said: “The EU has just approved its programmatic document for Sri Lanka covering 2021-2027. We are planning to focus our resources on supporting the Sri Lankan Government’s efforts to counter climate change and preserve the country’s biodiversity. Moreover, we will assist and support peace and reconciliation in close co-operation with the Government of Sri Lanka as we have done in the past, by promoting social inclusion and good governance across all provinces and communities. Projects also just started in support of reforms in the Justice system and preserving biodiversity.”
Further, reflecting upon the private investments from the EU to Sri Lanka, he added that presently hundreds of European companies were directly or indirectly present in the Sri Lankan market with more interest in investing in Sri Lanka in the near future.
“There is great potential to develop our economic partnership. The EU Delegation and the EU Member States are eager to co-operate with Sri Lanka in order to harness this potential. Also, a reliable and stable legal and administrative framework is the main prerequisite for trade and investment. Thus, we stand ready to support Sri Lanka in finding appropriate responses to the current challenge,” Bargfrede concluded.