A few years ago, Sri Lanka, with begging bowl in hand, had to plead with the Western world to raise the funds to run the country. Today, with the end of the war and a strong Government in place, the tides have turned and investors are now pursuing Sri Lanka.
Areas which have stimulated international investor interest are the possible availability of oil, opening of the Hambantota harbour and the opening of the North and the East for business once again.
Chairman, Chamber of Commerce and Industry, Jaffna K. Pooranachandran said that with the end of hostilities massive development projects have begun to roll out and there would be a boom in the manufacturing industry in the near future.
He said that the North and the East are full of untapped natural resources and the time has now come to harness them. “We will soon see a time where both local and international investors will come behind the North and East entrepreneur and signs of this are already emerging,” he said.
Representatives from Larsen and Toubro Limited, India’s largest engineering conglomerate which is building the world’s second largest airport in New Delhi visited Jaffna and are looking at making investments for more than US $ 100 million per project.
In addition blue chip companies such as John Keells and Aitken Spence are looking at building star class hotels in Jaffna. Merchant Bank of Sri Lanka (MBSL) laid the foundation stone for an 80-room hotel in Nallur.
Another area where foreign investors have shown an interest is the power sector.
The re-building of the railway line from Omanthai to Kankesanturai (KKS) has already being given to two Indian companies.
The Oddusudan tile factory in Mullaitivu which was shut down for two decades will re-commence production soon generating employment opportunities to youth. In addition the KKS cement factory which was closed for three decades will be reopened in three months.
The 65-acre Achuweli Economic Zone which was one of the main industrial attractions in Jaffna is also to be rebuilt with the assistance of the Indian government.
Indian High Commissioner in Sri Lanka Ashok K. Kantha who graced the first Jaffna International Trade Fair as the Chief Guest last week said the Indian government as well as the private sector would have a major role to play in rebuilding the infrastructure and help bring back prosperity to the North and the East again.
The Colombo Stock Exchange (CSE) has also decided to open a branch office in Jaffna.
An official from the CSE said this is in response to the demand of the Jaffna businessmen and the public who want to invest in the share market. The CSE is currently negotiating for a building in the peninsula which it is expected to get by the end of the month.
The Jaffna public’s per capita income is high.
“They are self-sufficient in every way. They also get a lot of foreign remittances from their relatives and they want to re-invest these funds in stocks,” a stockbroker said.
In addition, the Board of Investment has already opened a branch office in Jaffna mainly to woo the Tamil Diaspora to re-invest in the region. The Central Bank too has plans to open a branch in Jaffna.
The Export Development Board has set up a branch in Jaffna and is also taking steps to set up an ice plant in the region. The EDB office would facilitate the export of palmyra, fruits and vegetables (fresh and dried), fish, ginger, handicrafts, tobacco, salt-based products and many more items.
This office would also stimulate the SME sector in the area as they would be able to obtain technical and export assistance. A convention and exhibition centre will be built in Araly, Jaffna to fill the void of a venue to host international events.
This would also help attract MICE (Meetings, Incentives, Conferences and Exhibitions) tourism to the region.
MICE visitors are high spenders and such business generate additional employment and repeat holiday visits, hence the heavy focus of countries such as Singapore and Malaysia on MICE tourism. The recently concluded Jaffna International Trade Fair attended by over 175 local and international investors at the Jaffna Central College too would help the rebuilding process of the Jaffna entrepreneur. This was the first major international trade fair hosted in Jaffna.
Director, Lanka Exhibition and Conference Services (Pvt) Ltd, Imran Hassin said that they were very happy with the response to the event. He said this landmark fair was organised to put Jaffna in the world investment map and their efforts were fruitful as there were many business match-making opportunities. “The exhibition also brought in new technology to the North and the East enabling entrepreneurs to add a modern touch to their enterprises,” he said.
The event was organised in collaboration with the Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL). The main sponsors were Sri Lanka Telecom and Mobitel. Themed ‘Your gateway to Yarlpanam’ the event was also the first ever MICE event held in Jaffna.
President FCCISL, Kosala Wickramanayake said that the opening of the A-9 highway would open new vistas for businessmen. “It will make the Colombo market closer to the Northern market,” he said. Road development at a cost of over US$ 100 million has been designed to rehabilitate 350 kms of C and D class roads in the North and East Provinces.
The FCCISL also mediated with the Security Forces to enable the public to visit the final battle line areas and identify and bring back their motor vehicles. Around 6,000 bicycles, 3,000 motorcycles and 600 water pumps from the Puthumathalan area were collected and are being kept in a storehouse in Kilinochchi.
He said a lot needs to be done to improve the infrastructure of Jaffna and the youth too need skilled training. “The talent is there, but has to be sharpened,” he said.
Mayor of Jaffna, Y. Sathgunaraja said Jaffna businesses faced a severe beating for over 30 years.
They are now putting that aside and want to re-bound. She recalled the glorious industrial past of the Jaffna entrepreneur when big cement and chemical factories existed and the weaving mills supplied quality fabric to the country.
She said the power supply that had been disrupted has now been restored and the roads have been re-laid. Once the railway lines are re-built up to KKS Jaffna businessmen would receive a further boost as their transport charges would be further reduced. Jaffna entrepreneurs soon after the ending of the war, have kickstarted their businesses and many new products have hit the market.
The grape wine and cordial which along with the nelli cordial are packed in plastic bottles are gaining in popularity while traditional products such as dried fish and dried prawns have re-entered the market. Several new hotels too have come up, increasing the Jaffna bed capacity from around 200 to 500, mainly to cater to the demand of the enthusiastic Southern visitors who are touring the area after almost 30 years. Around 300,000 local and foreign tourists have arrived in the Northern Province after the A-9 Road was opened.
Transport is another area which has improved in leaps and bounds with air-conditioned buses taking off from both destinations.
Due to improved road conditions and commuters not being asked to get off at several points (the only check point is now at Omanthai) a person from Colombo could now reach Jaffna in less than nine hours.
Date:26th April, 2010 - 16:30 Hours (GMT)