Britain to Invest in Sri Lanka Oil Exploration and Infrastructure

15th October 2010, www.news360.lk, By Prasanna C Rodrigo

The United Kingdom says, Businesses in Britain is showing a great interest to invest here in Sri Lanka and is already bidding to obtain some of the big infrastructure development contracts.

The Deputy Head of UK Trade and Investment at the British High Commission in Colombo Nadeesha Epasinghe said apart from it, few UK companies are also looking at the possibility of engaging in oil exploration activities here in the country.

Speaking to www.news60.lk she said, UK Trade and Investment is following up with those companies to activate those plans.

Touching further Epasinghe also noted Britain which brought in the 2nd largest share of FDI’s to Sri Lanka in 2009 counting for a sum of US$ 300 million wants Sri Lanka and UK to be “Partners in Prosperity”.

Following is the full interview Nadeesha Epasinghe, who is the Deputy Head of UK Trade and Investment at the British High Commission in Colombo had with us.

Q1. How does UK see the trade and investment climate here in the country?

The UK has close and long-standing bilateral ties with Sri Lanka. The two countries have built on their historical links to develop a close partnership across a wide range of spheres, especially in trade, culture and education. In addition to these ties, the bilateral people-to-people links are also very strong. Many Sri Lankans have studied or worked in the UK and regard it as their second home and Sri Lanka is a top tourist destination for Britons. Statistics released by the Board of Investment (BOI) also support these links. In 2009, Foreign Direct Investment (FDI) by the UK totalled nearly US$300 million – the second largest share of FDI from a single country for 2009. Meanwhile, UK exports to Sri Lanka totalled US$186 million while imports from Sri Lanka to the UK totalled US $1 billion in 2009.

There are over 100 companies in Sri Lanka with a UK affiliation and some of these British investments are expanding their operations. I recently visited AB Mauri (a company owned by the Association of British Foods) which has a substantial investment in Sri Lanka and has recently expanded their operations with an Rs.50 million investment into a bakery school. In addition, some of the biggest British businesses operate in Sri Lanka, such as Marks and Spencer, Tesco, Triumph, GlaxoSmithKlein, Aviva, HSBC and Scott Wilson. Clearly, the UK and Sri Lanka already enjoy an extensive business partnership across many sectors. We at the British High Commission believe this partnership can be further strengthened and that the UK and Sri Lanka can be “Partners in Prosperity”. This is why we continue to engage with government officials, businesses, chambers of commerce and other key decision makers in Sri Lanka to further strengthen the bilateral trade relationship.

Q2. There have been many stories about UK investors showing an interest to invest in Sri Lanka after the end of the conflict. What is the level of progress in this regard?

We are receiving a lot of business interest from companies across different sectors in the UK in doing business with Sri Lanka. We are working with these potential investors, introducing them to the key players in the market and helping them assess the opportunities available.

Q3. What areas are they focusing on to invest in Sri Lanka?

The sectors that we see as having the greatest potential for UK companies in Sri Lanka are infrastructure, tourism, power, education and training and ICT. In addition, we feel that there are opportunities in the areas of agriculture, fisheries and garments (in which UK companies can build on the already existing links).

Q4. During an investor forum in Malaysia recently, you made a presentation about the opportunities Sri Lanka presents in regard with oil exploration. Are any of the British firms eyeing to bid for oil exploration activities in the country?

I attended the SubSea Asia Conference in Kula Lumpur in June and presented some of the opportunities available for oil exploration. There was some interest and we are following up with the relevant companies to take this forward. In addition we are supporting the British Company Cairn Energy who are about to embark on off-shore drilling off the coast of Mannar early next year; this is an investment of US$100 million.

Q5. Do you see any key players already in the pipeline, planning to enter Sri Lanka, maybe for projects like ports, airports, roads etc.?

There are already a number of UK companies involved in infrastructure development projects. The British company, Scott Wilson, is developing the Colombo Port and is also involved in the South Harbour Development to provide a robust and bankable business plan for the phased development.

We also have Mabey Bridge who constructed the flyovers and are engaged in a regional rural bridge development project. They have so far constructed 76 bridges and have another 60 to complete.

Moreover, there are other companies that are bidding for some big contracts in infrastructure developments. We will have to wait and see if they are successful!

Q6. Overall, how does the UK see Sri Lanka which is now a peaceful country?

The UK will continue to have strong friendly ties with Sri Lanka. We are at a historic point where our two countries can

build new partnerships and strengthen our commercial ties. The dawn of peace has created a unique opportunity for prosperity.

The UK welcomes this opportunity and wants to support Sri Lanka to capitalise on it. We believe that Sri Lanka is on the cusp

of achieving sustainable economic growth and investment. My team will support Sri Lanka’s economic development; both by

helping UK companies seeking to do business in Sri Lanka as well as helping Sri Lankan companies invest in the UK. We will

work towards Sri Lanka and the UK being partners in prosperity.