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37The MOU signing ceremonybetween SBF Vice-ChairmanTeo Siong Seng and Sri Lanka-Singapore Business CouncilPresident Shamil Mendis onMay 30, 2012 was witnessedby Singapore’s Foreign AffairsMinister K. Shanmugam and SriLankan Minister for Industry andCommerce Rishad Bathiudeen.STRATEGIES FORSRI LANKAAIM TO TRANSFORMTHE COUNTRY INTOA STRATEGICALLYIMPORTANTECONOMIC CENTREBY DEVELOPING5 STRATEGIC HUBS:1KNOWLEDGE2COMMERCIAL3NAVAL & MARITIME4AVIATION5ENERGYconnecting the rest ofAsia and the Pacific withEurope and the Americas.Sri Lanka is strategicallylocated next to the fastgrowing Indian subcontinentwith closeproximity to SoutheastAsia and the Middle East.According to Sri Lanka’sBoard of Investment, thefavourable governmentpolicies and improvedinvestor confidence havefacilitated the variouskey economic sectorsto perform better in2010. The services sectorremains the largestcontributor to the nationaleconomy, with a reported59.3% contribution.Taking advantageof Sri Lanka’s strategiclocation and resources,the government plans totransform the country intoa strategically importanteconomic centre bydeveloping five strategichubs – knowledge,commercial, naval andmaritime, aviation andenergy hubs.Sri Lanka also hasbilateral investmentprotection agreementswith 27 countries and hassigned double taxationavoidance agreementswith 38 countries,including Singapore.It is also a foundermember of the MultilateralInvestment GuaranteeAgency – an investmentguarantee agency ofthe World Bank whichprovides a safeguardagainst expropriation andnon-commercial risks.Educated workforceIn 2009, Sri Lanka hadthe most literatepopulation in South Asiaand one of the highestin the developing worldwith a literacy rate of91.4%. English is widelyspoken and is the mainlanguage used by thebusiness community.Extensive investmentin public education hasproduced a workforce thatis competent in high-techproduction and services.About 50% of the studentswho have completedhigher education aretrained in technical andbusiness disciplines.With Sri Lankacontinuing on thepath of development,Singapore is in a uniqueposition to harness themany opportunities forinvestment presentedin the country. The tworepublics share manycommon platforms in anumber of regional andinternational forums.Such interactions havepaved the way for botheconomies to exploreSupportivegovernment policiesThe Sri Lankan governmenthas recently embracedvarious strategies andpolicies that aim to fosterforeign direct investment.Total foreign ownershipis permitted acrossalmost all areas of theeconomy and thereare no restrictions onrepatriation of earnings,fees, capital and forextransactions. In addition,there is a transparent andsophisticated legal andregulatory frameworkwhich covers many areasof prerequisite business new opportunities.law enactments. p.38GROWTHENGINEThe principal engineof growth is the privatesector. Foreign exchangeliberalisation measureswill continue to improve,and private foreigninvestment – directand portfolio – arestrongly encouragedthrough the provision ofvarious trade incentives.Listed below areSingapore companies withsignificant investmentsin Sri Lanka in theform of joint ventures,direct investment orrepresentative offices.Shing Kwan GroupWorld Trade CentreTwin TowersHousing and commercialcomplexPrima GroupGrains, flour andflour-based productsSouth Asia TextileKnitted fabricsPrima GroupProcessing of chicken,manufacturing ofnoodles, bread andvalue-added productsGhim Li GroupApparelAman ResortsHotelBanyan Tree ResortsHotelBP de Silva HoldingsGold jewellerySingTelInternet, web hostingand e-commerceGetty Images