• Ravi K says two Austrian banks have agreed on attractive loan proposals
• Harsha positive on cabinet green light for bilateral air services with Austria

By Shehana Dain

Following President Maithripala Sirisena’s fruitful discussions with Austrian firms in February to partner in the private sector and invest in projects offered by the Government of Sri Lanka, 15 Austrian companies from the water treatment, hydropower, healthcare and renewable energy sectors were present in Colombo yesterday for discussions with respective ministries.

 At an economic forum in Colombo held yesterday it was observed that the Austrian firms should basically look at Sri Lanka beyond the critical mass of 20 million as the country has two FTAs under its belt with two of the most populated countries in the world, India and Pakistan. Meanwhile with ongoing discussions with China, Japan and Singapore for two fresh trade agreements, Government officials reiterated that Austria could use Sri Lanka as a springboard for business with substantial market access to large populations.

 Meanwhile Karunanayake who said ‘we don’t want aid but trade’ commended the support received from some of the top banks in Austria with regard to concessionary and commercial loans and urged local banks to follow suit. The Minister also said that during his recent visit in February to Vienna he was able to secure loans from two ‘hyper active’ banks.

“Austria has been very steady in giving us concessionary and commercial loans. In 2014 we recorded $ 150 million in loans and in 2015 we saw a steep increase up to $ 283 million and in our very recent discussions in Austria we had two hyper active banks which have been able to bring concessionary and commercial loans to Sri Lanka. In Austria they believe that risk is part of their area and not the investor itself I think this is a good lesson for our Sri Lankan banks, our local banks should get this spirit to their system.”

 Foreign Affairs Deputy Minister Dr. Harsha De Silva who was also present at the forum was critical as he stressed on the insufficient trade and investment between the two countries.

“The Austrians didn’t invest a single Euro in Sri Lanka last year, and in 2014 Austria only invested $ 500,000 a significantly minuscule amount,” he said.

However the deputy minister was positive that business will get a boost following the GSP + application approval by the European Parliament and negotiations with Austrian firms.

In 2015 Sri Lankan exports to Austria amounted to $ 28 million while imports stood at $ 81 million. In that context 53% of imports include man made staple fibres which are infused in the local apparel sector and re-exported. 

However Dr. De Silva was optimistic in relation to a bilateral air services agreement with Austria which is yet to receive the cabinet nod and said that this could possibly make Colombo a hub to serve other parts of the world.

“The bilateral air services agreement has been addressed and we are awaiting cabinet approval to increase the number of flights Austrian Airlines can make to Colombo and hopefully make Colombo a hub to serve other parts of the world,” he added.

 Two MOUs were also signed between the Ceylon Chamber of Commerce represented by Vice President Rajendra Theagarajah and the Austrian Chamber of Commerce represented by Vice President Richard Schenz.

Pix by Lasantha Kumara

Eran urges Austrian firms to consider state owned tea corporations  

In the backdrop of restructuring the national carrier, Public Enterprise Development  Minister Eran Wickramaratne called upon Austrian firms to look into the Government owned tea corporations for possible revamping. 

Wickramaratne who made these comments at a forum in Colombo said that dairy and renewable energy sectors are also open for future investments and public private partnerships. 

“We are restructuring the airline as we have been making losses for some time now. We have declared that we are looking for investment and management. We also have plantations which we inherited from British rule. We privatised some plantations a few years back but the state still has a considerable number of plantations. The model may require change but this is also an area for investment. Austria is very strong in the dairy industry and the Swiss have already come. I think it’s time- if you are looking at the dairy industry- to look at it,” he said. 

The Government is already managing 36 estates in which the statutory liability collectively added up to Rs. 3.6 billion per annum in 2014 without accounting for gratuity liability. Most of these factories have even been deprived of electricity due to late payments. 

Wickramaratne also indicated that the Government will be rolling out a new energy policy in the next two months and that renewable energy will take centre stage in the new proposal. 

‘Renewable energy is another area we will open up and the Government will announce a new energy policy in the next two months with renewable energy to take centre stage in the policy roll out.’ 

Austria is one of the foremost producers of hydroelectric power in Europe. The most important power facilities are publicly owned and 50% of the shares of the large private producers are owned by provincial governments. In 2015 Lower Austria, the largest of the country’s nine states was sourcing 100% of electricity requirements for its 1.65 million people from renewable electricity.