Malik outlines way forward via reforms

Following is the address delivered by Minister for Development Strategies and International Trade Malik Samarawickrama at the ‘Sri Lanka Means Business’ launch held at the Temple Trees auditorium on Monday 3 July

While thanking all of you for being here this afternoon at the launch of this important event under the theme ‘Sri Lanka Means Business,’ this is ‘The Roadmap on Investment Climate Reforms in Sri Lanka’. 

Over the past several months, my team has worked relentlessly with relevant public and private sector stakeholders with technical assistance from the World Bank Group to identify a well-defined program of reforms to address a wide range of shortcomings across all areas of business regulations in order to enhance the investment climate in Sri Lanka.

I trust that establishing a well-defined framework for the investment climate with appropriate sequencing of actions and an institutional mechanism is essential to lead reforms going forward. To this effect, I would like to thank various Government officials, private sector stakeholders and our partners at the World Bank Group and the Australian Department of Foreign Affairs who have contributed to the preparation of this Roadmap, while being grateful for the generosity exhibited in providing substantive inputs, knowledge and advice during the concept stage and finalisation of the roadmap.

This roadmap was developed in response to a policy commitment made by Prime Minister Ranil Wickremesinghe in October 2016, who announced the Government’s intention to improve Sri Lanka’s investment climate and reach a Top 70 ranking on the World Bank’s Ease of Doing Business Index by 2020. 

The Government of Sri Lanka has recognised that the main factors hindering the improvement of the business climate in Sri Lanka are high transaction costs in complying with regulations, a dense web of business regulations which discourage new entrants to the market and creates incentives for informality. As a result, it has obstructed enterprises to grow, undermined productivity, limited investments and limited access to finance. 

There have been efforts to introduce investment climate reforms by successive governments; however, these efforts were not sufficiently coordinated, lacked strategic prioritisation and institutional mechanisms to support such reforms. 

The Roadmap serves as a testament from the Government towards providing a better business environment that is more conducive to private sector development. 

There will be challenges. Sri Lanka is competing with several regional counterparts to attract this investment. Furthermore in 2017 Sri Lanka’s ranking on the overall Ease of Doing Business index was 110. Jumping 40 places ahead in the index is an ambitious, but achievable, undertaking provided that strong, concerted and well sequenced actions are taken to bring these reforms to completion. 

The Government is not limiting its commitment to improving the business environment focusing on the areas covered in the Doing Business report but wishes to go beyond this to provide opportunities for the people of Sri Lanka to better their prospects.

On 23 May 2017, the Investment Climate Roadmap was granted Cabinet approval. It is a significant step forward. It is important to remember, that it is essential to maintain a continuous dialogue to involve the active participation of the private sector in identifying the most significant barriers for doing business. In this context, we encourage our stakeholders to engage with us on identifying additional areas for reform that can be incorporated into the process. 

Just a few weeks ago, on 1 June 2017, the Doing Business report closed its reporting cycle for the upcoming Doing Business 2018 report—to be published in October—so that chapter is behind us. Today, it serves us no good to look backwards. We are instead looking at the future. The Doing Business 2019 report, which has a deadline of 1 June 2018 for reforms to be implemented and in force, is our target. 

This event marks the beginning of a new chapter in GoSL’s efforts towards improving the investment climate focused towards enhancing the ability of the country to attract, retain and integrate Foreign Direct Investments. 

I would like to conclude my short speech by emphasising that with committed implementation and a strong collaborative spirit from our stakeholders this reform plan will help Sri Lanka significantly improve the climate for existing and potential investors by 2020. Each one of you is a critical part of this effort.