Defunct garment factories available for investment

Thursday, 9 August 2012 01:54 - - {{hitsCtrl.values.hits}}

By Ashwin Hemmathagma, Our Lobby Correspondent

Identifying 403 garment factories that went out of business during the past 33-year history of the Board of Investment of Sri Lanka (BoI), the Government is looking at fresh investments from the private sector.

Responding to a question for oral answers from Member of Parliament Anoma Gamage (UNP) on Tuesday, Ministry of Economic Development stated that only 314 were functional out of 717 garment factories started as BoI projects since 1978.

In providing factories for new investors, compensation will be paid for the buildings which were constructed by the old investor who possessed the factory. Further, if the old investor had defaulted on payment of Employees Provident Fund and other compensation, action will taken by the BoI to settle it by recovering the funds through the compensation paid for the building.

“It is considered to arbitrate by assigning the responsibility for the new investor. A responsibility isn’t taken by BoI in relation to credit burden of the old investor. Many factories closed down, have mortgaged the assets to banks. When the rights of factories, which have signed the agreement with BoI are auctioned, it is considered the possibility of arbitrating the relevant employment payments through intervention of BoI. Further, payments of areas of the employees were made through the money received by selling the assets of the factories closed down by the industry within the zone,” stated the Ministry of Economic Development in its response.

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