SL Urged to Secure Quality FDI Amid Global Supply Chain Shifts 📈

A high-level policy dialogue co-hosted by Verité Research and the EU emphasizes that Sri Lanka must move beyond stabilization to attract high-productivity, sustainable investment as global value chains reorganize. • Strategic Reforms: The government is fast-tracking the Public-Private Partnership Act and Investment Protection Act, alongside phasing out para-tariffs and amending the Port City Act to transition into high-complexity production. • Investment Gap: Data reveals a stark contrast in regional competitiveness; while Vietnam’s exports to India surged 90-fold ($100 Mn to $9 Bn) between 2005-2024, Sri Lanka’s exports grew only 50% ($600 Mn to $900 Mn). • Key Constraints: Experts identified policy inconsistency, high input costs, and limited market access as primary hurdles. Sri Lanka currently holds only 9 preferential trade agreements, trailing behind regional peers like Thailand and Indonesia (16+). • Future Focus: Priorities include upgrading ICT/BPM infrastructure, digital connectivity, and logistics. The EU (outbound FDI stock of €9 Tn) remains a critical partner, seeking predictable rules and skilled labor. • Urgency: With India emerging as a regional hub, officials warn of a "narrow window of opportunity" requiring constitutionally backed policy consistency to restore investor confidence.