POST-CYCLONE INVESTMENT
Cyclone Ditwah created what seemed to be an insurmountable challenge. While raising the question of whether Sri Lanka could withstand further shocks following the economic crisis – which left foreign exchange reserves depleted and fuel queues consistently long – citizens responded with volunteerism, acts of charity, and a renewed sense of confidence and trust in each other that took many by surprise.
Although the forecast has been far from optimistic with expectations of the currency depreciating by five percent this year, investors signalled confidence that opportunities would be at hand.
Growth is anticipated to be slow, especially as the government attempts post-crisis regulationalongside the impact on export businesses vis-à-vis supply chains damaged by flooding and landslides.
Despite these impediments, several investment opportunities are taking shape.
Notably, investment strategies could emerge through government incentives and regulation between Sri Lanka and the UK.
There should also be greater awareness among Sri Lanka’s business community regarding policy developments overseas. The United Kingdom has decided to shift its international tariffs policy, allowing zero tariffs on incoming products from developing nations.
The usual precondition that products contain locally sourced materials no longer applies. The UK economy is on the cusp of an economic boom with private debt deleveraged at 100 percent of GDP since the peak in 2008. Analysts are already pointing to economic growth as a possible early sign of cyclical recovery – an optimistic note amid the noise of 2025.
In light of this, an investment strategy focussed on the UK would be especially promising, especially given the historic trading relationship between the two countries. The omens are favourable – and should Sri Lanka pursue these opportunities, the sky is very much the limit.
– Sunera Bandara
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