An American fund manager has said that the prospects for investing in Sri Lanka are getting stronger with reforms initiated by the government which could put the country on a sustainable growth path.
“The investment case for Sri Lanka is getting stronger with the support of the IMF,” said Caglar Somek, Senior Portfolio Manager at TimesSquare Capital Management and investor in Sri Lankan equities for over ten years.
“Sri Lanka has domestic avenues for growth, according to third party estimates such as the Economic Intelligence Unit,” he told the “Invest Sri Lanka Investor Forum” organized by the Colombo Stock Exchange (CSE) and the Securities and Exchange Commission (SEC) in association with CSE member firms.
“ Over 70% of long term sustainable growth will likely come from the consumption and investment side of the economy, which is encouraging,” he noted.
May 2009, when the 30-year ethnic war ended, was a turning point for the country and for foreign investors, Somek said.
The country is now on a sustainable growth path after going through a significant transition, he said, according to a CSE statement on the event.
Present growth and future estimates could further improve if the government continues its reform process beyond the IMF programme and attracts additional foreign direct investors, Somek said.
Commenting on the key attractions of Sri Lanka as a frontier market, he noted that Sri Lanka offers a more diversified economy, compared to other oil and commodity heavy frontier markets.
A fully functioning democracy, an improving balance of payments situation, independent institutions, the rule of law, promising social aspects, the absence of capital controls and Sri Lanka’s strategic location and external growth opportunities surrounding it were identified as key factors that could pursue foreign investors to consider Sri Lanka.