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Sri Lanka budget seen boosting construction sector

ECONOMYNEXT – Several big road and housing projects and regulatory measures announced in Sri Lanka’s government budget for 2017 should give a fillip to the construction sector, stock brokers said.

First Capital Equities said the proposal to introduce a Payment Guarantee Security Act will benefit the construction and engineering sector as it will provide adequate cover in recovering their payments.

The budget proposed a special incentive package with specific tax concessions for ‘Landmark Investments’ of over USD100 million and up to USD500 million, and investments over USD500 million and above.

First Capital Equities said these incentives will benefit the construction and building material sector which will see improved earnings.

The proposal to remove the cess of 25% applicable on pre-fabricated structures should also help improve construction sector earnings, they said in a report on the budget.

The budget also announced large housing projects including providing 100,000 homes worth Rs. 5 million each to middle income earners and 250 million homes worth Rs. 1 million each to low income earners. Land and the amenities will be provided free of cost by the government.
(COLOMBO, Nov 11, 2016)

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