Sri Lanka wary of money laundering, polluting foreign investments
ECONOMYNEXT – Getting foreign direct investments into Sri Lanka is still challenging but the investment promotion agency does not accept every proposal and is wary of money laundering efforts and polluting industries, its chief said.
An international management consultancy had helped the Board of Investment develop an assessing mechanism starting from the application to vet investment proposals, BOI chairman Dumindra Ratnayaka said.
“Today, one of the biggest challenges we face is that there are a whole load of dubious investors,”he told a forum on new initiatives by the BOI held by the investment promotion agency and Council for Business with Britain.
“They come in for money laundering intentions, hawking of agreements. It is important we leave them out and bring in the right people.”
US-based McKinsey and Company, a management consultancy, had helped the BOI build a well developed assessing mechanism to see if potential investors were good or dubious.
“This process is fool proof,” Ratnayaka said.
The BOI will also not approve investments that could cause pollution, even if they are attractive and the investments are big, he said.
Recebtly, the BOI rejected a proposed project involving processing of scrap stainless steel and nickel.
“The project was to sort and package them into various formulas and export them to parties looking to melt them and make different products,” Ratnayaka said.
“They had CEA (Central Environmental Authority) approval which said the BOI had to ensure scrap metal brought in is uncontaminated.
“Scrap metal not a homogenous product. There’s no way you can take a sample and say it is not contaminated. So we refused it. It had very little value addition and sustainability. If contaminated products did enter the country we would have a huge issue.
“It was a big investment and attractive but we said no,” Ratnayaka said.