Reclaiming the pearl of Sri Lanka

Korean companies and agencies helping create a better Sri Lanka


Sri Lanka, the former Pearl of the Indian Ocean, is out to reclaim its moniker by rebuilding a country ravaged by war and terrorist attacks.

For 26 years, the country suffered a civil war that ended in 2009 with many questions to be answered later this year.

In the meantime, Sri Lanka’s Minister of External Affairs Gamini Lakshman Peiris was in Seoul last week as part of a three-fold mission.

“One was to bring to notice the opportunities available in Sri Lanka after the end of hostilities,” he told The Korea Herald.

In the early 1980s, Korea was the largest investor in Sri Lanka, occupying a separate free trade zone exclusively for Korean investors but as the civil war with the Liberation Tigers of Tamil Eelam intensified, investments and trade dried up.

“But now that the situation is totally stable and there has not been a single incident since the military defeat of the LTTE in May 2009, it seems to us appropriate to try and stimulate and rekindle interest for Korean investors,” Peiris said.

Investing in Sri Lanka

The foreign minister added that there are advantages to investing in Sri Lanka.

“One principle advantage is the high-quality of human resources. We have an about 97 percent literacy rate, that is a significant advantage,” he said.

“The smallness of the country can be beneficial; we have a very effective board of investments which is a one-stop shop. This means there are no layers of bureaucracy, so it’s easy to start a venture to get it off the ground.”

Peiris added that Sri Lanka offers a business friendly culture, tax incentives, total protection of investments, no restrictions on repatriation of dividends, no requirement to have a Sri Lanka partner to start an enterprise, no restriction on foreign companies owning immobile property and, now that the war is over, political stability.

The second objective of the trip, his first as foreign minister, is to achieve greater understanding for Sri Lanka’s position on current events, rehabilitation and reintegration of displaced Tamils and other issues at international forums.

Both sides are also talking about governmental assistance for the development of Sri Lanka.

Korea reshaping the country

“We are entering into a new framework agreement in 2012 and we expect enhanced assistance now that there is more scope for doing work in regard to highways, the IT sector, water projects, all these can be undertaken on a much larger scale after the end of hostilities,” he said.

The Korea International Cooperation Agency has a significant impact on improving infrastructure in rural areas.

Peiris referred to KOICA’s contributions to such projects as the Korea-Sri Lanka Friendship Hospital, the International Convention Centre, capacity building of local authorities for emergency response and the solid waste management facility which is expected to be completed this year.

Grant aid was also used in improving health care facilities in the south and the rehabilitation of eight schools in the eastern provinces “and we are looking to expand those projects.”

“That area (east) is interesting because of its demographic composition, it’s an equal mix of Singhalese, Tamil and Muslims,” he said.

There are also plans to build a sports complex in the deep south of the country in time for Sri Lanka’s bid for the 2018 Commonwealth Games.

“Besides that, we strongly believe that these facilities, IT computers, sports facilities, must not be restricted to the principle cities and made available all throughout the country.”

The Korea Plant Industries Association is working on agricultural assistance and cooperation, enhancing the quality of seed materials, soil management, packaging and marketing.

“We have over 24,000 Sri Lankans working in Korea and they are making a contribution to the Korean economy and sending back large sums of money to Sri Lanka. We would like to see some facilities for language training in Sri Lanka and the Korean government is interested,” he said.

There is also talk of establishing a Korean studies program at the University of Colombo.

War crimes report

The United Nations says that over 40,000 Tamil civilians were killed during the last stages of the almost 30-year civil war in Sri Lanka. The U.N. also says that the Sri Lankan military committed war crimes. But the defense secretary said that those figures were exaggerated.

“So far the figures are highly speculative, some people say one number while another say another number,” Peiris said. “There is a systematic study being done by a Sri Lankan commission that was appointed by the president to investigate all these matters and to submit a report before Nov. 15, so the sensible course of action would be to wait to study that report.”

Recapturing the pearl

Once highly regarded as a dream vacation spot by many, Sri Lanka is quickly reclaiming its place as a haven for rest and relaxation.

“Tourism if a very visible growth area of the economy but we don’t have sufficient accommodations to offer our guests. This is a potentially lucrative area of investment,” he said.

Peiris plans to showcase the country more with a major tourism fair next year in Colombo which will coincide with the 35th anniversary of the establishment of diplomatic ties.

On the political front, Peiris said that it is highly possible that Sri Lankan President Mahinda Rajapaksa will visit Korea next year for the anniversary.

By Yoav Cerralbo (yoav@heraldcorp.com)