2004

Business Opportunities
In Sri Lanka
Presentation by
Ambassador Devinda R. Subasinghe
Sri Lankas Ambassador to the US
Ashland International Business Initiative
Convocation Centre
Ashland University, Ohio
January 20, 2004

Basic Facts
Area

65,606 sq km

Population

19.04 million

Labor Force
Literacy Rate

6.7 million
92%

Languages

Sinhala, Tamil,
English

Religions

Buddhism -70%
Hinduism 15%
Christianity 8%
Islam 7%

Government type

- Republic

Capital

- Colombo

Independence

- 4 February 1948
(from U.K.)

Sri Lanka: Overview

Sri Lanka is an island located in the Indian Ocean, at the base

of the Indian Sub-Continent, 880 km north of the Equator.

Sri Lanka is a multi-ethnic, multi-religious country with a

diverse and rich culture dating back to 2,500 years.

A land of endless enchantment for visitors from all over the

world.

Its fragrant spices, precious gems, legendary natural beauty,

sublime culture and hospitable people made it South Asias
paradise island.

Sri Lanka: Overview

Sri Lankas strategic location on the sea lanes between the

East and the West is an advantage to the islands positioning
as the hub of South Asia.

Sri Lankas most dynamic sectors in the economy are textiles

and apparel, food processing, tourism, food and beverages,
telecommunications and, insurance and banking.

US-Sri Lanka Relations

A Historical Glimpse
A history of 200 years of people-people contacts.
19th century trade involved the import of New England ice to Sri Lanka and
the export of Sri Lankan graphite to America.
Joseph Dixon, popularizer of the modern lead pencil visited Sri Lanka in
1838 to arrange for export of graphite.
As early as 1813, Rev. Samuel Newell, a New England clergyman, engaged
in Missionary activity in Ceylon (Sri Lanka.
Mrs. Harriet Winslow (great-great grandmother of the late John Foster
Dulles) founded a girls boarding school in 1824, considered the first in Asia.
In 1917, Dr. Ananda Coomaraswamy, one of worlds leading Oriental
scholars, was named the Curator of the Boston Museum of Fine Arts.
Formal diplomatic relations were established in 1948.

Sri Lanka-US Business Relations

Government of Sri Lanka currently pursuing a Free Trade Agreement
with the US Government to open markets bilaterally.
Trade and Investment Framework Agreement (TIFA) signed with the US
in July 2002 and establishment of Trade and Investment Joint Council
to promote trade and investment.
Sri Lanka has signed an Investment Promotion/Protection
Agreement, an Avoidance of Double Taxation Agreement, an Open
Skies Agreement and a Protection of Intellectual Property Rights
Agreement with the US to promote and guarantee protection of US FDI
in Sri Lanka.
The Sri Lanka Congressional Caucus of the 108 th Congress has been
reactivated to enhance US- Sri Lanka bilateral relations.
A Sri Lanka Working Group at the United States Chamber of Commerce
was established in September 2003 to foster increased business
relationships with Sri Lanka and to create a greater awareness of the
business opportunities that exist for US companies.

Sri Lankas Trade with the US

Total trade between Sri Lanka and the US was

US$ 2 billion in 2002.

Total trade between Sri Lanka and the US

- US$1.80 billion in the first 11 months of 2003.
Sri Lanka exports to the US was US$1.7 billion (first
11 months of 2003).
US exports to Sri Lanka was US$1.4 million (first 11
months of 2003).

Sri Lankas Exports to the US

Ceylon tea, considered the best in the world, caters to speciality tea
segment of the US market. Sri Lanka is the second largest supplier
of packeted tea and the third largest supplier of tea bags to the US.
Sri Lanka also exports green tea.

Sri Lankas Imports from the US

Cereals (wheat)
Electrical machinery
Fabrics and yarns
Tobacco
Paper and paper board
Rubber products
Chemicals
Automobiles
Plastics

Major US Companies Operating in

Sri Lanka

AES Corporation

Lanka Bell (Pvt.) Ltd.

Computer Associates International Inc.

Celetron

Ventures Corporation

Gloria Vanderbilt

Playknits Group

Sara Lee branded Apparel

Kellwood

The Coca Cola Company

Liz Claiborne Inc.

J. Walter Thompson

Nathan Associates

Union Carbide

May Department Stores International

Warner Lambert

JP Morgan Chase

Singer Corporation

Mast Industries Inc.

Fed Ex Corporation

Millennium Information Technologies

IBM Corporation

VIRTUSA

The Limited Inc.

Caterpillar Power

Wal-mart Stores Inc.

Bell Helicopter

Ansell

American International Group Inc.

Citi Group inc.

Chevron Texaco/Caltex

Galleon Group

General Electric

3M Company

Leading Brand Names

Manufactured in Sri Lanka

The Limited Inc. and Sri Lanka

The Limited, the Columbus, Ohio based company has been

purchasing intimate apparel (Victorias Secret) from Sri Lanka
for the last 15 years.

Sri Lanka manufactured lingerie, from the state-of the-art

factories employing highly skilled and literate workers,
considered the best product on the shelves at Victorias
Secret Stores.

Victorias Secret sources over US$350 million worth of

merchandise from Sri Lanka.

Sri Lanka recognized as one of Victorias Secrets leading

manufacturing bases in the world.

Trade Opportunities for

Companies in Ohio
Potential Ohio Exports

Agricultural Products Soybeans, corn, Wheat, feed grains

Medical Rubber Products
Industrial Machinery & Computers
Paper and Paper Board

Potential Imports from Sri Lanka

Apparel
Tea
Gems and Jewelry
Rubber and Rubber Goods
Information Communication Technology (ICT)
Plastics

Opportunities under India-Sri Lanka

Free Trade Agreement

Sri Lanka as a value addition platform to the Indian subcontinent.

A market of over 1.0 billion people.

Market Access Over 80%of goods can enter on duty free

basis

Sri Lanka-India land bridge project proposed. Pre-feasibility

study is to be undertaken to determine viability.

Potential sectors for US investment

Rubber, Paper & Paper board, garments & textiles, iron & steel,
Machinery & mechanical appliances, electronics/electrical and
automobiles & spare parts.

Indo-Lanka Land Bridge Location

The Land Bridge to India

Sri Lanka in US Study Abroad

Programs
DRAFT SLIDE for comments please.
The ISLE (Intercollegiate Sri Lanka Education) Program initiated in 1982,
is based in Kandy, Sri Lanka.
Participating colleges include, Bates, Bowdoin, Carleton, Colby, Grinnell,
Holy Cross, Swarthmore and Whitman.
Majors include, Religion, Political Science, Development Studies,
Sociology and Anthropology, Womens Studies, Psychology and
Linguistics.
Internships available with Government and Private Institutions and,
NGOs.
The American Institute for Sri Lankan Studies (AISLS), established in 1995
- fosters excellence in American research and teaching on Sri Lanka
- Promotes exchange of scholars and scholarly information between
the US and Sri Lanka
AISLS Fellowships support 2-4 months research in Sri Lanka by US
citizens holding PhDs or equivalent.

Investment Opportunities for Ohio

Companies in Sri Lanka

Infrastructure Development- Power & Energy; Ports & Airports; Water

Supply & Sanitation; Highways

Biosciences

Information Communication Technology

Rubber products

Automobile parts

Vertical integration of textiles/accessories

Food processing industries

Business Climate
The Sri Lankan economy is one of the most business friendly
and liberalised in South Asia.
Total Foreign Ownership
No restriction on Foreign Exchange Transactions(related to
current account payments).
Safety of Foreign Investments Guaranteed by the constitution.
Agreements signed with many countries
Bilateral Investment Protection
Double Tax Relief
Equal Treatment: Foreign & Local Investors
Legal & Regulatory framework
Sophisticated
Transparent

Investment Incentives in
Sri Lanka
Tax holidays from 5 to 20 years.
Concessionary tax at 15% after expiry of tax holiday.
Import Duty Exemption for Capital Goods.
Import Duty Exemption on Raw Materials if utilized for export
Exemption from Exchange Controls.
No restriction on repatriation of dividends, profits etc.
Free transferability of shares
The right to 100% foreign ownership in almost all sectors of the economy
Concessionary Taxation on expatriates income

Rubber products

A GREAT PLACE TO VISIT

A GREAT PLACE TO WORK
A GREAT PLACE TO LIVE

Thank You!

Embassy of Sri Lanka

2148, Wyoming Avenue NW
Washington DC 20008
Telephone : 202-483-4026
Fax

: 202-232-7181

E mail

: slembassy@slembassyusa.org

Website

: http://www.slembassyusa.org