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More FDI firms exited than entered Sri Lanka in post-war period

More than double the number of foreign direct investment (FDI) firms exited Sri Lanka after the end the war than entered, a study by the Institute of Policy Studies found.

The study found that 410 firms exited Sri Lanka between 2009 and 2016 and only 202 had entered in the same period. Across a longer period from 2002, 666 firms had exited while 469 had entered.

"Notably, there appear to be few entrants into the manufacturing sector since 2009, a time period during which Sri Lanka was expected to benefit from a peace dividend and attract higher rates of private investment," the IPS report said.

"While the three-decade long civil war hampered the realisation of the country’s investment potential, the country appears to have fallen short of expectations even in a post-conflict environment – largely owing to inconsistencies in the policy regime."

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