-By LeN Investigative Team
(Lanka-e-News -27.Dec.2024, 11.30 PM) Sri Lanka, an island known for its lush landscapes, tantalizing cuisine, and warm hospitality, ironically seems to lack the warmth when it comes to welcoming foreign investors. Ask any potential investor, and they’ll tell you the same tale of bureaucratic circles, red tape, and under-the-table "gratitudes." This isn’t a hidden fact, and yet the problem persists, raising a serious question: Why is Sri Lanka sabotaging its own economic prospects?
Here’s a witty yet deep dive into the quagmire.
Imagine this: An investor walks into Sri Lanka with a fat wallet and a grand plan. His goal? To set up a manufacturing plant that will provide thousands of jobs. Simple, right? Not in Sri Lanka.
The investor’s first stop is the Board of Investment (BOI), the so-called “one-stop shop” for investment. But this shop operates more like a multi-level marketing scheme.
⋆ The BOI officer tells him, “Sir, you need approval from the Urban Development Authority (UDA).”
⋆ At the UDA, they say, “Sir, you also need a clearance from the Environmental Protection Agency (EPA).”
⋆ At the EPA, they casually mention, “This requires a special permit from the Ministry of Lands.”
And so it goes. Office to office, form to form, stamp to stamp. It’s a dance where the music never stops, and neither does the investor’s frustration.
Here’s where the real comedy begins. Once upon a time—before the National People’s Power (NPP) government—investors were often introduced to a unique species: the “coordinating secretary.” These secretaries were the gatekeepers to ministers, who were the gatekeepers to approvals.
These secretaries didn’t work alone. They had a network, almost like a secret society, meeting in elite clubs and hotels. Let’s call it the “Cinnamon Cartel.”
1. The Introduction: A broker connects the investor to a coordinating secretary.
2. The Chain Reaction: The secretary introduces the investor to an additional secretary, who introduces them to a ministerial secretary, and eventually the minister.
3. The Toll Booths: At each step, the investor is asked for a “gratitude”—a euphemism for bribe.
By the time the investor reaches the final stage, they’re either broke or have backed out. Why? Because they could invest in Vietnam, Malaysia, or even Bangladesh—countries where they don’t need to pay a bribe just to open a factory.
Corruption isn’t just unethical; it’s also uneconomical. According to Transparency International’s Corruption Perceptions Index, Sri Lanka’s ranking has been sliding, making it less attractive to global investors.
Investors don’t just bring money; they bring jobs, technology, and expertise. But when they’re met with demands for bribes, delays, and lack of transparency, they turn to other markets. And who can blame them?
Take, for example, an Indian investor who wanted to set up a pharmaceutical plant. After months of paperwork and demands for under-the-table payments, he abandoned the project and moved to Malaysia. That single plant could have created 500 jobs.
If Sri Lanka wants to attract investors, it needs to take a page from Singapore and Dubai’s playbook. Here’s what those countries do differently:
1. One-Stop Investment Centers: In Singapore, an investor deals with one agency. All approvals, permits, and clearances are handled under one roof. No running around, no confusion.
2. Strict Anti-Corruption Laws: Both Singapore and Dubai have zero tolerance for corruption. Anyone caught demanding or accepting bribes faces severe penalties, including jail time.
3. Accountability Mechanisms: They have robust systems to monitor and regulate the investment process, ensuring transparency and fairness.
4. Retrospective Action: Sri Lanka should investigate all investments since 1979 to identify cases of corruption. Anyone found guilty of accepting bribes should face legal consequences.
Beyond structural reforms, there’s an urgent need to change the mindset of public officials. The current “entitlement” attitude—where officials believe they are owed something for simply doing their job—must be eradicated.
A strict law imposing a minimum five-year prison sentence for anyone demanding a bribe would send a strong message. But laws alone aren’t enough. A cultural shift is needed, one that prioritizes service over self-interest.
One of the lesser-discussed issues is how delays are weaponized. By deliberately stalling projects, officials create opportunities for bribe-seeking. This tactic not only frustrates investors but also causes economic stagnation.
For instance, a Middle Eastern investor once complained that his hotel project was delayed for three years because of “pending approvals.” When he finally withdrew, those approvals magically appeared—for a local competitor.
Sri Lanka is at a crossroads. The country desperately needs foreign investment to boost its economy, create jobs, and reduce its debt burden. But without systemic reform, investors will continue to look elsewhere.
Here’s what needs to be done immediately:
1. Establish a single-window clearance system for all investments.
2. Introduce and enforce strict anti-corruption laws.
3. Set up a monitoring and complaints mechanism to address investor grievances.
4. Investigate past corruption cases and hold guilty parties accountable.
5. Launch a national campaign to change attitudes and promote transparency.
Sri Lanka has all the ingredients to become a global investment hub: strategic location, skilled workforce, and natural resources. But unless it fixes its broken system, it will remain a punchline in the global investment community.
The choice is clear: Either streamline and reform, or continue to dance in circles while the world moves on. The clock is ticking, and investors won’t wait forever.
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by (2024-12-27 20:27:04)
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