Sri Lanka’s largest global FDI partner has come forward to introduce its successful industrialisation model to Sri Lanka and with a keen eye on the huge South Asian market, it is also moving to renew trade.

“The 12 national Industrial Parks we created in Malaysia are successful. We intend to introduce the same model to Sri Lanka as well. It is time that we also renew bilateral trade, apart from the strong investment bonds that we already have” said Dato' Seri S. Samy Vellu who is the Senior-Ministerial ranked Malaysia’s Special Envoy of Infrastructure for India and South Asia attached to the Prime Minister’s Office, who is currently leading a Malaysian delegation to Colombo.

Special Envoy Vellu spoke to Sri Lanka’s Minister of Industry and Commerce Rishad Bathiudeen on 26 February during his courtesy at the EDB. Joining Special Envoy Vellu at the 26 February discussion were Azmi Zainuddin (High Commissioner of Malaysia) and Azhar Mat (Head of Chancery of High Commission of Malaysia in Colombo). With Minister Bathiudeen at these discussions were Bandula Egodage (Chairman & CEO-EDB), and R.D.S. Kumararatne (DG-Department of Commerce).

“We are bidding for the Northern Highway on a Build Operate & Transfer (BOT) basis. We want to do a good job if we get it. Even on the 1,100 Km Kuala Lumpur highway there were only a few vehicles at first but now a million vehicles are passing through every day,” said Special Envoy Vellu.

He added, “We like to partner on Government to Government (G2G) projects, having done such projects in Bangladesh and India. We can jointly identify new industrial sectors and create industrial parks in Sri Lanka with our partnership. The 12 national Industrial Parks we created in Malaysia are also equipped with housing and social infrastructure for the people employed in the industrial parks including housing, sanitation and water, one reason that our Parks are successful. We intend to introduce the same model to Sri Lanka as well. The industrial layout needs to describe not only the types of industries to be set up but the social and community infrastructure as well. This is how we started industrialising the Malaysian economy.”

Minister Bathiudeen, responding to Special Envoy Vellu, said, “President Maithripala Sirisena’s vision of development is inclusive of industrial and exports promotion. Sri Lanka welcomes investments from Malaysia for infrastructure which is a designated ‘targeted investment sector’ from Malaysia. Other sectors called by Sri Lanka from Malaysia are tourism and recreation BPO/ IT & IT enabled services, education, electronic and electrical equipment manufacturing and rubber based manufacturing. I welcome your suggestions and keenness to partner with us through Malaysia’s successful Industrial Parks model. My Ministry already operates 27 industrial parks across the country and we are specially keen on investments and partnerships for our newest zones. Some new zones too are also being planned in other areas. My Ministry aims at taking industries from beyond the Western Province to the rest of Sri Lanka. Malaysian investors can invest here and access the massive Indian and Pakistan markets on more than 8500 products through our FTAs with these two markets. And most of the products you manufacture could be used as inputs in our manufacturing processes.”

Among the well-known Malaysian investments in Sri Lanka are Dialog Axiata, Merbok Mdf Lanka, Lion Brewery (Ceylon), Hemas Hospitals, Dankotuwa Porcelain, Sunshine Ventures, and APIIT Lanka Ltd. Malaysia ranks first among countries that have invested to-date in Sri Lanka through BOI. Realized total FDI from Malaysian projects exceeds US$ 1.28 Billion by third quarter of 2014. Annual FDI flow to Sri Lanka from Malaysia almost quadrupled in 2013 (from 2012) to $176.2 Mn.

Special Envoy Vellu responded: “It is time that we also renew bilateral trade, apart from the strong investment bonds that we already have. Of course, South Asia is a massive zone of people and Sri Lanka is lucky to sit so closely to this huge market.”
Sri Lanka’s bilateral trade with Malaysia, Sri Lanka’s largest global FDI investor, strongly increased by 31% to $757.2Mn in 2014 from 2013’s $577.66 Mn.

Photo captions: (Above) Minister of Industry & Commerce of Sri Lanka Rishad Bathiudeen meets Dato' Seri S. Samy Vellu on 26 February and (below) Minister of Industry & Commerce of Sri Lanka Rishad Bathiudeen discusses with Dato' Seri S. Samy Vellu at the EDB.