The Indian Ocean Island attracted a record 1.0 billion dollars in investments last year, mainly from new hotel constructions, Board of Investment’s acting chairman, MM C Ferdinando told a UK-based newspaper.
"Much of this (2011) FDI (foreign direct investments) originated from countries in the Far East, which have been less affected by the current economic conditions than the West,” he said.
Some 322million dollars of the 1.0 billion dollars secured in 2011, was invested in manufacturing, which represented a 101percent increase over a year earlier.
The bulk of the investment was in services and infrastructure, which increased 107percent on the previous year to 706million dollars, BOI figures showed.
"I am therefore confident that in 2012 Sri Lanka will be able to achieve about 1.7billion dollars in FDI (foreign direct investments)," he said without elaborating on the FDI discrepancies.
In its 2011 annual report, the Central Bank of Sri Lanka, which tips a 2.0 billion dollar FDI this year, said most of last year’s FDI in manufacturing was generated to revive Ceylon Steel Corporation. The former state-run steel giant was sold off to a foreign investor few years ago, under a privatisation drive.
The BOI this week said first quarter FDI in projects approved for this year was around 400 million dollars.
Ferdinando said foreign investments are being channelled to build new hotels and upgrade existing hotel infrastructure.
"This is to a great extent the result of a growing demand for travel, with about 800,000 tourist arrivals to the island (in 2011), the highest figure ever. The government is targeting 2.6 million tourist arrivals by 2016 and the construction of up to 35,000 additional hotel rooms to cater for this proposed growth," Ferdinando said.
Tourist arrivals have swelled into Sri Lanka, since the government ended the decades long ethnic conflict with the Tamil Tiger separatiss in May 2009.