Lanka misses foreign investment target

Colombo, January 1:

Sri Lanka attracted $600 million of foreign investment in 2006, a sharp year-on rise but well short of a billion dollar target, according to official figures released today.

The bulk of the foreign cash inflow came from telecommunications, IT, clothing and the construction of high rise condominiums, investment promotions minister Rohitha Bogollagama said. He said the figure was a ‘record’ which also eclipsed 2005’s investment inflow of $287 million. But at the start of the year, the government had targetted the one billion dollar mark. Sri Lanka’s business climate has come under pressure from the island’s ethnic conflict, with an upsurge in fighting with LTTE last year killing over 3,500. A World Bank study has also said rigid labour laws, a cumbersome legal system and high taxes was also battering business confidence.