Could Sri Lanka Casinos Be the Remedy for the State’s Slow Economy?

Bureaucratic issues have caused Sri Lanka to miss its foreign investment target last year, pulling down economic growth.

According to Investment Promotion Minister Lakshman Yapa Abeywardena, heavy bureaucracy slowed Foreign Direct Investment (FDI) to $1.3 billion for 2013. The figure is much lower than the initial $2 billion projection.

“There were shortcomings on our part that held up the expected foreign investments. We need to get $4 billion of FDI to maintain a growth rate of eight per cent. This year, we are hopeful of getting about $2 billion in FDI, but we need to push it up much more,” he told reporters.

Local gambling news say Sri Lanka’s economic growth was 7.3% lower than expected, though the figure was higher than the 6.3% growth in 2012.

Efforts for economic recovery

The government is hoping three new Sri Lanka casinos will bring the economy back on track. The investment adds up to $1.3 billion, but the actual projects have been surrounded by controversy.

The state has been offering a generous incentive for foreign investors, in the form of a 10-year tax exemption. And since casinos became legal in 2010 under the new Sri Lankan gambling laws, the state is now looking to attract developers.

According to Abeywardena, the government is also making efforts to open up the local building materials market, as Sri Lanka needs a lot of construction and rebuilding work done after decades of ethnic wars.