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Friday, June 21, 2024

“Colombo Port City could open SL to host of suspect economic practices and corruption.” : US Ambassador

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The Colombo Port City legislation appears to be an opening for corrupt influences and the potential for illicit financing, money laundering, and/or other activities by nefarious actors who want to take advantage of what they perceive to be a permissive environment for illegal activity, US Ambassador to Sri Lanka Alaina B. Teplitz states.

In an interview with Centre for Strategic Studies in Trincomalee, Teplitz sais tha thw US continues to be concerned about some aspects of the Port City legislation that passed in Parliament and companies are going to be wary of that.

US companies considering investing in Sri Lanka want predictability and a clear understanding of the investment environment. They’re going to need to know that if they’re investing, they’re not going to be confronted with risks that could present problems for them, either from regulatory bodies, their own shareholders, or their boards of directors, she noted.

Furthermore, the US Ambassador said that under the Foreign Corrupt Practices Act (FCPA), it is unlawful for a US company or individual to offer, pay, or promise to pay money or anything of value to any foreign official for the purpose of obtaining or retaining business.

A US company considering investing in Sri Lanka must be confident that they’re not going to be exposed to – or collaborating with – entities that could have economic measures levied against them by the U.S. Treasury or Commerce Department.

“We recognize that the government in Sri Lanka wants to take advantage of the investment already made in the Port City project, and that’s understandable. Our simple caution is that for such a large infrastructure / development project, it is incredibly important to get the legislation and regulations right – and ensure the door is not left open to illegal activity and unfair competition. As a general principle, bad money – for example, if the legislation does not close loopholes that might permit money-laundering – drives away good money.”

“You (the interviewer) mentioned “dual engines of Sri Lanka’s economic growth.” I think a more important question is “where will these engines take Sri Lanka?” The Hambantota port project incurred a tremendous amount of debt for the country, and ultimately Sri Lanka needed to lease out the port for the next century as a result. The Colombo Port City could possibly open Sri Lanka to a host of suspect economic practices and corruption. Who would benefit from that?” she questioned.

“Although some bad actors would likely benefit, the larger Sri Lankan economy would suffer. A country’s investments need to generate a positive return in order to benefit the people; investments that yield a negative return – either in terms of jobs, revenue, or reputational risk – are a millstone around the neck of future economic growth.

An economically strong and prosperous Sri Lanka is in the interest of both our countries. The private sector plays a key role in driving the global economy. Ensuring the right conditions prevail in order to attract high quality, U.S. private sector investment and to help Sri Lanka stake its claim as an attractive and reliable economic partner in the region should be a priority policy goal for the government,” Teplitz noted.

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