June 13, 2013 (LBO) – Sri Lanka plans to ban foreign investments into steel, cement, retail trade, small scale agriculture and beauty care products, to ‘protect’ domestic investors, according to decision by the cabinet of ministers. Cabinet spokesman Keheliya Rambukwelle said relevant regulations would be made known later.
He said existing investors in the sectors will not be affected and it will not be with retrospective effect.
Asked whether the move will not further limit and harm competition Rambukwelle said the rules may be relaxed later, if there is no domestic investment within a given period.
The state information office said by the cabinet of ministers had appointed a committee under the senior minister of monetary co-operation had been appointed to revise current regulations
However the government wanted to promote foreign investments into assembling of vehicles, refining petroleum products and making boats for the export market.
Investments into adding value to spices, animal husbandry and poultry farming would also be encouraged for ‘import substitution.’
Critics have said protection to businessmen had increased in recent years at the expense of consumers especially in trade.