It is an opportune moment in Sri Lanka to put together capital and expertise to develop the country and to reap the economic benefits, the Chief Executive Officer at National Asset Management Limited (NAMAL), S. Jeyavarman said.
In an article titled "A Fund Manager’s perspective: Post-War Sri Lanka", published on news360.lk yesterday (1 Sep), Mr. Jeyavarman said, after one year from ending the war, the picture is slowly changing and better opportunities are emerging to those who want to focus on business and others seeking employment.
The current outlook for the country is very positive for investors in many sectors. Many forms of direct investment opportunities are opening up in infrastructure projects and industries whereas for portfolio investors the stock market has opened more opportunities though the size of the market remains small, he said.
It is noteworthy that in the last five years the market capitalization of the Colombo Stock Market improved from USD 5 billion to 15 billion. The market capitalization and liquidity is expected to grow in coming years with new listings and other forms of financing by existing listed entities, he added.
‘It is more evident today that the capital market will become a sought after place to raise long term capital needs of the private sector to position themselves in the ongoing economic expansion’.
‘The economy with the integration of north and eastern parts of the country after the war has a better economic outlook and is expected to achieve in the immediate future a 7-8 percent growth and more in the future’.
‘The agriculture, industry and services sectors are the main drivers of the economy and expected to grow further in the future with more focused policy measurers and infrastructure facilities such as roadways, transportation, power, port facilities and so on’.
Mr Jeyavarman also said, ‘The political stability and direction is needed to achieve overall economic targets and to create a sustainable economic growth in the country. The ongoing infrastructure development projects are on the right direction. The ruling party obtained a significant voter base in the presidential and parliamentary elections held in early 2010 and commands a strong ruling coalition. With few more seats in the parliament the government can get a two-third majority to make suitable reforms to the constitution to improve the administrative process and to devolve power to where necessary’.
The Sri Lankan stock market has improved by 125% in 2009 and over 50% to date in 2010. The market turnover over the years has been growing very significantly averaging over Rs. 1 billion a day from a low turnover levels in the previous years, he said adding, ‘In this background, talking about the fund industry which I am involved in has shown remarkable recovery with attractive returns to the investors. The Unit Trust and portfolio management services are expected to grow and to provide an alternate investment opportunity in the capital market of Sri Lanka’.
source - www.priu.gov.lk
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