Sri Lanka rule of law seen key factor in luring investors

Sept 27, 2011 (LBO) - Sri Lanka must ensure that rule of law is maintained especially in commerce if it wants to be considered attractive to foreign investors, an economist said.

Indrajit Coomaraswamy, former director of economic affairs at the Commonwealth Secretariat in London, said foreign investment has not picked up as anticipated despite the end of the island's 30-year ethnic war in 2009.

He said it was important to evaluate the island investment climate and see if it is attractive enough to lure foreign investors.

"Investment has not recovered as expected," Coomaraswamy told a forum at the American Center.

"We need to look at the investment climate especially rule of law related to commerce and the sanctity of contracts.

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Countries like Singapore and Malaysia, although not having the democratic freedoms found in most liberal democracies, ensured that the rule of law in their commercial systems were " rock solid" and attracted foreign investments.