SRI LANKA INVITES MALAYSIA TO REBUILD WAR-SHATTERED ZONES

By D. Arul Rajoo

BANGKOK, June 23 (Bernama) -- Sri Lanka, fresh from its success in
eliminating rebels in the north and east of the island, is inviting Malaysian
investors to join efforts to rebuild its war-shattered zones that need at least
US$4 billion to US$5 billion in initial development.

Investment Promotion, Enterprise Development and Media Minister, Anura
Priyadarshana, said as Malaysian companies have vast experience in the
telecommunication, construction and agriculture sectors in the country, they
would be in a good position to expand their businesses to the affected areas.

He said the country was providing 15 years of tax holiday for companies
investing outside the western zones, especially in the north and east which had
not seen development in the past three decades due to the civil war between the
central government in Colombo and the Tamil Tigers fighting for a homeland for
the Tamil minority.

"We have not calculated the full amount needed to rebuild the whole area,
but at least US$4 billion to US$5 billion is needed for initial development.
With the war over, we can go and assess what need to be done after the three
decades of destruction where people were denied decent living by the rebels," he
said in an interview here.

Anura, who is leading a business delegation to tap investment potential for
both Thai and Sri Lankan businessmen, said the government would be establishing
export promotion and special economy zones in Trincomalee and Killinochchi, two
former strongholds of the rebels.

Sri Lanka crushed the Tiger rebels in May, ending one of the longest civil
wars in the world that killed about 70,000 people.

There are now 18 Malaysian investment projects in Sri Lanka and among the
major investments include Dialog Telekom (owned by Telekom Malaysia), the
cellular mobile telephone network, Merbok MDF Lanka which manufactures MDF
boards and Tritel Services which is a public pay phone system.

Others are Naratha Agro-Industries which cultivates oil seeds and
manufactures hydrogenated edible oil, Wincon Development (Ceylon) Ltd which is
involved in housing construction projects for state sector employees while a
36-megawatt thermal power plant in Chunnakam, Jaffna was build by Northern Power
Company, the subsidiary of a Malaysian firm.

Anura said there is vast potential in the agriculture, tourism, fishery and
construction sectors in the two areas, adding that once-abandoned cement
factories and paper mill could be revived now.

"In fact, one Malaysian company has shown interest to build a hotel in
Mullattivu," he said.

Asked about the fate of about 280,000 Tamils currently placed in refugee
camps, Anura said the government was in the midst of clearing their villages of
landmines before rebuilding houses and rehabilitating former rebels.

According to him, sign of recovery was already there in Jaffna, which was
liberated from the rebels a decade ago and now the government has lifted
restriction on fishing activities.

He said investors are also invited to open foreign university campuses in
the country, adding that two have been completed, offering law studies.

Sri Lanka, Anura said, offers a big market for investors as the country had
signed free trade agreements with India and Pakistan, giving tax free access to
over 1.3 billion population.

But while welcoming foreign aid, he said Sri Lanka, which was criticised by
many Western countries for alleged human right abuses during the final days of
the war, was not willing to accept unfavourable conditions being set by
international agencies like the World Bank that touches on its sovereignity.

He said Japan has shown keen interest to help Sri Lanka in rebuilding the
devastated areas, while investment missions are being undertaken in Italy, the
United States, Canada, Italy, Belgium and Singapore.
-- BERNAMA