Morgan Stanley Investment Head of Emerging Markets Ruchir Sharma yesterday told a packed Sri Lanka Investor Forum in New York that the country’s positives overweighted the negatives and predicted Sri Lanka has the potential to shine brighter.
Making a presentation on the perspective of investing in Sri Lanka, Sharma listed several positives as well as negatives for the benefit of around 190 fund managers present at the JW Marriott Essex Hotel in New York.
“There are many positives for Sri Lanka. Sri Lanka remains attractive and competitive and when it comes to equities Sri Lanka is cheap. Sri Lanka is in Morgan Stanley’s frontier market strategies and has some investments. Post-war Sri Lanka has a greater opportunity to shine”, said Sharma. “Sri Lanka has been among the good performing markets in the past decade”, he added.
He said high investment, low inflation, satisfactory management of public debt and soundness of the banking system we some of the other positives.
“Sri Lanka is in a geographical sweet spot and has managed relations with India and China very well”, said Sharma recalling during a 2011 meeting, President Mahinda Rajapaksa had told him: “China is my friend and India is my relative”.”
“Complacency is the biggest risk for Sri Lanka and I hope Sri Lanka can overcome this challenge”, he told the Invest Sri Lanka Forum in New York, which was inaugurated by Senior Minister for International Monetary Cooperation and Deputy Finance Minister Dr. Sarath Amunugama.
Sharma who has visited Sri Lanka in 1997 and 2011, noted that very few can sustain economic success over a long time whilst others could remain emerging forever. He noted that politics has been driving markets and this has been unprecedented in recent decades. He said that emerging economies do well during the first few terms of political leadership and in this regard President Rajapaksa has done a solid job in turning Sri Lanka around.
Michael O’Hanlon, Senior Advisor at TPG Capital – which recently announced one of the biggest portfolio investments amounting to over USD 116 million in Sri Lanka via Union Bank PLC – also spoke at the Forum, sharing his firm’s experience in investing.
Senior Minister Dr. Amunugama. Central Bank Governor Ajith Nivard Cabraal and Sri Lanka’s Permanent Representative to the UN in New York Dr. Palitha Kohona highlighted the post-conflict rebound and opportunities in Sri Lanka.
The Investor Forum is the first-ever in North America and was organized by the Colombo Stock Exchange (CSE) and the Securities and Exchange Commission of Sri Lanka (SEC), in association with the Sri Lankan Embassy in Washington DC, Bloomberg and the American Chamber of Commerce Sri Lanka.
A record 190 fund managers attended the event whilst Sri Lanka had the largest contingent of listed firms, numbering 14 and around 28 representatives, as well as several broking firms.
This was the third ‘Invest Sri Lanka – Investor Forum’ for the year, with previous Forums being held in Singapore and London in January and May respectively.