Sri Lankan ministers and senior officials have urged businesses in the UAE to invest in the country’s recovery programmes after it was ravaged in a recent devastating cyclone even as it strives to emerge from its worst economic crisis.
More than 600 people were killed by Cyclone Ditwah in December, which left only a quarter of Sri Lanka’s railway network usable, infrastructure destroyed and caused damage estimated to run into billions of dollars.
The island nation has also been struggling to attract investment after a historic default on debt repayment that plunged Sri Lanka into economic ruin in 2022.
Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka, told The National the country "is in a much better position than before the crisis".
“We want to convey that Sri Lanka is open for business, ask the banking community that was doing a lot of business with Sri Lankan banks earlier to engage again,” he said at a meeting with senior UAE bankers in Dubai on Friday.
A year of rebuilding
Sri Lanka is under a $3billion International Monetary Fund bailout programme and the debt deal is expected to reopen doors to bilateral transactions, resuming foreign-funded projects that were suspended when the country defaulted four years ago.
"The year 2026 is a year of rebuilding and reconstruction," Mr Weerasinghe told bankers in Dubai. "We would like UAE banks to be part of Sri Lanka’s recovery that is steady despite the shock we had in December when Cyclone Ditwah hit our country.
"We want to share information with the banks that goes beyond media headlines to encourage them to get back to the same levels of business they had before the crisis.”
-
The aftermath of flash floods and landslides in Nuwara Eliya, one of the largest tea plantation districts in central Sri Lanka, where more than 80 people have died. Across the country more than 490 people have been killed after Cyclone Ditwah struck. Several of the dead had been parishioners of Sri Lankan priest Father Roy Nayagam, who now works in the UAE. Photo: Fr Roy Nayagam -
Parishioner Nickolas Raj, pictured with the priest, and his wife and father were swept away when flash floods flattened their home in Nuwara Eliya. Photo: Fr Roy Nayagam -
Mr Raj and his wife. Their two-year-old daughter survived. Photo: Fr Roy Nayagam -
An orphan being cared by relatives in Nuwara Eliya. Photo: Fr Roy Nayagam -
Relatives mourn at the graves of those who died in flash floods and landslides across Nuwara Eliya district. Photo: Fr Roy Nayagam -
Devastation in Kandy, the hometown of Jeyaraj Baskaran, a Dubai resident, in one of the districts in Sri Lanka hardest hit by the cyclone. Photo: Jeyaraj Baskaran -
Roads, railways and infrastructure have collapsed in the floods and landslides. Photo: Jeyaraj Baskaran -
Volunteers delivering food and water supplies to survivors. Photo: Jeyaraj Baskaran -
Uprooted trees and damaged buildings following a landslide in the aftermath of Cyclone Ditwah in Gampola town, Kandy district. AFP -
A wrecked house following landslides in Hadabima village near Sarasavigama, in Kandy district. AFP
Chathuranga Abeysinghe, Sri Lanka’s Deputy Minister of Industry and Entrepreneurship, was part of the delegation to the UAE that included top officials of the Securities and Exchange Commission and the Colombo Stock Exchange.
He met investors and bankers in the UAE over the past two days and had meetings in Riyadh at the weekend.
“There is a great opportunity for Middle Eastern investors to invest in Sri Lanka ,” he told The National.
"There are various opportunities in tourism, the IT sector, opportunities for FDI [foreign direct investment] in the mineral sector, agricultural transformation, the renewable energy sector."
Mr Abeysinghe urged senior bankers from various UAE banks to take a closer look at Sri Lanka, pointing to strong manufacturing capacity, reform against corruption, and digitalisation of public sector processes for government efficiency that would provide greater transparency.
“If you had different views about us before, I think now it's time to relook at us,” he said. “I would like you to come for a few days to Sri Lanka and experience the vibe. People are very hopeful.”
He blamed systemic corruption and fiscal indiscipline of previous administrations for the crisis.
“We had very rigid government processes added to a high level of corruption,” he said. “The fundamental root course of our crisis was fiscal indiscipline.”
Resilient nation
Sri Lanka declared bankruptcy in 2022, suspended repayments towards about $80 billion in domestic and foreign loans, amid a foreign exchange crisis that resulted in citizens lining up for hours to buy scare fuel, food, medicine and cooking gas.
The current government headed by President Anura Dissanayake was elected in 2024 on a platform of reducing waste, fighting corruption and modernising government.
Mr Abeysinghe said the administration is working to integrate to capitalise on a strong regional market.
“If you draw a circle around us, we have access to about a 3.4 billion population - so with two hours of air travel anything from agriculture, fish and floral goods can be delivered fast - Sri Lanka can be the hub," he said.
"We are also politically neutral. We work very well with China, work very closely with India and we have a very good relationship with US. Sri Lanka will continue to be the region's politically neutral destination.”
Banking officials from the UAE said it was a “timely move” for the central bank to improve confidence by providing details of reform and governance.
About 350,000 Sri Lankans live in the UAE. Friday's meeting was organised by the Sri Lankan embassy and the Sri Lankan Bankers Association UAE.
Arusha Cooray, Sri Lanka’s ambassador to the UAE, said the Emirates is Colombo's largest trading partner in the Middle East, and the sixth largest investor overall in Sri Lanka.
“We are very hopeful, and unless we have hope, we can't change the growth trajectory of our country,” she said.
“So I would advise you to look at investing in Sri Lanka. We have always been very resilient. Our country bounces back quite fast, we also have a well-developed stock of human capital in addition to natural resources.”
