Overview
The Sri Lankan construction industry, which is one of the biggest GDP contributors and employment generators in the country. However, depleting foreign currency reserves, mounting debt, and the continuing weakness in Sri Lanka’s tourism sector are expected to limit public spending on infrastructural projects in 2022. The sector is also facing significant challenges due to the shortage of cement, due to import control measures put in place by the government to conserve dwindling foreign currency reserves. This has led to the shortage of inputs required to produce raw materials domestically. Industry experts worry that rising raw material costs combined with a fuel and energy shortage, may lead to potentially thousands of job losses and a sharp drop in construction projects.
Several large infrastructure projects are under development, including the PRC-built Port City on newly reclaimed land within Colombo’s city limits.
Leading Sub-Sectors
- Equipment sales
- Engineering, procurement, and construction
- Direct contracting
Opportunities
Sri Lankan developers frequently team up with U.S. engineering and design firms, especially for high-end office buildings, luxury apartments, or resorts. The government of Sri Lanka created a fully state-run firm (Selendiva Investments Ltd) to take over various state assets and act as the investment arm of the government. The company will take over underutilized or underperforming assets, such as prime real estate, restructure them, and raise capital.
Resources
Urban Development Authority (UDA)