By: Staff Writer
March 12, Colombo (LNW): Strong governance, policy stability and institutional credibility will determine whether Sri Lanka can attract long-term investment as it moves beyond its recent economic crisis, Mark Tucker, Chairman of AIA Group, said yesterday.
Addressing business leaders at a forum organised by the Sri Lanka Institute of Directors at Port City Colombo, Tucker warned that investors ultimately base their decisions on trust in governance systems and policy consistency.
“Capital only flows where there is trust,” he said, stressing that even strong economic opportunities can fail to attract investment if governance standards are weak or policy frameworks appear unpredictable.
Sri Lanka has made significant progress in stabilising its economy following the recent financial crisis, he acknowledged. However, the next stage of development will require deeper reforms to ensure that investors perceive the country as a reliable long-term destination for capital.
Tucker pointed out that investors typically make decisions over decades rather than months, meaning they require stable rules, transparent processes and consistent policy implementation.
In the past, some investors have faced regulatory shifts, project cancellations and policy uncertainty in Sri Lanka, he noted. Such issues increase execution risks and can slow the flow of capital into the economy.
To rebuild confidence, he recommended creating a stable regulatory environment with clearly defined rules that remain consistent over time. Streamlining approval procedures and strengthening institutional governance would also improve the investment climate.
Corporate governance within businesses is equally important. Tucker said company boards must reinforce oversight mechanisms covering risk management, financial controls, organisational culture and cyber resilience.
He also emphasised the role of sustainability and climate-related investment standards in shaping global capital flows. Increasingly, investors are directing funds toward projects aligned with environmental and sustainability goals.
As a result, new financing mechanisms such as green bonds, blended finance structures and regulated infrastructure investment vehicles are becoming important tools for funding large-scale development initiatives.
Tucker suggested Sri Lanka could also tap into the financial and intellectual resources of its global diaspora. Beyond capital, diaspora communities possess expertise, entrepreneurial networks and international experience that could help accelerate economic development.
Structured investment channels connecting diaspora investors with key sectors such as services, energy and technology could unlock new sources of funding.
Another critical driver of growth, he said, is human capital. Sri Lanka’s skilled workforce represents one of its strongest advantages, but continued investment in education, talent development and digital infrastructure will be necessary to maintain competitiveness.
Global economic trends are also shifting in ways that could benefit Sri Lanka. Trade and investment flows are increasingly centred around the Indian Ocean region, with rapid growth across South Asia, the Middle East and Association of Southeast Asian Nations economies.
Positioned along one of the world’s busiest shipping routes, Sri Lanka could leverage its geographic advantage to develop as a regional hub for trade and services.
For that potential to materialise, Tucker concluded, Sri Lanka must focus on strengthening governance, ensuring policy predictability and investing in people steps that will ultimately determine whether the country can reconnect with global capital markets.