Apart from aggregate accounting of Singapore’s investment abroad, case studies on the performance of these investments in individual countries hardly exist. This paper is an attempt to compile such a study by focusing on Singapore’s investment in Sri Lanka. Singapore is one of the largest foreign investors in Sri Lanka though Sri Lanka is a small recipient of Singapore’s total overseas investment. The bulk of Singapore’s investment in Sri Lanka has been in service industries. As usual these investments have created many employment opportunities. However, because of high import dependence the Singapore firms in Sri Lanka have begun to generate trade surpluses only recently. Revealed comparative advantage indices combined with attractive fiscal incentives and low-cost factors of production indicate that there are large investment opportunities in the manufacturing sector that remain to be exploited. The ongoing war obviously has deterred the expansion of Sri Lanka’s FDI base to its full extent.
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Find related papers by JEL classification: F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
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