Sri Lanka Investment Board: Navigating Bureaucracy, Corruption, and the Investment Dilemma
(October 21, 2025) Sri Lanka, which desperately needs foreign investment to recover from its financial struggles, has unfortunately developed one of the least welcoming bureaucracies for investors in South Asia.
The Board of Investment (BOI), meant to serve as a streamlined point of contact for investors, has instead become a hindrance to economic progress. Originally intended to be a vibrant, business-friendly channel, it has devolved into a complicated mess characterized by inefficiencies, excessive regulations, and hidden corruption, overseen by officials who seem both uninformed and indifferent towards the needs of investors.
There’s a note of irony here. The National People’s Power (NPP) government came to power with promises to reform key institutions, attract fresh foreign direct investment (FDI), and establish Sri Lanka as a viable regional hub. Yet, within the BOI’s headquarters in Colombo, things appear to remain unchanged—a bureaucratic machine still grinding out the same old lethargic routines marked by delays, arrogance, and visible obstruction.
Long Delays in Decision-Making
Any investor trying to navigate the BOI process will tell you it can be a lengthy ordeal. The initial steps include paying a non-refundable application fee, submitting a detailed proposal, and proving financial capability. What follows can be a frustrating bureaucratic maze.
Files tend to bounce between various departments, with each official raising additional queries. Investors have often been summoned to meetings to “clarify details” that were submitted months earlier. After going through stages like due diligence, an interdepartmental committee review, and then an internal assessment, approval can take as long as ten years.
In stark contrast, countries like Vietnam and Dubai manage to approve foreign investments in just 72 and 48 hours, respectively, while the BOI takes years to process a single application.
Excuses abound. Whether it’s “under consideration” or “technical evaluation pending,” the result is typically the same—prolonged delays, disappointment, and often investors withdrawing.
This leads to a vicious cycle: investors leave, projects fail, and Sri Lanka remains ensnared in an economic quagmire.
Concerns About BOI’s Credibility
Confidential documents from the US Treasury have raised critical concerns regarding the BOI’s credibility and governance. The report highlighted “unnecessary procedural bottlenecks, unclear evaluation criteria, and poor interagency coordination.”
In diplomatic terms, this is a delicate way of stating: the BOI is plagued by corruption, inefficiency, and counterproductive practices.
Foreign investors have voiced complaints about harassment, shifting expectations, and “requests for informal facilitation,” which is often understood as bribery.
Despite Sri Lanka’s participation in investment forums, the actual influx of FDI remains negligible. The total FDI in 2024 was around USD 740 million, a sharp drop compared to Vietnam’s USD 36 billion and Bangladesh’s USD 4.2 billion.
Renuka Weerakoon: Under Pressure
Currently, the BOI Secretary General, Renuka Weerakoon, is facing scrutiny. Appointed to modernize the BOI, under her leadership, the organization seems to have become even more bureaucratic.
Insider sources suggest she relies heavily on a select group of politically connected staff, many of whom are remnants from the previous government and resist change.
Anonymous investors have reported feeling obstructed by BOI officials. “It feels like they want to thwart investment. Every meeting leads to new delays,” remarked one European investor candidly.
Another investor from South Asia recounted how his proposal for a $20 million export processing zone stalled for two years due to the BOI “losing” his file multiple times. “In that duration, we could have easily set up three factories in Vietnam,” he noted.
Speculations About a Hidden Agenda
Rumors are circulating in Colombo that some BOI officials are deliberately frustrating investors. It seems to create an impression that the country is ungovernable regarding nuclear power plants.
Individuals within the Investment Promotion Ministry allege that Weerakoon is in communication with loyalists of former SLPP politicians, who benefited from the political patronage system established during the Rajapaksa administration.
If true, this could point to not just bureaucratic mismanagement but potential economic sabotage.
The impact is measurable. In the first nine months of 2025, over 22 proposed foreign projects reportedly withdrew from Sri Lanka, citing “procedural paralysis.” Several wealthy investors from the Middle East and East Asia are redirecting their focus to countries like Bangladesh and Vietnam.
The Divide Between BOI’s Image and Reality
Each year, the BOI holds flashy press events, publishes glossy materials, and releases optimistic annual reports touting “historic investment achievements.” The Secretary-General’s speeches brim with confidence and self-praise.
Yet, the data tells a very different story.
The agency spends millions on promoting investments abroad, often sending delegations to Singapore, Dubai, and London while staying in luxury accommodations. However, in the last three years, no significant investors have entered Sri Lanka through the BOI’s auspices.
The few that tried were forced to navigate insurmountable bureaucratic challenges, leading them to bypass the BOI in favor of private agreements directly with local ministries and authorities.
In essence, the BOI is becoming increasingly irrelevant.
Lack of Accountability and Performance
Unlike private business owners, BOI officials don’t appear to face the same pressure to deliver measurable outcomes. The question of accountability seems absent.
No one seems to ask:
- How many projects have you approved this year?
- How many have actually commenced construction?
- How many investors have pulled out?
If the BOI were a private entity, it would likely have gone out of business long ago. But as a government body, its inefficiencies continue, financed by taxpayers, underpinned by bureaucratic justifications.
This irony is hard to accept. Those tasked with attracting foreign investments are compensated by the very people whose livelihoods depend on those investments.
If the BOI fails to deliver, it should face replacement. That’s standard practice in business, governance, and democracy.
A 90-Day Challenge
Economic experts are now suggesting the government implement a 90-day performance directive for the BOI.
Within this time frame, the BOI must achieve tangible results, aiming for a USD 5 billion investment commitment that is verified.
If the BOI falls short, it could lead to a significant overhaul, including the removal of the Director-General and senior staff, to be replaced by a public-private hybrid investment authority staffed by experts with international experience.
Sri Lanka cannot afford to let bureaucratic delays hinder its economic recovery.
Learning from Neighboring Nations
Sri Lanka’s neighbors offer crucial insights.
- Vietnam: Processes all foreign investment applications through a digital platform, approvals for non-sensitive sectors can take up to 72 hours.
- Bangladesh: Has enabled online registration through the Bangladesh Investment Development Authority (BIDA).
- Cambodia: Simplified leasing and tax incentives have drawn garment and manufacturing investors who once eyed Sri Lanka.
- Pakistan: Even amid political unrest, swiftly established a “special economic zone” with rapid approvals.
- Dubai: Business visa approvals take 24 hours, and industrial permits take 48 hours.
Meanwhile, BOI officials are still preoccupied with gathering copies of passports and “introduction letters.”
This apparent inefficiency borders on economic self-sabotage.
Bureaucrats Living in Comfort
While investors wait interminably for approvals, BOI officials enjoy perks akin to private executives, including state vehicles, housing allowances, and travel budgets.
Document reviews indicate that in 2024 alone, the BOI spent Rs. 350 million on promotional activities abroad, most resulting in limited direct investment.
A senior official suggested that “promotion itself is an investment.”
Quite right—an investment in self-promotion.
The Real Victims
At the heart of the statistics and scandals are the real victims—the Sri Lankan people.
Each failed foreign project means lost jobs, decreased exports, and diminished revenue. Every delay costs invaluable time for progress.
Every delay from the BOI not only impacts businesses but also families, communities, and national trust.
Established in 1978 as a cornerstone of economic liberalization, the BOI has now become a symbol of stagnation.
Political Protection and a Silent Culture
Why is accountability absent?
It’s largely because the BOI functions under political protection. High-ranking officials are shielded by ministers who perceive the BOI as a diplomatic tool, rather than an economic catalyst.
Governments often use the BOI for visual messaging during foreign visits and investment summits. When deals fall through, the usual scapegoat becomes “external factors.”
No one confronts the uncomfortable truth that the BOI is failing in its most primary mission of facilitating investment.
Future Considerations: Reform or Replacement?
Radical restructuring might still be on the table for the BOI. Experts propose:
- Digitization: Transition all application and approval processes online.
- Performance Contracts: Tie salaries and promotions to actual FDI outcomes.
- Independent Monitoring: Establish an audit team to oversee project delays.
- International Expertise: Recruit professionals with experience in private sector investments.
- Transparency: Regularly publish updates on pending, approved, and denied projects.
If the BOI cannot adapt, it may need to be dismantled entirely. A new National Investment Authority (NIA), encompassing both public and private governance, could be the key to Sri Lanka’s future.
Final Thoughts: Deliver or Depart
Despite numerous speeches and strategy documents, the BOI remains ensnared in its cycle of excuses.
The Director-General now faces an urgent triptych of questions:
- How many investments have been approved during your term?
- How many investors have withdrawn due to bureaucratic hang-ups?
- What specific measures have been taken to enhance transparency and efficiency?
If no satisfactory answers emerge, resignation may be the only honorable option.
The BOI was not created to be a bureaucratic textbook; it was meant to energize Sri Lanka’s economy.
The time has come for it to regain that life force.
Should Renuka Weerakoon and her team fail to deliver, they might have to step aside. Sri Lanka cannot afford to wait another decade for approvals, process files, or encounter further excuses.
This nation needs investors, not bureaucrats.
And what the people require are results, not elaborate press events.
