Government to allow foreigners to buy land

The government is gearing to introduce amendments to existing land laws within three to four weeks, in a major push to liberalize Sri Lanka’s land laws allowing foreigners to buy land, Mirror Business learns. According to sources, the government will amend the controversial Land (Restrictions on Alienation) Act, which barred foreigners from owning lands, brought in during the final few months of the nationalistic Mahinda Rajapaksa regime in 2014 amid protest from the local business community.

A l s o , t h e g o v e r n m e n t contemplates to allow any foreigner who will bring in US $ 1.0 million (approx.Rs.145mn) to buy government-owned lands for personal purposes. B u t t h e r e w i l l be no restrictions in foreigners owning lands for commercial purpose hence the foreign companies who seek to acquire land will be allowed based on the size of the investment and the economic value addition the venture could bring in. Meanwhile, in another move, the government will offer 10-year temporary visa for any foreigner who will bring US $ 300, 000.

A n a l y s t s p e r c e i v e t h e m o v e s a s g o v e r n m e n t ’s desperation for dollars. In April, the government brought in a 90-day rule for the country’s exporters to repatriate their e a r n i n g s from t h e d a t e of the export. The policy was met with severe criticism from the export community but the government refused to budge. I t was only las t week a tourism sector expert warned that stricter land laws could cap the tourism growth – the only silver lining in the ailing Lankan economy. Tourism is trending towards concepts such as vacation clubs and timeshare where properties such as holiday homes or resorts can be owned or leased by individuals or a group of individuals for a short period of time during their stay.

“It could be an impediment to investments. Certain foreign companies like holding property,” Hemas Leisure Travel Aviation Group Managing Director Malinga Arsakularatne told a forum last week. Sri Lanka’s strict land laws are only one of the many factors blocking the flow of foreign direct investments (FDIs) to the country, but the government needs to strike a balance between investments and national interests, the majority of the analyst community opines.