Development assistance from Norwegian Investment Fund (Norfund) to Sri Lanka

Development assistance from Norwegian Investment Fund (Norfund) to Sri Lanka

Ambassador Godfrey Cooray had a zoom meeting with the Chief Executive Officer of the Norwegian Investment Fund, Tellef Thorleifsson on 09 October 2020 to seek possibilities on getting more development and investment assistance to Sri Lanka and he thanked Tellef Thorleifsson for giving the opportunity to have the zoom meeting and highlighted that being owned and funded by the Norwegian Government, it has already signed agreements with Sri Lankan Financial Institutes such as Hatton National Bank and Softlogic.

The Ambassador revealed that the Norfund, Finnfund and MunichRe have invested in total USD 30 million in Softlogic Life Insurance PLC. Finnfund and Norfund who signed a USD 15Mn Tier II Subordinated Debt transaction with the Softlogic Company on 24 August 2020 will provide funding to further develop the business objectives of the company. The transactions are even more significant as they are being executed amidst the ongoing COVID-19 pandemic. Mr. Thorleifsson stated that it was the first investment done in life insurance in the Asian region. Also Softlogic Life is Sri Lanka’s third-largest life insurance entity.

Ambassador Cooray elucidated that the UN´s Sustainable Development Goal Number 1 is to end poverty and Norfund is contributing to the achievement of this Goal by building sustainable economic growth. Norfund prioritizes investments in four investment areas that includes, clean energy, financial Institutions, green infrastructure and scalable enterprises. He further stated that Companies only survive if they are profitable. This means that profitability is essential for the creation of sustainable jobs and lasting development effects. Norfund invests in companies that will contribute to economic and social development through the direct and indirect jobs they provide, the goods and services they offer, the taxes they pay.

Mr. Thorleifsson stated that they mainly aim on sustainable businesses in developing countries which are financially sound. He further mentioned that they have a 30 billion Norwegian Krone in their balance sheet in equity. Out of that 50% investments goes for the African region and the rest will be for the developing countries in the Asian region. Earlier Norfund has mainly focused on Bangladesh, Myanmar. Cambogia, Laos, Vietnam and indirect investments to India. However, Sri Lanka had been added as the focused country of Norfund in last year. He emphasized that in phase I the Norfund will mainly target on financial Institutions and in the Phase II, their focus will direct for projects on energy sector. He further added that currently the Norfund is looking for three potential new large investments in Sri Lanka. They are reputable financial institutes, he said. But also he revealed that Norfund will target for investing in small scale hydro power projects in Sri Lanka in the near future.

The CEO also inquired the Ambassador on the current situation in Sri Lanka in terms of Covid 19 and its impact for the economy. Ambassador Cooray briefed that Sri Lanka has successfully controlled the Covid19 until first week of October due to the measures taken by President Gotabaya Rajapakse. However, currently it has been observed a small wave with several small clusters in the Western Province of the country. The Government has taken immediate actions and steps to control the situation.  Mr. Thorleifsson also appreciated the government ability to control the Covid 19 when compared to other countries.

Ambassador Cooray  revealed that the Covid as well as the Easter carnage in 2019 had been serious setback to the Sri Lankan economy and 2.5 million tourists arrivals also been stopped. Since, being in the middle of the Indian Ocean and also being the hub, Sri Lanka has become the centre of attraction for many parties. Ambassador highlighted that Sri Lanka wants the Indian ocean to be a peace zone and as per our foreign policy, we have a clear destiny with understandings to move with economic ties and bilateral/multilateral relationships for the betterment of the country.

The CEO of Norfund expressed his gratitude for the Ambassador and conveyed that they will continue their development assistance through relatively high investments to Sri Lanka. Also he promised to appoint an officer for Sri Lanka soon in their office in Bangkok.  Mr. Thorleifsson also requested to arrange meetings with higher dignitaries in the government sector of Sri Lanka during his next visit to Sri Lanka for further discussions on investments via Norfund to Sri Lanka.

Embassy of Sri Lanka

23 October 2020


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