By Shanika Sriyananda/DailyFT
Colombo, April 19: A top diplomat and green advocate emphasized the need of having a simple and easier bureaucratic system to attract international investors to invest in the country’s renewable energy projects to have a green economy.
“If the Government is on a fast-track to attract international investors, the bureaucratic system should be simple and easier while investors are facilitated to do their investments in foreign currencies,” President Ranil Wickremesinghe’s International Climate Change Advisor Erik Solheim said.
Solheim, the former Norwegian minister and former peace negotiator between the LTTE and the Sri Lankan Government, said that he was confident that with the International Monetary Fund facility and China and India on debt restructuring, Sri Lanka could look ahead and not backward.
“When it comes to bringing international investors, the Government should seriously look into these two key issues. No international investor will go through 15 different ministries when they reach Sri Lanka for investments. They need a one-stop-shop to get all work related to investments done where all the relevant ministries work together,” he said.
Solheim, who was participating at an investor forum held in Colombo recently, told in an interview with the Daily FT that implementing private sector driven renewable energy projects is paramount to achieve President Wickremesinghe’s vision to turn Sri Lanka’s economy into a green economy.
“Sri Lanka has huge opportunities to create employment and revenue by investing in solar, wind and green hydrogen,” he stressed.
Following are the excerpts of the interview:
Green hydrogen production needs a lot of renewable power. The biggest potential for Sri Lanka to have green hydrogen is offshore wind because Sri Lanka cannot have large solar farms due to limited land area. The sea between Sri Lanka and India is very shallow and a large number of wind mills can be installed to produce green hydrogen from those wind power mills. Sri Lanka can also produce green hydrogen fertiliser to export
By Shanika Sriyananda
Q: Sri Lanka has declared its willingness to become the first country in the region to adopt a green economy. What is your comment?
A: Yes, this is a great way forward for Sri Lanka, which is in a deep economic crisis. People are desperate to get more jobs and also to get out of this crisis. Going green is a huge opportunity to create more jobs. I strongly believe investing in key renewable energy generation sectors like solar, wind and green hydrogen will be a new boost for this.
Q: Sri Lanka is considering harnessing renewable driven power generation for decades. What should the Government do more to popularise clean energy?
A: Sri Lanka has a huge potential for wind power, particularly offshore. It also has the potential for solar power. When it comes to bringing international investors, there are two key issues that the Government needs to consider.
One is the bureaucratic system, which should be more simple and easier for international investors as they will not go through 15 different ministries when they reach Sri Lanka for investments. They need one stop shop to get all work related to investments done where all the relevant ministries work together.
Secondly, the international investors have to be facilitated to do their investments in foreign currencies and not in rupees.
Q: However, India and China are also strongly promoting the concept of the ‘Green Economy’ and what would be Sri Lanka’s potential or opportunities to shift to a green economy as declared?
A: Sri Lanka should work very closely with both China and India. Over 82% of the world’s solar panels and 70 % of electric batteries are made in China while 57% of electric cars in the world are sold in China, which is the world leader of most of the environmentally-friendly technology. Sri Lanka should open doors for Chinese investments. They are moving very fast in green hydrogen emission.
Indian companies should also come to invest in Sri Lanka. The Adani Company has proposed to commence a wind power project in the Mannar region and also another Indian investment in the pipeline for a solar power project in Trincomalee. Therefore, Sri Lanka has to use both opportunities to get Indian and Chinese investments.
Q: According to your forecast, how vulnerable is Sri Lanka to climate change?
A: Sri Lanka has been identified as one of the most vulnerable nations to climate change by the researchers. Sri Lanka is quite dry and it can be drier if climate change occurs. And Southern Sri Lanka is wet, green and arable. That makes this region more vulnerable to extreme weather such as floods and landslides. This makes Sri Lanka to get prepared for climate change. Therefore, even if it happened people are not exposed to dangers due to preparedness.
Without the Government setting the right policies investors will go to other places to invest. The international companies can invest in many different places. If Sri Lanka is seriously bureaucratic, they will go somewhere else. This is why there should be a simple process for investors to get clear permits fast following proper environmental laws of the country
Q: How important is it to encourage the private sector to invest in green energy?
A: There is no way of promoting green energy without the private sector. The Government must regulate markets and make sure that people get jobs. The renewable energy in the world is driven by the private companies and Sri Lanka should open avenues for them to invest. The production can happen in Sri Lanka and it will help to create more jobs for people.
In India, Prime Minister Narendra Modi has introduced a slogan which states ‘Make it in India’. Likewise Sri Lanka also needs to look into opportunities to manufacture goods in the country because that creates adequate jobs.
This will not just to import solar panels but to make sure that they are made in Sri Lanka. Even Sri Lanka can have electric vehicle assembling factories in the country.
Nearly the entire world is importing solar panels from China so Sri Lanka can look into possibilities of producing solar panels in Sri Lanka in joint venture with China.
Q: What is your responsibility as President Ranil Wickremesinghe’s International Climate Change Advisor?
A: I am happy to support the President in his great vision on promoting Sri Lanka as a green economy. My role is to advise him on policy related matters and also to help him to bring more investors to Sri Lanka as the country needs technology. I am happy to be back in this beautiful nation to help the country to overcome the prevailing economic crisis. I am also supporting the Government to bring Chinese, Indian, European or American companies to invest in Sri Lanka. This is why we held the’ Sri Lanka Clean Energy Summit 2023’ – an investor forum, recently. There it was discussed the policies that Sri Lanka adopts and also looked into making connections with world leading investment companies in green energy. We brought all the global associations like Green Hydrogen Associations, International Hydropower Association, and Global Wind Energy Council, which can help Sri Lanka to bring international investors to Sri Lanka. The President has indicated he wants a broader investor forum later in this year
I see a lot of interest in this area of renewable energy. Everyone felt that the forum was really a good opportunity to get connected with those who have interest in investing in Sri Lanka. With the International Monetary Fund facility and China and India on debt restructuring, Sri Lanka can look ahead and not backward. Otherwise no one will come to Sri Lanka to invest.
People are desperate to get more jobs and also to get out of this crisis. Going green is a huge opportunity to create more jobs. I strongly believe investing in key renewable energy generation sectors like solar, wind and green hydrogen will be a new boost for this
Q: What is your comment about the political commitment to address climate change issues and also have a green economy in Sri Lanka?
A: It is very strong because the President is fully interested in this area because he is a great environmentalist. He also sees ways to create jobs and also bring prosperity to the country through addressing climate change issues. He is committed to taking the country out of this crisis. Without energy, without electricity no country will be developed fast. He is adamant to see a fast development in Sri Lanka based on solar and wind power
Q: Once you were the Head of the United Nations Environment Program and do you have plans to get assistance from international organisations like the UN to implement programs to encourage more investments in green energy?
A: The UN’s process is very slow and bureaucratic. Therefore, my advice is to focus more on bringing private investments and carbon credit projects to Sri Lanka because that is where big money lies.
The most important thing is to see climate change as a threat. This is also a big opportunity for a country to grow and this is why both China and India are moving fast to get the opportunity to create more jobs and capture markets locally and globally.
In India, there is a company called Ola. They have a large manufacturing plant in Tamil Nadu, where over 2,000 young women are making electric scooters. Their slogan is ‘Tesla for the West – Ola for the rest’. This means that Ola can capture the market in the rest of the world.
Q: How do you see Sri Lanka seek more opportunities in carbon trading, which is becoming increasingly popular in reducing emission?
A: This is also a huge opportunity for Sri Lanka because this country has a fantastic nature. For example, take the restoration of mangroves, which can create very valuable carbon credits and also increase the tree cover. Carbon credit can be used in other areas to protect nature. Mangrove restoration will help to generate a lot of income to local communities living around mangroves. This will also help to protect nature by increasing the forest cover. No forest will sustain without people and carbon credit programs will create more jobs for people living around forests.
Q: Are you of the view that reforms are the key for a country’s development for a greener future?
A: Yes, without the Government setting the right policies investors will go to other places to invest. The international companies can invest in many different places. If Sri Lanka is seriously bureaucratic, they will go somewhere else. This is why there should be a simple process for investors to get clear permits fast following proper environmental laws of the country.
Q: Being an island nation, how important is it for the Government to give priority for disaster management and climate change adaptation for the country’s development?
A: Preparing for climate catastrophes is very important. For example, in preparing for a dry climate in the North, they can have better irrigation systems suitable for the dry climate while getting prepared for landslides and floods in the South. Generally, it is much better for getting prepared for disasters fast because staying stronger will help people. The better preparedness will cause less damage to human lives even in severe environmental catastrophes.
Q: What is Sri Lanka’s potential for producing green hydrogen?
A: Green hydrogen production needs a lot of renewable power. The biggest potential for Sri Lanka to have green hydrogen is offshore wind because Sri Lanka cannot have large solar farms due to limited land area. The sea between Sri Lanka and India is very shallow and a large number of wind mills can be installed to produce green hydrogen from those wind power mills. Sri Lanka can also produce green hydrogen fertiliser to export.
Q: How important for Sri Lanka to implement adaptation measures to enhance food security in the country?
A: Sri Lanka needs to mitigate climate change and also adapt to renewable energy to make sure that there wouldn’t be major issues. Preparing agriculture for the changing temperature and water patterns is very essential. The scientists need to tell us what can be expected to happen for better preparedness.
Q: Should Sri Lanka focus more on mitigation aspects or adaptation methods to climate change?
A: It is both. You can build up hydro power and at the same time need to get the agriculture sector and people for more warmer or wet climates. More studies coming from the United Nations and China are on mitigation of climate change. Sri Lanka should prepare for warmer climates.
Q: Do you think Sri Lanka should do more research on climate change vulnerability and what are your plans to get international assistance for such research?
A: President Wickremesinghe has clearly said that he wants to set up a climate change university in Sri Lanka. This is a good opportunity to make a positive approach. This university can be linked up with the other universities in the world in the US, India or China to do joint research and to bring the best international scientists to Sri Lanka to join with Sri Lankan scientists.