VIII.  TRADE AND PROJECT FINANCING

 Banking System

 The banking system includes the Central Bank of Sri Lanka, two
 large state-owned commercial banks, 4 private domestic
 commercial banks, 17 foreign banks, a national savings bank, 12
 regional rural development banks, two development finance
 institutions, a state mortgage bank and 4 merchants banks.


 Foreign Exchange Controls Affecting Trading

 There are no foreign exchange controls affecting active trading.
 There are a few on capital outflows. Sri Lanka removed all
 exchange control restrictions on current account transactions
 with effect from March 15, 1994.


 General Financing Availability

 Commercial banks provide term loans and working capital loans
 for importers.

 Available Export Financing and Insurance

 The Overseas Private Investment Corporation (OPIC)  provides
 investment insurance guarantees for U.S. investors.  OPIC
 currently insures banking, manufacturing and service investments
 in Sri Lanka.  EXIM Bank program is also available for U.S.
 Exporters interested in exporting to Sri Lanka.


 Project Financing Available and Types of Projects Supported

 Funds provided through multilateral agencies have been the major
 source of term lending.  The Asian Development Bank and the
 World Bank are the major sources of project financing.

 1.  The International Bank for Reconstruction and Development
 (IBRD), a member of the World Bank group makes long-term loans
 at market- related rates primarily to developing nations.  The
 International Development Agency (IDA), the soft loan window of
 the World Bank, lends to the poorest of the development
 countries.  Both the IBRD and IDA work to promote broadly based
 economic growth and frequently focuses on structural adjustment,
 sectoral reform and individual project lending and operate under
 the same set of procurement guidelines.  Typically the World
 Bank does not finance the entire cost of a project.  Rather, it
 finances the components of a project purchased with foreign
 exchange, which on average is about 40 per cent of the total
 project cost.  Each project may cover a wide variety of sectors
 and can involve anywhere from one to hundreds of separate
 contracts providing export business opportunities for suppliers
 worldwide.

 CONTACTS:

 U.S. Department of Commerce
 Liaison to the U.S. Executive Directors Office
 International Bank for Reconstruction and Development
 1818 H. St., NW
 Washington D.C.  20433
 Tele:  (202) 458-0118
 Fax:   (202) 477-2967

 Office of Multilateral Development Banks
 U.S. Foreign Commercial Service
 U.S. Department of Commerce
 Room H-1107
 Washington D.C.  20230
 Tele:  (202) 482-3399
 Fax:   (202) 273-0927

 2.  The Asian Development Bank is a multilateral institution
 that lends and invests exclusively in the Asian and Pacific
 countries, as well as selected Central Asian Republic countries.
 The ADB makes loans and equity investments for economic and
 social advancement of developing member countries; provides
 technical assistance for the preparation and execution of
 development projects, programs, and advisory services; promotes
 investment of public and private capital for development
 purposes; and responds to request for assistance in coordinating
 development policies and plans for developing member countries.
 The Bank is required to give attention to the needs of the
 smaller or less developed member countries and give priorities
 to regional, sub-regional and national projects and programs
 which will contribute to the harmonious economic growth of the
 region as a whole.

 CONTACTS:

 U.S. Department of Commerce
 Liaison Office to the Asian Development Bank
 Thomas Jefferson Cultural Center
 U.S. Embassy Manila
 Makati, Manila
 Manila, Philippines
 Tele:  (632) 813-3248
 Fax:   (632) 816-7684

 Office of Multilateral Development Banks
 U.S. & Foreign Commercial Service
 U.S. Department of Commerce
 Room 1107
 Washington, D.C.  20230
 Tele:  (202) 482-3399
 Fax:   (202) 273-0927

 Types of Projects supported:

 * World Bank IDA loan - $60 million available during 1994
     -1998 for private sector enterprises engaged in productive
     operations and services.

 * ADB loan - proposed - $75 million to finance foreign
     currency investments of private enterprises in the
     manufacturing, services and tourism sectors.

 * ADB LOAN - proposed - $50 million for road development