- Sri Lanka is considered one of the countries friendly to the UAE, as the ties of friendship and economic relations between the two countries date back many years, when the Arabs arrived in Sri Lanka two thousand years ago for the purpose of trade, and diplomatic relations were established between the two countries in July 1979 with the opening of the Sri Lankan embassy in Abu Dhabi.
- The strengthening of bilateral relations between the two countries led to mutual cooperation in various fields, foremost of which is the economic field. The UAE is the largest and most important trading partner of Sri Lanka in the Middle East region, and recent years have witnessed the exchange of official visits between the two countries, in addition to commercial and economic delegations to participate in forums and meetings and discuss trade and investment opportunities in the two countries.
- There has been a constant exchange of trade delegations and economic participation in forums and meetings, and discussions on trade and investment opportunities in both countries. Sri Lanka regularly participates in UAE’s trade exhibitions such as the Annual Investment Meeting (AIM), Arabian Travel Mart, Gulf Food Trade Exhibition and Arab Health Exhibition.
- Sri Lanka welcomes UAE investments and there are great investment opportunities available for UAE investors. The governments of the two countries look forward to further promote relations and open wider horizons of cooperation between the two countries.
- UAE investments rank first among the Middle East countries, amounting to 65% of the region's total investment in Sri Lanka. FDI inflows from the UAE to Sri Lanka during 2015-2018 were to the tune of US$ 641 million. During 2015-2017, Sri Lanka received US$ 593 million in FDI from the UAE, which represented 6.1 percent of the total FDI inflows to the country during that period. These investments are mainly in the construction and hospitality sectors, manufacturing industries, logistics, communications and information technology.
- The Balance of Trade between the two countries has always remained in favour of UAE. The bilateral trade in 2016 was US$ 1.34 billion, which jumped to US$ 2.13 billion in 2018, witnessing a 62.92 percent increase. Of this, total exports from Sri Lanka to the UAE were to the tune of US$ 290 million and total imports from the UAE to Sri Lanka were valued at US$ 1.84 billion. Tea, natural rubber, coconut oil, desiccated coconut, copra, cashew nuts, essential oil, fruits and vegetables, processed food, sea food, rubber products and toys are the major export commodities from Sri Lanka to the UAE, while imports from UAE constitute of petrol, fuel and gas oils, urea, iron and steel and machinery parts. Sri Lanka’s trade with the UAE in 2018 represented 56.5 percent of the country’s total trade with the Middle East, making the UAE its largest trading partner in the region.
- In the year 2008, Sri Lanka opened an office in Dubai in order to promote tourism in Sri Lanka. This led to an increase in the number of tourists from the United Arab Emirates to Sri Lanka. In 2011 the number of tourists coming from the UAE reached its peak of 17,664 tourists. A total number of 71,636 tourists from the Middle East visited Sri Lanka in 2018, and 5,785 of them were from the UAE.
- The Sri Lankan community in the UAE, amounting to around 300,000 Sri Lankans, is the second largest community of Sri Lankans abroad, with around one third of them doing white-collar jobs. The remittances from the diaspora heavily support the Sri Lankan economy. In 2018 alone 32,836 Sri Lankans travelled to UAE for employment. Sri Lanka received US$ 3.59 billion worth foreign remittances in 2018 from over one million Sri Lankans working in the Middle East, which represented 52.2 percent of the total remittances the country. The Sri Lankan Government has introduced insurance schemes and pension funds to ensure their welfare of the Sri Lankans living abroad.
- The current Sri Lankan government has a vision to develop the country's economy and establish infrastructure projects as well as free trade zones and major modern cities, and this requires more investment and support for major companies around the world, and because the UAE is the largest economic partner of Sri Lanka in the Middle East, there is much hope among the Sri Lankans in the UAE. Sri Lanka welcomes UAE’s hosting of the "Expo 2020" exhibition in Dubai and has committed to active participation in its activities, whether at the level of the public sector or the private sector, as it is considered a global platform to promote Sri Lanka economically as the government looks forward to attracting more investment and tourism in the coming years.
