3 quick questions for Linda Lundberg-Nilsson, CEO of the Norrbottens Handelskammare, Sweden’s northernmost and second oldest, founded in 1904. She comes from a family of entrepreneurs and has extensive experience in export trade but also in working at multinationals. Six years ago, Linda became CEO of the Chamber of Commerce, which is highly involved in the green reindustrialization that is transforming Swedish business and society. In this role, she has also hosted trade delegations from Sri Lanka.
1. What are the main tasks of the Norrbotten Chamber of Commerce? Given our geographical location, infrastructure issues are top priority. We work intensively on advocacy to shorten distances to our members’ main markets on the continent. A concrete example is the extension of the Scanmed corridor from Sicily and Stockholm to Luleå and the ice-free harbor in Narvik, Norway. This issue has become even more important in recent years for geopolitical reasons. The next area is skills development. We will receive 100,000 global talents in northern Sweden the coming years. Facilitating migration from third countries is crucial to our success. The third area is international trade. Through our global network of 12,000 international chambers of commerce, we help companies expand their business by internationalizing and reaching new markets.
2. What are the region of Norrbotten’s main assets? We are very well positioned for the radical transformation of Swedish society and industry that we are about to undertake. We have great resources of ore and minerals, raw materials that are necessary for the electrification of society’s transport system but also in constructions such as wind turbines. Norrbotten is an export intense region with a resource-based economy and a large primary industry sector such as timber, mining and minerals. Norrbotten has also been the backbone of Swedish hydropower for more than 100 years. We further have world-leading research and companies in wood construction, green steel, IT and tourism.
3. How can trade with Sri Lanka increase? We have already received the first trade delegations from Sri Lanka and we welcome more, not least from the Sri Lankan IT sector. We want to contribute to concrete business but there is work to be done before we meet. Business leaders must have done their homework and understand that there are many opportunities in Norrbotten, but that the competition is global. This requires clear decisions to invest strategically – it is costly to make mistakes. The requirements specification also needs to be clear. Do you want to establish a subsidiary, an agent, or a retailer? This systematic approach applies regardless of whether it is about importing to Norrbotten or exporting to Sri Lanka. And finally, we would like to see many of the global talents that we will welcome in the coming years come from Sri Lanka.
3 quick questions for Mattias Martinsson, Chief Investment Officer of Stockholm-based Tundra Fonder AB, a company he co-founded in 2011. The company now offers trading via a global fund which specialize in low-income and lower-middle-income countries. Since the mid-1990s, Mattias has worked with investments in emerging markets, first focusing on Russia and then on Asian emerging countries such as Sri Lanka, Bangladesh, Pakistan and Vietnam.
How do you work in practice with analysis of each market? We have an investor team with six members. Three are based in Stockholm and three are based in Asia. We invest exclusively in listed companies and we implement a very long-term perspective when we go in. We have three key pillars that need to be in place for us to invest:reliable and trustworthy owners with high-quality management, that the company is involved in a sector subject to structural growth (will grow its share of the local economy), and we want there to be clear societal benefits of the company growing (to reduce risk of state interference). The final pillar is also at the core of our sustainability philosophy . A typical sector we like is healthcare, where private alternatives reduce the burden on the public healthcare system.
What makes Sri Lanka stand out from an investment perspective? Sri Lanka has great potential in the service sector such as tourism, trade, IT and logistics. The literacy rate is very high and the education system is of good quality. The quality/price ratio is favorable and it is probably the one of our markets where quality of life is high enough also for spoiled foreign investors. We try to find the best listed Sri Lankan companies and enter with decades long investment horizon. Despite the crisis, these companies have remained strong. The stock market in Sri Lanka is still underdeveloped, which means there are many companies few foreigners have invested in. This creates an opportunity for us and means it is worth the effort to do in-depth analysis on each portfolio company.
How has the development in recent years affected Tundra Funds? These have been challenging years for everyone living in or working with Sri Lanka. The pandemic hit several industrial sectors hard, not the least tourism. The capital controls introduced in mid-2021 were devastating and then the political and economic turmoil in 2022 followed. Our perspective is howeverlong-term and we concluded that the total market capitalization in Colombo fell by 50 percent while our portfolio companies’ profits fell by only 10 percent. Now the trend has reversed and we took the opportunity to marginally increase our investments in Sri Lanka. It is encouraging to see that the performance over the past year has been very positive. I am very happy for Sri Lanka’s turnaround. For me personally, it is particularly gratifying as it is my favorite destination to which me and my family return repeatedly.
3 quick questions for State Secretary Håkan Jevrell at the Swedish Ministry for Foreign Affairs. His responsibility is foreign trade and promotion. He has previously been Ambassador to Singapore and Brunei and Sweden’s representative in Taiwan. Håkan Jevrell believes that Sri Lanka’s strategic location and skilled workforce are strong assets for the country. His personal favorite in Sri Lanka is Mirissa on the south coast of the island.
How can Swedish companies benefit from Sri Lanka’s strategic location? Sri Lanka has proven itself over time and is today an important part of strategic, global value chains, not least the country’s growing IT sector with a highly skilled workforce. The country is a hub in many ways. There are several opportunities here for Swedish companies. First, the obvious, to let Sri Lanka be a bridgehead for further establishment in other, nearby markets. Becoming part of the country’s extensive logistics expansion is another way, not least for sea-borne goods. A third way is by moving physical production to Sri Lanka, where the country has a high standard in several industrial sectors.
Sri Lanka is now transforming its energy system in a sustainable direction. What does this mean for Swedish export companies? The transition of Sri Lanka’s energy system is being carried out with high ambitions, not least in wind power. Sweden and Sri Lanka also have historical ties through previous joint hydropower projects on the island. Then Swedish companies could approach a similar situation as ”teachers”. Now a different approach is needed, one of humility and partnership. Swedish companies can offer competitive solutions, but Sweden is of course not alone. Running fast enough is therefore of crucial importance.
Sweden currently has no Embassy in Colombo. What does this mean for trade relations and how does the Ministry for Foreign Affairs work in this situation? First, Sweden has an Embassy in Delhi. The work there is led by an Ambassador with extensive experience and knowledge of Sri Lanka. That said, an Embassy is important, but Sweden and Swedish interests are working at many levels to develop and strengthen relations between our two countries. Team Sweden has an important role here. It is a network of authorities and companies that work together to promote Swedish exports and investments in Sweden. We also see that there are good opportunities for Sri Lankan companies to develop relationships in Sweden and for Swedish companies to contribute to the development and make a difference in Sri Lanka.