Colombo expects foreign money to pour in

       Sri Lanka is banking on foreign cash to rebuild shattered infrastructure as the island emerges from decades of ethnic civil war, officials say.
       Analysts are expecting a large investment peace dividend in the country,where bomb attacks and fighting dented investor confidence and kept highspending tourists away from the tropical South Asian island.
       There will be plenty of opportunities for investment once the former war zone is open for business, said Chinthaka Ranasinghe, head of research at John Keells Stock Brokers in Colombo.
       "These areas have been virtually bombed out. This throws up enormous potential" for investment, Mr Ranasinghe said."A large number of houses need to be built" along with "new roads, schools,telephone and electricity lines ... the investment rebound will be spectacular".
       Three months after the end of the war against the Tamil Tiger rebels, the government has yet to announce a timetable for when the devastated region will be fully open for business.
       But the government has said it hopes to resettle at least 80% of the nearly 300,000 people in the north who were displaced during the last stages of the conflict by the end of 2009, as mine clearing work progresses.
       The Treasury estimates nearly $3 billion will be spent by international donors and the government over the next three years to rebuild roads, bridges, electricity,water and sewer lines.
       More than $2 billion of that money will be spent in the north where the final battles of the war were fought in May, the Treasury said. The rest of the money will be spent in the east which was taken back from the rebels in 2007.
       Dialog Telekom, the Sri Lankan unit of Malaysia's Axiata Group Berhad, was the first international company to set foot into the former war zone, by launching a mobile phone network initially intended for use by government troops.
       Dialog will spend up to $10 million this year to install 60 base stations in the former war-torn areas, said chief executive Hans Wijayasuriya, who anticipates "pent-up demand".
       Home to about 14% of Sri Lanka's 20 million people, the island's north also has fertile farmland, fishing and mineral deposits, Mr Ranasinghe said.
       With a $2.6 billion bailout package from the International Monetary Fund to shore up the economy following the war that left tens of thousands dead, the central bank plans to tap overseas markets in September to raise $500 million through a sovereign bond.