CAL sets sights on trillion dollar frontier market expansion

• Aims to operate in regions with a combined GDP of US$1-1.5 trillion within next 3-5 years
• Says the move would enable to smaller markets such as Sri Lanka to attract global funds with envisioned expansions

By Nishel Fernando 

Colombo-based Capital Alliance (CAL), a full-service frontier capital markets solutions provider, plans to expand into other frontier markets, aiming to operate in regions with a combined GDP of US$1-1.5 trillion within the next 3-5 years.

CAL Group CEO Kanishke Mannakkara told Mirror Business that this would enable to smaller markets such as Sri Lanka to attract global funds with envisioned expansions, enabling the entity to offer combined product offering across various markets.

In particular, small frontier markets such as Sri Lanka have been struggling to attract global funds, and even FDI inflows are favoured towards emerging markets.

“Our market is small, due to the size of the market to attract foreign funds, it’s the case for many other frontier markets, and they are too small and complex. What we want to do is to offer all these frontier markets to global investors,” he said. 

Frontier markets include large economies such as Argentina to smaller economies such as Mauritius. And CAL might favour more towards frontier markets with a similar size to Bangladesh to smaller markets.
Mannakkara stressed that development of capital markets is essential for Sri Lanka to become a prosperous nation with more equitable wealth distribution.

“We strongly believe that prosperity is only possible through the development of capital markets and envision people to participate in these capital markets,” he added.

Sri Lanka’s market capitalisation to gross domestic product ratio remained at a weak level of around 18 percent. While neighbouring India had a nearly 100 percent ratio.

Sri Lanka’s retail investor base stands around 700,000 while most of investors remain to be rather inactive.