Lanka gets USD 630m from ADB

Ramani KANGARAARACHCHI

The Asian Development Bank (ADB) is to provide USD 630 million to Sri Lanka for the period from 2009 to 2011 with USD 210 million per year. This will be mainly for commercial projects and supplemented by some direct support to the private sector.

This was revealed by ADB Country Director Richard Vokes at the 18th Business for Peace Forum held at JAIC Hilton Colombo yesterday. His keynote address was on ADB, Sri Lanka Country Partnership Strategy.

Vokes said the partnership app-roach includes consultation with Government of Sri Lanka based on government’s ten-year plan under Mahinda Chintana. The world is in a volatile situation and the current economic situation in the country is going to be much harder than six months ago. However he said that everyone recognises Sri Lanka has done well despite the 25 years of conflict. ADB has analysed Sri Lanka’s situation under strength Weaknesses Opportunities and Threat (SWOT) analysis.

Elaborating on the strengths of the country he said Lanka is an international hub for transshipment and it is in a very strategic location on major shipping routes. “Having situated next to fast growing India it also has a booming and modern services sector, a strong asset base, and high labour standards.”

Meanwhile the weaknesses he pointed out included high fiscal deficit, large infrastructure deficit, high regional inequality in growth of gross domestic production, relatively weak structure of public finance management, inefficient traditional agricultural systems, and complicated government structure.

However there are opportunities, to improve expenditure management and revenue generation, invest in infrastructure development such as power and transport, to introduce more efficient use of resources to promote better project implementation and to invest in alternate sources of energy and other renewable.

According to Vokes some of the threats to the country included the conflict, difficulties in developing consensus for political reforms due to the complex political economy and vested intentions, pressure from high and volatile commodity prices and inflation.