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$100 mn from World Bank for economic reforms

$100 mn from World Bank for economic reforms

• The World Bank Board has approved a $100 million credit from the International Development Association (IDA) to support the Government’s economic reform program.
• The Ministry of National Policies and Economic Affairs will be responsible for overall implementation and coordination of the proposed operation.
• Other agencies involved include the Ministry of Development Strategies and International Trade, the Ministry of Finance, the Ministry of Parliamentary Reforms and Mass Media, the Auditor General’s Department, the Board of Investment and the Central Bank of Sri Lanka.
• “Improving a country’s competitiveness and creating more jobs are complex objectives that require a number of factors – stable macroeconomic environment, good governance, adequate investment climate and skills in demand”, said Emanuel Salinas Munos, Program Leader and Task Team Leader of the World Bank.”
• This program will support the Sri Lankan Government’s commitment to enable the potential of Sri Lankan enterprises to grow, become more productive and better integrate with the global economy”.
• The World Bank Group provides technical assistance to the Government in support of its reform efforts under this program.

Sri Lanka has been making steady progress on economic reforms, with the government aiming to create one million new jobs through a reform package focused on improving the country’s competitiveness, transparency and macroeconomic stability.
A recent World Bank study, the Systematic Country Diagnostic, highlighted the need for Sri Lanka to move from a largely inward looking and public sector driven economy to one that is capable of unleashing the potential of the private sector – leading to post-conflict economic growth and creating more and better jobs for Sri Lankans.
The Sri Lanka Competitiveness, Transparency and Fiscal Sustainability Development Policy Financing (DPF), which is only the second DPF to Sri Lanka in a decade, aims to support the government’s reform agenda by reducing obstacles to private sector competitiveness, establishing transparent and well managed public institutions and improving fiscal sustainability.
“The breadth and depth of the actions implemented signal the comprehensive approach and commitment of the Government to tackle difficult reforms aimed at making growth sustainable and creating jobs.” said Françoise Clottes, World Bank Country Director for Sri Lanka and the Maldives.
OSL Take:
The specific actions in this DPF operation will help improve fiscal sustainability and create the fiscal space for delivery of public services, social spending and capital investment, which are integral to the country’s competitiveness.
DPF operations provide untied funding to the Government upon completion of a package of policy and institutional reforms.
The funding provided is allocated by the government solely based on its budgetary priorities.
The unity government is making fruitfull changes to revive the Sri Lankan economy and steer ahead to position Colombo as a Smart Trading Hub by 2030.
The USD 44 billion Western Region Megapolis Masterplan (WRMM) is the key to turn a middle income country in to a higher-income platform by the targeted 2030 deadline.
The recent funding spree from the World Bank, ADB and other donor institutions comes with strict guidelines to realize and achieve “specific development goals” designed to lift the country to a better financial position within the Asian region.
OSL as the leading FDI generator calls on overseas investors to partner with us to pitch for the 140 mega-projects outlined in the WRMM with our local expertise and strong links.
Just feel free to talk to the biz-friendly OSL Team today to learn more.
Economic Background:
• The Gross Domestic Product (GDP) in Sri Lanka expanded 5.5 percent in the first quarter of 2016 over the same period in the previous year.
• GDP Growth Rate in Sri Lanka averaged 6.22 percent from 2003 until 2015, reaching an all time high of 16.12 percent in the first quarter of 2012 and a record low of 0.48 percent in the fourth quarter of 2013.
• In terms of GDP contribution, the Western Region produces more than 40% of the total GDP of Sri Lanka, thus is the main contributor to the country’s economy.
• Considering the high growth momentum, the GDP for Western Region is projected to reach over 214 billion USD by 2030.
• Around half of the country’s universities in Sri Lanka are located in Western Region
• By 2020, the government targets the per capita income in Sri Lanka to triple to around 12,000 USD. This will see per capital income in Western region grow to US $ 4.7 billion from present US $ 24.5 billion. This is assuming an average annual growth rate of 7-8%.
• GDP Growth Rate in Sri Lanka is reported by the Department of Census and Statistics – Sri Lanka.

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Article Code : VBS/AT/02082016/Z-1

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