ADB approves US$ 100 million additional financing to assist in skills development to meet labor demands in Sri Lanka
The Asian Development Bank’s (ADB) Board of Directors has reportedly approved a US$ 100 million results-based loan as additional financing to assist the Sri Lankan government’s efforts to develop skills to meet labor demands, support economic diversification, and enhance productivity in the country.
“Sri Lanka has achieved universal primary and high secondary enrollment rates, a high adult literacy rate, and gender parity in access to all levels of education. However, there remains a clear mismatch between skills among youth and labor market demand,” an ADB Principal Social Sector Specialist, Gi Soon Song has said.
“The ongoing skills enhancement program, spearheaded by the Government and supported by ADB, will address this issue through a focus on technical and vocational education and policy support.”
The ADB has noted that this lack of skilled labor is hurting the Sri Lankan economy, with the country’s private sector considering this as a key constraint to business growth. The unemployment rate is also high, with one out of five Sri Lankans aged 15-24 years out of work. Meanwhile, only 35.9% of women are included in the labor force despite outperforming male counterparts academically at every level. Equipping youth, especially young women, with employable skills is crucial to decrease youth unemployment and prepare the workforce for a high value-adding economy.
According to reports, the additional funding will enable the government to continue implementing the Skills Sector Development Programme (SSDP), which is supported by a US$ 100 million ADB loan approved in 2014, through 2020.
The SSDP aims to significantly improve the quality of TVET provided to young people in Sri Lanka to increase their employability, while also enhancing partnerships with the private sector for better TVET planning and provision to align skilled labor supply with market demand.
The programme is also expected to increase the number of TVET graduates and improving policy, institutional, and operational reforms to support the country’s skills sector.
The ADB is to also administer a US$ 3 million grant from the Japan Fund for Poverty Reduction (JFPR) to complement existing assistance to strengthen private sector engagement and women’s participation in TVET and employment in Sri Lanka.
OSL take:
The additional funding allocated by the ADB to assist in Sri Lanka’s work towards skills development would help build a skilled labour force in the country. The Sri Lankan government has already launched several programmes on skills development among the youth and women. This is an encouraging sign for any foreign business/investor to set up operations in Sri Lanka due to the availability of a skilled workforce in the country.
| Article Code : | VBS/AT/05042018/Z_5 |