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World Bank responds to peace prospects : Five Billion for reconstruction

by Ravi Ladduwahetty

In a clear endorsement of the peace initiative and positive signals from negotiations between the Sri Lankan Government and the LTTE, the World Bank has made available US$ 50 million (around Rs. 5 billion) as development aid for the war ravaged North- East.

The decision was made at the Annual General Meeting of the Executive Board of the World Bank in Washington. The package comprises US$ 15 million (around Rs. 1.5 billion) for the reconstruction of conflict areas and a further US$ 35 million (around Rs. 3.5 billion) for existing projects such as development of schools, health clinics and related social infrastructure. Finance Minister K.N. Choksy told the Daily News in a telephone interview from Washington late Tuesday night that the World Bank has responded magnificently to the prospects for peace in Sri Lanka by identifying resources that can be mobilised immediately.

"During the war many World Bank supported projects were designed with an islandwide focus but the conflict areas were inaccessible.

Now US$ 15 million is available for these areas," the Minister added.

A further US$ 35 million (around Rs. 3.5 billion) will be available out of projects where the money is no longer needed.

This too will be available for the reconstruction of the North-East, he said. The Minister said the World Bank is working with Sri Lanka's other international development partners on a comprehensive needs assessment for the North and East and, in the long term, the bank's strategy for supporting Sri Lanka will focus on economic reforms and development in the context of the peace process.

Choksy told the World Bank that the Government was resolved to reform the economy in parallel with the peace process. "One avenue reinforces the other and we have great opportunity now to lay the basis for the future of peace and economic prosperity in Sri Lanka," he said.

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