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More aid with better utilisation - World Bank

by Ravi Ladduwahetty

The World Bank would enhance its aid package to Sri Lanka by an additional one third if Sri Lanka's aid utilisation improves from the current 60 per cent, World Bank Country Director in Sri Lanka Peter Harold told a news conference yesterday.

The World Bank Country Director was responding to a question from the Daily News as to whether the Bank was content with the utilisation of aid and the prospects of additional aid with the peace process on the right track.

He attributed the low aid utilisation to the relatively slow decision making and procurement process, low implementing capacity and some projects not being owned by the Government of Sri Lanka.

The news conference was to announce the World Bank approval of US$ 43 million for the rehabilitation of Sri Lanka's war ravaged North- East next month. The funds will be available for utilisation before the end of this year, he said.

There is no reason as to why the Bank should not release the funds by the end of the year, Harold asserted. The loan package was free of interest and is payable within 40 years, with a grace period of 10 years.

The funds will be used for resettling over 800,000 Internally Displaced Persons (IDPs), improving health infrastructure, institutional development and improving the supply of drinking water.

The aid package, which is not a totally new line of credit, comprises unutilised funds rescheduled by the World Bank. This would not add to Sri Lanka's external debt portfolio to the World Bank even by one US Cent, he said.

Earlier, Prime Minister's Secretary Bradman Weerakoon said that the aid package was a result of the special request made by Prime Minister Ranil Wickremesinghe to World Bank President James Wolfensohn in August and the rest of the donor community about the need for the rapid rehabilitation of the North-East.

Weerakoon said the Government appreciated the fact that the Bank acted with vigour and sincerity within two and a half months to apportion the funds.

Weerakoon said that the first priority of the Government was to resettle the Internally Displaced Persons. This has been discussed by the Government and the LTTE.

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