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| Tuesday, 10 June 2003 |
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Using Tokyo funds prudently The Tokyo donor conference began yesterday on a positive note, with donor countries and agencies pledging more than US$ 2.3 billion for reconstruction and development in Sri Lanka over a four-year period. With one day still to go, Sri Lanka seems to be on course to receive a record US$ 3 billion in aid, as widely expected. This will no doubt be welcomed by all Sri Lankans, as the donors have stressed that the funds will be granted for projects islandwide. The North-East, which has seen the biggest devastation in the 20-year war, will naturally receive priority, but development in other areas will not be neglected by any means. Business leaders, some of whom are already in Tokyo for a separate Sri Lanka investment seminar, have also welcomed the international community's gesture towards our island. The private sector, which will be involved in many of the projects aided by Tokyo funds as contractors, consultants or operators, has raised several concerns vis-...-vis the utilisation of foreign loans and grants in Sri Lanka. The government and its implementing agencies should listen to these views attentively so that all Sri Lankans, be they in the North or the South, can reap the maximum benefit from the huge quantum of aid. A prime concern is that Sri Lanka's foreign aid utilisation is very low, even lower than that of Bangladesh. This has resulted in some donors pulling out of projects in Sri Lanka altogether. A donor has every right to expect that the funds granted for a good cause are used in full exactly for that purpose. After all, these funds are obtained from taxpayers in their countries, to whom the donor governments are accountable. A very low rate of aid utilisation does not speak volumes for the efficiency of implementing agencies. This is an alarming trend that must be reversed without delay in order to retain the confidence placed in us by the international community. The government and the implementing agencies must convince the international community that Sri Lanka has the potential to use all the funds effectively. A closely allied problem that has been identified in some instances by donor countries and agencies is corruption. It is no secret that huge chunks of funds have vanished into thin air, thanks to the lack of proper accounting and auditing mechanisms. Establishing proper controls thorough regulated audit mechanisms is vital for the disbursements of these funds. It goes without saying that the projects must be scrutinised at every stage from planning to commissioning. In this context, proper plans and evaluations will be essential from the preliminary stages. The long-term viability of the projects must also be taken into account. The private sector is keen to see that infrastructure schemes are included in the roll-call of development plans that will follow Tokyo. Sri Lanka cannot aspire to become a regional economic powerhouse with a creaking Third World infrastructure. Besides, investors are known to veer away from countries which have poor infrastructure facilities. Roads and electricity generation must receive priority in any efforts to develop infrastructure. Some business leaders have called for the commencement of large-scale projects such as the Mahaweli, which Sri Lanka cannot hope to complete using its own monetary resources. Establishing small-scale projects that mainly benefit rural areas would also be prudent. The government's implementing agencies should work closely with business chambers and key players in the private sector in formulating development plans that use the Tokyo funds. Their input will be valuable in identifying and designing projects that could propel Sri Lanka ahead of its regional competitors. |
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