Infrastructure development, key to addressing economic disparities
The Government is committed to investing heavily in infrastructure
development so that the whole country can benefit from economic
development, Enterprise Development and Investment Promotion Minister Dr
Sarath Amunugama said. He was addressing the Sri Lanka Economic Summit
2007 held at the Cinnamon Grand Hotel. The text of Dr Amunugamaâ€™s
Development is countryâ€™s progress
DEVELOPMENT: â€śSri Lankans have benefited greatly from the investments
made since independence in healthcare and education but that limited
investments in physical infrastructure development had curtailed
economic growth mainly to the western province.
Some year years ago when I was the Minister of Finance, we decided to
shift the annual donor meeting to Sri Lanka. By all accounts, the
meetings we have had in Kandy and in Galle last year were tremendous
successes. And now that we have this summit, we need to make sure it is
an annual event and held alongside the donor meeting.
As President Mahinda Rajapakse noted in the speech that was delivered
by the Secretary to the President, Lalith Weeratunga, in spite of
various challenges, the economy has registered strong growth.
Our goals now are two fold. Firstly, we need to achieve a macro
economic grow rate of around nine per cent. Secondly, we need to ensure
that the rapid economic growth rate we now see in the western province
is spread to the outlying regions as well.
Currently, the GDP of the western province is growing at 11 to 12 per
cent annually, on a par with the fastest growth rates in India or China.
As a result of the decline of the unemployment rate in the Western
province, some industries are already facing labour shortages.
One of the demands of the industrial sector to the BOI is to ensure
that is has access to proper manpower. You may be surprised to find that
there are labourers from China in some of the construction sites in the
Most of the developed economies are strongest in the services sector.
The question is how do we go on from here. There are very positive
factors. The world economy is on a growth spurt. It is the Chinese and
the Indian economies that have powered global growth during the last
five years and projected to do so in the next decade.
Sri Lanka needs to benefit from the growth of these economies. For
example, the current edition of Newsweek magazine makes an interesting
observation. The Indian middle class which is currently 50 million will
expand to 500 million by 2012. India, in fact, is slated to overtake
China as the fastest growing economy in the world.
Now add to this, the expansion of the middle class in Pakistan,
Bangladesh and China, and you can fathom the opportunities in the Asian
region. Sri Lanka is perfectly positioned to benefit from this growth.
Sri Lanka and India are the best of friends. We have always had a
warm and cordial relationship. Both history and geography demand that we
remain the best of friends.
And I can recall the words of our first Executive President who said
that we in Sri Lanka are lovers of India and followers of its greatest
son, Lord Buddha. As India leads the growth charge, we will do our best
to complement that growth. We are fortunate to have a free trade
agreement not only with India but also with Pakistan.
We are now in the process of negotiating a free trade arrangement in
the South Asian region. So the advantages are tremendous. Our hub status
will be a crucial factor in the next 10 years. We may be an island of
only 20 million people, but we are just 20 miles from the fastest
growing market in the world.
A market which will expand exponentially in the next 10 years. If
this is not a glorious opportunity, I donâ€™t know what is. Already,
cutting age businessmen are leveraging Sri Lankaâ€™s hub status. We have
had a large number of inquiries on manufacturing and exporting out of
Sri Lanka is not just about free trade agreements. We have been
internationally recognised for our high labour standards. Sri Lanka is
the only country in the region to be granted the GSP Plus status by the
The EU concessions were granted not on political grounds but because
of our ethical labour practices. Wherever in the world you go, you can
be confident and proud that Sri Lankan business people are model
employers. Also, Sri Lankan workers are model employees. Today if you
look at an analysis of labour, Sri Lanka will be commended for its best
practices by both the Government and the industry.
For over 60 years, Sri Lanka has invested a large part of its budget
on social services such as education and healthcare. This is why we have
done very well on the UNâ€™s Millennium Development Goals. In fact, in
some areas we are even ahead of many Western countries in the
achievement of Millennium Development Goals.
Nobel Prize winning Indian economist Amartya Sen has hailed Sri
Lankaâ€™s investment in education and healthcare as the greatest
investment in the Asian region in the last 50-60 years. In India, the
state of Kerala too has made similar social investments. We are also
proud of our programmes to benefits for the poor.
Today, western countries are tying to export the Millennium
Development Goals to the Third World. The World Bank and the IMF should
note that since independence, we have been pioneers in achieving these
This is the background from which employers and employees should
propel the countryâ€™s development. Lalith Weeratunga and I have led
initiatives to introduce new technology, science and modern languages to
our educational system.
All these huge investments have been our social welfare sector which
has led to many advantageous. We also have disadvantages, however. This
is why we are currently increasing the investments in physical
infrastructure such as roads, ports, airports, the railways, power and
The western province has shown how rapidly Sri Lanka can grow when
there is strong infrastructure. This is why we are investing
significantly in developing the infrastructure in the regions so they
too can attract quality investments.
We are aware that foreign governments and businessmen are concerned
about the security situation in the country. That is something we cannot
sweep under the carpet. Let me address the issues. The first point I
want to make is that Sri Lanka is the only country is the world where
every citizen, even those in areas which are not under the control of
the Government, are given free food rations, free education and free
We are the only country in the world in a combat situation, where
every single citizen irrespective of race, community or creed is granted
key benefits. And they must all be proud to be citizens of Sri Lanka,
whichever side of the curtain they may be located.
The Government makes every effort to ensure that the food is
delivered on time, coming, teachers are present and punctual, that
textbooks are available for studies. I donâ€™t think there is a single
country facing a terrorism menace that ensures the important needs of
all citizens are met.
I want to tell you that even the Kilinochchi Hospital was built with
Government funds. So donâ€™t give the impression to the global community
that this is some bitter and racist country. Nothing would be further
from the truth.
There are also misconceptions about our constitution. Under the 13th
amendment, we have granted the same powers of devolution to regions as
India has under its Constitution. Having played a significant role in
drafting the 13th amendment, I can assure you that ours is a carbon copy
of Indian model.
Unfortunately, either these facts are not known to the diplomatic
community in Sri Lanka or they make no effort to communicate the facts.
Now we are in the process of examining whether additional powers can be
devolved as the Government is committed to resolving the ethnic problem
As the President noted in his message, the Government of Sri Lanka is
fully committed to a negotiated settlement. Whatever the newspapers may
say, whatever individuals may say, there is no other way. That is the
view of the government. So you should not have any fears, that war will
ever be a substitute for peace.
These are the realities and please make sure you communicate them to
your stakeholders. And we need to use investments as an enabler to
address economic disparities which have often been the root cause for
the feeling of marginalization in the country.
I am glad that meetings such as this give you an opportunity not only
to make a contribution to framing the countryâ€™s development policies but
also to observe firsthand the situation in the island. Now the
organisers of this meeting who have done such a wonderful job should
ensure that this becomes an annual event.
Other countries have flower shows and this can be our power show. So
please make this an annual event and let me offer my special thanks to
the attendees from overseas. If you have any questions, please feel free
to ask me.
This is a free country. We do not impose our views on others; we only
want you to make up your own mind. Let us make a commitment to work
together to benefit all Sri Lankans and may this summit be an annual
event that serves our development goals.â€ť