WB to finalise country assistance strategy

The Country Assistance Strategy (CAS) of the World Bank for Sri Lanka for the next three years will be finalised in June.

Country Director World Bank in Sri Lanka, Naoko Ishii said they are now in the process of obtaining ideas as to how they would launch the CSA which would be for a period of three years.

The main purpose of the World Bank’s CAS consultations to seek inputs from a wide spectrum of people and organisations in Sri Lanka to ensure that the World Bank’s priorities for development assistance to the country are aligned with the needs of the people and the Government’s priorities.

This note presents a brief summary of Sri Lanka’s development challenges and our objectives in providing assistance to Sri Lanka.

The World Bank provides both financial support and advisory services.

In terms of financing, the World Bank provides loans to the Government worth around US$200 million annually in support of various programmes.

The Bank currently finances 13 projects in a variety of sectors, including health, education, roads, irrigation, community development and others.

Currently, new World Bank credits to Sri Lanka have 20 years maturity (including a 10 year grace period) and are interest free, but subject to a 0.75 percent service charge on the principal amount withdrawn and outstanding, a commitment charge (up to 0.50 percent) on the undisbursed balance.

“Sri Lanka is a country with good potential. Despite a quarter century of civil conflict, GDP growth has averaged 4.9 percent per year during this period.

The Western Province, where Colombo is located, has proven this potential with sustained high growth and a low poverty rate of 9 percent - less than half the national average.

“If the rest of the country could emulate the Western Province’s performance, Sri Lanka could eliminate extreme poverty in a generation,” she said.

Despite sustained growth, Sri Lanka is still underperforming relative to several of its East Asian neighbours, and - in recent years - vis-a-vis India underscoring the importance of accelerating economic growth.

This can be achieved not only by resolving the long-standing conflict, but also through continued improvements in the investment climate and a gradual move towards higher value-added production. (SS)