Economic integration promotes rapid growth -WB

Lumbini Edirisinghe

To achieve rapid growth, governments must promote economic integration which, at its core, is about the mobility of people, products, and ideas.

Infrastructure development

Senior Economist, World Bank Somik V. Lall said that instead of worrying about the size of metropolises, cities and towns, the World Development Report 2009 (WDR) calls for policymakers to worry about making sure that these places work well.

He was speaking at the launch of the World Development Report 2009 (WDR) in Colombo on Implications for Sri Lanka of WDR 2009, at the Galadari, organized by the Institute of Policy Studies of Sri Lanka and World Bank.

“Sri Lanka has laid a fertile ground for a successful economy and people keep coming to Colombo in search for productivity. This population shift from the villages to cities is natural and should be encouraged,” said Chief Economist of the Europe and Central Asia Region of the World Bank and the Director of the World Development Report (WDR) 2009, Indermit Gill.

He however noted that Colombo as the capital city has to go a long way in this current scenario, to achieve economic prosperity.

In Sri Lanka, with 30 percent of industrial establishments, the Western Province adds 76 percent of industrial value. International experience shows that while it is important to appropriately manage this concentration of economic production, it is also critical to pursue policies that make basic living standard more uniform across space.

Road development

Secretary, Ministry of Highways, Sirisena Amerasekara said that Infrastructure cost of regional development is extremely high. Therefore, they must concentrate on investing in limited areas where the Government can take the maximum usage and where the investments give fruitful income.” Education is the major issue in rural areas and this is the reason for large migrations to main cities in Sri Lanka.

“Resources should be identified as what are the most essential areas for the investments because unhealthy investments contribute to the unfavourable economic opportunities. Productivity can rapidly improve even in the smaller towns if development strategies are used,” he said.

Senior country Economist, South Asia Poverty Reduction and Economic Management, World Bank, Claus Astrup said that Sri Lanka is more urbanizing and it is a good symbol of Sri Lankan’s economy.

“When I think about the 3DS (density, diversity and distance) economic density in Sri Lanka is 50 percent of production from Sri Lanka.

Most people in Sri Lanka have easy access to the transport. Basic social services to the entire population bring reduction of the economic distance and would help to improve integration.