IFC funding for private sector explored

WB elevates Lanka’s borrowing status

Ravi LADDUWAHETTY

Satisfied with Sri Lanka’s economic performances, the World Bank has elevated Sri Lanka’s status to funding provided to middle income earning countries.

This follows the recent meetings the Sri Lanka delegation headed by International Monetary Cooperation Minister Dr Sarath Amunugama had with the World Bank Managing Director in Washington recently.

The other members of the delegation comprised Central Bank Deputy Governor Dharma Dheerasinghe, Assistant Governor Ananda Silva and Additional External Resources Director Sarath Kumarasiri.

Sri Lanka will be now be eligible for international Bank for reconstruction and development funding in addition to the international development assistance (IDA) funding in the World Bank deciding to provide double the funds, Dr Amunugama told the Daily News yesterday.

The assistance will be for education, health and development of national and provincial roads countrywide.

This would also mean that in addition to the concessionary funding that Sri Lanka had received through the IDA funding, it will also avail itself of the funding which will be available through IBRD funds which will be at commercial rates.

The minister also said that most concessionary funding has been made available to Sri Lanka though the World Bank and the Asian Development Bank and similarly, the standby arrangements regarding the country’s foreign reserves which is now in force with the International Monetary Fund also provides very concessionary terms. These concessions are in terms of interest rates, grace periods and periods of repayment.

Dr Amunugama also has explored the possibility of funding from World Bank associates such as the International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) which are tailormade for the private sector which could provide funding for Sri Lanka’s private sector.

This is in the light of the IFC already having provided funding for many blue chip corporates in Sri Lanka over the years.

Meanwhile, there will also be a meeting between Treasury Secretary Dr P.B. Jayasundera and World Bank Country Director in Sri Lanka Diaerietou Gaye shortly to discuss the Country Assistance Strategy for Sri Lanka for the three year period between 2012 and 2015.

It will be at this meeting that will be decided what the projects would be, and their corresponding funding. Though the World Bank has said that it will double the allocations for Sri Lanka, the funding will be on a project- by project basis. Of the projects those in the pipeline will be the continuation of a $ 100 million allocation for secondary education for Sri Lankan schools which includes curriculum development, information technology, mathematics and science education for which the infrastructure such as the classrooms have been developed. This project is at the appraisal stage, top Treasury sources said.

There is also a US $ 100 million program for the development of the health sector which will be for the prevention of the non-communicable diseases such as heart diseases, cancer, diabetes and asthma.

The third one will be development of the network of national and provincial roads including the Ambepussa - Trincomalee Road which the World Bank will be part fund the project with the other partners- the ADB, Korea and Japan as well.