ADB reaffirms commitment to Sri Lanka with $ 900 m investment pipeline for 2025

Asian Development Bank (ADB) Country Director Takafumi Kadono (right) and ADB Country Operations Head Cholpon Mambetova at the media briefing yesterday - Pic by Upul Abayasekara 

• Country Director Takafumi Kadono highlights bank’s alignment with SL’s development agenda, broader IMF-backed reform framework
• Asserts ADB’s support expands beyond financing, offering policy advisory, knowledge-sharing and partnerships
• ADB Country Operations Head Cholpon Mambetova details the bank’s strategic focus and priorities 
• Says sovereign lending active portfolio as of 1 Jan. 2025 accounted for $ 4 b across 27 projects targeting energy, transport, human development, finance, agriculture, urban development, and governance
• Projects approved in 2024 totalled $ 808 m 
• Port Access Elevated Highway to open in 2H 
• Economic growth outlook remains positive but awaits 2025 Budget  

By Charumini de Silva

The Asian Development Bank (ADB) yesterday reinforced its commitment to Sri Lanka’s economic recovery, outlining an ambitious $ 900 million investment pipeline for 2025.

Outlining ADB’s 2024 portfolio performance in Sri Lanka and plans for 2025, Country Director Takafumi Kadono highlighted the bank’s alignment with the country’s development agenda and the broader International Monetary Fund (IMF)-backed reform framework.

“Our support is not just about financing, but also about policy advisory, institutional capacity-building, and knowledge-sharing,” he told journalists.

ADB Country Operations Head Cholpon Mambetova detailed the bank’s strategic focus and said an indicative $ 900 million investment is on pipeline for this year, where ADB’s priorities include macroeconomic stability, power, agriculture, finance, tourism and skills development under modalities of policy based loans, results based lending, investment projects and technical assistant projects.

She said sovereign lending active portfolio as of 1 January 2025 accounted for $ 4 billion across 27 projects involving 36 loans, four grants targeting, with a strong emphasis on energy, transport, human development, finance, agriculture, urban development, and governance.

The modalities of these projects will include policy-based lending, results-based financing, and investment projects and areas of intervention will encompass financial sector stability, governance reforms, tourism, skills development, financial sector stability, power system strengthening, renewable energy and sustainable infrastructure. 

“Total approved projects in 2024 totalled $ 808 million, channelled into small and medium enterprise (SME) finance, power sector reforms, water supply and sanitation, and fiscal sustainability.

Recognising the constraints on Sri Lanka’s fiscal space, ADB’s Country Director said it is ramping up efforts to mobilise private sector investment. “Public-private partnerships (PPPs) will be critical in infrastructure financing and service delivery,” Kadono noted, adding that a pipeline of potential PPP projects is under consideration. 

The Country Director said the Port Access Elevated Highway funded by the ADB is will be opened by the second half of the year. 

ADB economists emphasised that while the growth outlook remains positive, much depends on the 2025 Budget and Government’s policy measures. It was noted that economy last year registered a growth beyond its expectations, led by construction and services. Thus, the outlook for 2025 is cautiously optimistic, with services expected to be the main driver of growth, supported by tourism and financial services.

Beyond traditional project financing, he said ADB is leveraging blended finance mechanisms and development partnerships to mobilise additional resources.

“Our support is not just about financing but also about policy advisory, institutional capacity-building, and knowledge-sharing,”Kadono explained. 

“We are not financing projects for the sake of lending. Our focus is on ensuring the country undertakes necessary structural and policy reforms to build a more resilient and inclusive economy,” he stressed.

ADB’s involvement in Sri Lanka spans decades, with cumulative assistance exceeding $12.6 billion since 1966. 

With Sri Lanka still facing constrained access to global financial markets due to its ongoing debt restructuring, ADB’s intervention has become even more crucial. The bank remains one of the country’s most reliable sources of funding, particularly as bilateral financial flows remain suspended and investor confidence is still recovering.

Kadono said the ADB recognises the urgent need for revenue mobilisation and public sector reforms and its assistance is tied to concrete fiscal and governance milestones.

He also highlighted State-owned Enterprise (SOE) restructuring as a priority area, particularly in sectors where inefficiencies are financial losses persist.