World Bank reassures support for Sri Lanka to build back better from COVID-19

The World Bank yesterday reassured Sri Lanka of its support to build back better from the COVID-19 impact. 

The reassurance was conveyed in a statement following conclusion of a successful visit by the World Bank’s Country Director for Maldives, Nepal and Sri Lanka Faris Hadad-Zervos to the country.

During the visit he reiterated the World Bank’s commitment to support Sri Lanka’s efforts towards recovery and to build back better from the COVID-19 shock.

Based in Kathmandu, Nepal, this latest mission followed the Country Director’s introductory visit to Sri Lanka last November after assuming his new role in July 2020. Hadad-Zervos was joined by Chiyo Kanda, the Country Manager for Maldives and Sri Lanka, based in Colombo.

“Sri Lanka’s economy is on the road to recovery after the worst downturn on record last year. The World Bank stands ready to support the Sri Lankan Government as it strives to protect its people from the pandemic, while addressing the vulnerabilities in the macro-fiscal environment,” said Hadad-Zervos. 

“Recovery and resilience in the post-COVID era can be accelerated by an export-oriented growth model that taps the full potential of private investments and that increases competitiveness and growth,” he added.

The visit coincided with the launch of the Sri Lanka Development Update: Economic and Poverty Impact of COVID-19, which was released on 9 April. The report provides an update on Sri Lanka’s economy and outlook, highlighting the devastating impact of the pandemic. Sri Lanka’s economy contracted by 3.6% in 2020, the worst growth performance on record, as is the case in many countries fighting the pandemic, but is expected to recover to 3.4% in 2021, mainly due to foreign investments as well as normalising tourism and other economic activities.

During the visit, the World Bank management team met with key Government officials, including Minister of Plantation Ramesh Pathirana, Minister of Water Supply Vasudeva Nanayakkara, Minister of Highways Johnston Fernando, State Minister of Money and Capital Market and State Enterprise Reforms Ajith Nivard Cabraal, Special Presidential Task Force on Economic Revival and Poverty Alleviation Chairman Basil Rajapaksa, Secretary to the President Dr. P.B. Jayasundera, Secretary to the Treasury S.R. Attygalle, Ministry of Technology Secretary Jayantha De Silva, Principal Advisor to the President Lalith Weeratunga and Central Bank Governor Prof. W.D. Lakshman.

Meetings were also held with private sector representatives, development partners as well as thought leaders to better understand how the World Bank can add value to Sri Lanka’s inclusive growth and sustainable development story.

“The in-depth discussions we have had with Government officials, private sector and development partners will help us focus on the priority areas – critical for building a greener and more resilient economy that benefits all Sri Lankans,” said World Bank Country Manager for Maldives and Sri Lanka Chiyo Kanda. “We explored many new, exciting avenues for collaboration including harnessing the power of digital technologies to provide more and better opportunities for all Sri Lankans.”

The visit also saw the signing of two important agreements between the World Bank and Sri Lankan Government. A $ 69.53 million credit will help improve dams and irrigation schemes covering 165,000 hectares of agricultural land and improve the management of watersheds and water resources, benefitting 356,000 farming families. Under a second $ 69.33 million loan, a modern transport terminal will be built in Kandy city that will integrate rail, bus, three-wheeler, and pedestrian traffic to make it safer and more efficient.

The World Bank responded to the COVID-19 outbreak in Sri Lanka by repurposing a large portion of its current portfolio to assist the Government in reducing the pandemic’s effects. Supplying critical personal protective equipment (PPE), providing temporary cash assistance to vulnerable groups, strengthening COVID-19 security mechanisms on public transportation, promoting tele-education for students, and providing technologies to enhance public service delivery are some of the initiatives supported by the World Bank. Further support in managing the situation, especially through a speedy and efficient vaccination program, is also on the table.

The current World Bank portfolio in Sri Lanka consists of 19 ongoing projects, with a total commitment value of $ 2.33 billion in a variety of sectors including transport, urban, agriculture, water, education and health.