Enhanced World Bank support pledged:

Major boost for Lanka’s economic drive

by Shirajiv SIRIMANE

The World Bank has endorsed that Sri Lankan economy is heading in the right direction, Central Bank Governor Ajith Nivard Cabraal said.

He told the Sunday Observer, that World Bank Managing Director, Dr.Ngozi Okonjo-Iweala has said that Sri Lanka’s remarkable rise from past challenges is a testament to the tenacity of the Sri Lankan people and the commitment of the country’s leadership.

Cabraal said that this statement would have a very positive impact on Sri Lanka and this is an excellent endorsement.

The Governor said the World Bank Managing Director made this statement after a careful study of Sri Lanka’s economy and coming from the top of the World Bank it is a very positive sentiment.

Dr. Okonjo-Iweala was speaking at the Central Bank’s 60th anniversary commemoration she stressed that in order to foster the economic well-being of all Sri Lankans, the ultimate recipe for growth must be unique to the country and that it would be expected to share its accumulated expertise with others in South Asia. “The World Bank can play a complementary role in facilitating this process by sharing not only our own knowledge, but also the expertise of other emerging economies through South-South exchanges,” she said.

The Managing Director also reaffirmed the World Bank’s strong and expanding support to Sri Lanka as it moves towards becoming a middle-income country enjoying lasting peace.

In recognition of the country’s emergence as a growing economy, Dr. Okonjo-Iweala announced Sri Lanka’s new eligibility for financing from the IBRD, the World Bank’s lending arm for middle-income countries in addition to the current assistance from the IDA.

This development has the potential to more than double the amount of resources available to Sri Lanka from the World Bank each year, to close to half a billion dollars - $200 million from IDA, which it continues to access, and now up to an additional $265 million available from IBRD.

In her speech at the Central Bank, Dr. Okonjo-Iweala also emphasized the importance of investment and innovation towards development and ideas from global perspectives that could help Sri Lanka reach its full potential as a growing middle income country.

“The expansion of the knowledge economy and the search for innovative ideas by all Sri Lankans will be important to successfully accelerate growth and improve living standards,” she said.

After meeting President Mahinda Rajapaksa she also reiterated the World Bank’s commitment to Sri Lanka, especially in supporting programs designed to encourage inclusive growth throughout the country.

She also noted the World Bank’s willingness to increase support to complement the ambitious development aspirations of doubling per capita income and growth in excess of 8%, which will be aided by increasing private investment from both foreign and domestic sources as envisioned in the Mahinda Chinthana, the Government’s vision for future development.

Since the World Bank Group’s first development credit to Sri Lanka for the Aberdeen - Lakshapana Power Project in 1954, the institution has become one of Sri Lanka’s largest development partners.