Sri Lanka’s achievements in education have been impressive, including universal access and participation in primary education, high enrollment in secondary education, and gender parity in general education. The primary education net enrollment rate is 99 percent and the primary education completion rate is over 95 percent. Gender parity in the education system is high compared with many other South Asian countries, with an equal proportion of girls and boys enrolled in primary education and a somewhat higher number of girls than boys in secondary and higher education.
However, access to higher education is low, below the level expected of an upper-middle income country. Also, universal access to good quality early childhood education is a challenge.
The World Bank is helping the development of human capital across all levels of education and training. The Sri Lanka Early Childhood Development Project will increase the ability of children from disadvantaged households to access early learning opportunities. World Bank assistance to the general education sector is currently ongoing through the General Education Modernization project that was launched in October 2018 and seeks to promote learning outcomes and socio-emotional skills of students.
This project enhances quality and strengthens the stewardship of the general education system. It also contributes to improve learning outcomes in English and Mathematics and enhance teacher performance. The Accelerating Higher Education Expansion and Development (AHEAD) Operation is new in the higher education sector and will help the country to increase enrollment in priority disciplines for economic development, improve the quality of degree programs, and promote research and development, and commercialization of innovations. This AHEAD Operation is the first Program for Results (PforR) Operation in Sri Lanka and in the higher education sector worldwide.
The World Bank has been supporting Sri Lanka’s health sector through analytical work and credits from the International Development Association since the late 1980s and, more recently, through loans from the International Bank for Reconstruction and Development.
Sri Lanka’s health system has a long track record of strong performance. For at least 50 years it has achieved much better outcomes in maternal and child health and infectious disease control than would have been predicted by its income level. The remarkable success in reducing maternal and infant mortality to very low levels (39 per 100,000 and 9 per 1,000 live births, respectively) in the last half-century is in part due to effective and integrated maternal and child health services.
A national health sector program supported under a $200-million Second Health Sector Development Project (approved in FY2013) closed in September 2018 contributing to key achievements in the health sector development in Sri Lanka. The project was designed to improve the standards of performance of the public health system and enable it to better respond to the challenges of malnutrition and non-communicable diseases (NCDs). The project also supported innovation, results monitoring, and capacity building in the health sector.
The Primary Healthcare System Strengthening Project builds on the earlier project and will benefit the people in Sri Lanka by increasing the utilization and quality of primary health care services. The focus of this project is on the detection and management of NCDs, responding to the changing health needs of the population and targeting the most vulnerable.
On the analytical front, substantial knowledge has been generated in recent years that inform government policies. Some of the key analytical work include assessment of health financing system, positive deviance study for nutrition, public expenditure review for health and nutrition, and analyses of human capital development.
Sri Lanka’s economic growth has been primarily driven by the Colombo Metropolitan Region (CMR), which currently generates 45 percent of the country’s GDP and is home to 28 percent of its population. Sustainable growth and long-term prosperity are expected to result from a more balanced distribution of economic opportunity, which in addition to Colombo also includes other major urban centers such as Kandy, Galle, and Jaffna. The World Bank is supporting Sri Lanka to implement its urbanization and rural-urban integration agenda.
The Metro Colombo Urban Development Project (MCUDP) is assisting the Colombo Metropolitan Region to upgrade basic urban infrastructure and to implement an innovative integrated urban flood control and urban wetland management approach. Results achieved: 3 km of primary canals have been completed, 2 micro-drainage subprojects have been implemented, and 29 km of roads that have been built or rehabilitated based on prescribed standards. The Beddegana Wetlands Park aids in flood control and allows the public to experience the city’s unique urban wetlands. In addition, the project rehabilitated the Town Square and Viharamahadevi Park, which included the creation of playgrounds, bicycle paths and public facilities.
The Strategic Cities Development Project and the Additional Financing to the project (approved in May 2016) are expanding the approach to urban infrastructure upgrading to Kandy, Galle and Jaffna—three strategic city regions in the center, south, and north—and supporting investments in urban water supply, sewage and drainage systems, cultural heritage rehabilitation, urban transport and traffic management, among other areas.
Climate Change and Disaster Risk Management
Climate-related hazards pose a significant threat to economic and social development in Sri Lanka. By 2050, potential impacts due to climate change are foreseen to be approximately a 1.2 percent loss of annual GDP. The ongoing Climate Resilience Improvement Project (CRIP) carried out rehabilitation works related to irrigation hydraulic infrastructures benefiting 50,000 hectares of agricultural land, landslide mitigation works in 18 schools protecting 30,000 students while establishing transport connectivity for 750,000 people by rehabilitating roads damaged by landslides and floods. CRIP also developed Integrated Flood and Drought Risk Assessment Reports and basin investment plans for 6 river basins, based on which the GoSL will invest in Forecasting and Early Warning of High Impact Weather, Floods and Landslides and Flood Mitigation Investments. The Cat-DDO program closed in 2017 supported the Government to strengthen disaster risk financing, risk information systems and resilient infrastructure planning. Building on these initial outputs, the GoSL and the Bank has advanced the dialogue to mainstream DRM further into various sectors.
Trade and Competitiveness
The Trade and Competitiveness program is a package of technical assistance to support the Government of Sri Lanka’s economic reform objectives to ultimately create more and better private sector jobs and become an upper-middle income country. The program is a joint initiative from the World Bank and the Australian Department of Foreign Affairs and Trade (DFAT).
All activities in the program are underscored by a strong focus on gender, youth, disability and poverty. Specifically, the program intends to enhance the trade and competitiveness of the private sector as a way to support private-sector led growth, increase economic diversification and enhance the volume and value addition of exports via the following areas:
Enhancing Sri Lanka’s Trade Potential: via the establishment of a more open trade policy regime; the development of an agile trade facilitation system and the reduction of regulatory barriers to trade. Among noteworthy reforms are the implementation of the Trade Information Portal established with joint agreements committing 30 agencies to share data with the Department of Commerce on trade-related regulations. The National Single Window (trade) Blueprint for Implementation and continues to support the Government with technical assistance on legal and procedural aspects of improved trade facilitation.
Enhancing Sri Lanka’s Investment Climate and Policy and Regulatory Simplification: Activities to foster domestic and foreign direct investment (FDI) through (i) institutional, legal and regulatory reforms to reduce transaction cost to enterprises and improve the overall domestic business environment; (ii) strengthening the Board of Investment’s capacity for investment promotion and advocacy to attract FDI in the country’s most strategic sectors; (iii) facilitating investment approval processes through a single window for investment; (iv) improving the effectiveness of the investment incentive regime and; (v) strengthening legal framework governing investment.
Some significant achievements include, the design of the Doing Business reform program, which has significantly reduced the processing time and cost for business owners with delivered reforms such as the online portal for one-day business registration, single application windows for obtaining building permits and carrying out property transactions at the Colombo Municipal Council, introduction of pre-trial conference as part of the case management techniques used in court, online systems for filing tax with the Inland Revenue Department, increased transparency across participating institutions and the appointment of an Official Receiver to improve the recovery rate and time of business insolvency cases. Further reforms are expected over 2019.
In addition, support to the Board of Investment’s modernization including the delivery of an investment promotion and aftercare program and the design and implementation of a One Stop Shop for fast-tracking investment approval.
Firm Growth, Productivity and Jobs: Building a more resilient innovative economy and entrepreneurial society; also inclusive of a Public Expenditure Review that will comprises of a functional and institutional review of current Research & Development, innovation and entrepreneurship programs and Government spending.
SMEs: Inclusive of a Financial Sector Modernization Project together with complementary technical assistance for capital market development; a proposed innovative SME project focuses on business development and innovative finance for SMEs and entrepreneurs.
Last Updated: Oct 15, 2019