Colombo, November 8, 2010: The Government of Sri Lanka and the World Bank jointly signed off on three projects with agreements totaling US$ 125.4 million today for Small and Medium Enterprise Development, North East Local Service Improvements, and Sustainable Tourism development.
“The three projects signed today will help Sri Lanka reap maximum benefits of the peace dividend and make further progress towards becoming a Middle Income Country.” said Amit Dar, Acting World Bank Country Director for Sri Lanka.
The Small and Medium Enterprise Development Facility Project supports the Sri Lanka Government’s efforts to improve access to finance for SMEs affected by the Global Financial Crisis. The US$57.4 million in support will strengthen access to finance for Sri Lankan Small and Medium Enterprises (SMEs).
The project aims to incentivize banks to provide credit to SMEs while building their SME lending capability over time,” says Cecile Niang, Economist, World Bank and Task Team Leader of the project.
The US$50 million North East Local Services Improvement Project is designed to augment resource transfers and building capacity of local authorities, the bottom tier in the Government structure, so that they are well equipped to deliver much needed local services to the citizens in an accountable manner.
“This project will support repairing and rebuilding critical infrastructure – from rural roads, culverts and bridges to public buildings, waste disposal, and rural water supply,” said Seenithamby Manoharan, World Bank Sr. Rural Development Specialist and project Task Team Leader. “Importantly, all infrastructure projects will be identified and prioritized by the citizens themselves.”
The Sustainable Tourism Development Project aims to facilitate environmentally and socially sound investments in the tourism sector, focusing particularly on the eastern part of the country. The US$18 million will additionally build capacity in the tourism sector’s institutional structure to improve efficiency in service delivery.
“The Eastern Province of Sri Lanka has an enormous tourism potential,” said Michael Wong, World Bank Private Sr. Sector Development Specialist and project Task Team Leader. “This project will help to expand economic opportunities in the East, making the tourism sector more competitive and inclusive while maintaining Sri Lanka's heritage and ecological environment.”
The credits from the International Development Association (IDA), the World Bank’s concessionary lending arm, have 20 years to maturity with a 10-year grace period.