OTH: Sri Lanka: Government of Sri Lanka Development Policy ...

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  • sri lankathe emerging wonder of asia

    mahinda ChintanaVision for the future

    dePartment of national PlanningministrY of finanCe and Planning

    the DeVeLoPMent PoLiCY frAMeWorKGoVernMent of sri LAnKA

  • Sri LankaThe emerging Wonder of AsiA

    Mahinda Chintana ViSion for the future



  • The department of national Planning - 2010

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  • The Emerging Wonder of AsiaSRI LANKA

    item unit 2005 2010 2016 est. Proj.

    Population mn 19.7 20.7 21.9 GDP USDbn 24.4 49.1 98.0 PerCapitaIncome US$ 1,241 2,375 4,470 Inflation-GDPDeflator % 5.7 7.0 4.0 Exports US$bn 6.3 8.0 18.0 InternationalTradeTurnover US$bn 15.2 21.3 44.1 InternationalServicesIncome(Net) US$bn 0.3 0.6 2.6 EarningsfromTourism US$bn 0.3 0.5 2.5 Remittances US$bn 2.0 3.8 7.0 AccesstoElectricity % 75.0 88.0 100.0 AccesstoTelecommunications % 23.6 85.0 100.0 WomeninLabourForce % 32.6 34.3 40.0 Unemployment % 7.2 5.3 3.2 InfantMortality Per1000 11.2 10.9 4.0 MaternalMortality Per1000 0.45a 0.39 0.2 Poverty % 15.2 7.6 4.2 PrimarySchoolEnrolment % 95.0 98.0 100.0 LiteracyRate-(15-24years) % 95.0 97.0 98.0 LiteracyRate-Computer % 9.7 20.3 75.0

  • A Dynamic Global HubSRI LANKA

    Mahinda Chintana - Vision for the Future

    The objective of our next massive leap forward is to transform Sri Lanka into a strategically important economic centre of the world. my determination therefore, is to transform sri Lanka to be the Pearl of the Asian silk route once again, in modern terms. Using our strategic geographical location effectively, i will develop our motherland as anaval, Aviation, Commercial, energy and Knowledge hub, serving as akey link between the east and the West.

  • Sri Lanka The Emerging Wonder of Asia

    Per CAPiTA inCome (Us$)












    2005 2009 2016


    the future

    the PaSt



    the PreSent

  • 1. Sri Lanka: the emerging Wonder of asia 1

    2. a Prosperous Country: a Land of Plenty 11

    2.1 Agriculture: feeding the nation 12

    2.2 fisheries and Aquatic resources 23

    2.3 self reliance in Livestock industry 29

    2.4 irrigation: Water is our heritage and Life 36

    2.5 Plantation economy 41

    3. enterprises with Strength to Conquer the World 47

    3.1 electricity for everybody, everyday 48

    3.2 Well established Telecommunications facilities 55

    3.3 User friendly modernized Postal sector 59

    3.4 Water services Perspective 61

    3.5 industry sector: Towards global Competitiveness 68

    3.6 state-owned enterprises to Become strategic 85

    4. developed road network and transport System 89

    4.1 Towards a modern road network 90

    4.2 Transportation hub 99


  • 5. focus on Modern education and knowledge Systems 111

    5.1 moving education Towards Creating Knowledge and skills 112

    5.2 University education for Knowledge 119

    5.3 Building a Competitive Workforce through

    Technology education and skills development 128

    5.4 A modern economy Through science and Technological innovations 137

    6. a healthy Society 143

    6.1 Active Community sport economy 144

    6.2 healthy nation, healthy People in a healthy Community 148

    7. Comforts, Convenience and Satisfactory Lifestyle 155

    7.1 environment 156

    7.2 sri Lanka The Wonder island of Asia 164

    7.3 housing for All Prosperous and healthy Lifestyle 172

    7.4 Urban development 178

    8. Shared Values and rapid development 185

    8.1 Towards a Caring society 186

    8.2 Culture and national heritage 197

    8.3 Towards a Balanced regional development with diversity 202

    references 300

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    sri Lanka has achieved many positive developments during the period 2005 to 2009 with the policies implemented under the mahinda Chintana - towards a new sri Lanka. it has also created a strong base to achieve a high and sustainable economic growth in the years to come. This process is envisaged to continue at a renewed pace with the policies and measures to be implemented during the next six years under the mahinda Chintana Vision for the future, to reposition sri Lanka in the global arena as a knowledge based strong middle income country with better and improved living standards which continues to preserve cultural values and traditions.

    The mahinda Chintana phase of socio economic development in sri Lanka was commenced following the Presidential election in november 2005 at which his excellency mahinda rajapaksa was elected as the President of sri Lanka. The policy framework, based on mahinda Chintana - Towards a new sri Lanka, envisaged to resolve the prolonged conflict, implement large infrastructure development initiatives consisting of electricity generation, ports, airports, water supply and irrigation, roads and transport, revitalize agriculture and domestic enterprises, strengthen public services and state owned enterprises, promote private sector and smes and implement rural centric integrated development initiatives aiming at empowering villages (gama neguma). This enabled sri Lanka to achieve a number of improvements, including the following:

    sustained economic growth of around 6 percent

    raise per capita income from Us$ 1,062 in 2004 to Us$ 2,053 in 2009

    reduce unemployment from 7.4 percent to 5 percent (from 2005 to 2009)

    reduce poverty from 15.7 percent to 7.6 percent (from 2006 to 2010)

    raise access to electricity from 75 percent to 87 percent, safe drinking water from 80 percent to 85 percent, telecommunication from 23 percent to 86 percent and road access from 93 percent to 95 percent between 2005 and 2009 period

    raise school enrolment from 95 percent to 98 percent, general literacy from 95 percent to 97 percent, computer literacy from 10 percent to 20 percent, infant mortality from 11.2 per thousand live births to 10.9, life expectancy from 73.2 years to 74.1 years, women participation in labour force from 32.6 percent to 34.3 percent and overall human resource index from 0.740 to 0.759 between 2005 and 2009 period

    Position the countrys overall happiness index ranking at 1st in Asia and 8th in the world

    The socio economic development strategy for the next decade based on the mahinda Chintana Vision for the future, the 2010 Presidential election manifesto of his excellency the President mahinda rajapaksa, envisages a sri Lanka that:

    has an economy with a green environment and rapid development

    Aspires to be a stable society with a high quality of life for all of its people having access to decent living, electricity, water, schooling and health facilities

    maintains the best of sri Lankan culture, traditions and long standing global identity

    Aims to consolidate as an emerging market economy, integrated into the global economy and is competitive internationally


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    intends to have the characteristics of a middle income economy with a knowledge-based society

    This vision is articulated identifying specific targets aiming at achieving the millennium development goals (mdgs) ahead of time. Among the mahinda Chintana goals (mCgs) for 2016 are the following;

    eradication of hunger and hard-core poverty

    Universalization of secondary education for all

    reducing malnutrition rate of children from a third to 12-15 percent

    increasing life expectancy from 76 to 80 years

    increasing access to clean water in urban areas from 65 to 90 percent

    raising forest coverage from 28 to 43 percent

    These are to be attained through rapid economic growth and a change in the structure of the economy to a modern, environmentally friendly and well connected rural-urban economy that can create better-remunerated employment opportunities:

    Almost doubling of gdP by 2016 to above Us$ 4,000 to be attained through an economic growth of over 8 percent per annum

    investment to be increased to 33-35 percent of gdP with sustained commitment of public investment of 6-7 percent of gdP to support private investment

    exports to grow at twice the rate of real gdP

    high spending tourism to grow in order to generate fourfold expansion in tourist earnings and remittances inflows, based on skills, to be doubled

    The share of rural employment to decline from about two-thirds to half; and

    The share of urban population to increase from a quarter to a third.

    sri Lankas new development strategy, which is outlined in this document, attempts to implement explained strategies and underlined actions not only for a higher economic growth but also for a higher quality growth in each sector.The mahinda Chintana goal is to share the benefits of growth across all segments of the population and also to prevent inequities, social exclusion and adverse environmental reprecussions that have been witnessed in some of the rapidly growing economies.

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    The mahinda Chintana vision is based on the economic philosophy that the growth in gross domestic Product (gdP) alone would not bring economic prosperity to the society. The mahinda Chintana goal (mCg) is to increase the gdP to provide benefits to every segment of society in a justifiable manner. The creation of prosperity to the majority of the people who cannot purely rely on market based solutions requires connectivity through roads, electricity, telecommunications, information technology, education and health services. hence, the development strategy relies not only on promoting investments on infrastructure based on commercial and economic returns but also on the creation of equitable access to such infrastructure development to enable people to engage in gainful economic activities.

    Towards this end, providing electricity to all, popularizing mobile usage among all people, establishing nanasala (iT centers) in remote villages and developing the rural and agricultural road network (maga neguma), have made a revolutionary transformation in the rural economy. Providing benefits through wider networking is supported by equally important rural centric development programmes such as rural irrigation projects, community water supply projects, storage and marketing facilities and financing and credit facilities.

    The mahinda Chintana philosophy is such that the empowering people must move hand-in-hand with the development in family values as well as vulnerabilities of women, children, and elderly are contained. it also places greater emphasis on the upliftment of moral values and liberating people from using narcotics and drugs (mathata Thitha). This holistic approach will enable the entire society to reach new heights in their overall living standards.

    GroWth aLone doeS not MeaneConoMiC ProSPeritY


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    sri Lankas growth targets for the 2010-2016 period appear well within reach. The 26 year conflict is over. necessary infrastructure is in place. The global economy is on the recovery path. over the past five years, sri Lanka has scored better on most of the aggregate indicators. There is also a benefit from the expected supply-side response from agriculture, livestock, fisheries as well as tourism related activities following the successful ending of the conflict.

    The doubling of the size of sri Lankas economy, which is envisaged over the coming six years, will need to be accompanied by a shift in the structure of the economy. The shift envisioned in the strategy whereby agriculture, industry and services become the key drivers in the initial phase, reflecting the impact of rapid recovery in agriculture based activities. The share of agriculture in gdP is to be consolidated at around 12 percent, industry at 28-30 percent and services at around 60 percent, thereby diversifying the economy. This shift enables those engaged in agriculture to enjoy higher returns. however, it is also important to manage a balanced growth to prevent widening urban-rural gaps.

    sri Lanka recognizes that the process of globalization presents both opportunities and challenges. sri Lankas decision to honour its commitments under the free Trade Agreements (fTAs) with india and Pakistan and other regional Trade Agreements (sAfTA, APTA, and BimsTeC) will have great gains for the country in terms of exports, investment opportunities and acquisition of technology.

    encouraging the Private Sectorif investment rates are to rise as needed, the domestic private investment will need to rise from the current low level of around 15-17 percent of gdP to about 22 percent of gdP for the 2010-2016 period.

    sri Lankas investment climate for the private sector has been affected adversely in the past by conflict related uncertainties, legal disputes and infrastructure limitations. however, there are indications that the climate in sri Lanka is rapidly improving. Changing attitudes of officials and bankers, as well as systems and procedures adopted with regard to private enterprises, in addition to the improvement in legal and regulatory framework, are the key priorities in the medium term administrative reforms.

    Mobilizing foreign direct investmentThe government envisages foreign investment playing an important role in bringing investment and technology into sri Lanka. during the past decade, sri Lanka benefited disproportionately from direct investment inflows which were on average equivalent to 1.5 percent of gdP. The government projects to double the level of inflows during the current decade, particularly in the areas of tourism, urban development, iT/BPo services, pharmaceutical and renewable energy etc.

    Prioritize investments CarefullyThe governments programme for the coming six years envisages some closing of the infrastructure gap between sri Lanka and its neighbours. This will involve very large investments across the full range of transport, energy, water, sanitation and irrigation sectors. in the areas of energy and ports, a considerable front-based investment has taken place. Thus, while many investments will have good returns, a careful cost-benefit analysis (in which economic, social and environmental costs are all taken into account) will be undertaken in planning for the future.

    the economic framework

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    diversify the Pattern of financeThe pattern of financing will be such that the government resources and official development Assistance (odA) will finance a large share of infrastructure growth in the medium term. odA donors are less willing to finance investments when pr...


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