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  • 1. Research & Development Unit

2. After the military war is over, the Economic War will begin 3. What is this Economic War? 4. This war is all about ensuring 5. No Sri Lankan goes to bed hungry Cheap food strategy - so that the people will have enough to eat All Sri Lankans should have access to good health facilities and medicine Ensuring that all the citizens have access to good quality education at least up to secondary school level. 6. Educating girls should be emphasized paving the way for them to be educated mothers in the future. English, ICT, Science, Technology and Math should be given pride of place in the sphere of education. Attract good quality Foreign Direct Investments and not fly-by- night investors who only come to rob the country. Good quality public transport should be available to all, i.e. buses, railway, MRT, etc... Good quality infrastructure is a sine qua non for rapid economic development. Therefore, wide roads, development of renewable sources of energy, good quality garbage disposal mechanism and minimizing environmental pollution paving the way for sustainable development, are areas that deserve greater emphasis. 7. The Savings habit should be improved through greater public awareness so that the country could reduce its dependence on foreign sources to fund its investments. Micro lending and SME lending should be promoted on a much bigger scale, with greater participation of women entrepreneurs on the lines of the Grameen scheme of Bangladesh. Expand broadband connectivity throughout the country so that rural small businesses can better compete and all Sri Lankans will have access to knowledge & information . 8. O P P O R T U N I T I E S INFRASTRUCTURE DEVELOPMENT Physical Infrastructure Human Infrastructure 9. Southern Expressway-2011 Rs.20,158 Mn. by GOSL (Government of Sri Lanka) and Rs.47,037 Mn. by ADB & JBIC. Colombo-Kandy Expressway- 2012 Rs.13, 000 Mn. by GOSL and Rs.52,000 Mn. Foreign. Colombo-Katunayake Expressway- 2012 Rs.5,000 Mn. by GOSL and Rs.22,000 Mn. Foreign. Katunayake-Anuradhapura Road-2012 Rs.940 Mn. by GOSL and Rs.3,758 Mn. by Government of Korea. The National Highway Network- Road Improvement (A and B) 2012 Rs.5,700 Mn. by GOSL and Rs.13,300 Mn. Foreign. Northern Expressway 2017 Rs.90,000 Mn. Construction of Flyovers - 2013 17 flyovers are to be constructed in Colombo city and its suburbs. Rs.6,000 Mn. by GOSL and Rs.14,000 Mn. Foreign. The Flyovers at railway crossing in Kelaniya, Pannipitiya, Orugodawatta and Gampaha The flyover at Nugegoda (Funded by the British Government at a cost of Rs. 878 Mn.) - Completed PHYSICAL INFRASTRUCTURE Construction of several Bridges - Bentota & Manampitiya (Completed) - Katuatugastota, Mannar, etc Outer Circular Roads-2011 Rs.40,065 Mn. by GOSL and Rs.46,817 Mn. by JBIC. 10. Physical Infrastructure (Cont)Power Generation Projects Kerawalapitiya Power Plant - 2008 Rs.90 Mn. by GOSL (Funded by CEB) Rs.34,177 Mn. committed by West Coast Power Pvt Ltd. Upper Kotmale Hydro Power Plant 2009/10 Rs.5,952 Mn by GOSL and Rs.32,267 Mn committed by JBIC. Norochcholai Coal Fired Power Plant Phase 1 (2010/11) Rs.1,500 Mn. by GOSL and Rs.50,050 Mn. committed by EXIM Bank of China. Colombo Port Expansion - 2010 Rs.19,800 Mn. by GOSL and Rs.33,000 Mn. committed by ADB and the balance Rs.33,100 Mn from Private sector Ports and Aviation Weeravilla International Air Port 2010 Rs.19,250 Mn. by GOSL. Oluvil Port Development 2010 Rs.1,238 Mn. by GOSL & Rs. 4,950 Mn. by the Government of Denmark Hambantota Port Development 2011 Rs. 8,442 Mn. by GOSL and Rs.33,9770 Mn. committed by EXIM Bank of China. The Contractor M/s China Harbour Engineering Co. and SynoHydro Corporation (Joint Venture) Galle Port Development - 2012 Rs.3,382 Mn. by GOSL and Rs.13,530 Mn. committed by JBIC. The consultancy contract has been awarded to M/s Pacific Consultants 11. Physical Infrastructure (Cont) Upgrading of Colombo Matara Railway Line - 2012 Rs. 3,800 Mn. by GOSL and Rs.15,200 Mn. Foreign. Transportatio n Matara-Kataragama Railway Line Extension (Stage 1 & 2) - 2014 Rs. 6,000 MN. by GOSL and Rs.24,000 Mn. Foreign. Light Rapid Transit (LRT) Railway System - 2015 Rs.30,500 Mn. Foreign. Eastern Railway Line Rehabilitation 2012 Rs. 900 Mn. by GOSL and Rs.3,600 Mn. Foreign. HUMAN INFRASTRUCTURE To improve the productivity of the people SL should enhance ; Access to good health care Access to cheaper but quality food Access to good quality education Furthermore, year 2009 has been declared as the year of English & ICT. 12. Positioning Sri Lanka as a Knowledge Hub Sri Lanka to be positioned as a centre for education Private Universities A MUST (With or without foreign collaboration). This would help SL economy by: Reducing Foreign Exchange outflow for educational purposes Encouraging Foreign Exchange inflow (foreign students coming to study here). Already Sri Lanka has a pool of very knowledgeable University lecturers and professors. The quality of our knowledge of English has to be vastly enhanced by utilizing foreign resources preferably, the services of British trainers should be obtained to train our teachers. Human Infrastructure (Cont) 13. 2009 YEAR OF ENGLISH & ICT Improvement of English and ICT is a pledge embedded in the Mahinda Chintana policy statement. Two task forces have been set up to promote English and ICT in 2009, which has been declared as the Year of English and ICT. The Information and Communication Technology Agency (ICTA) of Sri Lanka as the apex body of Information and Communication Technology (ICT) in the country, assists the task forces. Other ICT related organisations also work with the task forces. The key focus of the Year of English and ICT is to Make the general public proficient in English so that, inter alia, they will have greater access to world knowledge and opportunities /capabilities in the ICT sector. Increasing the English and ICT literacy rate Ensuring that Sri Lanka has sufficient English teachers and ICT instructors, thereby laying the foundation for English and ICT led development. Creating ICT awareness in Sri Lanka. Source: Human Infrastructure (Cont) 14. How are we going to develop our exports ? Diversifying exports. Certain industries have been identified as thrust industries which are capable of crossing the US$ 1bn threshold. Greater emphasis should be accorded to these industries eg: Rubber, spices, Leather and Gem and Jewellery. Sri Lanka must also promote the export of services Expor t Developme nt 15. Foreign Direct Investment (FDI) Foreign Direct Investment (FDI) High tech technology transfer Using local resources Goods for which there is a demand in the world market Value addition Skill development We should avoid fly-by-night investors 16. SL had Received US$ 889 mn. of FDIs in 2008. Sector-Wise Analysis Country US$ Mn Country US$ Mn Malaysia 150 USA 57 India 126 Sweden 38 Netherlands 117 China 27 UK 87 Singapore 21 Luxembourg 82 Japan 17 Hong Kong 74 Belgium 13 Sector US$ Mn % of Total Services / Infrastructure 697 78.40% Telecom Sector 553 62.2% Power Sector 88 9.90% Housing & Property Development 20 2.25% IT/BPO 14 1.58% Other 22 2.47% Manufacturing 189 21.26% Textiles & Apparel Sector 72 8.10% Rubber Products 35 3.94% Agro-Products 15 1.69% Electrical & Electronics 15 1.69% Non Metallic Mineral Products 12 1.35% Fabricated Metal 10 1.12% Garment Accessories 8 0.90% Other 22 2.47% Agriculture sector 3 0.34%Source : BOI, Sri Lanka However, 62.2% of this was received for Telecom sector, while the broader category of Services / Infrastructure accounted for 78.4%. The important Manufacturing sector attracted only 21.26% of total FDIs in 2008. Main Contributors to FDI 17. Harvesting Marine Resources All this time a vast area of the coastline was inaccessible due to LTTE activities. Now ,the coast line is free. Tapping Fisheries Resources Sri Lanka becoming self sufficient in fish Excess to be exported - the possibility of establishing Canned fish factories in appropriate locations should be probed. At present SLs sea territory is 08 times larger than the country and in near future the sea territory possessed by Sri Lanka would be 23 times larger than the country. 18. SME Sector Developments Developing the SME sector, which is mostly concentrated out of the Western Province, will result in the creation of employment and contribute to the development of rural areas in the country. SMEs are also important in Sri Lanka as they make up more than 80%of all businesses, account for about 35%of employment and about 20% of total industrial value addition. 19. Agricultural Developments The Agricultural Sector is the cornerstone in Sri Lankas economy with more than 70% of the population living in rural areas depending on agriculture for their livelihoods. Currently this sector accounts for 18% of the GDP and 30% of the employment. AGRICULTURE SECTOR GROWTH In 2008 agriculture sector including fishing had expanded by 7.5% from 3.4%n in 2007. Paddy production had risen 23.5% and a return to peace in the eastern Sri Lanka had increased maize production and fishing. Rubber production increased by 10.3% against 4.2% in 2007. Tea increased 4.3% against a contraction of 1.8% in 2007. The coconut sector grew at 5.2% against 5.1% in 2007. AGRICULTURE SECTOR GROWTH In 2008 agriculture sector including fishing had expanded by 7.5% from 3.4%n in 2007. Paddy production had risen 23.5% and a return to peace in the eastern Sri Lanka had increased maize production and fishing. Rubber production increased by 10.3% against 4.2% in 2007. Tea increased 4.3% against a contraction of 1.8% in 2007. The coconut sector grew at 5.2% against 5.1% in 2007. Agri Sector Share of GDP 2008 10.9% Tea 1.2% Rubber 0.2% Coconut 1.4% Minor Export Crops 0.4% Paddy