WASHINGTON, DC, May 19, 2010 – Sri Lanka's Governor of the Central Bank, Ajith Nivard Cabraal, took time from his official visit to Washington to talk to a gathering of Asia Society members on Sri Lanka's post-conflict growth and development at the residence here of the Sri Lankan Ambassador, Jaliya Wickramasuriya.
"At the time that we ended the war we took some extraordinary measures, which were painful for the country at the time, but nevertheless necessary in order to bring [Sri Lanka] to a new economic threshold," Cabraal told listeners. In the year after the end of the conflict, he continued, Sri Lanka has been able to contain inflation, keep interest rates low, and maintain unprecedented levels of infrastructure development, with over $4.5 billion being invested in roads, ports, airports, and power plants. Additionally, Sri Lanka is investing $1 billion annually in the north and east of the country to help close the development gap caused by the war.
Sri Lanka has also seen significant achievements in poverty reduction, power generation, and education. Between 1997 and 2009, the percentage of the population living below the poverty level has dropped from 22% to 11%, and is expected to decrease to 2% in the next six years. Electricity coverage has expanded from 74% to 86% in the last five years, with the government aiming for 100% coverage within the next two years. Moreover, Sri Lanka is not prone to blackouts like other South Asian nations. The country's literacy rate stands at 97%, with IT literacy is at 35% and growing, encouraged by factors like the approximately 14 million Sri Lankan citizens who now own a cell phone.
With regard to future planning, Cabraal continued, Sri Lanka hopes to focus on five major industries or "hubs": 1) aviation, by building 14 domestic airports and one new international airport; 2) naval, through the development of 3 new ports; 3) knowledge; 4) banking and IT industries; and, finally, 5) energy.
Towards the close of his talk, Cabraal pointed out that "We have not forgotten that we need to ensure the real economy .... The people should benefit from the fruits of development and the peace dividend." Cabraal cited tremendous new investment opportunities in industries like fisheries and apparel.
Tourism, meanwhile, has particularly strong potential, with 2.5 million tourists projected to visit Sri Lanka in the next five years. The country plans to promote tourism heavily in that time, and has arranged a project in which Ambassador Wickramasuriya will guide tourists on a personalized tour the country. With over 600 people having registered, the tour is currently full, and a second round is already being planned
Reported by Aditya Banerjee, Asia Society Washington Center