Fastest-growing South Asia expected to grow further, WB official says
The South Asian region is the fastest growing region in the world where growth has been strong. Eight countries in the region have recorded 6.9 per cent growth which is expected to exceed 7 per cent next year, said Dr. Hartwig Schafer, Vice President South Asia Region of the World Bank.
The visiting official, speaking at the Colombo launch of the Sri Lanka Development Update on “Demographic changes in Sri Lanka” last week, said however that behind the strong growth of these countries, the darker side of it was due to debt dynamics, growing fiscal deficits and widening current account deficits.
“Should there be a global economic shock this growth can be very fragile and we need to keep our eyes open to have preventive measures in place,” he cautioned.
Dr. Schafer said that three out of five countries in South Asia are most vulnerable to climate change and natural disasters. Eighty per cent of the big cities of the metropolis in South Asia is floods- prone and Colombo for instance was badly affected by floods a few years back. One of the projects of the World Bank is to prevent such floods happening and to prevent loss of life and help prevent damages caused by floods amounting to hundreds of million of rupees per year. “Having visited Sri Lanka after many years I have witnessed Sri Lanka’s tremendous progress and potential for economic development where the World Bank provides resources, policy advice and technical assistance.”
He said multi- dimensional poverty has to be looked into in terms of access to education and services and South Asian countries stands lower than the rest of the world. ”We have to intervene with regard to develop human capital and improve access to services. Sri Lanka is one of the top performers in the region, but more has to be done to improve human capital.” Referring to the huge debt burden the country faces, he said the World Bank has some proposals to help Sri Lanka.
The opening up of the private sector is important for foreign investment to flow into the country. The World Bank will work closely with the Sri Lankan government to create regulatory policies to encourage private sector participation in development activities. Sri Lanka has done extremely well in the international ranking moving upwards. “The World Bank has 14 projects under implementation in Sri Lanka to the tune of US$1.8 billion covering a range of sectors from infrastructure, agriculture, flood mitigation, water and macroeconomic management systems.”
Senior Country Economist for Sri Lanka and the Maldives Dr. Fernado also spoke. The panel discussion on demographic change in Sri Lanka involved State Minister, Ministry of Finance and Mass Media, Eran Wickramaratne; Dr. W.A. Wijewardena former Deputy Governor of the Central Bank; Prof. Indralal de Silva, former ( chair) of Demography, University of Colombo; and Prof. Amala de Silva, Department of Economics, University of Colombo.