Sri Lanka Human Development Report 2012.pdf

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An Environment for Business to Prosper With the end of conflict, Sri Lanka can now focus on a more impressive growth trajectory. While public investment in infrastructure - roads, bridges, ports, airports, etc. - continues at a rapid pace, private sector investment will be an important determinant of the ambitious post-conflict scenario envisaged. For Sri Lanka to sustain growth at 8 percent in the medium- to long-term, the country will need to raise its annual rate of investment from the current investment edged up by 4.6 percent in 2010 and another 1.4 percent in 2011, growing by 8.2 percent since the cessation of the conflict. While the share of public investment in total investment rose from 9.5 percent in 2002 to 20.9 percent in 2011, it has contracted by 23.1 percent since 2009 (Table 6.3). Table 6.3: Public and Private Investment as Proportions of Total Investment, 2002–2011 Year public investment, % private investment, % 2002 9.53 90.47 2003 10.49 89.51 2004 10.83 89.17 2005 16.46 83.54 2006 14.49 85.51 2007 19.28 80.72 2008 23.55 76.45 2009 26.91 73.09 2010 22.3 77.7 2011 20.89 79.11 Source: Central Bank of Sri Lanka Annual Report (various years). level of approximately 26 percent of GDP to at least 35 percent. 306 With greater fiscal pressures, public investment alone will not be enough. Expanding private investment will depend on governance that motivates businesses to expand and create jobs. From 2002 to 2009, the share of private investment in total investment contracted steadily, falling from 90.5 percent to 73.1 percent. Once peace was restored, private The drop in public investment signifies the increasing vibrancy of the private sector and underscores fiscal constraints. Government officials are clear that the preconflict growth of public investment cannot be sustained. To continue the rate of overall investment as a share of GDP, the private sector will need to play a more active role. The Government envisages that private investment, which stood at just above Rs. 1,500 billion in 2011, needs to increase to Rs. 2,000 billion in the next couple of years. 307 Chapter 6 Bridging Governance Gaps: State Capacity and People’s Participation 107
While the objective is laudable, it cannot be accomplished unless the growth rate of private investment picks up rapidly. This requires the Government, at the national and sub-national levels, to take immediate steps to accelerate private investment, including by fostering a businessfriendly environment to stimulate investment from domestic and foreign sources. Gauging what’s good for business One indication of the business environment is access to productive employment, a key element of human development. Unemployment among the 15-19 and 20- 24 age groups remains high across most provinces. The exceptions, to some extent, are the Western and North Western provinces. The two account for 62 percent of industries; 71 percent of people engaged in the industrial sector live and work in these two provinces. The greater availability of industrial jobs is mainly responsible for disparities in employment and incomes between them and other provinces. Facilitating private enterprise in other regions could begin by extending focused support to small and medium enterprises, which are least equipped to navigate unfavourable business conditions. Government agencies, particularly those involved in regulation and the granting of licences, permits and approvals, can help or hinder private sector growth, and, in turn, the creation of employment opportunities. The most widely used measure of the ease of doing business is the World Bank’s Doing Business Index (DBI). It benchmarks countries globally on a number of factors, including governance, essentially offering a measure of regulation and red tape. The index for 2012 ranks Sri Lanka low on many of the indicators that determine how government rules and regulations impact enterprise growth. These include ‘dealing with construction permits’, ‘registering property’, ‘paying taxes’ and ‘enforcing contracts’. Sri Lanka has not been able to improve its rankings on many index indicators over the last five years, except ‘dealing with construction permits’. Other rankings have either gone down or remained the same (Figure 6.7). Figure 6.7: DBI Rankings: Sri Lanka’s Recent Performance, 2008–2012 Note: Rankings are based on 183 countries in the 2012 edition of the DBI. Rankings closer to 1 indicate that it is easier for a local firm to start and operate a business. Source: The World Bank and International Finance Corporation 2012. 108 sri lanka Human Development report 2012
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SriLankaHumanDevelopmentReport 2012
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Sri Lanka Human Development Report
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Acknowledgements This report would
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sri lanka Human Development report
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Access to water 89 Accessibility to
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Figure 1.1: Share of GDP by Provinc
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Table 2.1 Table 2.2: Table 2.3: Tab
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CHAPTER 1 Why Revisit Regional Dime
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spreading its fruits more equitably
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Negotiations are still ongoing to f
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Box 1.1 A Selected Summary of Damag
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Other Vulnerable Groups A number of
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education financing and the distrib
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CHAPTER 2 Patterns of Human Develop
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population. It accounts for inequal
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Regional Variations in the Human De
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Map 2.1: Human Development Index 20
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Gender Inequality Index Among distr
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Comparing Districts Across Indices
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14.5 percent in 2009-2010. As seen
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Economic Growth and Inequality Alth
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The poverty gap index, which measur
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half the headcount index. For the e
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What are the factors that push peop
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lowest incidence of both income and
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CHAPTER 3 Bridging Human Developmen
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disability of the heads of poor hou
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Infant Mortality and Under-five Mor
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and given three doses each of polio
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as the absence of illness, but also
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Box 3.2: Gender-based Violence The
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Figure 3.7: Distribution of Governm
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Figure 3.10: Medical Officers per 1
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While access to public health care
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Data on access in the Northern and
Page 71 and 72: People in Conflict-affected Areas F
Page 73 and 74: CHAPTER 4 Bridging Human Developmen
Page 75 and 76: Levels)—mark the end of the senio
Page 77 and 78: Funding Education Public investment
Page 79 and 80: Figure 4.2: Distribution of Out-of-
Page 81 and 82: Male children are generally less li
Page 83 and 84: Deficits in information technology
Page 85 and 86: supports displaced children who ret
Page 87 and 88: Educational Performance: Senior Sec
Page 89 and 90: Building a Knowledge Economy Sri La
Page 91 and 92: Figure 4.10: Distribution of Univer
Page 93 and 94: offered by private institutions. 18
Page 95 and 96: CHAPTER 5 Bridging Human Developmen
Page 97 and 98: twice the rate for the economy as a
Page 99 and 100: across geographic locations and by
Page 101 and 102: Box 5.1 Programmes to Improve Infra
Page 103 and 104: Figure 5.5: Extent (Ac) of Agricult
Page 105 and 106: towards constructing multipurpose r
Page 107 and 108: The length of national, provincial
Page 109 and 110: performs better in terms of mobile
Page 111 and 112: Technological advancements and tran
Page 113 and 114: Figure 5.12: Number of Fishers and
Page 115 and 116: CHAPTER 6 Bridging Governance Gaps:
Page 117 and 118: Figure 6.1: Sri Lanka’s Tax Reven
Page 119 and 120: When taxation becomes more visible,
Page 121: Table 6.2: The CPI: Comparing Count
Page 125 and 126: There has been progress on some ind
Page 127 and 128: to collect their own revenue throug
Page 129 and 130: the public sector in policy reform
Page 131 and 132: Table 6.6: Women in Elected Politic
Page 133 and 134: CHAPTER 7 Building on Peace, Progre
Page 135 and 136: This is a considerable task, but it
Page 137 and 138: The Ministry of Health in associati
Page 139 and 140: nationally and locally. The decline
Page 141 and 142: Notes sri lanka Human Development r
Page 143 and 144: 54 World Health Organization 2001.
Page 145 and 146: amount equivalent to 8 percent of G
Page 147 and 148: Bibliography sri lanka Human Develo
Page 149 and 150: ———. 2009e. Statistics databa
Page 151 and 152: Draft-13%2006%202010.pdf]. Last acc
Page 153 and 154: ———. 2008c. Land Reforms in S
Page 155 and 156: Table A2: Human Development Index a
Page 157 and 158: Table A4: Income Poverty, Multidime
Page 159 and 160: Table A6: Income Poverty and Measur
Page 161 and 162: Table A8: Demography, Land and Hous
Page 163 and 164: Table A10: Infant Mortality, Under-
Page 165 and 166: Table A12: Maternal Nutrition, Tota
Page 167 and 168: Table A14: Health Awareness Percent
Page 169 and 170: Table A16: Primary Gross Enrolment
Page 171 and 172: Table A18: Government Schools and S
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Table A20: Labour Force Labour forc
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Table A22: Unemployed Population Un
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Table A24: Household Possessions Co
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Table A26: Average Distance and Tim
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Technical Note sri lanka Human Deve
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HDI= (I Life Expectancy ) 1 / 3 ×
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where MMR=maternal mortality rate;
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Multidimensional poverty headcount(
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Figure T.2: Intensity of Poverty an
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of the total deprivations of poor p
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178 sri lanka Human Development rep
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