National Microfinance Study of Sri Lanka: Survey of Practices and ...

With successive central government’s concern seemingly focused on the
‘security’ of the North and East region rather than the welfare, recovery and
development of this vital region and its communities, the GAs are in the main
dependent upon the assistance and resources of the donor community,
international, national and local non government organisations.
In the Wanni, the LTTE govern the area using the previous divisional and district
structures. This body goes by the name ‘The Local Authorities’ and as well as
managing local authority affairs, also operates the police force and district courts.
The international bodies were in the past using joint district review committees
and boards set up by the local authorities through which all programmes and
projects were assessed, however this appears to have fallen away and a loss of
coordination of projects and programmes in the area is being experienced.
The Local Authorities engage in dialogue with the GAs of the bordering cleared
district areas concerning community affairs, certain infrastructure, and issues
concerning health and education. In mid 2001, the offices of the local authority
were moved to Killinochchi with the LTTE designating this town as the ‘capital’
of the area due to its strategic geographic position on the A9 route and road access
throughout the Wanni and the Jaffna Peninsula.
This move was regarded with dismay by the international agencies and
organisations as their emergency and relief bases, logistics and the focal points of
their programmes are clustered in and around Madhu, Mallavi and
Puthukkudyiruppu (PKI). Negotiations broke off in mid 2001 and the UNHCR
raised the level of threat officially to Phase 4, which in UN terms means that the
security threat is felt to be too high to continue relief and rehabilitation
programmes, however it is believed that this will change again in the near future.
Markets, infrastructure and security
Overall, eighteen years of armed conflict has severely disrupted the markets,
infrastructure and economy of the North and East region. Whilst the country’s
overall economy grew at an annual average rate of 5.5% in the period 1990-95,
the northern districts of the North and East Province saw a negative annual
growth rate of – 6.2% in the same period (UNDP, 2001)
Recently the combined ‘knock on’ effect of the global downturn, the exponential
increase in the government’s war expenditure, and the ‘draining’ of foreign
exchange reserves have placed Sri Lanka in the unenviable position of a negative
2.2% growth for 2001 with the North and East region continuing to decline.
Batticaloa, Trincomalee and Vavuniya (BTV)
Over the past five years the areas of Batticaloa, Trincomalee and Vavuniya have
remained fairly stable and there has been resettlement and relocation of
communities. A large number of international and national organisations are
continuing to undertake relief and rehabilitation programmes in the North and
East helping to provide the basic conditions necessary for economic activity to be
re-established and maintained.