Welcome to the First Edition of the ERD News

First Quarter2004 Bulletin No. 1.

Welcome

Welcome to the first edition of the ERD News.

Aid Commitment Highlights

Total Aid commitment was US $ 200 millions during the first quarter 2004.

• The agreement for the third

tranche of US$ 25 Mn under the Indian Line of Credit was signed on 23rd March 2004 by the Government of Sri Lanka and the Government of India. The proceeds of the credit will be used to import capital goods, consumer durables and food items.

• The Government of China

provided audio visual equipment, computers and air conditioners etc. to the Bandaranaiyake Centre for International Studies. The Letters of Exchange for this donation amounting to RMBY 1.7 Mn (Rs 20 Mn) were signed on 17th March 2004 by the Government of Sri Lanka and the Government of China.

• The Asian Development

Bank and the Government of Sri Lanka signed aloan Agreement on 14th January 2004 to provide US$ 50 mn for the Conflict Affected Area Rehabilitation Project. The total estimated cost of this project is US$ 106.9 Mn of which US$ 80 million is provided by ADB and the balance US$ 26.7 Mn from the GOSL. The agreement for the balance of US$ 30 mn from ADB will be signed subsequently at a later date. The project will focus on activities to rehabilitate and reconstruct the essential infrastructure needs and restore community livelihoods on the most severely affected districts.

• Three agreements for

US$ 70 mn were signed on 21st January 2004 by the Government of Sri Lanka and the Asian Development Bank to implement the Rural Finance Sector Development Program. It consists of two project loans and one programme loan. The proceeds of the program will be used to establish a sustainable rural finance system through policy reforms and to improve the operations of Rural Financial Institutions. The project loan will be used for institutional strengthening, capacity building in the rural finance sector and providing finances to rural small and micro enterprises through National Development Trust Fund.

• The Exchange of Letters for

a grant of Japanese Yen 1,500 Mn were signed on 1st March 2004 by the Government of Japan and the Government of Sri Lanka to promote the economic structural adjustment efforts to mitigate the economic difficulties including indebtedness of the GOSL.

• A agreement for the project

on Delimitation of the Outer Edge of the Continental Margin of Sri Lanka was signed on 10th February 2004 by the Government of Sri Lanka and the Government of Norway for the total cost of NOK 37.0 million(US$5.2mn). According to the United Nations Convention on the Law of the Sea (UNCLOS), Sri Lanka is entitled to extend its seabed beyond 350 nautical miles from its baseline.

• European CommissionprovidedEURO 1.6 mn under the Small Project Facility to contribute to the on-going reform process of the Sri Lankan economy and EURO 1.6 mn to strengthen the capacity of the Government of Sri Lanka to meet challenges from WTO in order to enhance export potential in the Garments Gems and Jewellery Sectors.

• An exchange of Notes was signed on 11.2.2004 with the Embassy of German (GTZ) for Basic Education for Children in Disadvantaged Area(BECARE) to improve the quality of primary –level schooling.

Commitment of Tokyo Pledges

Out of the total Pledges US $ 4.5 billion, US $ 557.3 Million were committed up to 1st Quarter of 2004.

Loan Negotiations

World Bank

01.Community Development & Livelihood Improvement – US $ 69.8 mn

02.Health Sector Development- US $ 69.2 mn

ADB

03.NECORD- extension US $ 10 mn

04.TA for Road Project Preparatory Work US $ 15 mn

Donor Missions

The following Missions were fielded during the period under review.

-ADB: 20 missions, of which 7 missions for reviewing projects

-The World Bank: 14 missions were received for project identification, preparation and reviews

-Japan: Two preliminary study missions were visited.

-Bilateral East Countries: IFAD, UNFPA, UNICEF,FAO, SFD and Kuwait Fund review missions fielded.

Projects in the pipeline -2004 (Over US$ 10 Million )

Project US$ Mn

Japan

1. Small Scale Infrastructure

Upgrading and

Rehabilitation Project 112.0

2. Environment Friendly Solution

Fund II 44.0

3. Small and Micro Industries

Leader & Entrepreneurs

Promotion Project III 87.5

The World Bank

4.Poverty Reduction Support

Credit90

5. ICT for Development

E-Sri Lanka Initiative50

6.Community Development

& Livelihood Improvement

Project51

7. Health Sector Operation60

8.North East Irrigated

Agriculture Project II62

ADB

9. Eastern Province

Coastal Community

Development Project20

10.Fiscal Management

Reform Programm70

11. Private Sector Development 70

12.SecondaryEducation Modernization II40

13. TA Loan for Road

Project Preparation15

Korea

14.Greater Galle Water

Supply Project Phase ii 14.7

China

15.National Performance Arts

Centre- Construction of Main

Theatre 17.0

IFAD

16.Livelihood Support &

PartnershipProgramme 22.0

Australia

17. Sustainable Water Assistance Management Project 28.0

Thailand

18. Importation of Agriculture Machinery from Thailand under

Credit Line 20.0

European Commission

19. Rehabilitation of roads in

the North and East13

Germany

20.32kV Jaffna-Kilinochchi

Transmission Line rehabilitation

and 220 KV protection system14

Sweden

21. Central Wastewater Treatment

Plants for Ratmalana & Ja-Ela70

22. Rural Electrification Project IV20

Norway

23.Monitoring of all Grid

Substation SCADA System 10.08

Denmark

24.Colombo Sewerage

Rehabilitation Project 24.6

25.OluvilHarbour

Development Project 25.0

26. Milco Dairy Development

Project 15.2

ERD aims to disburse US $ 976 million in 2004

A joined efforts had been made by the ERD and the Project Directors to disburse a total of US $ 157 mn in the 1st quarter of 2004, The breakdown is as follows

Foreign Debt Service Payments

The Total Debt Service Payments During the First Quarter 2004 was US $ 102 mn.

This comprises

Amortization US $ 64.1mn

Interest and Other fee US $ 37.9 mn

Foreign Training Programmes

ERD announced 145 training programmes and applications from 683 Government agencies were received. 138 placements out of 492 applications were submitted.

Two incountry training programme were held with 20 participants for each programme at SLRC and PGRC. Received 68 applications from volunteers and experts of which 22 were selected as volunteers and 10 as experts.

Development of Integrated Aid Management System

ERD is in the process of development of Integrated aid Management System with the financial assistance of the UNDP and NORAD.

The new system, which is web based, consists of three areas:

1. Aid Management System which could be defined as the management information process from the initiation of project concept up to the mobilization of resources by the effectuation of the agreement between the Government and the donor.

2. Project Management Information which consists of management information process which involves the management of the project implementation up to the completion and post evaluation.

3. Foreign Training Management System for the mmanagement of foreign training opportunities offered to the Government of Sri Lanka by the donors.

The main objective of the system is to implement foreign funded development projects on-time avoiding delays that cause expenditure increases and hamper economic and social progress of the country.The pilot system will be implemented by the end of this year.

CAPACITY BUILDING ACTIVITIES

Seminar on Alternative Funding Sources

Availability of concessionary funds is limited, alternative funding sources have to be sought.

ERD held a seminar on Enhancing Knowledge on Alternative Funding Sources with the financial support of Sida on24th and 25th of January 2004 at Hotel Triton, Ahungalle to strengthen the capacity of the government officials to mobilize resources from semi-concessional and commercial sources.

Officials from the key Ministries, CBSL, Heads of Departments of the Ministry of Finance and the some of the ERD staff participated in this Seminar.

Training Opportunities for ERD Officers

The following officers of ERD received training.

Foreign Training (Short Term)

1. Short Term Training (Foreign)-

Mrs Asoka Fernando, Director Japan Division –Debt Management Course-Japan

1. Mr Sanath Perera, Deputy Director, TA Division.-Economic Development Policy for Sri Lankan Officials-Korea.

1. Mr S Dayawansa, IS&DM Division-UK CSDRMS-IT Administration.UK

Foreign Training (Long Term)

1. Mr S. P Bandara, Assistant Director, Public Administration-India

Local Training

1. Mr SM Piyatissa, Assistant Director-Designing Policies-CBSL

Welfare Activities

In remembrance of Mr M J Pinto (K.K.S), the welfare society organized a “ Dharma Deshana”

Comments…..!!!!!! 

We Welcome your suggestions, inputs and contributions to the ERD News Letter. We hope this News Letter provides useful updates and information with the current status of Foreign aid Commitments , Disbursements and Repayments.