Resurgence of Sri Lanka's North Central Province

The 2009-10 Household Income and Expenditure Survey tells a different story. It looks like the NCP has graduated to the middle cohort. Despite the massive government resources poured into Hambantota District, the Southern Province does not show any evidence of leaping ahead.

The Western Province is the leader and the Eastern and Northern Provinces are the laggards. The other six provinces are more or less at the level for the country as a whole. Within the middle cohort, the NCP is a leader, with more houses that have telephones in them than radios.

It is behind the country average, only because it is behind in computer penetration. If the ranking were done on phones alone, it would be only behind the Western Province.

The Western Province has a greater percentage of households with cars and vans, but the NCP is the clear leader in households with two and three wheel vehicles. It is behind only Sabaragamuva in the proportion of non-food expenditures spent on transport.

The reason I have highlighted the transport-related assets in NCP households is because they require regular operational expenditures. They are a good proxy for income.

Not that good a picture on conventional household assets, though it still does better than the four laggard provinces.

The cumulative evidence suggests the NCP has pulled ahead. What caused this advance?

The NCP was a war-affected region. Did the fact that it supplied a large number of soldiers, which resulted in money flowing into the villages, wash out the negative effects from the war? Did the fact that it was the principal staging area for the war result in the economy gaining momentum? Did the fertilizer subsidy contribute?

The massive investments in the Hambantota District have yet to show results in terms of people’s income and expenditures. But more mundane actions, most likely expenditures on the war, appear to have propelled the NCP forward in a very short time.

Are there alternative explanations?

Rohan Samarajiva heads LirneAsia, a regional think tank. He was also a former telecoms regulator in Sri Lanka. To read previous columns go to LBOs main navigation panel and click on the 'Choices' category.

READER COMMENT(S)

7. Rohan Samarajiva Oct 18

Two wheelers was my abbreviation. The category is motor cycles and scooters. Does not include Kubota/Landmaster type machines. BTW, most ag work in NCP is now done using combine harvesters.

The HIES is a public document online at the Census and Statistics website.

6. parakrama samaratunga Oct 18

Does the "2 wheeler" category include 2 wheel tractors. It makes a large difference as NCP being a predominantly agricultural area 2 WTs could constitute a very large proportion of the "2 wheelers" indicated in the analysis. This may alter the conclusions of the subsequent analysis using maintenance expenditure as a proxy for income because maintenance of 2WT is part of the investment outlay while that of other 2 Ws like motor cycles could be categorized under consumption expenditure.

5. shantha Oct 18

How about Government Paddy Purchasing Scheme contribution? I do not have any figures. But it is really worth finding the reasons.

4. Rohan Samarajiva Oct 17

Not sure they have figures for every year. HIES is not an annual survey.

Here are some numbers for 2003-04.
Cannot give you table or figure here.
TV: LK 70.8; WP 85.8; CP 70.6; SP 67.7; NWP 72.6. NCP 65.7 Phone: LK 24.5; WP 45.3; CP 17.1; SP 18.3; NWP 23.1; NCP 13.9

Motor cycle: LK 16.3; WP 19.9; CP 6.6; SP 14.8; NWP 27.2; NCP 20.9

Car/Van: LK 5.8; WP 12.1; CP 3.5; SP 2.8; NWP 5.5; NCP 3.8 Refrigerator: LK 29.7; WP 53.6; CP 21.8; SP 24.1; NWP 27.6; NCP 19.4

3. Dinesh Oct 17

My 2 cents:
Interpreting the figures should be easier if you compare them to a prior data point - perhaps the previous year's figures. That would show changes occurring over a period of time rather than at a particular point in time. The growth rate / trend is just as important as the existing base.

That said, any geographical area where a war stops should see very rapid economic growth.

The Western Province grew the fastest for decades. This is just an opinion, but I think the other provinces are actually growing much faster (than the WP) now - driven by peacetime growth in the formerly conflicted areas, and a massive agricultural boom.

2. Rohan Samarajiva Oct 17

These are percentages of households with motor cycles, computers etc. So population is already factored in. On vehicle numbers, the data from the Department of Motor Traffic is analyzed at http://indi.ca/2011/10/sri-lankan-car-ownership-has-doubled/. Vehicles have doubled since 2002.

1. Analyst Oct 17

Prof RJ: Is it possible to add the population distribution also into these charts so that the analysis can be correlated properly. Alraming the number of vehicles we seem to have in this country. Pathetic the computer penetration despite so many "e" startegies.