Resurgence of Sri Lanka’s North Central Province

Oct 17, 2011 (LBO) – For the longest time, the provinces fell out in the following pattern: the Western Province in the lead; the Central, North Western and Southern Provinces in the middle; and the North Central, Sabaragamuva, Uva, Eastern and Northern Provinces as the laggards.

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.