Feb 16, 2016 (LBO) – Sri Lanka has reduced poverty to below 7 percent of the population but future prosperity will depend on addressing chronic revenue short falls and fostering a more competitive and inclusive economy, the World Bank said in research findings announced today.
“The Sri Lanka poverty assessment has found that the falling poverty stems mostly from increasing labour income as the economy has shifted from the less productive agriculture towards the industry and service sectors, more urbanization and rising domestic demand,” a statement said.
The World Bank group carried out a systematic country diagnostic (SCD) to identify the key constraints to sustain progress in ending poverty and boosting shared prosperity.
The SCD highlights that the island has one of the lowest tax to Gross Domestic Product rates in the world, undercutting the government’s ability to invest in education, health and other services.
The research finds that while poverty has decreased progress is uneven across location, gender, and ethnicity.
Many people are at risk of falling back into poverty as over 40 percent of the population live on less than 225 rupees per person per day, it said.
“The findings of the report reinforce the need to further measures aimed at improving the governments effectiveness, transparency, accountability and establishing strong institutions so all Sri Lankans can take part in the country’s increasing prosperity,” Françoise Clottes, Country Director, World Bank Sri Lanka and the Maldives said.
Clottes was speaking at the launch of the report in Colombo, Tuesday.