ERD signs 52 foreign agreements worth USD 5 Bn in 2017

The Department of External Resources (ERD) has facilitated to enter into 52 foreign financing agreements worth USD 5,022.1 million in 2017 with development partners and lending agencies.This includes USD 2,522.1 million of Official Development Assistance (ODA) and USD 2,500 million raised through capital market instruments, according to 2017 performance report of the ERD.

The Government of China and its lending agencies have been the main financier in 2017 by injecting 21.5 percent (USD 542.4 million) of total ODA commitments followed by Japan, World Bank and Asian Development Bank (ADB) by recording 17.1 percent, 16.9 percent and 16.8 percent of the total ODA commitments respectively.

In addition, Government of India, United Nations (UN) Agencies, Saudi Arabia, European Investment Bank, European Community, Austria, Netherlands, United States of America (USA), OPEC Fund for International Development (OFID), Kuwait and Korea have provided their technical and financial assistance in 2017 to finance the development needs of the Country. According to 2017 progress report of ERD.

The foreign financing raised in 2017 will be utilized mainly for water supply and sanitation sector (27.8 percent) followed by ground transport, and roads and bridges, 17.7 and 15.7 percent respectively. Significant amount of foreign financing has been committed for the irrigation, agriculture and education sector projects as well. Commitment made in 2017 for the education and training sector was USD 147.9 million. During 2017, the total disbursements from the commitments already made by various development partners were USD 1,668.7 million.

Compared to 2016, both commitment and disbursement of sovereign loans and grants remained steady in 2017. In line with the vision 2025, special attention has been given to increase foreign financing to education, health care, research and development and vocational training sectors and negotiations are being held with several development partners to obtain more financial assistance to strengthen those sectors.

The composition and the form of foreign financing have changed over the past years with the graduation of Sri Lanka into lower middle income economy. In, parallel to the increase of per capita income, Sri Lanka has been gradually disqualified for the concessional external assistance generally available for lower income countries.