Sri Lanka's Lost Decades and Flawed World Bank Projects

For instance, poverty is estimated to have more than doubled between 2019 and 2023. The lack of recent household survey data to inform Aswesuma’s design undermines its poverty-targeting performance.” (Page 83)

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Many of us argued at the outset that Aswesuma was going to fail. With close to two thirds of the population in the informal sector and over half the population multi-dimensionally vulnerable, targeted social protection will not work, and universal measures are necessary to address such a deep crisis. However, the World Bank and many of our local neoliberal pandits were splitting hairs about better targetting, mainly to deflect attention from the meagre allocation of 0.6% of GDP for social protection in the IMF program. And even today, their focus is on better targetting, as they avoid the structural problem of socioeconomic exclusion with technical solutions of targetting without adequate financing.

There is the long history of the World Bank’s failed vision for Sri Lanka, particularly in relation to agriculture. From World Bank membership exactly 75 years ago in 1950 and its first high powered mission in 1951, to its massive Accelerated Mahaweli Project, Sri Lanka has had a series of failed World Bank programmes that have done considerable damage to our economy. The latest so-called Rurban project, again seeks to modernise agriculture and address climate change. Significantly, the World Bank in its project appraisal refuses to recognise the utter failure of the predecessor Agriculture Sector Modernisation Project (ASMP), costing a USD 125 million loan to Sri Lanka, and recently concluded in December 2024.