Announcement of Sri Lanka Aid Group Meeting on April 10, 1975

INTERNATIONAL BANK FOR • RECONSTRUCl lON AND DEVELOPMENT 1818 H STREET, N.W .. WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank News Release April 10, 1975 SRI LANKA: AID GROUP MEETING The following announcement was issued yesterday at the World Bank's European Office in Paris. "The eleventh meeting of the Sri Lanka Aid Group was held in Paris under the Chairmanship of the World Bank. The following countries were represented: Australia, Canada, France, Germany, Japan, the Netherlands, Sweden, the United Kingdom and the United States. Representatives of the International Monetary Fund, the Asian Development Bank, the United Nations Development Programme and observers from Denmark, India, Italy and the Organization for • Economic Cooperation and Development also attended. The Sri. Lanka delegation was led by Dr. H.A. de S. Gunasekera, Secretary of the Ministry of Planning and Economic Affairs. Sri Lanka's delegation reviewed recent economic developments, pointing out that the continuing high prices for essential imports, particularly food, petroleum and fertilizer, and the disappointing outlook for the Spring (Maha) rice harvest, were again aggravating balance of payments problems and limiting the availability of resources for investment. The delegation called attention to the crash food production program aimed at reducing subBtantially the country's dependence on food imports. The delegation then indicated the actions the Government intends to take over the coming months to further increase production, exports and employment, particularly in the agricultural sector, and otherwise promote economic development. The delegation stressed that continuing support from the Aid Group is essential if the Government's development objectives were to be achieved. • The Group welcomed the improvement in the 1974 fiscal outcome as compared with 1973 and expressed the hope that public savings and investment would increase in 197~. It agreed that /MORE  -2- priority should be given. to expansion of agricultural output for both domestic conswnption and export. The Group viewed the low levels of domestic savings and investment, tke weak balance of payments position, and growing external debt as principal problema • of the economy, and agreed that continued assistance on a substantial scale would be needed, with primary empahsis on quick disbursing commodity aid as well as project assistance on the softest possible terms. Indications of fresh aid by the Group for 1975 were clearly significantly larger than their commitment& in 1974." • •