This report presents the findings, conclusions and recommendations from an Economic
Growth and Conflict Assessment sponsored by USAID/Sri Lanka in October/November,
The report is based on a field assessment conducted by Bruce Bolnick of Nathan
Associates on behalf of USAID/EGAT, Naren Chanmugam of USAID/Nepal, and Judith
Dunbar of USAID/DCHA/CMM, with support and input from Dick Edwards, Lionel
Jayaratne, and Mark Sorenson from USAID/Sri Lanka.
The assessment team would also
like to thank the USAID/OTI program in Sri Lanka for their substantive and logistical
support in this assessment. The report also draws upon the Sri Lanka Economic
Performance Assessment (EPA) conducted by Nathan Associates on behalf of
USAID/EGAT under the Country Analytic Support (CAS) Project.
The goal of the assessment was to develop recommendations for a robust yet conflict-
sensitive approach to economic growth programming for USAID/Sri Lanka. The
assessment team carried out research and fact finding in Sri Lanka and Washington, DC.
The Economic Performance Assessment processed and summarized recent economic and
conflict data from public sources as background for the assessment. The assessment team
conducted over XXX interviews with private sector, NGO, government and civil society
representatives across Sri Lanka, including Colombo, Kurunegala, Kandy, Moneragala,
Pottuvil, Hambantota, Matara, Galle, Vanatha Villu, Mahavilachchiya, Thantrimale,
Anuradhapura, and Trincomalee.
This report first presents analysis of the current economic and conflict situation.
provides recommendations, including potential program areas, program implementation
approaches (including how and where to implement the program), linkages across the
USAID portfolio, and possible program mechanisms.
Based on the analysis below, the assessment team concluded that USAID should pursue a
program that promotes sustainable and equitable economic growth through private sector
development that delivers major benefits to conflict-strategic regions and populations in
support of a durable political solution to the conflict.
By ‘conflict-strategic’, we mean
people and geographic areas that are either directly impacted by the war, or are critical to
successful peace negotiations.
The program should engage these people and regions in two ways.
First, it should work
to improve private sector practices at the base level of supply chains in the rural sector,
particularly focusing on agriculture, agribusiness, information and communications
technology (ICT), and non-farm activities.
For example, it might work with smallholders
producing fruits and vegetables to improve their productivity or reduce their post-harvest
This engagement should be designed to produce a sustainable improvement in
livelihoods in these regions.
Second, the program should enable local actors, including
both the private sector and local government, to engage in and eventually drive the