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Economic Aspects | Natural Resource Aspects | Institutional Aspects | Social Aspects |Sri Lanka

ECONOMIC ASPECTS OF SUSTAINABLE DEVELOPMENT IN SRI LANKA

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INTERNATIONAL COOPERATION

Status

Cross country surveys have shown that there is a positive relationship between poverty and environment degradation. The poor are both agents and victims of environment damage. Growth and environment are two sides of the same coin. Therefore, it is imperative for a developing country like Sri Lanka with a low per-capita income and a high unemployment rate, to achieve a high rate of economic growth to improve the standard of living of the poor to minimize environmental degradation stemming from poverty.

Challenges

The main constraints to achieving sustainable development are the inadequacy of finances and technology and a supportive system of global trade and international cooperation. Twenty percent of the export earnings of Sri Lanka are derived from agriculture exports consisting mainly of tea, rubber and coconut. Volatile commodity prices have an adverse impact on export earnings and the economy. The market restrictions on garment exports, etc., restrict the growth of Sri Lanka's industry and exports. These limitations to Sri Lanka's ability to generate export earnings and its physical limitations to the expansion of agriculture, make it extremely difficult to mobilise domestic resources for development. A more equitable trading system supportive of sustainable development is needed.

In the context of limited domestic resources, enhanced international cooperation is vital for achieving the goal of sustainable development. Since economic development is essential for the prevention of environmental degradation, trade and the transfer of funds and technology should not be subjected to environment conditionalities.

There is an urgent need to provide additional resources from the international community in a predictable and an assured manner to support the efforts of developing countries. The ODA target for aid of 0.7 percent of developed countries GNP must be reached if the commitments made by the developing countries at the Rio Summit are to be met. These resources must be made available commensurate with the needs and priorities of developing countries.

Cooperation

Sri Lanka is committed to the ideals of SAARC and expects to phase out quantitative restrictions in respect of all imports, once the balance of payments position improves.

This information was provided by the Government of Sri Lanka to the fifth session of the United Nations Commission on Sustainable Development. Last Update: November 1997.

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TRADE

No information available.

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CHANGING CONSUMPTION PATTERNS

Decision-Making: Strategies, Policies, and Plans

The Government has pursued tariff policies which encourage moderation in the demand for luxury items and the adoption of lifestyles and consumption patterns which do not have a deleterious impact on the environment. Environment standards are enforced by the Central Environment Authority (CEA) to abate pollution of air and water.

The Government plans to switch to using unleaded petrol in the transport sector. Under the World Bank-funded MEIP, it is planned to set up common effluent treatment plants in the main industrial centres. The certification of industrial products which meet the prescribed standards of environment-friendly production packaging and waste disposal, remain desirable goals.

The development of alternative sources of energy is given priority. The consumption patterns of the poor should be considered as survival consumption. Moreover, it should be emphasized that the consumption of energy by an individual in South Asia is about one-twentieth that of a person in a developed economy.

Air pollution is also extremely low when compared to the developed countries. However, Government policy and its target are to maintain sustainable consumption patterns. In pursuance of this, the import of refrigerators using ozone-depleting substances has been banned.

Status

The experience of over-consumption and unsustainable lifestyles in the developed countries has brought focus to the adverse impact of unsustainable patterns of consumption and production on the environment. Sri Lanka, being a poor country does not, as yet, experiment in extravagant lifestyles on a significant scale. However, with expanding trade and globalization and growth of communication, patterns of demand for consumer goods are being altered. The process of development and increase in the number of households is increasing the consumption of energy. 

Capacity-Building, Education, Training, and Awareness-Raising

The CEA has conducted training workshops and awareness programmes and projects to encourage recycling of wastes, and the adoption of cleaner technologies.

 

This information was provided by the Government of Sri Lanka to the fifth session of the United Nations Commission on Sustainable Development. Last Update: November 1997.

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FINANCING

No information is available.

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TECHNOLOGY

No information is available.

 

BIOTECHNOLOGY

No information is available.

Click here to link to the Biosafety Information Network and Advisory Service (BINAS), a service of the United Nations Industrial Development Organization (UNIDO), which monitors global developments in regulatory issues in biotechnology.

Click here to go to the Web Site of UNEP's International Register on Biosafety.

Click here to link to biosafety web sites in the European Union.

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INDUSTRY

Decision-Making: Coordinating Bodies

The Public Enterprise Reform Commission is mandated to advise the Government on reforming the public sector, upgrading production and services with access to international markets, acquisition of new technology and expertise, and developing and broad-basing the capital market.

Decision-Making: Legislation and Regulations

Private sector capital inflows have become important to meet investment needs. Several measures were taken to encourage private foreign investment and to give a fillip to local manufacturers and exporters. Implementation of a policy of encouragement of the private sector and discouragement of the public sector from commercial and business oriented activities, and further liberalization of the economic process, were directed towards encouraging foreign private investment. Several tax measures were introduced to invigorate the capital market. These included extension of tax holidays, turn-over tax exemptions and duty-free import facilities on projects; specific imports were offered for companies in the manufacturing and service sectors. Substantial resources were allocated for the development of infrastructure.

The Government has taken steps to invite private sector investment in selected new ventures on a BOD/BOT basis. The maximum tariff on imports has been brought down to 50%. The Third Tariff Commission has been appointed to further study the tariff structure to enhance value added exports.

Decision-Making: Strategies, Policies, and Plans

The Ministry of Forestry and Environment gives very high importance to developing a rapport with industry to promote cleaner technologies and pollution minimization programmes.

Decision-Making: Major Group Involvement

A forum for improving the dialogue between the Government agencies and the private sector for the promotion of sustainable development, known as the Lanka International Forum on Environmental and Sustainable Development (LIFE), has been established.

Capacity-Building, Education, Training, and Awareness-Raising

Under a US-Aid funded project, the private sector industrialists are provided training and awareness programmes on pollution control and environmental standards, cleaner technologies and recycling of wastes. Under a UNDP project, a programme to demonstrate pollution minimization methods and the benefits of recycling wastes is being implemented very successfully.
Training and equipment provided by UNDP and USAID to private sector industry enhances its capacity and competitiveness. 

 

This information was provided by the Government of Sri Lanka to the fifth session of the United Nations Commission on Sustainable Development. Last Update: November 1997.

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TRANSPORT

Decision-Making: Strategies, Policies, Plans

The Government plans to switch to using unleaded petrol in the transport sector.

This information was provided by the Government of Sri Lanka to the fifth session of the United Nations Commission on Sustainable Development. Last Update: November 1997.

Click here for basic statistical data for countries in the ESCAP region, including statistics on demographics, education, employment, energy, national accounts, external trade, finance and production, land use, transport and international tourism.

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SUSTAINABLE TOURISM

No information is available.

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