World Bank calls for urgent energy, public sector and PPP reforms to drive growth

Saturday, 4 October 2025 01:11 - - {{hitsCtrl.values.hits}}

World Bank Country Manager Gevorg Sargsyan (second from right) addressing members of key Parliamentary oversight committees

Stresses Sri Lanka’s energy costs remain among highest in region, burdening both households and industries
Insists reforms in pricing, management and investment critical to lowering costs and ensuring reliable supply
Highlights need to “rightsize” public sector, as country employs one of largest public sector workforces compared to peer nations; opines low productivity, relatively low wage levels continue to hinder fiscal sustainability
Describes strengthening ports and logistics as vital to unlocking potential as trade and investment hub
*Underscores importance of efficiently run PPPs as viable alternative to wholesale privatisation

A World Bank delegation has called for urgent reforms in Sri Lanka’s energy sector, public sector workforce and investment framework, warning that the country’s current cost structure and inefficiencies pose a significant drag on competitiveness and long-term economic recovery.

The team, led by Country Manager Gevorg Sargsyan, met on 25 September with the Committee on Public Finance (CoPF) Chair Dr. Harsha de Silva as well as with the Chairs and members of the Committee on Public Enterprises (CoPE), Committee on Public Accounts (CoPA) and the Committee on Ways and Means.

World Bank officials stressed that Sri Lanka’s energy costs remain among the highest in the region, burdening both households and industries, and insisted reforms in pricing, management, and investment were critical to lowering costs and ensuring reliable supply.

They also flagged the need to “rightsize” the public sector, noting that while Sri Lanka employs one of the largest public sector workforces compared to peer nations, low productivity and relatively low wage levels continue to hinder fiscal sustainability.

The discussions also centred on strengthening ports and logistics, which the World Bank described as vital to unlocking Sri Lanka’s potential as a trade and investment hub.

Beyond structural reforms, the World Bank delegation underscored the importance of efficiently run Public-Private Partnerships (PPPs) as a viable alternative to wholesale privatisation. Sharing international examples, officials highlighted how well-designed PPPs can improve service delivery and attract investment, particularly in infrastructure and utilities.

Committee Chairs including CoPE Chair Dr. Nishantha Samaraweera, CoPA Chair Kabir Hashim and Ways and Means Chair Wijesiri Basnayake welcomed the recommendations and reiterated their commitment to oversight and reform in areas such as revenue collection, job creation, poverty reduction, women’s participation in the economy, and the strengthening of tourism, education, agriculture and entrepreneurship.

World Bank Group Senior Operations Officer Stephan Massing, IFC Senior Country Officer Victor Anthonypillai, and Parliament Director Legislative Services and Director Communication (Acting) M. Jayalath Perera were also present in these meetings.