The World Bank has urged Sri Lanka to accelerate long-delayed energy sector reforms, warning that soaring costs threaten competitiveness. In high-level talks with Parliament’s key finance committees, the Bank also flagged public sector inefficiency, low productivity, and the urgent need for public-private partnerships to drive sustainable growth.
A top-level World Bank delegation led by Country Manager Gevorg Sargsyan has called on Sri Lanka to fast-track critical reforms in the energy sector, cautioning that high energy costs are undermining the country’s economic recovery and regional competitiveness.
The delegation met with Dr. Harsha de Silva, Chairman of the Committee on Finance, as well as Chairmen of COPE, COPA, and the Committee on Ways and Means, in a joint session that examined Sri Lanka’s structural challenges and development priorities.
World Bank officials emphasized that Sri Lanka’s energy prices remain significantly higher than those of neighboring countries, straining businesses and households alike. They pressed for reforms that could reduce inefficiencies, attract investment, and stabilize long-term supply, warning that failure to act would keep growth trapped below potential.
The delegation also highlighted broader structural weaknesses. They noted Sri Lanka’s unusually large public sector workforce relative to regional peers, coupled with some of the lowest public sector salaries in South Asia. Productivity, they warned, cannot improve without reforms that balance efficiency, fair wages, and sustainable employment levels.
Committee members briefed the World Bank on their oversight functions, outlining priorities that extend beyond fiscal stabilization. These include strengthening revenue collection, boosting job creation, reducing poverty, and improving women’s participation in the economy. Sectors such as tourism, agriculture, education, and entrepreneurship were identified as key growth drivers that require urgent support.
The importance of developing ports and logistics hubs was also stressed, with World Bank officials calling it a vital step to integrate Sri Lanka more effectively into global trade networks.
A significant portion of the discussion focused on the role of Public-Private Partnerships (PPPs). Rather than outright privatization, PPPs were seen as a way to mobilize capital, share risks, and improve efficiency while retaining national oversight. Examples from other countries were cited as successful models that Sri Lanka could adopt.
Dr. Harsha de Silva and fellow committee chairmen, Dr. Nishantha Samaraweera, Kabir Hashim, and Wijesiri Basnayake, expressed appreciation for the World Bank’s consistent support for Sri Lanka’s development. They emphasized the need for continued cooperation to steer the economy toward resilience and sustainability.
Also attending were World Bank Group Senior Operations Officer Stefan Messing, IMF Country Officer Victor Anthony Pillai, and Sri Lanka’s Director of Legislative Services, M. Jayalath Perera.
The discussions marked a renewed commitment between Sri Lanka’s Parliament and international financial institutions to push forward with reforms that could define the country’s long-term trajectory. With rising debt and external pressures, the message was clear: without urgent reforms in energy and productivity, Sri Lanka risks losing the fragile gains it has made since its economic crisis.
