April 15, 2003, Washington, DC – A wide array of international officials spoke positively about the progress being made in the Sri Lankan peace process and outlined plans that could result in $1.1 billion in annual international aid to help the country recover from two decades of war.

U.S. Deputy Secretary of State Richard Armitage convened a one-day seminar yesterday at the State Department that served as a prelude to June’s Tokyo Conference on Reconstruction and Development in Sri Lanka. The seminar was co-hosted by the U.S. and Sri Lankan governments, with the special participation of Norway and Japan. The IMF and the World Bank also participated as they were involved in the needs assessment for Sri Lanka. Armitage opened the session by saying that “international support is essential” for Sri Lankan peace to survive and later noted that the country was providing “a message of hope” to the world and serving as a “working model” on how to resolve fierce ethnic strife. He was joined at the podium by Norwegian State Secretary Vidar Helgesen, whose country is facilitating the peace process, and Yasushi Akashi, special representative of the Government of Japan, where the next steps will be made to provide financial support to the Sri Lankan government. There were many countries and international organizations such as the United Nations Development Program (UNDP), Overseas Private Investment Corporation (OPIC), U.S. Trade Development Agency (TDA) which were represented. High level representatives from the European Union including Canada, France, Germany, The Russian Federation, China, Denmark, Finland, Iceland, India, Japan, Malaysia, Norway, Pakistan, Saudi Arabia, Thailand and the United Kingdom were all in attendance.

Milinda Moragoda, Sri Lankan Minister for Economic Reform, Science and Technology, acknowledged that 20 years of conflict “have wounded minds as well as bodies” and reminded the audience that the conflict has killed more people than the United States lost during the entire Vietnam War, while spreading terror throughout the country and crippling the economy.

“It is not feasible for us to deal with reconstruction of war-ravaged areas in isolation from the development of the rest of the country which has also suffered economic and social damage as a result of the war,” Minister Moragoda said. “Nor would we succeed in our efforts if assistance were to be delayed pending conclusion of a peace agreement. …If we are unable to demonstrate the dividend that peace will bring, we risk a breakdown of the negotiations and a resumption of hostilities.”

Minister Moragoda said, “Funds are urgently required for both the immediate needs of reconstruction, rehabilitation and relief as well as for laying the foundations for overall

economic recovery after two decades of destructive and debilitating conflict.” Five areas in need of immediate attention, he said, are: locating and neutralizing one million landmines scattered in the nation; rebuilding whole towns and villages; providing shelter and simple agriculture equipment to an estimated one million displaced persons; rebuilding and refurbishing schools; and getting jobs for displaced people and others hurt by the war.

A report from the IMF highlighted the progress made under Prime Minister Ranil Wickremesinghe, including a return to economic growth of 3.5 to 4 percent last year after the economy shrank 1.25 percent the year before, a decline in the rate of inflation to 9.5 percent compared with 14 percent, and the advancement of structural economic reforms that have increased confidence in the economy’s direction. However, continued reforms alone will not be enough to close the gap between greater government revenue from continued economic growth and the mounting cost of recovery from the war, the IMF concluded, adding that additional international support will be necessary. The World Bank and IMF have estimated that an international aid package of $1.1 billion a year for the next three years will provide much needed help to the government as it pursues a “Regaining Sri Lanka” program of economic recovery and development. International leaders will further consider the aid request at the June conference in Tokyo.

Minister Moragoda described key elements of the “Regaining Sri Lanka” program as infrastructure development including road construction and repair and the augmentation of power generation; making Sri Lanka a transport, logistics and financial hub for the region; establishment of a strong information and communications technology sector; improved education; better health care delivery systems; improved productivity in agriculture, fisheries and small businesses; environmental preservation; tourism and eco-tourism promotion; and public sector reform.

“We are convinced that unless we can significantly increase economic growth and demonstrate the prospect of a better future for all, it will not be possible to make headway in the building of a lasting peace and a united nation,” Minister Moragoda said.

Vidar Helgesen, the State Secretary of Norway, said the ceasefire and seven months of productive negotiations have meant that “people’s security has improved dramatically” and that important strides have been made in improving the country’s economic and political structures. However, Secretary Helgesen said that “a peace dividend is critical to the success of the negotiations” and that more international support will be needed to provide that dividend.

“The parties (in Sri Lanka) are demonstrating patience and persistence,” Secretary Helgesen said. “We, the international community, should do the same.”

Mr. Akashi of Japan spoke of the upcoming Tokyo conference for major donors in June and said the international community “will be harshly judged by history if we do not take full advantage of the positive momentum which as been generated now.”

India was also present in the seminar, being the first time ever, that the country participated in the peace process-related event. Indian Ambassador Lalith Mansingh stated that his country is pleased to participate in the seminar on Sri Lanka and “India is committed to the unity, sovereignty and territorial integrity of Sri Lanka.” India supports the actions taken by the government of Sri Lanka towards a negotiated peace that satisfies the just aspirations of all the communities in Sri Lanka.” Ambassador stated that “We have been kept briefed by all the Sri Lankan parties.”

Mieko Nishimizu, Vice President of the South Asia Region of The World Bank, said Sri Lanka is “no ordinary developing country” and reminded the audience that Sri Lanka was a leader in introducing universal adult franchise and a tradition of democratic governance “right down to the village level.” She pointed out that Sri Lanka produced the world’s first woman prime minister in the 1960s and has a history of the best socio-economic indicators in all of Asia including life expectancy, infant and maternal mortality, literacy and near universal primary school enrollment.

“Today, there is a coincidence of the sovereign will of the people of Sri Lanka to change, to capture peace, to secure good governance, and to embrace sound economic policies – and their leaders with the singular mandate to regain Sri Lanka that becomes all her people,” Mrs. Nishimizu said. “We are invited to offer our moral and financial support, to assist them to begin that journey. We can do so effectively, in ways that will be sustained long after we are gone, if and only if we can honor the sovereign will, and respect Sri Lanka’s own leadership for positive social, economic and political change.”