The Asian Development Bank (ADB) is providing $50 million loan to Sri Lanka to continue with public finance management reforms aimed at paving the way for increased investment in underdeveloped areas, including those severely affected by conflict.

The loan for the Fiscal Management Efficiency Project will be used to introduce new tax revenue and treasury management systems which will strengthen public resource management, giving the Government the fiscal space to step up spending in lagging and conflict-affected regions.

It will build on the success of ADB’s earlier Fiscal Management Reform Program in Sri Lanka and is supported by a technical assistance grant of $2 million from the Government of Japan-financed Japan Special Fund.

“The project will support the efforts of the Government of Sri Lanka to promote sustainable and equitable development in the post-conflict environment by providing greater scope for increasing investments in reconstruction and infrastructure,” said G. Bhatta, Principal Public Sector Management Specialist in ADB’s South Asia Department. It will also help build transparency in, and accountability of, the public financial management system in the country, he said.

Addressing the needs of vulnerable groups, especially women, through inclusion of gender-specific needs in the allocation and use of public funds as well as enhanced social safety nets, will be a key benefit of the project.

The technical assistance from Japan Special Fund will be used to help with the establishment of the two IT management information systems, including the preparation of request for proposals to select the international vendor.