Reply from the Prime Minister to the NJC letter
Posted on June 6th, 2019

The National Joint Committee 

The reply from the office of the Prime Minister that the National Joint Committee received to the letter sent to the Prime Minister regarding the MCC agreement

Compact Development Unit, Policy Development Office, 2nd FIoor, New Building, North Wing – Temple Trees, Colombo 03. Tel: 0l I 7124402, Fax: 01 1 7124404

To Lt Col. Anil Amarasekera (Retd,) Co-President National Joint Committee 231, Kirula Road Colombo 5

Dear Sir,

The Millennium Challenge Corporation Agreement

3 i”‘ May, 2019

This has reference to your letter of 22″d instant addressed to Hon. Ranil Wickremesinghe, the Prime Minister of Sri Lanka on the above.

Whilst thanking you for requesting information on a socially and politically important matter as the misinformation and fabricated fake news spreads on the matter so quickly and easily without being vetted, investigated, or confirmed.

In order to provide you the complete and accurate information on the matter in the proposed agreement with the Millennium Challenge Corporation, USA (MCC), we write to inform the following:

1. The Government of Sri Lanka, with the help of the Center for Intemational Development (CID) at Harvard University, conducted a constraints analysis (CA) to identif, constrains which hampered the economic growth in the country and identified three binding constraints; i.e. 1. access to land; 2. weakness in transport and logistics infrastructure and planning; and 3. policy instability. 2. Having considered the in-depth economic analysis, the GoSL prioritized and focused on the two binding constrains namely, access to land and improve in transport which GoSL and MCC recognize as critical constraints to economic $owh. The copy of report can be accesseci through: https://assets.mcc. gov/contenVuploads/constraints-anal)zsis-sri-lanka.pdf

3. MCC’s Board of Directors selected Sri Lanka for a threshold program in December 2015 and elevated Sri Lanka to eligibility for a compact in December 2016 after continued improvements in performance as measured by the MCC scorecard. Since early 2077, }lCC has worked collaboratively and closely with the Government of Sri Lanka, through the Office of Policy Development under the Prime Minister’s Office, to develop a dual-sector compact program in grant funding. Tkoughout the compact development process, the Government of Sri Lanka and MCC consulted with hundreds of individuals from government, the private sector, and civil society in small group discussions and one-on-one meetings to understand the root causes ofthe transport and land binding constraints and potential activities that would address those root causes. The Government of Sri Lanka and MCC also launched multiple rounds of due diligence to identifu potential projects that could meet MCC’s investment criteria. On the basis of such engagements and analyses, the Govemment of Sri Lanka submitted project proposals to MCC for consideration in November 2017.

4. Projects are identified under the grant funding after completing a rigorous due diligence process done through a period over 1.5 years. The activities will assist Sri Lanka to achieve its objective of strengthening transpofi infrastructure and land administration. The total grant amount is US$ 48t) million, which would disburse over a five-year implementation time frame.

5. Under the land administration project, the following activities will be done: (i) Preparation of Parcel Fabric map and inventory of state land. (ii) Improvement of Deeds Registry. (iii)Improvements of the land valuation system. (iv) Land Grants Registration and Deed Conversion Activity. (v) Land Policy and Legal Govemance Improvement Activity,

The above activities will be implemented in the following 7 districts with the limited funds available for the land sector. (Kegall4 Kandy, Matale, Kurunegala, Anuradhapura, Polonnaruwa and Trincomalee) Further we requested to include Gampaha district as rvell. 6. It is quite surprising that the transport component of the MCC has not been given the importance as given to the land administration project. The following activities are proposed under the Transport Development project:

(i) Establishing an Advanced Traffic Management System (ATMS) covering the Colombo Metropolitan area to improve the efficiency, capacity and safety of the CMR road network to improve flow rate, reduce travel time and congestion, reduce traffic emission and reduce accidents.

(ii) Bus Transport Sector Modernization (BTSM) programme will make a significant improvement to the speed and quality of the public bus system combining state owned and private buses.

(iii)Developing and improvement of 137 k.m. road sections in the Central Ring Road (CRR) covering and connecting Sabaragamuwa, Uv4 Norlh Central and Central Provinces to markets in the Westem Province. Connected to this Road development, is a study to locate and finance, locations for rvholesale storage of Agro produce in collaboration with private investors at locations on the CRR Road network to be developed to improve post-harvest management of produce.

We assume that the above information would clear your doubts and all misinformation regarding the MCC grant. Please also be informed that the Agreement between the MCC and the GoSL is yet to be signed and we are unaware of any agreement signed on or about 27’h April2019. More information on the MCC grant for Sri Lanka could be obtained from the following link please. https ://www. mcc. gov/where-we-work/program/sri-lanka-compact

Please note that there is no provision for leasing of 1.2 million acres of land under this Compact to any one which is totally baseless and untrue.

R. Siriwardhane Coordinator/Consultant MCC Sri Lanka Project Mr. E.M,S.B.Ekanayake, Secretary to the Prime Minister, (This refers to your minute dated29l5l19).

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