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Chapter outline

State of the Economy Report: 2004

Contents

Policy Perspectives and Performance
1. Policy Perspectives

2. Macroeconomic Performance

2.1 Introduction
2.2 Output Growth
2.3 Employment and Unemployment
2.4 Investment and Savings
2.5 Fiscal Policy and Public Debt
2.5.1 Revenue and Expenditure
2.5.2 Public Debt
2.6 Inflation and Monetary Developments
2.7 Share Market Developments
2.8 The External Sector
2.8.1 External Debt
2.8.2 Exchange Rate Movements
2.9 Conclusion


3. International Environment

3.1 Introduction
3.2 Trends in the Global Economy
3.2.1 Output Growth
3.2.2 Commodity Markets and Inflation
3.2.3 Financial Markets and Capital Flows
3.2.4 International Trade
3.3 Post Cancun Stalemate
3.4 Implications for Sri Lanka
3.4.1 Sri Lanka and FTAs
3.5 Conclusion

Land Policy in Sri Lanka

4. Land Policy in Sri Lanka

4.1 Introduction
4.2 Land Availability
4.3 Changes in Land Utilization

4.3.1 Forest Land Use
4.3.2 Agricultural Land Use
4.3.3 Increase in Homesteads
4.3.4 Change in Urban Land Use

4.4 Policy Framework
4.5 Land Markets

4.5.1 Allocation and Transfer of Land Among Users and Uses
4.5.2 Property Rights, Tenure Security and Land Rental Markets
4.5.3 Sales Markets

4.6 Co-existence of Traditional Markets and Intervention Policies

4.6.1 Efficiency
4.6.2 Equity
4.6.3 Inter-temporal Efficiency and Conservation
4.6.4 Illegal Utilization of Land
4.6.5 Externalities 4.6.6 Fragmentation/Consolidation
4.6.7 Transaction Cost
4.6.8 Disputes and Social Conflicts
4.6.9 Property Rights

4.7. Summary and Policy Implications

Leading Issues in the Development Process

5. National Education Policy: A Review

5.1 Introduction
5.2 Content of Education
5.3 Instruments of Delivery
5.4 Management of Delivery
5.5 Equity of Access
5.6 Approaches to Financing
5.6.1 Adequacy of Funds
5.6.2 Distribution of Funds
5.6.3 Policy Implications
5.7 Formulation and Implementation of Reform Agenda

6. Social Security Benefit Schemes in Sri Lanka

6.1 Introduction
6.2 Social Security: The Sri Lankan Context
6.2.1 Origin and Development of Policies
6.3 Income Profile of the Elderly in Sri Lanka
6.4 Evaluation of Current Schemes
6.4.1 Coverage of Existing Schemes
6.4.2 Adequacy of Retirement Income
6.4.3 Fiscal Implications
6.4.4 Investment Performance
6.5 Social Security Provision for Migrant Workers
6.6 Conclusion and Policy Implications

7. Achieving MDGs in Sri Lanka: Current Status, Trends and Challenges

7.1 Introduction
7.2 MDGs: Goals, Targets and Indicators
7.3 Goal 1: Eradicating Extreme Poverty and Hunger
7.3.1 Poverty
7.3.2 Hunger and Child Malnutrition
7.4 Goal 2: Achieving Universal Primary Education
7.5 Goal 3: Promoting Gender Equality
7.6 Goal 4: Reducing Child Mortality
7.7 Goal 5: Improving Maternal Health
7.8 Goal 6: Combat HIV/AIDS, Malaria and Other Diseases
7.8.1 HIV/AIDS
7.8.2 Malaria
7.8.3 Tuberculosis
7.9 Goal 7: Ensuring Environmental Sustainability
7.10 MDGs in Sri Lanka: A Comparison with South Asian Countries
7.11 Issues and Challenges

8. Regulatory Impact Assessment: Opportunities and Challenges in
Sri Lanka 95

8.1 Introduction -95
8.2 RIA: An Overview -96
8.2.1 What is Regulation? -96
8.3 Why RIA? -97
8.4 Adopting RIA in Sri Lanka -98
8.5 Regulation in Sri Lanka- 99
8.5.1 PUCSL -99
8.5.2 TRC -101
8.6 Challenges and Options -102

9. Natural Resources in Sri Lanka: Growth, Poverty Reduction and
Environmental Protection

9.1 Introduction
9.2 Natural Resources: Growth, Poverty and Politics
9.3 Water
9.4 Forestry
9.5 Protected Areas
9.6 Sand Mining
9.7 Fisheries
9.8 Conclusion and Recommendations

10. Open Skies Policy for Sri Lanka?

10.1 Introduction
10.2 Regulation of International Air Services
10.3 Sri Lanka’s Aviation Policy
10.4 Sri Lanka’s Aviation Industry
10.5 Policy Options for Liberalization
10.5.1 Unilateral Liberalization
10.5.2 Reciprocal Bilateral Liberalization
10.5.3 Plurilateral
10.5.4 Multilateral
10.6 Conclusion

Policy Briefs

11. Monopolies and Mergers and Acquisitions Legislation: Policy Options
for Sri Lanka

11.1 Introduction
11.2 Competition Policy: Why, for Whom and How?
11.3 M&M Policy Issues 11.4 Sri Lanka’s Experience with Monopoly and M&As Policy
11.5 M&M Policy for Sri Lanka: Does it Need One?

12. Small and Medium Scale Authority and International Practices

12.1 Introduction
12.2 Present Institutional Support System for SMEs in Sri Lanka
12.3 Small and Medium Enterprise Authority
12.4 International Practices
12.4.1 Israel
12.4.2 Japan
12.4.3 Pakistan
12.5 Conclusion

13. US-Sri Lanka Free Trade Agreement: Can It Help the Apparel Sector?

13.1 Introduction
13.2 US Textile and Apparel Industry
13.3 Sri Lanka T&A Industry
13.4 Benefits of a US-Sri Lanka FTA
13.5 FTA Options Available to Sri Lanka
13.6 Challenges Ahead and Conclusion

14. Threat from China for the Apparel Industry: Mirage and the Reality

14.1 Introduction
14.2 China’s Dominance
14.3 Challenges to China’s Dominance in the Apparel Trade
14.4 Threat and the Reality
14.5 Conclusion

15. Anti-dumping Legislation: To Have or Not?

15.1 Anti-dumping Duties: Definition and Design
15.2 Arguments in Favour of Anti-dumping
15.2.1 Antidote to Predatory Pricing
15.2.2 ‘Sanctuary Market’ Argument
15.2.3 Stop Disruption of Sporadic Dumping
15.2.4 Protecting Specific Communities
15.3 The Case Against
15.3.1 Traditional Benefits of Unilateral Trade Liberalization
15.3.2 Resource Constraints
15.3.3 Devil in the Details
15.3.4 Safeguards Option
15.4 The Path Ahead for Sri Lanka

Prospects

16. Prospects

Appendices
Diary of Events

Appendix A: Macroeconomic Indicators

Appendix B: Capital Market


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