Invest in human capital for secure future, World Bank advises Sri Lanka

• WB report finds SL performs only “moderately well” globally in human capital development
• SL faces deep-rooted challenges in tackling under-nutrition and inadequate learning outcomes in school 
• Visionary leadership and long-term commitment from policymakers required to rectify shortcomings 

By Shabiya Ali Ahlam

The World Bank (WB) has advised Sri Lanka to prioritise investing in human capital, as the country’s progression to higher-income status would require a more developed human resource pool, which the island nation might not have, if corrective measures are not taken in the immediate future. 
The latest Human Capital Development Report published by the WB has found that Sri Lanka performs only “moderately well” globally, with an overall score of 58 percent and a ranking of 74 out of the 157 countries included in the Human Capital Index. 

This indicates that if the current education and health conditions persist, a child born in Sri Lanka today will only be 58 percent as productive as she or he could have been, if they had the benefit of a complete education and enjoyed full health.

Meanwhile, children born in Singapore today can expect to achieve 88 percent of their full potential, while those in Japan and Korea can reach 84 percent.

WB Country Director for Nepal, Sri Lanka and the Maldives Dr. Idah Pswarayi-Riddihough stressing that people are the most valuable resource in any country said, “Investing in people is smart economics. Developing human capital to a new and higher level will be key for Sri Lanka to become the upper-middle-income economy it seeks to be.” She also assured that the WB stands ready and committed to assist the Sri Lankan government in realising the nation’s full promise and potential, given that Sri Lanka lags behind East Asian countries such as China, Malaysia, Mongolia, Thailand and Vietnam in terms of human capital, a position that it calls for urgent attention. 

The report points out that Sri Lanka faces deep-rooted challenges in tackling undernutrition and inadequate learning outcomes in school. While these are recognised as ‘second generation’ challenges that are hard to address, the WB asserted they are vital for human capital development and equitable economic growth.

Meanwhile, it was pointed out that the gender variation in Sri Lanka’s human capital favours girls and women and with the gap being significant, the WB suggested that promoting human capital development among boys is particularly important for policymakers. 

Highlighting possible avenues to address this growing issue, Human Development for Sri Lanka and the Maldives Lead Economist and Programme Leader Harsha Aturupane opined that the country needs to address human capital development from the twin perspectives of upper-middle-income growth and regional equity.

“Greater resources and policy attention are needed for provinces where human capital is less advanced, while also making rapid improvements in human capital in the more advanced provinces,” he said.

The WB acknowledges that while the development of human capital will be of immense benefit and value to the island nation, it will also be a complex and challenging process that require visionary leadership and long-term commitment from political authorities and policymakers. 

Southern province overtakes Western province in human capital development 

However, the current study shows that the Southern province, despite being considerably poorer than the Western province, has attained a slightly higher human capital, particularly due to better learning outcomes,” the WB said in its latest Human Capital Development Report on Sri Lanka. 

The WB attributed the higher HCI level in the Southern province to close attention of policymakers and good teacher management and development.

The agency said it observed that the Southern province effectively deployed teachers from schools with teacher surpluses to schools with teacher deficits in a manner that minimised disruption to the ‘family lives’ of the teachers. 

Doing so had reduced the resistance towards teacher transfers. The province is also noted to have recruited teachers to fill vacancies in remote, estate sector schools, which had suffered from teacher shortages for many years. “This is an encouraging finding for other provinces, as human capital development can be promoted faster than economic growth,” the WB said.
The HCI is a cross-country metric designed to measure and forecast a country’s human capital. The index follows the trajectory, from birth to childhood, of a child born today. It essentially measures the amount of human capital that a child can expect to attain by the age of 18, given the risks of poor health and poor education that exist in the country at the time of birth. 
The HCI, which is different from the United Nations Development Programme’s Human Development Index (HDI), has three components: (1) a measure whether children from birth to school age (age five), (2) a measure of expected years if quality adjusted schooling, which takes into account the quantity and quality of schooling and (3) the two broad measures of nutrition and health, stunting rates and adult survival rates. 
(SAA)