Trade policy expert urges quality growth initiative with JICA assistance to boost exports

By Nishel Fernando

Dr. Lakna Paranawithana, an independent management consultant who played a key role in developing the Sri Lanka Rubber Master Plan and served as a senior advisor to the government, has urged Sri Lankan stakeholders to launch a dedicated Quality Growth (QG) initiative with the assistance of the Japan International Cooperation Agency (JICA), arguing that the move would position local exporters to draw on Japanese development funding as the country pursues ambitious export targets. 

“Future Japanese government development assistance will give priority to ‘Quality Growth’ in disbursing technical assistance, grants and loans, and therefore the stakeholders must launch a QG initiative with JICA assistance,” Dr. Paranawithana said.

The recommendation carries added weight given JICA’s own country strategy for Sri Lanka, which already designates ‘Promoting Quality Growth’ as one of three priority areas for its cooperation programme here, alongside inclusive growth and vulnerability mitigation.  

Dr. Paranawithana’s proposal, in effect, calls on local stakeholders to build a structured initiative around a pillar JICA has already committed to, rather than starting from scratch.

His argument draws on “Introduction to Quality Growth: Concept, Theoretical Background, Policy and Measurement,” edited by Koki Hirota and published by the JICA Ogata Sadako Research Institute for Peace and Development, the product of a research project the institute launched in 2016. 

The book, translated from the original Japanese edition and released as an open-access publication, defines quality growth around three pillars: inclusiveness, meaning the fruits of growth are shared broadly rather than concentrated; sustainability, meaning growth does not compromise the needs of future generations, particularly on climate and natural resources; and resilience, the capacity to withstand and recover from shocks such as disasters or financial crises. 

The concept traces back to the 2010 APEC Leaders’ Meeting and was formally adopted as a strategic priority in Japan’s Development Cooperation Charter in 2015, a designation reaffirmed in the Charter’s 2023 revision. 

One of those case studies offers a template close to what Dr. Paranawithana is proposing. 

The book’s Costa Rica chapter documents how the country moved away from a commodity export base dominated by coffee and bananas toward higher-value manufacturing and services, a shift catalysed when the government’s investment promotion agency secured an Intel microchip assembly plant in 1996. Manufacturing’s share of merchandise exports rose from 25.4 percent to 68 percent within three years, and high-technology exports quadrupled as a proportion of total exports by 2015, while services exports, including software development and back-office processing, grew to comprise 43 percent of gross exports. The chapter attributes the shift largely to coordinated government-backed investment promotion and incentives for foreign investors, illustrating the kind of value-added transition Dr. Paranawithana is proposing for Sri Lanka. 

Applying the framework to Sri Lanka’s export sector, Dr. Paranawithana argued that the country should pivot toward premium, quality-differentiated positioning rather than competing primarily on volume, contending that sophisticated, high-spending consumers are willing to pay more for distinctive products. 

He emphasised that the most viable catalyst for this shift is Sri Lanka’s human capital rather than heavy capital investment, provided it is backed by targeted research and development and stronger technological capability. He added that local enterprises should embed ethical labour practices and environmental stewardship into their operations to align with international donor standards, and that offering top-tier products to both export and domestic markets remains the most effective strategy as global consumer sophistication rises.

The push comes as Sri Lanka pursues some of its most ambitious export targets in years. The Export Development Board (EDB) has forecast total export earnings of US$ 20 billion for 2026, up 10 percent year-on-year, under the newly launched National Export Development Plan (NEDP) 2026-2030, which targets US$ 36 billion in export revenue by 2030.

By proactively structuring a QG initiative aligned with JICA’s existing priority framework, Dr. Paranawithana opined that Sri Lankan exporters could secure technical assistance and grants that anchor revenue growth in durable, quality-led expansion rather than transient volume gains.