Opinion

Our stance is to support the new government and the people

02 Feb 2015 - {{hitsCtrl.values.hits}}

Japan International Cooperation Agency or JICA is a Japanese governmental organization which provides Japanese government’s Official Development Assistance (ODA) to countries like Sri Lanka. In an interview with Mr. Kiyoshi Amada, the JICA’s Chief Representative to Sri Lanka explained the types of loans, grants and technical assistance available to Sri Lanka through JICA.

Q To start off, could you give me a brief background about the relationship between Japan and Sri Lanka and JICA’s role in our country?

Japanese Official Development Assistance started in Sri Lanka in 1954, 60 years ago, when Japanese government joined the Colombo Plan. JICA’s assistance to Sri Lanka started in the same year, 1954. So we have more than 60 years of experience in Sri Lanka. That year, six Sri Lankan officials visited Japan for a technical training programme as JICA’s first project in Sri Lanka. After that, JICA started its Grant Assistance, Loan Assistance and Volunteer programme in 1961, 1976 and 1981, respectively. During the past 60 years, JICA has provided various kinds of financial and technical assistance, totally amounting to about 1,000 billion JPY, and almost 1,000 volunteers have come to the country so far. Currently, there are nearly 80 Japanese volunteers working in Sri Lanka and annually our assistance to Sri Lanka is about 400 – 500 million JPY.

Q What are the key areas that JICA assists Sri Lanka with?

Japanese government set up the long-term and overall goal of our assistance to Sri Lanka, which is “promotion of economic growth in consideration of emerging regions”. Under that target, we have 3 priority areas: firstly, infrastructure development for economic growth, secondly, social and economic improvement in emerging regions; and thirdly, social infrastructure development to mitigate vulnerability.
Let me explain this further.
Infrastructure development for economic growth include transport network, power sector, and the environment. Social and economic improvement in emerging regions covers promotion of agricultural and fishing villages. But particularly it highlights promotion of regional development in conflict affected areas – northern and eastern part of the country. Social infrastructure development to mitigate vulnerability covers climate change and disaster management as well as health care. In addition to those 3 priority areas, JICA volunteers work for social services, environmental conservation, vocational training and physical education and sports as well.

Q What are the types of Japanese assistance available to Sri Lanka through JICA?
We have two types of assistance. One is technical cooperation which includes receiving training in Japan and also dispatching Japanese expats to transfer the technology and technical capacities. The other type is financial assistance which includes grant assistance and loan assistance. Grant assistance is basically a donation while loan assistance includes concessional loans with less than 1 percent interest and about a 40-year repayment period.

Q What are the benefits and concessions given to Sri Lanka with regard to financial aid and loans and what are the terms and conditions that come along with such assistance?

First, let me provide one example of outcome of our financial assistance. That is the electricity power sector. Approximately 21% of CEB’s generation capacity was constructed by Japanese financial assistance. It includes Upper-Kotmale Hydropower Station, Kelanitissa Combined Cycle Power Station and others. JICA financial assistance contributes to electricity supply in the country, which people enjoy for their life and industries also utilize for their economic activities.
As for the terms and conditions of our loan assistance, interest rate was 0.1% and repayment period was 40 years including 10 years grace period for two, the loans committed in last year. In the year before, 2013, interest rates were 0.2 - 1.4 per cent and repayment periods were 25 years or 40 years. Therefore, I can say that conditions of our loan assistance are fairly concessional.

Q Speaking about financial assistance, could you briefly explain the procedure to obtain JICA loans and grants?

JICA has two types of financial assistance, grant assistance and concessional loan assistance. For our assistance, Government-to-Government basis, request is required. Before making the decision of providing our financial assistance, JICA goes through the process of appraisal of projects. Project appraisal comprehensively covers all the aspects of the projects. Necessity of the projects, technical appropriateness, economic and financial benefits, environmental and social impacts, and so on.
If the project necessity is clear but the project has not been well prepared by the Sri Lankan Government, JICA also conducts project preparatory study to support the Sri Lankan Government to prepare a project proposal. After diplomatic commitment of the financial assistance by Japanese government, JICA concludes a grant or loan agreement with the Government of Sri Lanka. Then the project starts.
In any case, I think that most important point in this process is ownership of the project by Sri Lankan side. JICA can make suggestion and recommendation and provide assistance, but projects are yours.

Q Some have pointed out that when JICA provides loans and financial assistance for projects, it also makes it mandatory to give the contract to Japanese contractors. Is there such a condition that comes with Japanese financial assistance?

For some projects we provide our loan assistance with the condition of Japanese ties to procure the goods and the services – that is more than 30 per cent from Japan. That depends on the project. For example, the project we committed last September, the digital terrestrial television broadcasting project, introduced Japanese modern TV broadcasting systems and was tied to Japanese procurement.
But in other cases the loans are not tied to Japanese procurement. Those conditions are clearly stated and publicized when the loan agreement is signed.

Q What is unique about Japanese assistance when compared to assistance and aid from other countries?

I think a special feature in Japanese assistance is the combination of technical and financial assistance. One example is the disaster management programme. On one hand, Japanese expats cooperate with the Sri Lankan official to develop their own technical capacity. In addition to that, JICA also provides financial assistance such as the loan for landslide prevention to NBR and RDA. So technical cooperation and capital investment works together to help the Sri Lankan government provide security to the people.
The same approach is now taken in the health sector. The non-communicable disease technical cooperation project was started last year. Our financial assistance is utilized by the Sri Lankan government to develop the base hospitals.
Outcome of technical cooperation and financial assistance together will help Sri Lankan Government to provide its services for human securities of people in Sri Lanka.

Q What are some of the recent projects that were completed with JICA assistance? Are there any future projects in the pipeline?

Last April, I attended the opening ceremony of the Manmunai Bridge in Batticaloa, which was completed by utilizing JICA grant assistance. The bridge enables land access to markets and services in the east side of the lagoon where Batticaloa town is located, especially for the farmer community in the west side. I saw thousands of people enthusiastically come to celebrate the opening, and the next morning a lot of buses communicated between both sides of the bridge.

That is an example of the capital investment physical infrastructure developed by our financial assistance recently. But JICA has been contributing to development of transport network in various ways. Master Plan study of Colombo Urban Transport was also completed last year. It is not a financial assistance but technical cooperation. Japanese experts worked with Sri Lankan officials to prepare the Master Plan, of which the objective is to improve mobility in Colombo Metropolitan Area and maintain it till the target year of 2035, based on the four policy pillars: economic efficiency, equity in society, environmental sustainability and safety. Since I understand that Sri Lankan new government considers encouraging people to utilize the public transport, I hope that the Master Plan will be helpful for them and your people to consider and take actual measures.
As for new projects, we are continuing our dialogue with the Government because as you know, the Government has changed. We will have some discussions with the present Government to confirm their policy directions. Then, new assistance will come after these discussions.

Q What is JICA’s reaction to the new Government in Sri Lanka and how do you think the change in government will affect JICA’s activities in Sri Lanka?

After the presidential election, Japanese government represented by the Prime Minister Abe and the Foreign Minister Kishida already expressed their congratulations to Mr. Maithripala Sirisena, the new President of Sri Lanka. In addition, they reaffirmed their intention of further developing the Japan-Sri Lanka relationship and of continuing to support Sri Lanka’s efforts in the areas of national reconciliation, democracy and economic development.
I understand that the new government is supported by the Sri Lankan people and is welcomed not only by Japan but by international community as a whole. In these circumstances, I am very happy to say that JICA will continue to support Sri Lankan people through the new government.

Q The new government has indicated that it is looking to increase Japanese loans. Will JICA be willing to give more financial assistance to Sri Lanka than before?

We might need to consider a couple of aspects. One is our own capacity – how much volume we can provide. In addition, we also have to consider the basic direction of the economic and social policy of Sri Lanka. Therefore, we will continue our relationship with Sri Lanka and our stance is to support the new government and the people.

Q What have you got to say about the increased economic presence of China in Sri Lanka and has that deteriorated the relationship between Japan and Sri Lanka?

I don’t think China’s presence will deteriorate the relationship between Japan and Sri Lanka. Not only China, but the entire international community are important partners to Sri Lanka. Since of late, the economic presence of China is large not only in Sri Lanka but also in the Asian region as a whole. So it is important for us to even work together with China on some occasions. We hope Sri Lanka maintains healthy relationship with Japan as well as all the countries in the world.

Q How can Sri Lanka strengthen its ties with Japan in the future?

I think that there has been already a strong friendship between two countries. Sri Lanka is becoming better known among Japanese people now as a number of tourists from Japan is increasing after the end of domestic conflict.
I feel that Japanese business people’s interest in Sri Lanka has been also expanding particularly since Japanese Prime Minister Shinzo Abe’s visit last September. I hope that sincere dialogue between business peoples will strengthen business relation between two countries. Last April, JICA has launched its investment promotion assistance together with Japanese Embassy and JETRO by dispatching Japanese expert to the Board of Investment. I hope such an approach will help to further enhance the trend.

At present JICA volunteers are working throughout Sri Lanka and they work and live together with ordinary Sri Lankan people. Some of them continue to work with Sri Lanka. Their experience with people in Sri Lanka is an enormous asset to the friendship of the two countries. Every year a Sri Lankan festival is held in Tokyo for which Sri Lankans living in Japan, ex-volunteers and other Japanese people who have an interest in Sri Lanka gather.
Coming back to your question, I do not think that we do have to do something special to strengthen our ties. Both countries should continue our efforts to make our own countries better tomorrow, which will strengthen our ties naturally. Particularly in Sri Lankan side, it is critical to maintain the peace and national unity.

Opinion

Our stance is to support the new government and the people

Q To start off, could you give me a brief background about the relationship between Japan and Sri Lanka and JICA’s role in our country?

Q What are the key areas that JICA assists Sri Lanka with?

Q What are the benefits and concessions given to Sri Lanka with regard to financial aid and loans and what are the terms and conditions that come along with such assistance?

Q Speaking about financial assistance, could you briefly explain the procedure to obtain JICA loans and grants?

Q Some have pointed out that when JICA provides loans and financial assistance for projects, it also makes it mandatory to give the contract to Japanese contractors. Is there such a condition that comes with Japanese financial assistance?

Q What is unique about Japanese assistance when compared to assistance and aid from other countries?

Q What are some of the recent projects that were completed with JICA assistance? Are there any future projects in the pipeline?

Q What is JICA’s reaction to the new Government in Sri Lanka and how do you think the change in government will affect JICA’s activities in Sri Lanka?

Q The new government has indicated that it is looking to increase Japanese loans. Will JICA be willing to give more financial assistance to Sri Lanka than before?

Q What have you got to say about the increased economic presence of China in Sri Lanka and has that deteriorated the relationship between Japan and Sri Lanka?

Q How can Sri Lanka strengthen its ties with Japan in the future?

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