World Bank-led $2bn framework aims to boost Sri Lanka jobs

A Country Partnership Framework (CPF) for Sri Lanka spanning 2026 to 2030 launched to provide two billion dollars in financing aimed at boosting private sector-led development and tackling employment shortages.

Country Manager for Sri Lanka, Gevorg Sargsyan, stated:

"In the next few years, we will provide about $2 billion of financing to the public and private sectors to achieve these objectives. This will also mean mobilisation of the private capital over $1.2 billion."

This funding intends to sustain a 7% growth rate and help one million young people secure employment over the upcoming decade.

The framework officially debuted during an event titled “Sri Lanka’s Next Chapter: Jobs, Growth, and Opportunity,” at Trace Expert City Colombo, which was co-organised with the University of Colombo.

Structural deficiencies continue to leave prospective workers vulnerable despite the island stabilising remarkably following its 2022 economic collapse, Sargsyan noted.

Sargsyan added:

"A million young people will enter the workforce in the coming years. But indeed, with the current pace of the economy, only one third of them are expected or guaranteed to have formal quality jobs."

The five-year development plan will target four high-potential sectors: logistics, energy, tourism, and agribusiness, he observed.

Deep-seated domestic friction continues to hinder corporate expansion and workforce formalisation, private sector leaders and policymakers warned during a panel discussion moderated by Gregory Smith, Manager of Country Economics at the International Finance Corporation (IFC).

A lack of mid-stage expansion capital prevented smaller firms from growing beyond fifty employees, PickMe Chairman and Founder Ajit Gunewardene stressed.

Gunewardene stated:

"We need access to capital for growth-stage companies — not seed capital, and not bailout — stage funds for SOEs, which is where a lot of this money goes."

Rigid and outdated working conditions fail to accommodate a modern care economy, keeping the female labour force participation rate low at 33%, Good Life X Founder and Chair Randhula De Silva pointed out.

De Silva noted:

"The current rigidity keeps a lot of women and a lot of people who want flexible working away because work structures and these conditions are set through archaic models from the industrial era."

Immediate institutional overhauls are underway to adapt to future employment markets, Industrial Development Board (IDB) Chairman Yasas Hewage revealed.

"We are rewriting the SME policy," Hewage said, adding that the IDB is updating its 57-year-old operating act to match contemporary economic developments.

Monetary stability must underpin any sector-specific targeting, as failing to address macro-level factors renders other efforts futile, Advocata Institute Chief Executive Officer Dhananath Fernando cautioned.

"Without monetary stability, everything would be nothing," Fernando said, urging youth to study macroeconomics because price and import controls fail to protect the economy in the long run.

The 2026–2030 framework represents a collaborative effort by the World Bank, the IFC, and the Multilateral Investment Guarantee Agency (MIGA) to steer Sri Lanka away from fragile, debt-reliant models toward a competitive recovery led by the private sector.