The Context

Since the end of its 26-year conflict in 2009, Sri Lanka has made significant economic and social progress. Economic growth has been rapid. A real GDP growth was recorded at 3.2 per cent in 2018, compared to 3.4 per cent in the previous year. This rapid economic growth rate has led to Sri Lanka being classified as a lower middle-income country with a per capita GDP of US$4.103. The poverty headcount was cut by more than half, to six per cent, in less than 10 years. 

82 per cent of Sri Lanka’s total population resides in rural areas, and agriculture remains the backbone of the economy. Four fifths of the country’s poor people are dependent on the rural sector. Almost half of poor rural people are small-scale farmers.

Tea and rubber have made large contributions to the national economy. Tea smallholders contribute 70 per cent of Sri Lanka's total tea production, while smallholder rubber growers cultivate 62 per cent of the land under rubber cultivation.

Youth unemployment is a major challenge, as young people face an unemployment rate more than three times higher than for the population as a whole.

The Strategy

IFAD has over 30 years of experience in Sri Lanka. We support government policies to achieve food security, ensure higher and sustainable incomes for farmers, improve production and productivity, and sustainably manage the environment. 

Within this policy framework, our programmes and projects promote deep involvement of the private sector, and of small and medium-sized industries related to the agriculture, fisheries, livestock and plantation sectors.

The 2015 IFAD country strategic opportunities programme aims to: 

• help smallholders increase their productivity sustainably by reducing degradation of natural resources (mainly land), improving agricultural technologies and creating off-farm opportunities, while recognizing the growing links between urban and rural growth and employment creation; 
• empower poor rural women and men to connect to markets by scaling up value chain development, developing public-private-producer partnerships, and mobilizing innovative financial products tailored to meet needs of rural poor in country.