ADS Provides Sri Lanka USD 110 Million for Health Systems Improvement Project

The Finance Ministry announced that the government has decided to borrow USD 110 million from the Asian Development Bank (ADB) and receive a USD 03 million grant from the ADB-managed Japanese Fund for Poverty Reduction (JFPR) to implement the “Additional Financing of Health Systems Enhancement Project”.

With the outbreak of the COVID-19 pandemic in early 2020, USD 15 million from the ongoing HSEP was reallocated for emergency activities such as increasing the capacity of molecular biology laboratories, increasing hospital access to emergency medical equipment, expanding high dependency and intensive care units, expanding oxygen accessibility and increasing the availability of vaccines.

The additional funding will be used to scale up the outputs of an ongoing project that is performing well, to meet the government’s urgent financing needs to support and manage the third wave of the COVID-19 pandemic and to replenish previously reallocated funds to finish the originally planned activities, which are primarily related to primary healthcare (PHC) development.

The collective effects of the original and extra funded initiatives remain consistent with the original project goal of creating a healthier society through a more comprehensive PHC system and supporting COVID-19 pandemic management. The total project cost is anticipated to be USD 123 million, including a USD 10 million contribution from the government. The project is expected to be finished by November 30th, 2025.

SR Attygalle, Secretary, Ministry of Finance, on behalf of the Government of Sri Lanka, and Chen Chen, Country Director, ADB Resident Mission, on behalf of ADB, signed the relevant Loan Agreement and Grant Agreement for the Additional Financing of Health Systems Enhancement Project, totaling USD 110 million and USD 3 million, respectively.