Infrastructure alone won’t lead to economic development
Though there is enough connectivity – the roads and other infrastructure in some areas across Sri Lanka – this alone won’t lead to economic development.
Prof. Sirimal Abeyratne, Prof in Economics, Colombo University – one of the well-known economists in the country, in answer to a query made by an official of the Road Development Authority said that though there is a well developed road network and infrastructure the economic development as expected are not taking place in those areas.
Prof. Abeyratne said that the road network or the infrastructure would not create that atmosphere of growth, development and economic activity. “If we like to see other locations of Sri Lanka such as Hambantota and Trincomalee grow, there should be connectivity – not just infrastructure. There should be a set of factors that are associated with connectivity that attracts economic activity and human resources.
He said a classic example of the government failure is Hambantota where the infrastructure is in place and where there is an airport and a port.
Prof. Abeyratne was delivering the John Diandas Memorial Lecture 2019 held at the Colombo Lighthouse, Horton Place, organised by the Chartered Institute of Logistics and Transport last week. He spoke on ‘Public Transport and the National Economy – Connectivity and interconnectivity: Transport system and Economic Development’.
Growth is higher in a relatively smaller location where both economic activity and people concentrate than elsewhere which will be left as large farmlands and forests, he indicated.
He indicated that a nation with higher incomes, decent jobs, and better living standards, needs better transport connectivity as a fruit of development. He said that connectivity is measured across geographical space and is not limited to physical connectivity and transport connectivity. Connectivity cost is its monetary and time cost, while quality is about the qualitative aspects of connectivity that includes convenience, efficiency and safety.
Transport connectivity is an important prerequisite of economic development or ‘being rich as a nation’, he said and indicated that economic development demands transport connectivity as an input and in turn, a better transport connectivity is an important outcome of economic development.
Prof. Abeyratne said that there is a valid economic reason for people to concentrate in some places in a country to invest, work and live, rather than spread all over. When there are economic activities in some locations, investors find these places offering better investment opportunities.
Transport connectivity itself is an economic activity which involves infrastructure, transport systems, and management, Prof Abeyratne indicated and said that if they do not transform it to a commercially viable economic activity, it would not perform well and then it would not contribute to economic development as anticipated. Sri Lanka’s public transport system is an example, he commented.
Meanwhile the late Mr. Diandas was popularly known as ‘Mr Transport’ in Sri Lanka. He was a British citizen born in India in 1924. A Fellow of the Institute of Chartered Accountants, Sri Lanka he also functioned as an independent Transport Consultant.