Published: 10 May 2004

Ambassador Subasinghe meets with President Bush at the White House President Bush compliments Sri Lanka on its economic reform program, highlighting Sri Lanka as an example of progress Sri Lanka, the only South Asian country and one of three Asia-Pacific countries to be chosen as MCA recipient US President George W. Bush, at a ceremony held this morning at the East Room of the White House, announced the first group of Millennium Challenge Account eligible nations which were selected last week by the Board of Directors of the Millennium Challenge Corporation. The President met with and congratulated Ambassadors from sixteen countries namely, Armenia, Benin, Bolivia, Cape Verde, Georgia, Ghana, Honduras, Lesotho, Madagascar, Mali, Mongolia, Mozambique, Nicaragua, Senegal, Sri Lanka and Vanuatu, who were present at the ceremony. Ambassador Devinda R. Subasinghe, Sri Lanka’s Ambassador to the United States, represented Sri Lanka at the ceremony and President Bush met Ambassador Subasinghe individually prior to the ceremony in the Blue Room of the White House. Announcing the selection of the first group of Millennium Challenge Account countries in an East Room ceremony at the White House, President Bush said, “two years ago, I announced a new and hopeful approach in America’s aid to developing nations. Under this approach, America has pledged to increase development assistance by 50 percent over three years. To make sure that governments make the right choices for their people, we link new aid to clear standards of economic, political, and social reform. We invited governments in developing nations to meet those standards so that they may truly serve their people.” The President, referring to Sri Lanka said, “since launching its program of economic reform in 2002, Sri Lanka has reduced its budget deficit by a third, and cut inflation by half. Other nations represented here can point with pride to similar examples of progress.” Sri Lanka is the only South Asian country and one of three Asia-Pacific countries selected as an MCA recipient nation among the first group of countries for MCA assistance for FY 2004. Sri Lanka’s Ambassador to the United States Devinda R. Subasinghe said, “the MCA will be a useful catalyst for further policy reforms in Sri Lanka that will lead to economic growth and poverty reduction with a focus on the rural economy. Sri Lanka will seek to harness the synergies between MCA assistance, trade and economic priorities of the new Government to creatively utilize MCA funds for achieving growth with equity.” The President emphasized the importance of economic reform, which brings more investment and more trade, lessening the need for aid over time. He urged selected nations to develop proposals explaining how they will further address the needs of their people and increase economic growth by setting out clear goals and measurable benchmarks. The MCA recognizes that economic development assistance can be successful if it is linked to sound policies in developing countries. The fund in the MCA, therefore, will be distributed to developing countries that demonstrate strong commitment toward; good governance, the health and education of their people and sound economic policies that foster enterprise and entrepreneurship. Embassy of Sri Lanka Washington DC USA 10 May 2004 Related links

• Remarks by the President at Ceremony Celebrating Countries Selected for the Millennium Challenge Account

Published: 08 May 2004

Minister Kadirgamar to meet with Secretary of State Powell and National Security Advisor Rice during the visit

Minister of Foreign Affairs of the Government of Sri Lanka, Hon. Lakshman Kadirgamar, will visit Washington DC in the week of May 10, 2004. While in Washington DC, Foreign Minister Kadirgamar will meet with Secretary of State, Hon. Colin L. Powell and the National Security Advisor, Dr. Condoleezza Rice, to discuss bilateral cooperation and peace initiatives of the Government. Current relations between the two countries are marked by regular, high level contacts and meaningful bilateral cooperation in the areas of trade, investment, national security and global issues. Hon. Kadirgamar will apprise the Secretary of State on the policies of the Government and reiterate its desire to achieve a secure, just and lasting peace for the benefit of all communities of Sri Lanka. He will also discuss with, both the Secretary of State and the National Security Advisor, the status of the ongoing ceasefire agreement and prospects for resumption of peace talks. Minister Kadirgamar is also expected to meet with senior officials of the Department of Defence at the Pentagon, to discuss the ongoing defence and security relationship and, related issues between the two countries. He is also scheduled to visit the US Coast Guard Cutter "Courageous," which is due to be officially handed over to the Sri Lanka Navy next month. In meetings with Senior Officials of the Office of the United States Trade Representative, Minister Kadirgamar will discuss ways and means to expand and deepen US- Sri Lanka trade and investment relations. Hon. Kadirgamar is also scheduled to meet with members of the US-Sri Lanka Working Group established at the United States Chamber of Commerce to engage them in the current trade and investment opportunities in the country. Other meetings include those with Senior Administration Officials, Senators and Congressmen, and members of the US business community and the international media. Minister Kadirgamar is also expected to address the Congressional Caucus on Sri Lanka and Sri Lankan Americans of the 108th Congress. Yet another highlight of the visit will be a talk by the Minister at the Brookings Institution entitled, "Sri Lanka: Current Developments & Future Prospects." This visit to Washington DC is the fifth visit by Minister Kadirgamar as Foreign Minister. His previous visits were in 1995, 1997, 1998, 1999 and 2001. Embassy of Sri Lanka Washington DC USA 08 May 2004

Published: 06 May 2004

MCC CEO Paul Applegarth says countries selected are identified as good partners of the U.S. who had performed best against the selection criteria

Ambassador Subasinghe says Sri Lanka’s selection bears testimony to the country’s good policy environment and the concerted and consistent economic reform programs undertaken by its Governments with a focus on poverty reduction

The Board of Directors of the Millennium Challenge Corporation (MCC) selected the first set of countries eligible for Millennium Challenge Account (MCA ) assistance in Financial Year 2004. Sri Lanka is among the 16 countries selected for funding in US FY 2004. The countries selected are Armenia, Benin, Bolivia, Cape Verde, Georgia, Ghana, Honduras, Lesotho, Madagascar, Mali, Mongolia, Mozambique, Nicaragua, Senegal, Sri Lanka and Vanuatu. Sri Lanka’s success at qualifying for MCC assistance is a reflection of the country having invested in its people with a consistent method of defining its national priorities and formulating policy with clear objectives. The MCC Board had considered the past and current policy performance of the country in the areas of governing justly, investing in her people and promoting economic freedom, including trends of policy improvement. According to official MCC data, Sri Lanka passes all six of the Governance indicators, two of the four “investing in People” indicators (minimum necessary) and, five of the six “Economic Freedom” indicators. Sri Lanka’s Ambassador to the United States Devinda R. Subasinghe said, “the MCA will be a useful catalyst for further policy reforms in Sri Lanka that will lead to economic growth and poverty reduction. The Mission actively focused on promoting Sri Lanka as an eligible candidate for assistance under the Millennium Challenge Account. Sri Lanka’s selection bears testimony to the country’s good policy environment and the concerted and consistent economic reform programs undertaken by its Governments with a focus on poverty reduction.” Mr. Paul Applegarth, CEO of the MCC said, “countries selected are identified as good partners of the US who had performed best against the selection criteria.” The MCC focus is, “Investing in growth- [in ]what works.” MCA has been conceived with bipartisan support by the US Administration as an innovative foreign aid program, predicated on several principles such as, country ownership, inclusiveness (country stakeholders), accountability and emphasis on policy outcomes in the development and implementation of MCA programs. The MCA assistance calls for greater responsibility from developing countries in the implementation of programs and the MCC’s mission is to focus on assisting emerging market countries to escape their dependency status through self-sustaining economic growth. The US congress approved the MCA in January 2004 and allocated a budget of US$1 billion for the first year. President Bush has asked for an additional US$2.5 billion to ramp up the MCA budget for FY 2005. The MCA is administered by the Millennium Challenge Corporation which is managed by Mr. Paul Applegarth, Chief Executive Officer, appointed by the President and confirmed by the Senate and, overseen by a Board of Directors comprising the Secretary of State (Chairman of the Board), the Secretary of Treasury, the US Trade Representative and the Administrator of USAID and four members to be appointed by the President on the advice and consent of the Senate. The MCA implementation process will commence with a formal invitation to the Heads of Governments of the 16 selected countries, inviting each to propose a country program for MCA assistance. Following country selection, the MCC will enter into compacts with qualifying countries that focus on outcomes, outline concrete objectives, benchmarks and responsibilities for meeting their development goals. The level of funding for country programs will be determined on the basis of the quality and the needs of the program. Programs must have a minimum three year commitment. The MCC is planning country Missions to brief Governments on the program and make preliminary country assessments towards end of May 2004 or early June 2004. The MCC will also assist countries with capacity building in the areas of program and benchmark evaluation, among other areas. Embassy of Sri Lanka Washington DC USA 06 May 2004

Published: 22 April 2004

Ambassador Ashley Wills praising the Sri Lankan political and social sensibilities says that the Sri Lankans are a uniquely proud people who have upheld healthy democratic traditions amidst myriad political and social challenges Sri Lanka’s Ambassador to the United States, Ambassador Subasinghe, says Sri Lanka’s peace process will sustain itself and will be strengthened by the involvement of its key stakeholders The Young Professionals for International Cooperation (YPIC) - Asian Affairs Committee of the United Nations Association of the National Capital Area (UNA-NCA) organized a Sinhala and Tamil New Year celebration entitled, “Paththandu-Avurudu” on April 22, 2004 at the Meridian International in Washington DC. The event was attended by a diverse group of young professionals and Sri Lanka enthusiasts from the expatriate community as well as, from the local community. Representatives from various academic institutions, UN agencies, the Department of State and Non-Governmental Organisations also participated. Sri Lanka’s Ambassador to the United States, Ambassador Devinda R. Subasinghe was the Chief Guest on this occasion. Ambassador Ashley Wills, former US Ambassador to Sri Lanka and Assistant United States Trade Representative was the Guest of Honour. “Paththandu-Avurudu” was an evening of dialogue and discussion on facets of Sri Lanka’s art, culture and politics. The evening also featured an excellent cultural program and showcased the best of traditional Sri Lankan cuisine. Considered one of the most dynamic internationally focused groups in Washington DC, the Young Professionals for International Cooperation- Asian Affairs Committee of the United Nations Association of the National Capital Area is a part of the largest grassroots foreign policy organization in the United States. UNA-NCA’s concerns and projects are significantly in the areas of peace and security, conflict resolution, nuclear non-proliferation, global health, sustainable development and, human rights. The programs of the YPIC seek to engage professionals and students in dialogue on the UN and international affairs thereby fostering mentorship, and promoting career development for the leaders of tomorrow. Speaking on this occasion, Ambassador Ashley Wills provided creative insights into the politics of South Asia and the myriad forces that inform South Asian political and social action. Ambassador Wills praising the Sri Lankan political and social sensibilities said, “the Sri Lankans are a uniquely proud people who have upheld and nurtured a healthy democratic tradition amidst numerous political and social challenges. The texture of democratic governance in the island nation is being strengthened and renewed at every new crossroads.” Ambassador Wills informed the audience that there was a new determination among the people and the Government to find a lasting resolution to the twenty year old conflict. Complimenting Ambassador Subasinghe for gaining a focus for Sri Lanka in the US Administration and other Governmental and private sector agencies, Ambassador Wills mentioned that the US will continue to support Sri Lanka in its development and peace efforts. Ambassador Subasinghe gave a substantive exposition on the UN -Sri Lanka relations, the US-Sri Lanka bilateral experience, and the internal and external political dynamics that shaped the country’s foreign policy since Independence. According to Ambassador Subasinghe, one of the enduring motifs in the country’s foreign policy is the policy of neutrality which was exemplified by Sri Lanka’s active involvement in the formation of the Non-Aligned Movement in the early 1960s. During this period, the country’s role in the United Nations Organization was guided by the principle of “non-alignment.” Sri Lanka became a member of the United Nations in 1955 and the country shares the organization’s universal values of human rights and democracy. The most active UN agencies in Sri Lanka are the United Nations Development Program (UNDP), United Nations Children’s Fund (UNICEF) and the United Nations High Commissioner for Refugees (UNHCR). In the Post-Cold War period, successive Governments have integrated Sri Lanka more with the international community and with the process of globalization consistent with the country’s democratic traditions and its economic policies. Speaking on the Sri Lanka peace process and current ceasefire in place, Ambassador Subasinghe said, “the peace process will sustain itself and will be strengthened by the involvement of the key stakeholders.” In conclusion, the Ambassador hoped that the spirit of harmony and amity that the Sinhala and the Tamil New Year imparts would translate itself into greater cooperation among the different communities living in Sri Lanka. Embassy of Sri Lanka Washington DC USA 22 April 2004

Published: 30 March 2004

IDA Executive Board unanimously commends the design of the project

Sri Lanka's Ambassador to the United States, Ambassador Subasinghe, welcoming World Bank approval for the grant says that the Gemi Diriya project is a creatively innovative poverty alleviation strategy, one that will nurture the entrepreneurial impulse at the grassroots level

The Board of the Executive Directors of the International Development Association (IDA) of the World Bank approved an IDA grant of US$51 million (SDR 34, 200,000million equivalent) for the Community Development and Livelihood Improvement "Gemi Diriya" Project, on March 30, 2004. This project is premised upon striking a balance between growth and equity in a context of implementation of a structural adjustment programme. It has been recognized by policy makers that the current growth rates of 4-5 per cent was inadequate to have an empowering impact on the rural poor. Ambassador Devinda R. Subasinghe, welcoming World Bank approval for the grant said, "the Gemi Diriya project is a creatively innovative poverty alleviation strategy, one that will nurture the entrepreneurial impulse at the grassroots level." The project objective is to assist the recipient in its efforts to improve the livelihood and quality of life of its rural communities in the Uva and the Southern Provinces in Sri Lanka. This objective will be achieved through devolving decision -making power and resources to community organizations, strengthening selected local Governments that demonstrate responsiveness and accountability to rural communities, and working with federations of Village Organizations, the private sector, and NGOs on economic empowerment to increase the size and diversity of livelihood. An Innovative Seed Fund will help pilot innovative ideas which need experimentation, learning, and gestation that have the potential for being scaled - up and replicated, including, among others, the development of new economic activities with value- added products for livelihood improvement, and the provision of access to information technology and communication to rural communities. The "Gemi Diriya" Project will be implemented by the Gemi Diriya Foundation (GDF), a company incorporated and registered under the Sri Lanka Companies Act ( No. 17 of 1982). The GDF, headed by a Chief Executive Officer and a Board of Directors, must remain, among other things, committed to the objectives of the project and maintain financial transparency, and conduct its operations and affairs in accordance with sound financial standards and practices with qualified and experienced management. The Executive Board including the French, the US, the UK, Spain, African and Austrian Chairs unanimously commended the design of the Gemi Diriya Project. Its vision encompasses a new thinking of empowering communities to plan, implement and monitor development with a set of principles of good governance with accountability and cost sharing with greater dependence on their capacities and partnerships with the outside world for reducing rural poverty. Embassy of Sri Lanka Washington DC USA 30 March 2004

Published: 26 March 2004

Welcoming Senate approval for the U.S. - Sri Lanka Tax Treaty, U.S. Treasury Secretary Snow says, that the tax treaty will expand U.S. economic relations with Sri Lanka, an important trading partner in the developing world Sri Lanka's Envoy to the United States, Ambassador Subasinghe says that the Double Taxation agreement is a milestone in the Sri Lanka U.S. business relationship The United States Senate approved the US-Sri Lanka Double Taxation Agreement and the Protocol Amending the Convention between the Government of Sri Lanka and the US Government for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion on March 26, 2004. The proposed tax treaty with the US was first signed in 1985. The Protocol Amending the Convention between the Government of Sri Lanka and the US Government for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, was signed in Washington DC in September 2002. The agreement with Sri Lanka represents the first tax treaty between the two countries. Welcoming Senate approval for the US-Sri Lanka Tax Treaty, Treasury Secretary Snow said, "[t]his tax treaty will expand our economic relations with Sri Lanka, an important trading partner in the developing world, and is an important step in our ongoing efforts to broaden the reach of our tax treaty network." Sri Lanka's Ambassador to the United States, Ambassador Subasinghe, commenting on Senate approval said, "the conclusion of this Agreement is an important milestone in the developing Sri Lanka -US business relationship benefiting US companies in Sri Lanka and the small but growing Sri Lanka owned companies operating in the US. It is expected to generate greater confidence with US investors wishing to invest in Sri Lanka and would also strengthen the existing framework for the promotion of US investments such as the Bilateral Investment Promotion and Protection Treaty and the Trade and Investment Framework Agreement (TIFA)." Further, the Treaty would expand the ongoing discussions under the US-Sri Lanka Trade and Investment Framework agreement aimed at deepening and diversifying trade between the two countries. The proposed Treaty will relieve Double Taxation both in the United States and Sri Lanka through the Foreign Tax Credit Mechanism. It will also provide for non-discriminatory treatment by one country to residents and nationals of the other. Further, the Treaty includes an exchange of information provisions that generally follows the US Model. Sri Lanka has confirmed its ability to obtain and exchange key tax related information. Following ratification by the Senate, the Treaty and the Protocol will come into force upon a bilateral exchange of Instruments of Ratification. Sri Lanka had previously ratified the agreement. The exchange of instruments of ratification is projected for the second quarter of 2004. Embassy of Sri Lanka Washington DC USA 26 March 2004