Sri Lanka: Skills Sector Enhancement Program

Sovereign Project | 42251-018 Status: Approved


ADB is helping Sri Lanka revamp its technical and vocational education and training (TVET) to equip its workforce, especially the youth, with the required skills for the job market. The program will support the government’s Skills Sector Development Program and improve employment rates in four priority sectors: construction, tourism, information technology, and manufacturing, particularly for disadvantaged groups, including women.

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Procurement Documents

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Project Name Skills Sector Enhancement Program
Project Number 42251-018
Country Sri Lanka
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Grant: Skills Sector Enhancement Program
Germany US$ 15.40 million
Loan 3119-SRI: Skills Sector Enhancement Program
Ordinary capital resources US$ 50.00 million
Loan 3120-SRI: Skills Sector Enhancement Program
Asian Development Fund US$ 50.00 million
Loan: Skills Sector Enhancement Program
Export-Import Bank of Korea US$ 26.00 million
World Bank US$ 100.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Private sector development
Sector / Subsector

Education - Technical and vocational education and training

Gender Equity and Mainstreaming Effective gender mainstreaming
Description ADB and the Government of Sri Lanka are working together to provide people in the country with the skills they need to get good jobs. The Skills Sector Enhancement Program is improving the teacher training and the government's overall quality assurance efforts in regards to technical training. It is also helping the Sri Lankan government analyze where the gaps are greatest in the labor market's demand for skills. This is allowing technical training to be focused on the areas where there is the most demand. The program is also working to increase the number of students enrolled in technical programs to 172,000 and is providing financial help to at least 18,000 students from disadvantaged situations. The program is working to improve coordination, monitor and evaluation of skills development efforts and strengthen performance management of publicly financed training initiatives.
Project Rationale and Linkage to Country/Regional Strategy Sri Lanka's progress in education is excellent compared with that of other countries in South Asia. However, a significant mismatch exists between the skills of graduates and what is needed by employers. Sri Lankan firms have identified lack of skilled labor as one of the key constraints to their business and youth unemployment remains very high at 17.3% - compared to an overall unemployment rate of 4%. The skills mismatch became even more evident during the recent period of high economic growth as both education and technical training systems failed to adapt to the rapid labor market shifts resulting from the rise of the service sector. Sri Lanka is working to reconfigure the skills, abilities, and competencies of young people to meet the demands of the global economy and to support the country's transition to a knowledge-based economy.

Project Outcome

Description of Outcome A market-responsive and inclusive TVET system
Progress Toward Outcome Outcome target achievement will be independently verified with a third party tracer study, which will be conducted from May to November 2016.
Implementation Progress
Description of Project Outputs

1. Improved quality of TVET provision

2. Enhanced industry partnership for TVET planning and provision

3. Increased participation and improved equity in TVET

4. Improved TVET sector management to implement policy, institutional, and operational reforms

Status of Implementation Progress (Outputs, Activities, and Issues)

1. Improved quality of TVET provision - (a) A simplified QMS manual (ISO-based) was developed in Oct. 2014, and 57 centers were prioritized for QMS installation. As of 31 August 2015, 46 centers obtained approval from TVEC. Additional 11 centers received feedback from external auditors for clarifications or follow-up actions to be eligible for TVEC approval, which was completed in Oct. 2015. With 57 centers installed with QMS, the target of 5% against the total number of public and private training providers registered with TVEC in 2013 (1,081) has been met; (b) Revised NVQ operations manual is prepared, which needs validation through stakeholder consultation. TVET Technical Advisor will assist the Reform Specialist as necessary - continued/enhanced focus required as this forms the backbone of quality training; and (c) Revised HRD policy is implemented in VTA and CGTTI. Performance allowance implemented in VTA, NAITA, NYSC, CGTTI and NIFNI.

2. Enhanced industry partnership for TVET planning and provision - (a) TVEC completed employer survey in 4 priority sectors and is coordinating skills gap analyses to be completed by June 2016; (b) The contract agreement between MSDVT and Advance Construction Training Academy (ACTA) was signed on 18 Dec. 2015 to train 600 students in the field of construction as the first phase followed by another 600 students in the second and third phases subject to performance. Request for proposal has been reissued for tourism sector; and (c) 3 PPP university colleges are operational.

3. Increased participation and improved equity in TVET - (a) 178,326 enrolled in 2014 for which 42% was female; and (b) In 2014 and 2015, NAITA issued certificates to 12,869 people through recognition of prior learning.

4. Improved TVET sector management to implement policy, institutional, and operational reforms - TVET public and private facility survey completed in 2015 to support the development of the rationalization plan. Performance Partnership Agreements for 2015 signed for VTA, NAITA, DTET, UNIVOTEC, TVEC, NYSC, CGTTI, and NIFNE. Performance-based financing piloted in 21 training centers, including 10 VTA centers.

Geographical Location

Safeguard Categories

Environment B
Involuntary Resettlement C
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects The program is classified as environment category B according to ADB's Safeguard Policy Statement (2009). Construction activities will be limited to refurbishment, extension, renovation of existing structures and new buildings within the existing TVET center premises or government owned land. No significant environmental impacts are envisaged from the proposed works. Any work inviting higher category of environment classification (category A) shall not be included in the project.
Involuntary Resettlement The program is classified as category C for involuntary resettlement according to ADB's Safeguard Policy Statement (2009). The safeguard requirements 2 will not apply as there will be no land acquisition and involuntary resettlement. Mostly minor civil works will be carried out for refurbishment of existing buildings and facilities. New buildings will be constructed either within the existing TVET institute premises or on government owned land.
Indigenous Peoples The project is classified category C for indigenous peoples according to ADB's Safeguard Policy Statement (2009). Implementation of program components neither directly nor indirectly affects the dignity, human rights, livelihood systems, or culture of indigenous people. Hence, the safeguard requirements 3 will not trigger.
Stakeholder Communication, Participation, and Consultation
During Project Design

Throughout the design phase there were regular meetings with stakeholders to assess sectoral issues and discuss the program design. Key issues discussed were quality, relevance, staff training, working with industry, and increasing participation rates. There were regular briefings with the heads of the MYASD TVET agencies, agencies higher level officials and with representatives of development partners. Special meetings were held to present the findings and recommendations of the design team to relevant officials and management in MYASD TVET agencies for their feedback. Organizations consulted include Foreign Employment Bureau, ministries of education, higher education, and others, Senior Ministers Secretariat, the Board of Investment, the Information and Communication Technology Agency, Tourism Development Authority, Institute of Construction Training and Development, and Institute of Tourism and Hotel Management, development partners, and industry representatives such as the Employers Federation, National Construction Association, Chambers of Commerce and Industries, Chambers of Small and Medium Enterprises, Chamber of Construction Industries, Association of Software and Service Companies, and Hotels Association.

About 15 private and public training institutes were visited to review the status of training delivery, QA measures and the operation of career guidance and counseling units and to assess the existing institutional arrangements and capacity, including accessibility for under-represented groups. Around 125 interviews were conducted with stakeholders (students and teachers) in Colombo in Western Province, Galle in Southern Province, Kandy in Central Province, Anuradhapura in North Central Province and Vavuniya and Killinochchi in Northern Provinces.

During Project Implementation

The program will strengthen the engagement of the employers organizations and professional bodies in TVET planning and delivery through (i) industry working groups to validate skills gap analysis, training plans, competency standards, and curricula; and (ii) introduction of purchasing model where employer can deliver training to bridge the skills gaps. A student tracking system will be established to ensure feedback from students and graduates can inform the TVET system improvement. The program will also introduce a targeted stipend program to encourage the participation of disadvantaged groups including women in TVET.

In addition to the engagement of employers organizations and professional bodies, civil society organizations providing TVET will also benefit from the program through access to curricula, assessment, quality management systems, as well as opportunities for public-private partnerships.

Business Opportunities

Consulting Services As results-based lending, the procurement of consulting services will follow the country system.
Procurement As results-based lending, the procurement will follow the country system.

Responsible Staff

Responsible ADB Officer Gi Soon Song
Responsible ADB Department South Asia Department
Responsible ADB Division Human and Social Development Division, SARD
Executing Agencies
Ministry of Youth Affairs and Skills Development
Nipunatha Piyasa,
No. 354/2, Elvitigala Mawatha,
Colombo 05, Sri Lanka


Concept Clearance -
Fact Finding 02 Dec 2013 to 13 Dec 2013
MRM 31 Jan 2014
Approval 28 Mar 2014
Last Review Mission -
Last PDS Update 28 Mar 2016

Loan 3119-SRI

Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Mar 2014 27 May 2014 30 May 2014 30 Jun 2017 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 361.00 Cumulative Contract Awards
ADB 50.00 28 Mar 2014 29.00 0.00 58%
Counterpart 185.00 Cumulative Disbursements
Cofinancing 126.00 28 Mar 2014 29.00 0.00 58%

Loan 3120-SRI

Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Mar 2014 27 May 2014 30 May 2014 30 Jun 2017 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 50.00 Cumulative Contract Awards
ADB 50.00 28 Mar 2014 27.66 0.00 59%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 28 Mar 2014 27.66 0.00 59%

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Title Document Type Document Date
Skills Sector Enhancement Program: Environmental and Social Management Framework (Draft) Environmental and Social Management System Frameworks Mar 2014
Skills Sector Enhancement Program: Program Safeguard Systems Assessment Program Safeguard Systems Assessments Jan 2014

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.

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