ADB Approves $106.9m Package to Modernize Sri Lanka’s Health Care System

The Asian Development Bank (ADB) has approved a $106.9 million financing package to support a sweeping reform of Sri Lanka’s health sector, aimed at strengthening secondary curative care services, enhancing disease prevention and control, and improving governance and management capacity within the system.

The financing includes a $100 million loan and a $6.9 million grant from the Pandemic Prevention, Preparedness, and Response Trust Fund, underscoring ADB’s commitment to helping Sri Lanka reinforce its health care systems for future resilience.

Responding to a Changing Health Landscape

“Sri Lanka has made impressive gains in ensuring access to and quality of health services for all,” said Takafumi Kadono, ADB’s Country Director for Sri Lanka. “But with rising longevity and changing lifestyles, elderly health care needs and noncommunicable diseases are on the rise. Such demographic and disease pattern changes require a more robust secondary care to effectively provide patient-centered treatments and care services with enhanced case management capacity.”

While Sri Lanka’s free public health system has been praised globally for its successes in maternal and child health, the country faces a mounting double burden: chronic noncommunicable diseases such as diabetes and heart disease, alongside the persistent threat of communicable disease outbreaks.

Building a Stronger Secondary Care System

The new program, titled the Strengthening Integrated Health Care and Governance for Universal Health Coverage Program, adopts a Results-Based Lending (RBL) approach. This means funding will be disbursed upon the achievement of concrete performance targets rather than traditional project inputs.

Key components include:

• Hospital modernization: Nationwide upgrades in infrastructure and service processes to ensure quality care, climate resilience, gender responsiveness, and elderly-friendly facilities.

• Patient-centered services: Expanding surgical and specialist treatment availability in secondary hospitals, helping transform them into the first point of referral for patients, integrated with primary care and community services.

• Resource optimization: Enhancing cooperation between hospitals, primary health care facilities, and other government services for efficient use of resources.

Strengthening Pandemic Preparedness

The COVID-19 pandemic highlighted vulnerabilities in Sri Lanka’s health system. This program seeks to correct them through:

• Establishing a national center for disease control.

• Expanding and accrediting public health laboratories.

• Implementing integrated disease surveillance systems across sectors.

• Bolstering pharmaceutical logistics, quality assurance, and supply chain integrity.

Such improvements will not only improve responses to future pandemics but also enhance day-to-day disease monitoring and outbreak management.

Enhancing Governance and Integrity

The package also aims to improve governance in the health sector. This will include:

• Digitalization of the government procurement system, improving transparency and efficiency.

• Adoption of global best practices in pharmaceutical procurement and regulation.

• Strengthened oversight mechanisms to prevent corruption and ensure quality standards.

These measures reflect ADB’s broader focus on strengthening institutional integrity, ensuring that every dollar invested translates into better services for patients.

Benefits for All Sri Lankans

The improvements are designed to benefit the entire population. With stronger and more responsive health systems, healthy citizens will be better positioned to pursue educational and economic opportunities, fueling Sri Lanka’s long-term development goals.

The ADB emphasizes that investment in health care is not just a social good but an economic necessity, contributing to workforce productivity and sustainable growth.

Looking Ahead

This program aligns with Sri Lanka’s ambition to achieve universal health coverage while modernizing its health sector to meet the demands of an ageing population and new health challenges. By focusing on integration, transparency, and resilience, the initiative offers a pathway to a stronger, more equitable, and future-ready health system.