The process and institutional arrangements that underpin policy efficiency are critical factors in overcoming economic and political barriers to growth and development. Policy efficiency can ensure that difficult but necessary reforms are identified, prioritised, initiated, implemented, and sustained over time.
In view of Sri Lanka’s current demographic transition, higher growth will have to come from improved labour productivity and efficiency, encompassing a gamut of regulatory reforms to raise competitiveness and institutional capacity in the economy. This calls for policies that will allow for a reallocation of factors of production; diversification, upgrading, and deepening of the production and export baskets; and the use of new production methods and processes, and different inputs.