Through low-interest loans and grants, IFAD develops and finances projects that enable rural poor people to overcome poverty themselves. IFAD also acts as an advocate for the small farmers, herders, fisher folk, landless workers, artisans and indigenous peoples who live in rural areas and represent 75 per cent of the world’s 1.2 billion extremely poor people.

Sri Lanka was one of the first countries to benefit from IFAD loans. Since 1978 Sri Lanka has received a total of US$ 145.2 million for 18 projects to improve the lives and livelihoods of some 25-30 thousand households, or about 1.8.million people. Out the total money received Sri Lanka was able to use about US $ 75 million with varying degrees of disbursement rates. Most of these programmes are in the agriculture sector covering food crops, plantation crops and spices, and a few of them invested in the irrigation and fisheries sectors.

In 2005, in response to the urgent priority of recovery from the devastating effects of the tsunami, IFAD earmarked a total of about US$34.5 million, in addition to the loan resources presented above, to support two programmes in the affected area:

• the Post-Tsunami Coastal Rehabilitation and Resource Management Programme benefits about 250,000 people, focusing on management of coastal resources, and development of social and economic infrastructure, including housing and fisheries
• the Post-Tsunami Livelihoods Support and Partnership Programme benefits around 22,000 people, focusing on housing as priority infrastructure.