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Last week's Development Forum discussed challenges faced by the economy and governments policy to deal with them. Last week's Development Forum discussed challenges faced by the economy and governments policy to deal with them. Donors were encouraging the government to setup a mechanism to deliver Tsunami aid to Northeastern areas including those controlled by the LTTE.

Analysts say this is only the first of many challenges faced by the government.

Donors spent time discussing Sri Lanka’s economic plans that seek a bigger interventionist role for the state at the development forum in Kandy a few days ago.

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They also discussed how government plans to implement Tsunami reconstruction in North Eastern areas where a bitter dispute between the People’s Alliance and its leftist partner the JVP is preventing the setting up of a development mechanism for the area.

Aid givers, who have pledged enough funds to finance the reconstruction say they are keen the government put in place a working arrangement so that everybody can be helped based on needs and not on whether they reside in a government controlled a