PM reiterates SME support to fuel SL growth story

Prof. Lakshman Watawala handing over SME committee proposals to Prime Minister in the presence of Wimal Weerawansa Minister of Industries, Mahinda Amaraweera Minister of Environment, Ajith Nivard Cabraal State Minister of Money & Capital Market and State Enterprise Reforms and D.V. Chanaka State Minster of Aviation and Export Zones Development, Dr.Upul Galappathi MP Hambantota District and Co-Chair District Co-Organising Committee, Dr. D K Rajapakse Chairman Emeritus DSI Samson Group and Suresh De Mel, Director HDCC

Prime Minister Mahinda Rajapaksa reiterated government’s support for the upliftment of small and medium enterprises (SME) so that the sector can be an active player in the country’s post-COVID-19 growth story.

As local SMEs continue to face the challenges of having access to capital, and international market exposure among others, the Premier said the newly elected government would go the extra mile to ensure the sector is provided with a level playing field and a sustainable avenue for growth.

“We will provide all facilities for the development of exports by SMEs as I find the share is only 5 percent compared to the global average of 30 percent. We will provide all support by granting incentives and other assistance to those who venture to earn valuable foreign exchange for Sri Lanka,” said Prime Minister Rajapaksa at the first Regional SME Development Conference held in Hambantota, co-hosted by CMA Sri Lanka and the Hambantota District Chamber of Commerce.

He added the granting of tax incentives for the impacted SME sector would be supported as such would enable many of these businesses affected by COVID-19 pandemic.

“It will help to withstand the difficult times and make them stronger and viable, especially those operating in difficult and most difficult areas such the Hambantota district,” Rajapaksa told the audience that comprised of over 375 SMEs.

Furthermore, he shared that the setting up of a Credit Guarantee Institution would materialise in the near future as it is acknowledged that SMEs and start-ups are unable to take their efforts forward due to the inability of providing collateral for securing finances. The endeavour would be pushed forward by the Finance Ministry with the assistance of a number of foreign lending agencies which have already pledged to provide the necessary funding, he said.

Following the two-month long island wide lockdown that took place to contain the pandemic, CMA established a COVID-19 SME Committee together with professional bodies, Chambers of Commerce & Industry, commercial banks, and industry experts to find solutions to problems faced by the SME sector.

Following a comprehensive analysis of the situation, the committee forwarded a number of recommendations such as; the setting up of export houses, extending tax incentives to SMEs in the rural underdeveloped areas, revising labour laws, and identifying leading Sri Lankan companies to explore opportunities to attract Japanese investments affected by COVID – 19 pandemic to shift to Sri Lanka.CMA President Prof. Lakshman Watawala also proposed the setting up of ‘SME Help Desks’ by member Chambers of Commerce and Industry, so that impacted SMEs are provided assistance for their revival.

Via the Help Desk initiative, expert committees would be established to extend to SMEs advice on financing, labour, management, marketing, entrepreneurship, skills development and accessing commercial bank loans and other facilities. 

SMEs in Sri Lanka account for 52 percent of the GDP, and 45 percent of the total employment, and makes up for more than 75 percent of the total number of enterprises in the country.