Sajith announces $ 100 m in ADB aid for SMEs

Saturday, 14 October 2023 01:53 - - {{hitsCtrl.values.hits}}

Funds to be received in December and disbursed as capital via 13 local banks
Approach to facilitate a loan guarantee program for SMEs and subsidised loans
Aid is a result of a series of discussions between ADB and SME sector facilitated by Opposition Leader

Opposition Leader Sajith Premadasa said Sri Lanka’s Small and Medium-scale Entrepreneurs (SMEs) have been presented with a great opportunity to strengthen their businesses following the Asian Development Bank’s (ADB) commitment to provide $ 100 million in aid to support them, which was announced yesterday.

The announcement was made during a meeting held between ADB officials and representatives of the SME sector at the Opposition Leader’s Office in Colombo yesterday.

This sum will be received in December and disbursed as capital through the National Credit Guarantee Institution and distributed via 13 banks within our national banking system. This approach will facilitate the implementation of a loan guarantee program for SMEs industrialists in the country. Additionally, it will enable a program that provides loans with subsidised interest rates.

Premadasa pointed out that a country’s progress is hindered when it has low Government revenue and lacks effective financial management. He stressed that to advance, a country should ideally have higher revenue as a percentage of its GDP. “However, the current Government is attempting to boost Government revenue by imposing tax increases which may not be effective if it leads to a contraction of the economy,” he remarked.

The Leader of the Opposition emphasised that expanding the economy is crucial to augment the State’s revenue. To achieve this, he noted that micro, small, and medium-scale industrialists would play a significant role, contributing nearly 50% to the growth.

Premadasa also expressed his gratitude for the support provided by the ADB in aiding the recovery of the struggling SME businesses in the country.

The Opposition Leader has played a facilitating role in organising multiple meetings between the ADB and the SME sector recently. These meetings provided an opportunity for SMEs to present the challenges they are encountering to ADB officials.

Sri Lanka Director of the ADB Takafumi Kadono attended the discussion along with ADB Private Sector Development Unit Head Santosh Pokharel and ADB Financial Analyst Uresha T. Walpitagama.