The Government announced that the ongoing freeze on parate action for Micro, Small, and Medium Enterprises (MSMEs) will be extended beyond the original deadline of 15 December.
This extension was confirmed in a meeting led by Deputy Minister of Finance and Planning, Dr. Harshana Suriyapperuma, with representatives from MSMEs. The Government is set to introduce a Parliamentary Act to prolong the suspension for an additional six months.
This initiative forms part of an ongoing effort to unite various MSME advocacy groups, including the Ceylon Federation of MSMEs and the National Trade Protection Council.
The Ceylon Federation of MSMEs welcomed the move, stating that it would provide much-needed relief to MSMEs.
The Central Bank will gather the necessary information, and further talks are planned for early next week.
Deputy Minister Suriyapperuma expressed optimism that the extension would benefit a wider range of MSMEs. Mahendra Perera, President of the Ceylon Federation of MSMEs, added that the discussion also covered the potential for debt restructuring, including the possibility of lowering interest rates to help businesses manage their loans more effectively.
The meeting also addressed the challenges faced by businesses that have fallen into non-performing loan (NPL) status, particularly due to the impacts of the COVID-19 pandemic and the Easter Sunday attacks. Solutions to these issues were actively discussed.
One suggestion made was to return properties and businesses seized by banks in auctions between 2019 and 2024 to their original owners.
It was proposed that a debt restructuring process be put in place to allow for the repayment of loans, with collaboration between the Central Bank and the Ministry of Finance.
The meeting further focused on creating a conducive environment for sustainable entrepreneurial growth in Sri Lanka. A proposal was made for establishing a data system to better capture and address the challenges faced by both entrepreneurs and MSMEs.
To protect domestic MSMEs, it was recommended that registered trade unions from each sector, along with representatives from the Central Bank, the Ministry of Industry, and relevant banks, form a committee to tackle MSME challenges. The attendees supported this idea and agreed to move forward.
Additionally, officials and MSME representatives discussed tax issues, including tax arrears, and proposed removing penalties while providing opportunities for MSMEs to pay off arrears, including contributions to the Employees’ Provident Fund (EPF) and Employees’ Trust Fund (ETF).
