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Ceylon Federation of MSME partners with IDB to further develop Entrepreneurship

By: Staff Writer

May 26, Colombo (LNW): For the first time in Sri Lanka, to promote entrepreneurship (Public/Private), the Industrial Development Board and the Ceylon Federation of MSME signed a memorandum of understanding at the Industrial Development Board head office before the unlocking of Rs 5 billion new loan relief package proposed in the budget 2024, leading members of the federation said.  

The aim is to align our entrepreneurship with the global need to connect with the international community, not only the activities that can be done in the country for entrepreneurs.

The Ceylon Federation of MSME, which has been personally successful in setting up the mechanism for that, has built the necessary capacity and resources for that purpose, they added. .

Another task is to establish a link between the government institutions including the Industrial Development Board, which is essential for entrepreneurship and its existence, for the common purpose.

The finance ministry in collaboration with ministry of industries will provide credit facilities of Rs 5 million each to 1000 selected existing MSMEs for further expansion and recovery of their businesses via licensed commercial banks and licensed specialised banks at concessional interest rates.

Another special loan scheme amounting to Rs.3 billion will be implemented with support from the Asian Development Bank (ADB) in addition to the 2024 budgetary support.

The government is also considering the possibility of upgrading the Sri Lanka Savings Bank a subsidiary of the National Savings Bank to a MSME Bank or to set up a special purpose vehicle (SPV) to disburse loans easing the burden on the banking sector.

Preliminary activities in the selection of eligible existing MSMEs are now underway and further information relating to this loan scheme could be obtained from the director (sectorial development division of the ministry of industries), President of the Ceylon Federation of MSME, Shashika De Silva disclosed.  

Another purpose of this partnership with the Industrial Development Board is to build a government mechanism where entrepreneurs can effectively receive the resources and opportunities they create under a proper system.

 In this way, it will be possible to get answers to many huge questions affecting entrepreneurship Vice Presidents of the Federation of MSME. Mahendra Perera said.

The micro, small, and medium enterprise (MSME) sector in Sri Lanka accounts for 90 percent of all businesses in the country, provides 45percent of employment, and contributes 52percent to the GDP.

A recent ILO study revealed that 79.8 percent of the one million MSMEs that operated in 2018 were still in operation.

Among the 20.2 percent businesses either permanently or temporarily closed, 8.3percent of closures were reported to be due to economic crisis while 11.9percent were due to reasons other than economic crisisChairman of the Industrial Development Board, Dr. Mr. Saranga Alahapperuma, General Manager of the Industrial Development Board and Mrs. Shashika De Silva, the President of the Ceylon Federation of MSME, Vice Presidents, Mr. Mahendra Perera, and Mr. S.N. Raghavan participated in this event.

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