August 09, Colombo (LNW): A new bill will be introduced to address bankrupt Micro, Small and Medium Enterprises (MSMEs.) as it was not feasible to indefinitely maintain the temporarily suspended Parate law.
President Ranil Wickremesinghe mentioned that the proposed bill includes provisions for restructuring loans taken by Micro, Small and Medium Enterprises (MSMEs).
“Currently, the government has suspended the Parate law, but it cannot remain suspended indefinitely. Therefore, we are working on a new Insolvency Bill, which we have now presented. A copy will be made available for discussion
Additionally, a new institution named “Enterprise Sri Lanka” will be established to provide necessary support and assistance to Micro, Small and Medium-Scale Entrepreneurs. The President emphasised that the Government is committed to encouraging and empowering these entrepreneurs in Sri Lanka.
The President made these revelations at the Ceylon Federation of MSMEs organised “Critical initiative to revitalise Sri Lanka’s micro, small and medium scale economy” forum at the BMICH.
The President stated that a copy of the new bill, which has already been drafted, can be provided to the Ceylon Federation of MSMEs. He requested that micro, small, and medium enterprises submit their views and suggestions on the bill.
Additionally, the President mentioned that an opportunity could be arranged to discuss the issues faced by micro, small, and medium enterprises with the International Monetary Fund (IMF) delegation scheduled to visit Sri Lanka at the end of this month.
President Wickremesinghe further stated: “There have been many questions from you, the Micro, Small and Medium-scale Entrepreneurs, about the recent challenges. Before addressing your specific concerns, I want to explain the background that led to these issues. We need to find solutions based on this context.”
“During the recent past, the country’s economy faced a severe collapse, impacting all businesses, particularly small enterprises and causing widespread losses among micro-enterprises. The banking system was also at risk. Our immediate priority upon taking office was to stabilise the situation, negotiate with the IMF, and work towards economic recovery.
They indicated that reaching an agreement with the IMF would allow us to move forward. Private creditors also agreed to address the framework once we had an agreement with the official creditors. Without financial support, making progress was impossible.”
“During that period, we had to agree on several key issues. We decided not to print more money or borrow from banks, as banks themselves were struggling. These practices had become our main sources of income, but we were advised to abandon these flawed approaches and adopt a new strategy.”
