Helping Hand for Sri Lanka's Small Businesses

George Saibel, Director of the Special Advisory Services Division of the Commonwealth Secretariat

Small and medium-sized enterprises (SMEs) in the rural areas of Sri Lanka struggle to exist in today's globalised economy. They are hampered by the lack of technology and access to credit and markets, as well as competition from foreign products. To assist these SMEs in enhancing their competitive edge, the Commonwealth Secretariat is working with Sri Lanka's Ministry of Small and Rural Industries to develop a policy framework that will outline the targets and measures to achieve results for rural SMEs. This includes strategies such as the establishment of a network of rural SMEs for greater co-operation, the development of an information database and the facilitation of financing opportunities.

This project in capacity-building, to be implemented in 2006, is sponsored by the Commonwealth Fund for Technical Co-operation (CFTC). It is aimed at supporting the Government of Sri Lanka's efforts to attain the Millennium Development Goals through job creation and economic growth, and thus reduce poverty.

The growth of Sri Lanka's agricultural and manufacturing sectors has slowed in recent years. The liberalised global market has also made many SMEs more vulnerable to competition pressure from better quality foreign products. The lack of infrastructure in the rural areas where a majority of the population reside, the small size of its enterprises that are moreover scattered over wide areas, and the lack of technical know-how in product design and markets pose a major challenge to the development of rural industries.

George Saibel, Director of the Special Advisory Services Division of the Secretariat, which is overseeing this CFTC project, said: "This project will enhance the operational SME policy environment and enable small rural entrepreneurs to develop viable and competitive enterprises. It also aims at increasing the knowledge levels and institutional capacity of the Ministry of Small and Rural Industries and support institutions to implement rural SME support programmes."

Mr Saibel added that the CFTC project will contribute towards the Government's goals of reducing regional imbalance, increasing economic and business opportunities in rural areas, enhancing general employment and strengthening the co-ordination of SME activities in Sri Lanka.

 

CNIS - Commonwealth News and Information Service Issue 265, 14 December 2005

Key Links:

• CFTC
• Country Profile: Sri Lanka
• Special Advisory Services