Additional financing is slated for the National Credit Guarantee Institution (NCGI) once the effectiveness of the NCGI is proven and the first guarantees will be issued towards the end of the year, Takafumi Kadono, Country Director, Sri Lanka Resident Mission told the CMA Sri Lanka SME Development Summit 2024 held yesterday.
He said ADB also intends to play a prominent role in supporting SMEs in Sri Lanka as they contribute 52% of GDP, 45% of employment and constitute more than 75% of enterprises in the country.
Some of Sri Lanka’s fastest growing sectors such as tourism, agriculture, information technology and business process outsourcing are mostly SMEs and they have the power to drive the growth, diversify exports, develop local skills, generate employment, alleviate geographical and social disparities and make Sri Lanka a resilient, inclusive and competitive country. However, SMEs are disadvantaged and have been hit hardest by a spate of crises and there are structural issues that hindered them from growing, he said.
Kadono said recent research showed that if there were gender parity in accessing finance globally by women led entrepreneurs an estimated USD 5 to 6 trillion net value addition could be achieved globally. He commended the Central Bank of Sri Lanka for launching the financial literacy road map, which does highlight the need of educating SMEs to develop their financial literacy.
Meanwhile, Udeni Samararatne, Director NCGI addressing event said a second tranche of USD 50 million is expected from the ADB after monitoring the performance of the NCGI. He said upto a 67% guarantee will be provided by the NCGI to borrowers.
Fizel Jabir
