News

World Bank priority for SMEs in rural areas

BY ASANGA Warnakulasuriya

THE World Bank in its latest assessment on Sri Lanka's investment outlook has decided to accord more priority to small and medium entrepreneurs in rural areas to help them develop more interlinking and product mobilisation.

In an exclusive interview with the Daily News, World Bank Sector Manager, Finance and Private Sector for the South Asian region, Simon C. Bell said that the assessment which was carried out focusing on the private sector in urban and rural areas had revealed that a lack of proper linkages and streamlined product range had led to snail paced development in the small and medium sector in rural areas.

"Although the BOI companies and other private companies based in Colombo and suburbs have adopted the mechanism of linkages and mobilisation, it was evident that most of the SMEs in rural areas were either unaware or facing financial difficulties, adopting such strategies," Bell said.

Considering the fact that agriculture is Sri Lanka's economic mainstay like in many other countries in South Asia and a majority are farmers, diversifying agricultural products was never looked upon unlike with the industrial aspect, he said.

He also said that in its report due to be released shortly, several key issues hampering the development process were also identified. One of the major difficulties faced by the urban private sector was labour legislation which also links with the trade unions and their actions.

Interruptions in the power supply and inadequate infrastructure to expand businesses have added to their woes, Bell added.

On the contrary, the rural based private sector has less worries with workers since most of them were family members but the main worry for SME's in the inner part of the country is the lack of proper transportation facilities and inadequate funds to adopt new technologies.

Bell made these comments following his brief visit to Kosgoda to help victims affected by the tsunami.

A team of volunteer staff members led by the Director, World Bank Finance and Private Sector Development South Asia region, Joseph Pernia yesterday helped the NGO, International Association for Human Values (IAHV) to rebuild a house in Kosgoda. US$ 2,500 raised by staff members was given to IAHV.

The Director speaking at the presentation said that "the sum may be a small one but it is a small token of what we feel from the heart".

Suraj Nair, the representative of IAHV for Sri Lanka was also present.