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President Ranil Wickremesinghe yesterday (19th) announced the establishment of a new development bank to provide financial assistance to Sri Lankan businessmen, who he declared would have the opportunity to access loans at low interest rates.
The President also unveiled plans to set up an Economic Commission to oversee these activities, and a new agency, Enterprise Sri Lanka, will also be established to support small and medium-sized enterprise entrepreneurs.
President Ranil Wickremesinghe made the announcement at the opening ceremony of the International Industry Expo 2024, Sri Lanka’s first ever.
The exhibition is being organised by the Industrial Development Board under the guidance of the Ministry of Industry and with the patronage of Minister of State for Industry and Health, Dr Ramesh Pathirana, and will be held from today (20th) until June 23rd at the Sirimavo Bandaranaike International Conference Centre.
In his speech, the President noted that some people have become accustomed to taking every development project to court. He stressed that such actions are hindering progress, stressing that the country can only develop through a coherent national policy.
“We have been a bankrupt state, but I hope that in the coming weeks we will be able to completely shed that label. Negotiations on related agreements are also expected to be completed in the near future which will make transactions with private creditors smoother. These achievements have been achieved over the past two years,” President Wickremesinghe said.
However, we cannot rest on our laurels as we aim to repay our long-term outstanding loans, ideally stretching out to 2042, and our focus must now shift to our debt repayment strategy.
As our country is primarily an import-based economy, we continually require foreign exchange to cover these imports. Without sufficient foreign exchange reserves, we have no choice but to resort to borrowing. However, this approach could lead to a new economic crisis within the next 15-20 years. Therefore, our country is currently focusing on transitioning to an export-oriented economy.
Manufacturing plays a vital role in the transition to an export-oriented economy. The sector must evolve into a competitive digital economy, in line with the goal of achieving zero carbon emissions and promoting a green economy. These efforts must guide future efforts.
Our immediate priority is to make our existing industries competitive through strategic planning. Achieving competitiveness is not something that can be achieved overnight. Neighbouring countries like India, especially states like Tamil Nadu, Telangana and Andhra Pradesh, have made great strides in industrial development. Our immediate challenge is to keep pace with these developments and collaborate. Furthermore, we will work with other global partners in the near term to achieve these goals.
Our main objective, therefore, is to enable our industries to gain competitiveness. The Government is committed to providing all the support necessary to facilitate this transformation.
We are currently considering setting up a development bank to raise the capital required for this endeavour. We established DFCC Bank in 1960, followed by NDB Bank in 1980. After privatisation, both banks have grown into major commercial organisations in our country. In particular, without these banks, the success of President Premadasa’s 200 garment industry would not have been possible. Hence, the need to set up a new bank is growing.
This new bank will aim to maintain low interest rates. Furthermore, an Economic Commission will be established to drive these initiatives. Furthermore, we will be introducing a new entity called Enterprise Sri Lanka to support small and medium-sized enterprises. This institutional framework is designed to support all industrialists across the country. We aim to progress steadily on this path over the next 5-10 years.
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