Economic Development Ministry launches ‘Matching Grant Scheme

As Sri Lanka embarks on a journey to become the “Wonder of Asia”, Ministry of Economic Development has introduced a Matching Grant Scheme under the “Mahinda Chintana Vision for the Future” to support the tourism related SMEs and strengthen the local economy through sustainable tourism development.

Vice-President, Global Alliance and Channels, Infor, Jeff Abbot

Accordingly the Ministry of Economic Development has made available a sum of Rs. 2,000 million with a credit facility from the World Bank as an out-right grant for the development of tourism and tourism related Small and Medium Enterprises (SME’S).

Thereby, the Ministry of Economic Development will bear the cost for either 50% of the project value or a maximum of Rs. 10 million of any SME project under the tourism industry.

It is the government’s belief that the SME sector would bridge the gap between large scale corporates and micro level enterprises there by further contributing towards the objective of strengthening the economy of the country.

This Matching Grant Scheme will be administered by People’s Bank under the direction of the Ministry of Economic Development. People’s Bank as the matching admintrator ban brings forward over 50 years of experience in dealing with financial services relating to many ministries in the country and with an extensive branch network of over 725 and owning up to 24 SME sectors testified as the most qualified financial institution to manage the funding of this grant. Through this project it is estimated that almost 1500 SMEs belonging to the industry will receive benefits while 2000 new job opportunities will also be created. The project will also improve the technical and managerial skills of almost 5000 persons and it is expected to bring an additional investment of Rs. 5000 million towards tourism and tourism related SME’s. As per the recent analytics tourist arrivals for the year 2010 stood at 650,000 while this number increased to 1,005605 in 2012. The Government of Sri Lanka has arrived at steps to increase tourist arrivals to 2.5 Million in 2016 and to 4 Million by the year 2020.

Through such figures it is estimated that the country will receive an income of USD 3 Billion in 2016 and USD 8 Billion in 2020 in terms of foreign exchange earnings.

However in order to achieve these targets, certain drawbacks prevailing in the SME sector need to be identified and necessary steps need to be taken. It is important to create an environment that satisfy tourist which will result in re-visits and promote Sri Lanka as one of the best holiday destinations in the world.