ADB boost for small and medium enterprises
[February 19, 2002 - 12.00 GMT]

The Asian Development Bank (ADB) has signed an agreement with the Government to provide US $ 86 million “to strengthen” the Small and Medium Scale Enterprises (SMEs) in Sri Lanka.

The ADB assistance will be given in three segments. A US $ 20 million policy loan will be provided to support reforms under the first segment and a US $ 6 million investment loan for the consulting contracts and procurements associated with the “Business Services Support Facility” under the second.

Under segment three US$ 60 million investment loan will be provided for five participating credit institutions - National Development Bank (NDB) Development and Finance Corporation Bank (DFCC), Hatton National Bank (HNB), Commercial Bank and Sampath Bank - to finance SMEs on commercial terms. 

"The SME sector creates jobs and helps reduce poverty," said ADB's Principal Economist Jaseem Ahmed. 

“Give them a supportive, but not protective, policy and regulatory environment and they will take the lead," he added.

The package also consists of a partial credit guarantee to support commercial co-financing up to US $ 90 million.

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Last Updated Date: February 19, 2002  - 12.00 GMT.