SL calls for greater integration at SAARC SME Forum

*  26% of the GDP in SL generated by SME’s

* Almost 80% of Exporters in SL are SME’s

* Over 60% of tea production in SL is by SME’s

Sri Lanka yesterday called for greater integration between the member nations of South Asia Association for Regional Cooperation (SAARC) and especially by the Small and Medium Enterprises (SMEs).

This call was made by Sri Lanka’s Minister for Industry and Commerce Rishad Bathiudeen and his delegation attending the two-day international conference on “Evolving a SME policy for SAARC countries” in Chennai, India organised by the Tamil Nadu Small Industries Association and Friedrich Naumann Stiftung Fur die Freiheit (FNF) Germany.

Minister Bathiudeen was the chief guest at the opening whilst the other two in the Lankan delegation are Federation of Chamber of Commerce of Sri Lanka President Kosala Wickramanayake and Board Director for EDB/IDB and task force member of the Industrial Development strategy for Sri Lanka Rohantha Athukorala.

Minister Bathiudeen in his address said that the challenge for South Asia is how inter-regional trade can be increased given that the total external trade of the region is at a low ebb of 0.8% of the world’s exports and 1.3% of world imports and the intra regional trade represents only a meager 5.3% (Exports) and 4.8% (Imports) of the total, in contrast with the likes of  EU where 55% of the total trade comes from within the EU;  while in ASEAN 35% of the total trade comes from within which explains the strong integration that exists between countries, in comparison to South Asia.  He went on to say that in the NAFTA, the integration is so strong that 60% of the trade comes from within the region.

Rohantha Athukorala presenting the Sri Lankan scenario mentioned that Sri Lanka could play catalyst to integrating trade between the region with its emerging hub status for transport, Commercial, Knowledge, Shopping and later on the financial hub that will take form.

He went on to say that a 8.5% GDP growth registered in quarter 2 driven by the SME sector is an indication of the entrepreneurial skills  available and with the new budget reforms coming into play later in the year Sri Lanka becoming an economic engine in the South Asian region will only be a matter of time.

There were many commitments for entrepreneurs wanting to set up Rice Mills, Fisheries export companies post the Sri Lankan Session which was the highlight of Day One as the country is emerging after a 30 year conflict.

Kosala Wickramanayake said that even the tea industry is driven by the SME sector which contributes to over half the production of the quality tea of the country.

He explained the regional network that the chambers had and how it assisted SMEs in the incubation period to becoming business enterprises.

South Asia is the home to around 2 billion out of the six billion people in the world and the World Bank and ADB estimate that the regional GDP to be worth almost a US$ 1000 billion while the GDP growth for the last 20 years has been around 5% which is double the Global average.

Some of the key points discussed were the need for a SME policy and how access to finance can be facilitated together with support services like R&D and market access by the Indian, Pakistan, Bangladesh, Bhutan and Maldivian high level delegation.