The Hon. (Dr.) Anil Jayantha - Minister of Labour and Deputy Minister of Economic Development

¶ 01 Hon. Deputy Chairperson of Committees, the motion by Hon. Ravi Karunanayake on financing and empowering entrepreneurship to develop the economy is timely. Within about seven months, the Government has stabilized the country economically, fiscally, politically, and socially. International organizations, leaders, and diplomats acknowledge improvements in governance. We are implementing the Governance Diagnostic Assessment, upholding the rule of law, avoiding political abuse of power, and combating corruption.

¶ 02 When some make remarks—knowingly or otherwise—for political gain, two harmful tendencies appear: first, ethnic nationalism, which has cost Sri Lanka dearly; and second, fomenting distrust and discouragement. Investment requires confidence. Forecasts, such as the World Bank’s 3.1 percent growth for 2026, are based on available data and global risks; last year, IMF and World Bank projected 2.3 percent, but we achieved around 5 percent. We should not weaponize forecasts to deter investment and progress; we operate within constraints and need everyone’s support.

¶ 03 On entrepreneurship, it is not merely “doing any business” or saying “do not take jobs; be on your own.” Real entrepreneurship means deploying one’s labour, creativity, and capital to add value productively—linking our workforce into national and global value chains.

¶ 04 Our labour laws have historically been reactive—resolving disputes rather than cultivating productive relations. We have proposed to Cabinet appointing a special group to consolidate labour laws into a modern framework that fosters productive relations, resolves issues responsibly, and improves industrial harmony.

¶ 05 On finance, credit alone without sound entrepreneurial objectives is ineffective. We will examine why businesses failed—causes and data-driven remedies. Market power and information asymmetries must be addressed so fair information reaches all, with training, financial literacy, and digital literacy.

¶ 06 We note existing schemes: under “E-Friends,” Rs. 197 million was allocated in 2025 across 88 sectors, totaling about Rs. 2.4 billion cumulatively. “SMILE” and “E-Friends” loan schemes continue—about Rs. 4,000 million through ten banks across 19 sectors. However, distribution has been geographically skewed—concentrated in the Western Province and certain districts and banks—creating disparities. We will correct this.

¶ 07 Research shows some concessional loans were diverted, with politically connected borrowers re-depositing funds elsewhere rather than investing productively. We must prevent such leakages.

¶ 08 Currently, we utilize ADB-supported SME LoCs—two projects—where banks refinance and on-lend; Stage I totaled USD 206 million since 2016 and has been rupee-hedged, with Rs. 16,979 million disbursed in 2025; Stage II of similar size is planned. Collateral shortfalls are a key barrier; through the National Credit Guarantee Institution, after assessing business viability, we will provide guarantees and work toward a robust banking framework, ultimately establishing a Development Bank and strong regional finance to back production nationwide. We will incorporate Members’ ideas as we implement this agenda.

¶ 09 Thank you.