Small and Medium-sized
Enterprises (SMEs) have long been considered the backbone of the economy in Sri
Lanka. They have played a crucial role in providing employment opportunities,
mobilizing domestic savings, reducing poverty, and contributing to the
country's Gross Domestic Product (GDP). However, SMEs in Sri Lanka are
currently facing a critical moment, as they are faced with a range of
challenges that threaten their survival and growth. The SME sector dominates
the agriculture, plantation, construction, manufacturing, trade and other
services industries, with over 70% of the country's population involved in
SMEs.
One of the biggest challenges
that SMEs are facing is the impact of COVID-19 on the global economy. The
pandemic has led to a sharp decline in consumer spending and a decrease in
demand for goods and services. This has had a direct impact on SMEs, particularly
in sectors such as tourism, hospitality, and retail, where businesses have been
forced to close or reduce their operations. This has resulted in a significant
loss of revenue and has put many SMEs in a precarious financial position.
