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President proposes new development bank, Economic Commission

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President Ranil Wickremesinghe yesterday (19) announced the establishment of a new development bank to provide financial support to industrialists in Sri Lanka. This initiative will offer industrialists the opportunity to obtain loans at low interest rates, the President declared.

The President also revealed plans to set up an Economic Commission to oversee these activities. A new institution, “Enterprise Sri Lanka,” will also be created to empower small and medium-sized entrepreneurs.

President Ranil Wickremesinghe made this announcement during the inauguration of the International Industry Expo 2024, the first event of its kind in Sri Lanka.

Organized by the Industrial Development Board under the guidance of the Ministry of Industry, and with the support of Industries and Health Minister Dr. Ramesh Pathirana, the exhibition will run from today (20) until June 23 at the Sirimavo Bandaranaike International Conference Hall.

In his address, the President remarked that some individuals have become accustomed to taking every development initiative to court. He emphasized that such actions hinder progress and stressed that the country can only be developed through a consistent national policy.

President Wickremesinghe said: We were a bankrupt nation. However, in the coming weeks, we anticipate shedding this label entirely. Negotiations for the related agreement are also slated for completion in the near future, facilitating smoother dealings with private creditors. These achievements have been realized over the past two years.

Yet, we must not rest on these achievements. Our focus must now shift to debt repayment strategies, as we aim to settle outstanding loans over an extended period, ideally extending until 2042.

Given that we are primarily an import-based economy, we continually need foreign exchange to cover these imports. Without sufficient foreign exchange reserves, we are compelled to resort to taking loans. However, this practice can potentially lead to another economic crisis within the next 15-20 years. Hence, our current focus is on transitioning to an export-oriented economy.

In this shift towards an export-oriented economy, the manufacturing sector plays a pivotal role. This sector needs to evolve into a competitive and digital economy, aligned with our goal of achieving zero carbon emissions and fostering a green economy. These initiatives must guide our efforts moving forward.

Our immediate priority is to enhance the competitiveness of existing industries through strategic plans. Achieving competitiveness cannot happen overnight; neighbouring countries like India, particularly in states such as Tamil Nadu, Telangana, and Andhra Pradesh, have made significant strides in industrial development. It is crucial for us to align and collaborate with these developments. Furthermore, we aim to engage with other global partners to advance these objectives.

Therefore, our primary objective is to ensure our industries attain competitive capabilities. The government is committed to providing all necessary support to facilitate this transformation.

We are currently exploring the establishment of a development bank to facilitate the required funding for this initiative. Back in 1960, we established the DFCC Bank, followed by the founding of the NDB Bank in 1980. Post-privatization, both banks have evolved into major commercial entities in our country. Notably, without these banks, President Premadasa’s success with 200 garment industries would not have been possible. Hence, there is a strong need to initiate a new bank.

This new bank aims to maintain low interest rates. Additionally, an Economic Commission will be instituted to advance these initiatives. Furthermore, we plan to introduce a new entity called Enterprise Sri Lanka to support small and medium-scale entrepreneurs. This institutional framework is designed to assist all industrialists across the country. We aim to progress steadily along this path over the next 5-10 years.

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