Sri Lankan government to launch five year Innovation and Entrepreneurship Strategy for better doing-business climate
Sri Lanka’s State Minister for National Policies and Economic Affairs Dr. Harsha de Silva has said the government is looking at ensuring a better doing-business climate in the country by introducing a new five year Innovation and Entrepreneurship Strategy.
The Minister has said the new strategy will be unveiled soon and many positive changes will be implemented by the end of the month.
The Minister has made these observations at the launch of Sri Lanka’s first integrated entrepreneurship platform, Venture Frontier Lanka.
Dr. de Silva has noted the critical need for the government to deliver on consistent policies to encourage entrepreneurship, which will lead the country towards a well-planned path to development.
“The Government’s Vision for 2025 is to create a prosperous nation and build a knowledge-based, highly competitive social market economy. To achieve this, we need to create high-paying jobs and we need entrepreneurs and start-up businesses. Entrepreneurs who set up SMEs are engines of growth. Start-ups are disruptive, innovative, and dynamic, while jobs that will be created here are of high value, high skill, and high pay,” the Minister has said.
He has explained that the key objectives of the Innovation and Entrepreneurship Strategy 2018 – 2022 were the high skill and capital-intensive exports production, building the ecosystem for scaling growth-oriented start-ups, and modernising and re-aligning the research and development (R and D) sector.
“The strategy wants to support SMEs in developing higher value-added products and services for exports. We want to improve the business environment, supporting early stage financing and reviewing the institutional framework. One such step would be allowing limited liability partnerships and encouraging angel financing. We also need to increase R and D spending to at least 0.8% of GDP, with at least 50% coming from the private sector,” de Silva has noted.
According to data, only 2.8% or around 230,000 of the working population in Sri Lanka are employers or business owners, compared to 27.5% in Thailand, 19.6% in Vietnam, 16.9% in Brazil, 15.3% in Indonesia, 11.6% in Bangladesh and 7.5% in China. He said considering the population of these countries, the level of entrepreneurial activity in these economies were staggering.
“The data does not paint a rosy picture about entrepreneurship in Sri Lanka. I listen to people from all over this nation, and I know that they have the raw skills and revolutionary ideas that are the base for successful entrepreneurship, but that is not enough. They (entrepreneurs) need training, mentoring, guidance on how to do their market research, structure their project, where and how to approach funders, market their products and need innovative financing,” Dr. de Silva has observed.
He has also noted that the start-up business model requires banks and finance companies to adopt a different attitude to financing, and requires newer models like venture capital and angel financing.
However, the Minister has assured that the government was taking steps to directly address some of the major stumbling blocks, such as lack of financing and lack of mentoring through.
The Sri Lankan government’s commitment to improve the country’s doing-business climate is an encouraging signal for those interested in setting up businesses in the island nation. The proposed Innovation and Entrepreneurship Strategy would result in the opening up of many investment opportunities as well as create opportunities for local SMEs to grow to a position where they could seek partnerships with foreign businesses.
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