1. ECONOMIC TRENDS FOR SME DEVELOPMENT IN SRI LANKA

2. Socio - Economic Indicators Sri Lanka at a glance  Multiracial Country – Total population 20.01 million (2007)  Area – 65,610 sq km (Water 870 sq km  Coastline – 1340 km  Natural Resources – Limestone, graphite, mineral sands and gems, phosphates, clay, hydropower  Poor house holds – 15.2%  Human Development Index – 0.74 (2005) (The placed 99 among 177 countries)

3. Contd:-  Life expectancy - Male 71.7 years Female 77 years  Total fertility rate - 1.85 children born/woman  People living with HIV/AIDS – 3500  Ethnic groups - Sinhalese 73.8%, Sri Lankan Moors 7.2%, Indian Tamils 4.6%, Sri Lankan Tamil 3.9%, Others 10.5  Literacy rate -92.5% ( Definition ; age 15 and over can read and write)

4. People  Age structure - 0 - 14 Years 24.4% 15 - 64 Years 68.4% 65 years & over 7.2%  Population growth rate - 1.1% (2007 est.)  Net migration rate - 1.27 migrants/1000 population (2005 est.)  Sex ratio - Total population -.96 male/female ( 2005 est.)

5. Economy  GDP per capita - US $ 1617 (2007)  GDP composition by sector Agriculture - 12.3% Industry - 28.2% Services - 59.5%  Labour force – 7.48 million (2007) Country1950 (US $)2004 (US $) Sri Lanka891012 (12 times) Japan9032000 (355 times) Singapore3028000 (933 times) Maldives303120 (144 times)

6. Contd;  Unemployment rate – 6.5% (2006)  Population below poverty line – 5.6%  Gini index (Income distribution) – 0.46 (Zero is perfect)  Inflation rate – 14%  Investment – 27% of GDP  Industries – rubber processing, tea, coconuts and other agricultural commodities, clothing, cement, petroleum refining, textiles, tobacco  Exports partners – US 32.4%, UK 13.5%, India 6.8%, Germany 4.8% ( 2005 est.)

7. Definitions of SMEs Total Assets Valve excluding land & building less Rs.1 M --Micro Industries Total Assets excluding land and building ranging between Rs. 1-20 M. --Small Industries Total Assets excluding land & building ranging between Rs.20-50 M. --Medium Industries Source – Ministry of Industry & Investment Promotion (White Paper December 2003) (Draft Paper)

8. Significant of SMEs - More Labour intensive - Supply of Cheap Goods & Services - Less Value Addition - Sub Contracting Facilities - Generating an employment opportunities - Requiring Minimum Investment