Colombo, December 22, 2008—IFC,
a member of the World Bank Group, is facilitating the streamlining of business
licensing processes in Matara in the Southern Province of Sri Lanka, which
could help promote entrepreneurship and economic growth in an area that
is home to one-fifth of the country’s population.
The initiative, undertaken in collaboration
with the Matara Municipal Council, is designed to make it easier for companies
and small enterprises to obtain licenses and permits for starting a business.
It is being led by IFC Advisory Services in the region—the SouthAsia Enterprise
Development Facility. IFC-SEDF is funded by the governments of Norway and
Netherlands, and by IFC.
“IFC will help us eliminate activities
of little value, while adding value by making improvements in cost, time,
and quality of services,” said C. Withanachchi, Municipal Commissioner
for the Matara Municipal Council. “An increase in business licensing and
participation in the formal economy may result in an increase in the tax
base, leading to more revenues for the municipality.”
IFC has a strong track record in working
with governments and municipalities to simplify business regulations globally
as well as in Sri Lanka. IFC previously worked with the Colombo Municipal
Council to streamline its business licensing processes. Business licenses
in Colombo are now being issued within an average of 32 days.
Per Kjellerhaug, IFC’s Regional Manager,
said: “Simplification will make business processes more efficient, increase
satisfaction among small and medium businesses and contribute to a more
positive work environment for municipal employees.” He also noted that
the partnership between IFC and the Matara Council will create long-term
economic benefits within the municipality.
The Matara project will be a replication
of the Colombo project. Matara has a population of 3.8 million, about 20
percent of Sri Lanka’s population. Southern Sri Lanka contributes 9 percent
of the country’s gross domestic product. More thanr 80 percent of the
businesses in the region are classified as small and medium enterprises.
Many of these demonstrate significant untapped potential to generate
growth, income and employment.
The Matara Municipal Council has been
a strong driver of this project. It has shown a vision for creating an
enabling environment in which businesses grow and prosper in Matara, the
main commercial hub in the south of the country. The simplification process
will make changes in the way small businesses participate in the formal
IFC, a member of the World Bank Group,
creates opportunity for people to escape poverty and improve their lives.
We foster sustainable economic growth in developing countries by supporting
private sector development, mobilizing private capital, and providing advisory
and risk mitigation services to businesses and governments. Our new investments
totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous
year. For more information, visit www.ifc.org.
The IFC SouthAsia Enterprise Development
Facility is a multidonor-funded facility, managed and operated by IFC.
It is one of 11 regional programs managed by IFC worldwide, and is funded
by IFC, the governments of the Netherlands and Norway, the European Commission,
the U.K. Department for International Development, the Canadian International
Development Agency, and the Asian Development Bank. It facilitates increased
access to finance and provides quality business development services to
projects in Bangladesh, Bhutan, northeast India, Maldives, Nepal, and Sri
Lanka. IFC-SEDF also works to create a business-enabling environment that
is supportive of small businesses.