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Serving Sri Lanka

This web log is a news and views blog. The primary aim is to provide an avenue for the expression and collection of ideas on sustainable, fair, and just, grassroot level development. Some of the topics that the blog will specifically address are: poverty reduction, rural development, educational issues, social empowerment, post-Tsunami relief and reconstruction, livelihood development, environmental conservation and bio-diversity. 

Wednesday, August 10, 2005

Tsunami hit entrepreneurs battle with banks

The Island: 06/08/2005"

The tsunami caused more than 40,000 deaths, over 15,000 injuries, 150,000 houses were destroyed or damaged displacing over a million people of which 275,000 people have lost their livelihood.

Children, women and the elderly are the most vulnerable of the tsunami victims, with over 5000 children displaced of which over 1000 children have become orphans.

The fisheries sector suffered the most, socially and economically, accounting for 90% of all deaths, 55% of displaced families and destroyed houses, and 50% of the estimated job losses, with 6 5% of the national boat fleet lost. Ten out of twelve major fishing harbours were completely destroyed, including support facilities such as ice plants etc, and eighty one percent (22,940) of fishing vessels were damaged or totally destroyed. The second largest sector to suffer was the tourism sector, with substantial property and job losses. The physical assets loss is estimated at US $ 1.5 billion amounting to 4.5% of GDP, while the output -loss estimate of $330 mn in the fisheries and tourism sectors amounts to 1.5% of GDP.

The tsunami dealt a severe blow to the country’s infrastructure. It left 83,000 totally or partly damaged houses, destroyed 1,615 km of the road network and 72 hospitals. One of the severely hit sectors was education where 182 schools were damaged and over 1.00,000 children we’re displaced. In addition, roads, railways, telephone, water supply, fishing ports, hotels and other coastal infrastructure were substantially damaged. It is estimated the damage to housing, tourism and fisheries industries amounts to 1.5% of the GNP.

However, seven months after the tsunami, the affected entrepreneurs and industrialists in the southern costal belt are still battling with bankers to obtain industrial loans

"The bankers seek co-lateral to issue loans," said the affected entrepreneurs. Meanwhile a leading printer alleged that a private bank, refused to issue a loan due to lack of collateral.

"I mortgaged my business to this bank when I applied for a loan. The bank issued my loan. I am still paying the existing loan. After the devastation I further requested the bank to issue another loan. But they asked for more co-lateral, he said. This is a pathetic situation," said the worried Printer.

A number of industrialists have made repeated complaints to the exporters forum.

"All bankers are following the same procedure, they ask collateral." (SCP)

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