Current Challenges and Opportunities for Entrepreneurship and SME’S Development in Post-Conflict Areas

Abstract

Small and Medium Enterprises (SMEs) play a pivotal role in the socio-economic development and poverty reduction process of any economy in terms of employment generation, growth of GDP, innovation, equitable income distribution, resource utilization and regional development. As a result of the twenty-six years-long civil war, Sri Lanka was unable to realize her full potential in the SME sector despite the endowment in human capital and natural resources. The main objective of this study is to examine the current role of SMEs in different industries, as well as understanding their contribution to the economy and identify the possibilities for promoting SMEs in the whole country including war affected areas. The population of this study consists of all the entrepreneur who lives in post conflict area. in depth interviews is used as the primary data collection source which are predominantly in semi-structured in nature and findings of the study were analyzed using a Thematic analysis and interpretation. The study found that there is a vast opportunity for Sri Lanka to harness the opportunity by developing this vital sector. The paper further, attempts to identify the policy changes necessary for enhancing the role of SMEs in economic development.And also study revealed that medium sized firms (employees between 40-99) have been gaining relatively higher productivity and their contribution for value addition,total output and employement generation is also better than micro and small firms.There is a huge potential for this sector to prosper in waraffected areas given the high level of human capital and natural resource endowments.