As Sri Lanka prepares to mark the anniversary of the devastating Boxing Day tsunami, The University of Queensland’s commercialisation company, UniQuest Pty Ltd, is helping the country rebuild.
UniQuest’s International Projects Division and Brisbane-based micro-finance specialists, the Foundation for Development Cooperation (FDC), are working with the Sri Lankan Government and the Asian Development Bank to restructure the country’s rural finance sector.
The three-year, US$3 million Rural Finance Sector Development Project will help Sri Lanka develop a strong and flourishing local economy by helping the rural poor access sound financial services, according to UniQuest Managing Director, David Henderson.
“The project has been designed to create a sustainable and viable rural financial system in Sri Lanka, that allows individuals easy access to a sound finance,” said Mr Henderson.
“Sri Lankans are trying to rebuild their lives following the civil war and the Boxing Day tsunami. However, those in country areas are very vulnerable to the largely unregulated and unsupervised rural finance sector.
“There has been little control of loan terms or interest rates offered by informal rural financial institutions and in many cases, low-income households and rural businesses are suffering because they are unable to access suitable finance products to establish or maintain their businesses.”
The first step in the project will be to work with the Sri Lankan Ministry for Finance and Planning and the Central Bank of Sri Lanka to establish a regulatory and supervisory framework either by amending existing Government Acts or developing a new Act.
With regulation, the sector will be restructured with uniformity and supervision processes put in place. Capacity building and institutional restructuring programs will follow to support financial institutions to adapt to the changed policy environment.
“It’s a large and complex project but it has huge potential,” said Mr Henderson.
“Sri Lanka has lagged behind the rest of South Asia in micro-finance for many years but this is their opportunity to catch-up with world best practice.”
UniQuest and the Brisbane-based FDC are also working with Sri Lankan partner, Environment Management EML, which is owned by Ernst and Young. Jointly, they have employed 28 domestic and 10 international consultants to work on the project.
2005 is the United Nation’s International year of micro-credit.
Media inquiries: Julia Renaud at UniQuest (07 3365 4037, 0438 436 179)
