The Committee on Public Finance (COPF) convened today (2) for a key discussion on Parate Execution (PE), addressing key issues affecting Sri Lanka's economic recovery and the plight of Micro, Small, and Medium Enterprises (MSMEs).

According to COPF Chairman Dr. Harsha de Silva, one of the major outcomes of the meeting was the approval of a temporary suspension of PE until 15 December 2024, pending parliamentary endorsement. 

De Silva stated that this decision seeks to offer a lifeline to struggling MSMEs grappling with the aftermath of multiple crises, affording them essential breathing space to stabilise and restructure.

De Silva noted that the COPF has stressed the importance of fairness in loan recovery processes. 

According to data shared by the Central Bank of Sri Lanka (CBSL), only 57% of PE cases received concessions over five years. As part of ensuring equitable treatment, COPF has requested a detailed breakdown of Non-Performing Loans (NPLs) by sector and category, with a special focus on providing support to sectors like tourism that are rapidly recuperating.

COPF emphasised the critical need to nurture this sector's ongoing recovery through targeted support measures.

COPF urged the CBSL and Ministry of Finance (MoF) to reassess NPLs, particularly for MSMEs and individuals who have been adversely affected by uncontrollable circumstances. 

The discussion has also delved into the delicate balance between economic recovery and lending practices. 

Notably, despite concerns about the potential impact of PE suspension on bank recovery periods, COPF highlighted a substantial rise in bank profits during Q4, amounting to Rs. 400 billion.