Sowing the seed of entrepreneurship across rural Sri Lanka

Gently rocking her four-month-old infant in her arms, 21-year-old Maduwanthi paid close attention to every bit of information that was shared during the workshop, with the hope of bettering her future. Maduwanthi attended all five days of the Entrepreneur Development (ED) workshop organized for Samurdhi (state welfare organization) beneficiaries to help them set up or grow their own business ventures.

USAID’s youth employability and entrepreneurship project, YouLead, is working with the Department of Samurdhi Development on an ambitious plan to encourage more than 13,000 low-income families to start a micro-business or improve any informal economic activity they are engaged in.

The goal is to create new, mostly rural, enterprises and help struggling families diversify their household income—an outcome made all the more important with Sri Lanka in the grip of an unprecedented economic crisis.

By the end of June 2022, 127 training programs were completed in eight districts with YouLead support reaching more than 5,000 participants. By the end of August, YouLead expects to complete 270 programs, ultimately resulting in more than 5,000 new micro-enterprises and self-employment opportunities across Ampara, Anuradhapura, Hambantota, Kilinochchi, Kurunegala, Matara, Monaragala and Vavuniya.

The program aims to reach youth and women like Maduwanthi from a small village in the Monaragala district, who is keen to learn the fundamentals of starting and running her own business. Her informal efforts to sell vegetables started when COVID related lockdowns disrupted her husband Awantha’s income as a fish seller.

Awantha, a former farmer, used his contacts to procure fresh produce and set up a vegetable stall for Maduwanthi. Two years on, the couple is now looking at expanding their business and sourcing supply for other retailers.

“I realized that we need to be more financially prudent and learn how to keep a track of our income and costs. I was still breastfeeding my baby but also didn’t want to miss the opportunity to learn. So I just brought my baby along,” says Maduwanthi. “Everyone was very supportive and some of the Samurdhi Officers even helped care for the baby when I was doing the group work. I learned a lot, including how to manage my cash flow and expand our business.”

Most Samurdhi recipients are engaged in micro-scale agriculture and/or daily wage work and were hit particularly hard by the COVID-19 pandemic. Economic resilience is greatly enhanced when there are diversified earning opportunities for the family and stronger financial literacy. The impacts are magnified when women have an opportunity to directly contribute through self-employment or livelihood opportunities that generate cash.

Like Awantha and Maduwanthi, many more households across Sri Lanka are dealing with job losses and increasingly irregular income, making it harder to cope with escalating costs and supply shortages.

YouLead’s Entrepreneurship program aims to support these communities establish their own business and generate an additional source of income for their households. The Samurdhi program builds on the success of a 2019 pilot project in Matara, where over 1500 Samurdhi livelihood support recipients attended a five-day training program focused on financial literacy. By 2021, an estimated 469 participants had started businesses and continued to operate??through COVID-19 related lockdowns. Over 78 percent of the businesses were women-owned.

Image Caption : Maduwanthi attending the entrepreneurship development training program with her four month old infant.