Sri Lanka's Horana named best town for business

A town south-east of the Sri Lankan capital Colombo has emerged as the surprising choice of companies as the best place to do business.

A study conducted by the international organization Asia Foundation in Sri Lanka on private sector business development and economic growth, found that Horana, 60 km from Colombo, had the best enabling environment for private enterprise.

The Economic Governance Index (EGI) surveyed around 5,000 firms from 48 municipal councils from all over Sri Lanka to ascertain the impediments and stimuli for private enterprise.

The EGI indicated Horana ranked highest in the overall index as having the most conducive environment for small and medium scale businesses.

It was also ranked the area with the best tax administration.

The EGI was derived after studying ten areas concerning private businesses.

Among these, the poor attitude of the government towards business was considered as the major constraint for growth of businesses by 21 percent of the firms.

Furthermore, access to land and buildings was mentioned as the second biggest constraint by 17 percent.

The survey indicated there was low public trust in state institutions and economic governance.

Despite government attitude being the major constraint, only four percent believed taxes were a constraint.

In terms of protection and property rights, the survey showed firms believe Gampola in the central hills was the safest for business while the Dehiwala and Mount Lavinia suburbs of Colombo was the least secure.

On infrastructure and business services which include highways, electricity, telecommunication, garbage disposal, water supply and advisory services available for enterprise growth, the hill country resort of Nuwara Eliya and Avissawella, south of the central massif, ranked as the best.

Ja Ela, a northern suburb of Colombo, was ranked the worst in such facilities.

Puttalam, in the northwestern region, was ranked in the lowest position in the overall index while Colombo was in the middle.

The objective of the Asia Foundation survey was to help the government to improve its policies and business environment to suit that of small business ventures.

The organisation will also help build capacity of local enterprises to facilitate dialog for an improved business environment.