Sri Lanka tea factories clamour for loan concession

March 25, 2009 (LBO) - The Sri Lanka Tea Board has received applications from more than 470 tea factories seeking approval to get government concessions on loans, a senior official said.
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But the tea companies have complained that they have got no funds yet.
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Tea Board chairman Lalith Hettiarachchi said the manufacturers are seeking support for working capital loans promised by the government to help them get over the present economic crisis.

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"The total recommended loan component so far exceeds two billion rupees," he said.

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"Hopefully, this concessionary loan would help manufacturers to get over the difficulties that they are undergoing presently by not having enough liquidity for their production process to continue."

Under the scheme, the government has guaranteed to pay six percent of the interest on loans taken by tea firms.

But the companies have been complaining they have not got money yet because banks are insisting on collateral most of which has already been pledged for previous loans.

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Hasitha de Alwis, director (promotion), Sri Lanka Tea Board, said the board's role is to give recommendation letters checking on the credibility of the factories.

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