Impact of COVID-19 on the Performance of MSMEs in Jaffna District, Sri Lanka

Abstract

The study intended to identify the impact of COVID-19 on the performance of MSMEs in the Jaffna District. Accordingly, considering the population as the whole MSMEs operating within Jaffna District, and due to the pandemic situation in the country, the samples were selected conveniently during June 2021. Therefore, the researchers interviewed 15 MSME operators including the sectors of manufacturing, hotels and travel, food and beverages, construction, hospitals, and trading. The semi-structured interviews were conducted in the medium of Tamil since the population is Tamil Tamil speaking community and finally translated into English. Following a descriptive analysis, the study found that the food and beverage, health, and trading industries recorded a profitable performance even during the lockdown periods and after the lift out of lockdown. However, they stated that there was a reduction in the total revenue due to the Covid-19 outbreak. On the contrary, other manufacturing industries such as cleaning, sanitary, hotels, and travel and construction industries recorded poor performance due to the COVID-19 outbreak. The main reasons were highlighted as the travel ban imposed by the government, lack of investments, and the public’s reduced spending on vacation holidays. The study suggests that MSMEs can boost their performances over time by implementing competing strategies. Also, future research can consider identifying factors that are restraining the contribution of MSMEs to the national economy.