Abstract:
Businesses around the globe are experiencing serious adverse impacts due to COVID-
19 global crisis. One of the main victims of the COVID-19 outbreak is Micro, Small
and Medium-Sized Enterprises (MSME’s) as this sector is highly vulnerable to
hazardous situations owing to its nature. The objective of this study is to find out the
problems faced by the MSME sector in Sri Lanka due to COVID-19. A sample of
200 MSMEs from different industries and regions of Sri Lanka participated in this
survey. The study revealed that 95 percent of the enterprises have been negatively
affected by the outbreak. The most severe damage was found in the tourism and travel
related businesses followed by the entertainment industry. The top five identified
major problems were financial shortages, supply chain disruption, logistics, reduction
of production, and demand. It was found that workers were unable to attend work
properly due to travel restrictions, lockdowns, and fear of the disease. However, some
new business opportunities are emerging due to Covid-19. There is a significant
demand for online retail and food industry, and home delivery services due to
behavioral changes of the community. This study concludes that many of the
economic and operational activities were brutally disturbed causing businesses to
undergo severe hardships and threatening their survival.
