State Owned Enterprise reforms in full steam

Finance and Mass Media Ministry Senior Advisor, Mano Tittawella and Finance Ministry's Public Private Partnership (PPP) Unit Chairman Thilan Wijesinghe at the forum. Picture by Shan Rupassara.

The government has launched a major restructuring programme for State Owned Enterprises (SOE), Finance and Mass Media Ministry Senior Advisor, Mano Tittawella said yesterday. Answering questions posed by the business community, on the ailing public sector, he explained that they were looking at either listing non-strategic enterprises on the stock market or handing them over to private sector management.

Tittawella was speaking at the post Budget Forum organised by Ernst and Young at the Colombo Hilton yesterday.

The government previously announced that they would sell the government owned stakes in the SOE’s of Hilton and Hyatt.

One of the main proposals for SOE’s in the 2018 Budget was the proposal to allow State Banks such as the Bank of Ceylon and People’s Bank to raise their own debt and equity capital, he said.

“We will not pump any more money into these state banks.The minority stakes here will be listed on the stock market and most of it will be offered to customers and employees of the banks so that they can be stakeholders in their own institutions,” Tittawella said. He added that it would be a major point in capital market development in the country.

Finance Ministry's Public Private Partnership (PPP) Unit Chairman Thilan Wijesinghe in the meantime envisioned PPPs to make up 40 to 50 percent of all FDIs into the country in future.

“The PPP Unit’s role is to assist the line ministries concerned with both the PPP process and the SOE reform process,” Wijesinghe who is currently working on restructuring Sri Lankan Airlines and soliciting a strategic partner for the Airline said.

He however admitted that there were delays in implementing PPP projects due to lack of staff and sorting out confusions regarding the proper guidelines to be followed in these ventures. The Unit however has been supported by World Bank funding, with an initial grant of US$ 700,000 and they hope to soon recruit the necessary experts.

“We need to hire financial advisors to support the line ministries.There has been an overall lack of skill rather than lack of will in the case of SOE reform.This is where PPP will step in,” Wijesinghe said.

Tittawella said their focus was on creating an equal playing field for SOEs and the private sector, with the public sector being revenue generating and competitive with no added advantage compared to the private sector. 


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