LNP – Govt. mulls closure of state institutions deemed redundant

The government is making a fresh approach to revive the loss-making state institutions, which includes shutting down unviable entities, listing selected institutions on the Stock Exchange (CSE), merging certain organizations, and redefining operational mandates.

President Anura Kumara Dissanayake hinted at this when he addressed the Sri Lanka Economic Summit organized by the Ceylon Chamber of Commerce recently.

Citing an example, he said private companies carry out far more efficient work in the construction industry than the state owned enterprises. He said the government mulls the closure of such state ventures since they are redundant in the presence of an efficient private sector. However, he refrained from naming any institution earmarked for it.

The President said his government would seek to list some with the Stock Exchange.

Although the term free market is often used, the global market is not entirely free. It is divided into different segments, and the government is working to secure a share for our country in this fragmented global market. One of the key strategies being studied is expanding into the global market by leveraging our proximity to India, which is one of our closest markets. The government is reviewing the previous trade agreement with India, considering its advantages and disadvantages, and aims to establish a new trade agreement to better position Sri Lanka in the global market, according to the President’s Media Division (PMD).

The world does not stop based on statements. Currently, declarations made by the United States may lead to conflicting or alarming situations, but the world continues to move forward despite such statements, the PMD said earlier.

The previous government also planned for deep economic reforms in the State-Owned Enterprise (SOE) sector. It also set up the State-Owned Enterprise Restructuring Unit (SRU) under the Ministry of Finance, Economic Stabilization and National Policies (MoF). By Cabinet decision taken on March 13, 2023, the then government mandated the SRU to divest an identified set of SOEs.

However, the current government has firmed up its position that the national carrier ‘SriLankan Airlines’ would not be privatized. The airline authorities have now submitted a five –year business plan leaving the options open for the government to make the national carrier financially viable without being a burden to the treasury.