State-Owned Enterprise losses mount to staggering Rs 1.2 trillion

The 55 “Strategically Important” listed State-Owned Enterprises (SOE) snowballing losses from 2006 to 2020 is a staggering Rs. 1.2 trillion. Out of the 527 state-owned enterprises the Treasury has classified 55 as “Strategically Important” it was revealed at an Advocata Institute that organised an event on “The Urgency of State-Owned Enterprise Reforms” last week.

Sri Lanka’s State-Owned Enterprises have placed a significant burden on public finances. They are also a major source of inefficiency in the economy. “Therefore the present economic crisis, along with Sri Lanka’s current debt crisis, makes reforms on SOE’s a national priority to emerge from present economic challenges,” it was opined at the event.

Policy Analyst Advocata, K.D.D.B.Vimanga said that Ceylon Petroleum Corporation, Ceylon Electoral Board, SriLankan Airlines, and Sri Lanka Transport Board daily loss in the year 2019 per day was Rs. 384,479,189. Academic Chair Advocata Institute Dr Sarath Rajapatirana, said that the total productivity of SOE is less than 1% and very much less in countries like Vietnam and Korea.

LIRNEasia Founding Chair and Advocata Institute Advisor Prof. Rohan Samarajiva for the second time in succession (at an Advocate event) stressed that SriLankan Airlines should be privatised as it is making around Rs. 47 billion in losses per annum. “What is the rationality of using public funds collected through commodity taxes from persons who have never even gone near the airport to keep this airline,” he asked. He also pointed out that even India doesn’t own a national carrier as (Air India was returned to Tata after 68 years. After the Group paid INR 18,000 crore to acquire it from the government.)

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