Sri Lanka to revamp SOEs via divestments and holding company

EconomyNext reports that Deputy Finance and Planning Minister Anil Jayantha discussed a planned overhaul of state-owned enterprises at a forum arranged by the Securities and Exchange Commission and the Colombo Stock Exchange. Newsfirst reports that the government is considering a broad reorganisation and does not want to operate hotels, trading firms and other non-essential commercial ventures.

EconomyNext reports that a committee has been appointed to assess public enterprises and develop restructuring approaches. Jayantha said 527 bodies are designated as state enterprises, but only a few are genuine commercial businesses; many carry out administrative duties set out in law. EconomyNext reports that he said some firms could be divested and others combined.

EconomyNext reports that Jayantha said the state would focus on regulation and enabling economic activity rather than running basic businesses such as hotels or trading operations. He also said the government would keep ownership in strategic utility fields, including energy, to limit the risk of private firms manipulating markets.

EconomyNext reports that the proposed SOE law would move commercial state enterprises and state banks away from standard bureaucratic oversight. Under the proposed arrangement, they could receive separate management and be reorganised within a holding structure as limited-liability companies. EconomyNext reports that Jayantha said this could give firms discretion to respond to market conditions, and that some reformed companies might list on the stock exchange to attract local private and overseas investment.

EconomyNext reports that the date for submitting the bill to Parliament is unclear because the Legal Draftsman’s Department is dealing with a backlog. The initial goal was parliamentary approval by year-end, but Jayantha said that target could be delayed.