16 May, 2022

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Selling The Nation’s Public Assets

By Sonali Wijeratne

Sonali Wijeratne

The Government which has virtually brought the Nation to its knees due to its dire mismanagement of the Economy and Monetary Policy is now proposing the divestiture of non-strategic public assets of Sri Lanka! If we as a Nation must indeed sell the family silver to keep our heads above water, the million dollar question is: how competent and honest is the present Government to handle such divestiture of National Assets? It is the method of such divestment, the negotiation of conditions attached to such divestment and whether there is a detailed plan for implementation that should bother the beleagured people of this country already burdened with political cronyism, nepotism and mismanagement at its worst.

No doubt, the Economic Advisors and Councils would have touted the usual text book arguments for adopting such privatization measures especially at this critical juncture of the foreign exchange crisis, deficits in the Current Account of the Balance of Payments, default on debt payments, and crippling Budget Deficit. These range from the estimation of economic transformation, technical and capital transfer, human resource capacity development of Research & Development. It is also a fact that the loss making State Owned Enterprises (SOEs) which are a reservoir for political appointments, inefficiency and corruption would receive a boost through such divestiture while also reducing the colossal expenditure of the Government on maintaining such SOEs. Policy for divestiture to bring in the much needed foreign exchange to service our debt service payments is problematic, since the present economic environment for investor confidence may not entirely be conducive!

The People of Sri Lanka have been hitherto kept in the dark as to the methods used by the Government for the proposed divestiture. It is vital that we the owners of these Public Assets are made aware as to the nature of competitive tender process, or whether there is a bidding process conducted on a special Board of the Colombo Stock Exchange amongst short listed parties, or Initial Public Offers (IPOs) that make members of the public part owners of the enterprises and generate a process of “peoplisation” of public assets.

When the Nation is at the brink of an abyss of economic failure, in its desperation to survive, are we going in for a quick fix of the Privatization of Corruption? We are sadly lacking in much of the prerequisites for successful privatization as sound regulatory environment, fully transparent procurement process, anti-corruption laws, Competition Law and framework and stakeholder consultation. If much of the proceeds of our massive unsustainable external debt is said to have been focused on non-tradable and miscellaneous expenditures, then it is important for us to know which ear marked accounts the proceeds of these divestment will target.

The resounding concern is how much negotiating strength and cudgel will Sri Lanka have with countries as China, India, Bangladesh who are our big lenders; given the political environment of the privatization process. Considering the present state of our level of development, size of foreign debt and fiscal burden, is there a level of professional integrity, and efficiency to negotiate an appropriate modality of divestment as befits the interests of our country? Are we in a position or able to extract performance requirement criteria for expansion and modernization, transfer of technology in such divestiture programmes? It is a sad, bad day for Sri Lanka when its remaining assets are frittered away for short term gain by those who have already lost the confidence of the people, and with unashamed nonchalance have admitted making serious mistakes, in agriculture, monetary policy, to name a few!

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Latest comments

  • 9
    2

    Dear Sonali,
    .
    They came to protect the nation and nation’s assets. At the time, Hambantota harbour leased, they attacked to previous govt, putting YELLOW PETs as the front runners of their protesting marches.
    .
    Ironically they did yet; as of today, one thing right – which is getting all Rajapakshes exonerated from all of their crime investigations. As one monk articulated it clearly, they should all be brought to Galle face green and should be beheaded in a public ceremony, similar to the doings of Saudis.
    https://www.youtube.com/watch?v=Q-quDKShlUg

    If Judiciary is doing the job independently, how come all those CRIME investigations incl GAMPAHA palace, alleged to have built by looted funds, by Kaputu Kak Kak aka Basil, got exonerated ? In the same time, former MP honourable Ranjan is being jailed on the offence of being disobedient to or disrespectful of a court of law and its officers: contempt of court. This land has become an island of utter fools.

  • 4
    1

    https://www.youtube.com/watch?v=ZiBg20VJup8

    True enough the people elected with a 2/3 majority have bought the country to its knees. This is a know fact and everyone knows it, but the secondary question to be asked is: are these same people better off now than when they began? Country might have gone to hell in a hand basket but they have done well even to provide for their next generation. As you know if your smart enough you can make money in a bull or bear market. Think this is the bear market and they are getting ready for the kill.

  • 0
    2

    True enough the people elected with a 2/3 majority have bought the country to its knees. This is a know fact and everyone knows it, but the secondary question to be asked is: are these same people better off now than when they began? Country might have gone to hell in a hand basket but they have done well even to provide for their next generation. As you know if your smart enough you can make money in a bull or bear market. Think this is the bear market and they are getting ready for the kill.

  • 5
    1

    SW,
    Thanks for the incisive article on National assets, wealth and their disposal at time of need.
    I agree with you on all that.
    The biggest and important question, should be addressed to the President 2010-2014.
    HE was questioned many times, by government and Opposition MPs, Cabinet Ministers in Private and various NGO organisation at that time!
    The question was are these large quantum of Loans (commercial and otherwise) is within Sri Lankas’ ability to be repaid sustainably
    The stock answer was yes and if anyone continued to query, the rebuttal was “Mama Kerala Pennang”!!
    MaRa was UNTOUCHABLE THEN!!!
    So we should sk that genius to go into this and seek remediation and restructuring or deferment of repayment!!
    The coal power plants (Total) escalation in price from CBK “government exit to MaRa Government entry and signing of contract” was USD 350 Million a 30% escalation!! A mammoth 1/3 jump in original quoted price.
    It was suspected all items of the interconnected plant were not Bran New and such was the case, resulting in frequent breakdowns soon after commissioning and major overhaul within a short time of commissioning!!
    MaRa is the only one who could give answers to this tragedy!!

  • 3
    0

    To Readers,
    The author raises an important issue.
    Here is an extract from an article in the Financial Times – Sri Lanka.

    “The reserves-strapped Government can free up State-owned commercial assets worth over $ 11 billion to tide with the current and future cash flow crisis, experts said yesterday.”

    After borrowing to fund projects with poor or no returns (the purpose was to get huge commissions), Sri Lanka is unable to service its debts. As part of the solution, we will be required to sell our family silver to international investors. Such conditions will be imposed by the IMF.
    Family silver includes our infrastructure, Railway network, telecommunications, the power system (power stations and the transmission grid), roads, whatever that is left of ports and airports.
    This is an excellent time for investment bankers and our local dealmakers (aka politicians and corrupt officials). They would extract the highest commissions. People should remain vigilant not to allow the politicians to engage in deal-making.
    CONTD..

    • 3
      0

      CONTD..
      The voters are not innocent either. They voted in 1977 to change the government.
      Sri Lanka embraced the open economy and imports destroyed local industries.
      Politicians (all parties since 1977) continued with the same policies.
      Once we are through this crisis, Sri Lanka will have “Rentier Capitalism”. Even Ranil would not have dreamt of such hot-blooded capitalism.
      We will own nothing and voters will not understand what happened.
      Note that I am not against borrowing.
      Countries should borrow, particularly soft loans, to fund projects that provide high returns that add value over time.
      Our politicians have collectively destroyed Sri Lanka.

  • 0
    0

    Neethipathi’s /Attorney General’s behaviour of the current govt is like a domestic servant. SL domestic servants would not think about anything but their jobs- they nod heads to anything.

    Unfortunately, srilankens defend him repeating that crime investgations wihtin this god punished land is independent.
    That Boralugoda Kotaluwa (Mule of Boralugoda family) aka Dinesh Gunawardhana or the like constantly defend this. I really dont know why ? Many of these many would kick the bucket soon, but their last breath would not be different to that of Gadafi or Mugabe.
    The kind of BPs should equally punished to the manner that MONK asked it to be by bringing them all to Gall Face Green.
    .
    If Neethipathi would act bold, victimized families of the massacre would have already felt better as of today, in terms of the losses of their lovely ones. I could not believe my eyes last night, but we should really be ashamed as a nation – we repeat about our so called inheritage – but our BPs have repeatedly acted as barbarians not only to notherners but also to all as of today.
    .
    https://www.youtube.com/watch?v=IXte7NjXaR0

  • 3
    3

    China must take full responsibility for the economic disaster Srilanka has plunged into. They exploited the corrupt Rajapkshe family by corrupt means to establish a strategic Chinese foothold in the Indian Ocean Region by building white elephants like Hambantota Port, Mattala Airport, Colombo Port City, Lotus Tower etc., which have become festering wounds in the Srilankan Economy. It is the Srilankans who have to endure untold hardships having to do without the bare essentials; food, medicine, fuel, electricity etc., etc., while the Rajapakshe family and their henchmen can afford to live and maintain their cozy lifestyles unhindered. Srilanka must get out of this debt trap by cancelling what China has lend to Srilanka to the very last penny. Norochchalai Coal power plant is a can of worms and highways to nowhere without commuters. For the construction work the China used Chinese prisoners as forced labour violating human rights. In contrast India has been very generous in contrary to the Chinese ulterior motives.

    • 5
      1

      The Srilankans spent a colossus to maintain the Institution of the Presidency and the Institution of the Parliament. It must be asked what the people of Srilanka got back in return?

    • 0
      0

      It is the customary logic before someone lends money to another to be assured that the borrower sure has the ability/capability to pay back the loan. Did China do that? If China has not done that she has to eat it up.

  • 5
    2

    “The resounding concern is how much negotiating strength and cudgel will Sri Lanka have with countries as China, India, Bangladesh who are our big lenders”
    Really? Is Bangladesh a “big” lender to SL? Does China or India really have Even 25% of our debt stock?
    Young lady, before you set out to write profound articles on economics, don’t you think you should not rely on hearsay for statistics?
    True, there is more than 50 billion USD in debt, but most of it is NOT due to the lenders you have listed.

  • 7
    2

    soman

    Do you smell a rat?
    I do.
    Is Gota trying to scapegoat Kegalle SSP for the Rambukkana incident?
    I won’t be surprised if he is charged, found guilty and within 6 months being pardoned and back to service with promotion, possibly to the rank of DIG, …. …

    • 7
      1

      Surgeon General Silva

      Where are you.
      According to today’s Hindu 60 Sri Lankan’s have already claimed asylum in Tamilnadu. This time around they are genuine economic refugees. However Stalin the champion of Dravidian causes have refused to call them refugees.
      He calls them Ilangayer, (Ceylonese, Ceylon Tamils).

      Could you tell us how many Indian refugees (in your mind they are Kallathonies arriving here for economic betterment) have you apprehended and detained in your newly discovered island in the North for the sole purpose of preventing people coming from Tamilnadu.

      Please ignore me I am talking to myself.

  • 3
    1

    Right from the onset of this economic crisis it was clear that the mismanagement was aimed at weakening our country’s economic stand. My guess was that this was economic sabotage, in order to lead us into a situation, whereby we would be forced to sell our national assets for amounts far below their real value.
    It is obvious that many foreign investors would be reluctant to invest in Sri Lanka at this time due to the bad state of the economy. Therefore the next option would be to sell the assets to the highest bidder who will be someone from within the system.
    That is scenario they are looking at. If given the chance, either they themselves through proxies or their cronies will aquire the assets for peanuts.

  • 1
    3

    I bet Ali Sabry the crook blackmailed Gotabhaya to get the Finance portfolio. His proposal to find “Debt Advisors” proves his conspiracy to “formulate an undesirable IMF package” and swindle millions of public money as payments to “Debt Advisors”. He did the same earlier. He hired foreign consultants to claim compensation, which is a routine procedure, from the insurers of the X-Press Pearl ship that caught fire. India’s unnecessary meddling in Sri Lanka’s IMF talks also warrants serious suspicion. The Governor of the Central Bank is the competent authority to negotiate an IMF package that is conducive to Sri Lanka.
    One good thing that came out of country-wide protests is, the President will never consult his soothsayer, Gnanakka ever again. A Cabinet without the Rajapaksas is a fresh move. The incredibly stupid Rajapaksa offspring who wrote Gnanakka’s occult scripts lost both jobs. However, the composition of the Cabinet and non-Cabinet Ministers proves that there is a “new Gnanakka” in the Presidential Secretariat.

  • 3
    1

    All that fake outrage at western nations, and statements of Muslims taking over this country, all that Sinhala nationalist anger at those who” interfere” in our country (it seems many international agencies have been right), and the Rajapaksa’s have taken this country to a place we have never, ever seen, or been in before. We seem to have absolutely no choice now, and kiss the hands of those we bit, and rejected. We have never seen such an angry nation. People of all religions, from all walks of life, united in demanding change, and asking for relief. We know this – as long there are Rajapaksa’s, and some of the same cronies still wielding the powers, that change will be a sticking plaster on a festering would.

    • 0
      2

      Ashan,
      “All that fake outrage at western nations, and statements of Muslims taking over this country, all that Sinhala nationalist anger at those who” interfere” in our country”
      Don’t you think, if the Muslims had been allowed to run this country, we wouldn’t be reduced to beggary now? What’s a little Sharia law compared to starvation? Imagine, Duminda Silva and Sgt. Ratnayaka couldn’t have been pardoned if their heads had been removed a week after conviction?

  • 1
    0

    All that fake outrage at western nations, and statements of Muslims taking over this country, all that Sinhala nationalist anger at those who” interfere” in our country (it seems many international agencies have been right), and the Rajapaksa’s have taken this country to a place we have never, ever seen, or been in before. We seem to have absolutely no choice now, and kiss the hands of those we bit, and rejected. We have never seen such an angry nation. People of all religions, from all walks of life, united in demanding change, and asking for relief. We know this – as long there are Rajapaksa’s, and some of the same cronies still wielding the powers, that change will be a sticking plaster on a festering wound.

  • 4
    1

    This is preposterous, and this article is a timely reminder that Lanka should never allow a repetition of such sale of public assets, that have as much a chance of ending up inside the Rajapaksa amudeys as night follows day.

    I say, starve the bastards out and kick them to kingdom come; let the lowyer Ali Sabry try to bail them out from the courts of justice when they are eventually dragged there.

  • 2
    5

    Dear Sonali Wijeratne –
    .
    Selling Assets is your subject. I haven’t been able to read it. Will do so. No comments displayed yet, although the article has been on display for at least five hours..
    .
    There are fifteen comments displayed with about this, and I have submitted many more. Comments were slow to come in, but are likely to soar to a hundred.
    .
    https://www.colombotelegraph.com/index.php/the-fuel-price-hike-repositioning-transport-logistics-sector-to-lead-economic-recovery-in-sri-lanka/
    .
    There is a very significant 27 minute speech by Nagananda Kodituwakku in Sinhalese. I think that it is less than a day old. May be only 5 hours old, going on when the first comment came in. The time now is 01.50 am.
    .
    https://www.youtube.com/watch?v=t17lU5pvDmg
    .
    Nagananda has filed a case in the Supreme Court against the fraudulent election of an American citizen. He was armed with an affidavit form Jeevan Hoole.
    .
    Panini Edirisinhe

  • 3
    3

    Sonali Wijeratne is crying a lot. She should. That is what I do when I lose hope.
    .
    I have cried many a times in the past. There was no one to lend his shoulder. Each unto himself is our motto, I guess.
    .
    Yes. Sri Lanka demonstrated no outward emotion when I was weeping loud.
    .
    I harbour no resentment. I understand the rules of the game.
    .
    Sonali, I am offering my shoulder to you. I too am crying for you. Hoping that at least you would lend your shoulder to me, next time.

    • 2
      1

      Nathan

      “That is what I do when I lose hope.”

      Keep Hope Alive – Jesse Jackson

      “I harbour no resentment. I understand the rules of the game.”

      Brilliant, however don’t forget the b******s when you vote them out next time.
      Keep Hope Alive – Jesse Jackson

  • 3
    0

    Really good set of inquiries.

    Not a chance for future of Motherland with the Regime and Cohorts in power. They’d deliver us down to the level of Ethopia and tell us how lucky we are to have them as Saviors. All the while, money of the hardworking-suffering-Lankan-Masses will be placed on alternate off-shore entities and Port-City so Regime and Cohorts can reign supreme.

    Here, we were not too happy with Colombo culture. Now Colombo culture together with outstation culture will fall into irrapairable damage and despair…..all their hard work and investments soon to be gone.

    Only culture left will be Regime and Cohorts leading SB supremacy, with China, India, Bangladesh, and The-Diaspora creating the new Haute Couture Culture of the Rajapaksa glory (whilst foreign entities take away the wealth of Lankan hard work to their own home countries).

    People, kiss goodbye to Lankan interactivity, entreprenurship, job creativity, work intergration, and the hopeful happy outlook of the Lankan Spirit.

    Welcome to Sri Lanka as the plunder-box for the Asian region.

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