ECONOMYNEXT – Sri Lanka’s cabinet of ministers has approved a state enterprise reform policy to strengthen government finances and reduce the burden on the country and speed up an economic recovery, Minister Bandula Gunawardana said.
“The aim of the policy is to transform state enterprises so that they will not be a burden to the country, a burden to the budget and to make them market oriented,” Minister Gunawardana told reporters.
“If you look at the pricing policy, throughout history if the entity imports goods and sells below cost that will be bankrupt.
“As a result, state enterprises have to go for a cost – reflective policy. If there are excess workers productivity will fall. So, employment has to be optimized.”
The policy also aims to create an environment which is competitive and market based to draw domestic and foreign investments, he said.
“State enterprises have to be reformed to improve finances, economic variables and balance of payments,” Gunawardana said.
“Some agencies may have to be divested and invested productively. Some divisions may have to be closed.”
A state enterprise reform unit has already been set up.
“Putting this into action quickly, and restructuring state enterprises is an important step in getting the country out of the economic crisis,” Gunawardana said. (Colombo/May16/2023)