By: Staff Writer
September 07, Colombo (LNW): In a decisive step to ease the burden on public finances, the government has announced plans to liquidate 33 state-owned enterprises (SOEs) that have long been deemed non-functional and financially unsustainable. The decision, unveiled by Cabinet Spokesman Dr. Nalinda Jayatissa, reflects Colombo’s growing urgency to restructure a bloated public sector that continues to drain resources while delivering little economic value.
Dr. Jayatissa explained that most of these entities were established decades ago to serve specific public purposes or strategic economic goals but have since lost relevance in the current market-driven environment. “Many of these enterprises exist today only by name boards, without any meaningful contribution to the economy or society,” he said. The liquidation process will be conducted in two stages under the supervision of the Special Liquidation Unit of the Finance Ministry.
Among the institutions set for closure are Asian Games Ltd., Thurusaviya Fund, Selendiva Investment Ltd., Lanka Logistics Ltd., Commonwealth Games Hambantota Ltd., Magampura Management Company, Mihin Lanka Ltd., Technopark Development Ltd., and Media Training Institute. A full list is expected to be published soon.
Importantly, the national carrier SriLankan Airlines has been excluded from the liquidation list, with Rs. 20 billion already allocated for restructuring efforts to stabilize operations. The government hopes that a rebound in tourism will help revive the airline’s fortunes.
The move comes amid stark evidence of the financial drain caused by SOEs. Data obtained through the Right to Information Act and the Department of Public Enterprises show that, between 2018 and 2022, 20 state-owned companies incurred combined losses of Rs. 851.7 billion.
The Ceylon Petroleum Corporation (CPC) alone accounted for Rs. 817 billion in losses, despite generating over Rs. 3.6 trillion in revenue during the same period. Meanwhile, the Ceylon Electricity Board (CEB), employing more than 23,000 workers, recorded losses of Rs. 125 million in 2022 while spending Rs. 1.7 billion on salaries and allowances.
Overall, the Treasury has been compelled to pump billions into these failing entities to keep them afloat, even as the country battles to stabilize its fragile post-bankruptcy economy. Critics argue that much of the income generated by SOEs is consumed by employee salaries and benefits, leaving little room for operational improvements or investments.
