Establishing independent holding company for State-Owned Enterprises

STATE-OWNED Enterprises (SOEs) are defined as government-owned or controlled entities which generate most of their revenue from selling goods and services on a commercial basis.

- Manjula de Silva

1. Introduction

In other words, they are commercial entities that are state-owned. A closer look at the numerous state-owned institutions that operate in Sri Lanka will reveal that only about 130 entities would fall into the category of SOEs. The rest of them are non-commercial state institutions such as regulatory agencies, promotional institutions, research and development agencies, educational institutions, and a multitude of others.

While these entities have their own issues that are receiving attention through a different process, they do not fall into the category of State-Owned Enterprises (SOEs) that will be covered by this article.

In the 2024 manifesto titled A Thriving Nation: A Beautiful Life of the National People's Power (NPP), which received an overwhelming mandate from the people of Sri Lanka, the following approach is outlined regarding State-Owned Enterprises.

Take appropriate strategic decisions on each institution based on its strategic importance, potential for economic growth, capability to stimulate the production economy, impact on financial stability and relevance to national security Provide the public with access to comprehensive information on the operations of SOEs to ensure transparency.

Promote research and development activities to explore new opportunities in economic trends, potentials, and developments prevailing at the national and international levels.

It is clear from the above that a significant number of SOEs will qualify to remain under state ownership on account of one or more of the criteria mentioned above. However, it is important to ensure that they perform the role expected from them, regardless of ownership, to deliver essential products or services to the public at an affordable cost without being a burden to the state.