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President, PM attacks loss-making SOEs saying they are swallowing public funds

31 July 2019 - 138   - 0

President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe on Tuesday lambasted loss-making state enterprises such as SriLankan Airlines, Railway, Ceylon Electricity Board, Ceylon Petroleum Corporation and Water Supply and Drainage Board, saying this was a huge burden shouldered by the abjectly poor, ordinary people of the country and a huge blow to the country’s national economy.

These views were expressed at the 80th anniversary celebrations of the Bank of Ceylon (BOC) held at the BMICH Colombo. The function was also attended by Karu Jayasuriya, Speaker of the House and Eran Wickramaratne, State Minister of Finance.  

President Sirisena remarked that these institutions were making a huge negative impact on the national economy, while noting that the trade unions threaten and win their demands and obtain benefits. 

Reminiscing on the past, he said it was the BOC that provided a loan when he became a parliamentarian to build a house of his own. He said today BOC stands with a solid financial base. The problems in other troubled state enterprises were not because of the actions of yesterday or today but were perennial ones spanning 30 to 35 years. Sadly these grave losses are being met by the ordinary masses, the President lamented.

To spontaneous applause by the audience, the President remarked: “State agencies like BOC would never be privatized and they will be preserved as national heritage”.

Premier Wickremesinghe in his address traced how BOC came into existence. In the 1930s when the State Council was established, a proposal to set up a bank for the Sri Lankan businessmen was proposed and a commission was appointed to report on the issue.

In 1931 he indicated that there was a serious economic recession affecting the entire Europe and the US and everybody was affected. 

During that time all the banks in Sri Lanka were foreign owned and the local businessmen had their deposits in these foreign banks.
When the war and the great recession forced the economies of Europe and the US to collapse, local businessmen were not given any relief by these foreign banks and thus most of the local businesses were bankrupt. Some were sold out and it was at this point of time that local businessmen decided that they should have a local national bank.  

As a result of the bank commission report, the establishment of a national local bank was mooted and on August 1, 1939 the BOC came into existence and the initial capital then was only Rs. 2 million and the total deposits were Rs. 4 million.  

He said that prior to 2015 the government was not stable and the country was facing economic hardships and was unable to procure loans. He said that some people were indicating that the country’s economy today was collapsing and asked what the government was doing. 

“I will tell you one thing. The different economic perspectives have now completely changed and we have established a versatile and stable economy.  Look at BOC from the Rs. 900 odd billion deposits in BOC (in 2015) it has shot up to Rs. 1,900 billion today, a sharp expansion during a span of just five years – a tremendous expansion of more than 80 per cent,” he said.
Eran Wickramaratne, State Minister of Finance remarked that the country must distance itself from the horrible culture of corruption.

(QP)

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