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JVP Leader questions wisdom of promoting privatisation

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By Rathindra Kuruwita

Those who claimed that privatisation was the panacea for Sri Lanka’s economic ills had to present information about privatise institutions first, Janatha Vimukthi Peramuna (JVP) leader Anura Kumara Dissanayake said on Wednesday at a conference on privatisation of state assets.

Dissanayake said that the SLPP had campaigned in 2019 and 2020 on a platform of protecting and developing state assets. Therefore, if it embarked on a path of privatizing state assets, it should first go for an election and seek a new mandate.Dissanayake said that Sri Lanka had been privatising state assets since the 1980s and an overwhelming majority of those projects had led to disaster.

“In the 80s and 90s we privatised textile mills and paper manufacturing plants. Of course, there were issues with the quality of their products, but we have to understand that this was the 1980s. Now, these factories are closed, and we import almost all textiles now, burning a lot of foreign exchange. We also have a severe paper shortage and there are complaints that we don’t have paper to print school textbooks, exercise boots, term test papers and print newspapers. We privatised tea plantations, and these plantation owners claim that they can’t pay a daily wage of Rs. 1000. So, before telling us why we should privatise the rest of state-owned enterprises, the proponents of privatisation must show us the data on the impact of previous privatisation endeavours,” he said.

The JVP leader said that those who support privatisation often show Sri Lanka Telecom (SLT) as an example of the benefits of privatization. Dissanayake said that advocates of privatisation claim that before privatisation it took six to seven months to get a connection and that once the SLT was privatized everything changed.

“Is this what actually happened? If you look at the technological evolution of the telecommunications industry, the late 1980s and early 1990s saw boosts in digitization and wireless technologies. The privatization of SLT took place at a time when these technological developments were taking place.

“We benefited from technological developments in other parts of the world. The driver of efficiency in telecommunications in Sri Lanka was technological breakthroughs in the west, not privatization,” he said.

Dissanayake added that during the current economic crisis, those who represent powerful business interests have done a good job of convincing people that the best course of action is to privatize state assets.

“People are suffering and when they see the electricity bill or suffer from fuel hikes, they have been told that this is happening because the Ceylon Electricity Board (CEB) and Ceylon Petroleum Corporation (CPC) are owned by the state. They think the prices have gone up because there are too many workers in these institutions,” he said.

However, if the inefficiency of state owned enterprises is the reason for electricity and fuel price hikes, what could explain the dramatic rise in the prices of items like cement or biscuits or milk powder? the JVP leader asked.

“The government plays no role in producing cement. When it comes to milk powder, Highland only has about five percent market share and Highland is still cheaper than other brands. The advocates of privatization are silent on this. Or they tell us that milk powder is bad for the body, or we should not buy cement or biscuits. So, are we going to blame the inefficiency of the private sector for the price increase in biscuits? It is obvious that the current price hikes have little to do with the ownership,” he said.

Dissanayake said that the government is not proposing to only sell loss making institutions. Among institutions that are earmarked for privatization are profit making entities like the SLT, Sri Lanka Insurance Corporation and Sri Lankan ground handling and catering.

“Catering and ground handling departments of SriLankan make a lot of profit. I have looked at the annual reports of SriLankan catering from 2011 to 2021. They have been profitable in all years except 2020, they have been profitable even in the 2021-2022 financial year. It’s obvious why they made losses in 2020. If you look at ground handling, they are doing even better. They made a five billion rupee profit last year. The government is getting ready to sell them and I am sure there are many people ready to buy them. But what about the airline? No one will buy the airline because liabilities are higher than assets and this is a really bad time to run an airline. The government is ready to absorb all the losses of the airline, but even then there are no buyers. We will end up selling the profit-making entities and holding on to loss makers. This will only make things worse,” he said.

The JVP leader said that there are three main drivers that animate those who support privatization. Some of them are adherents of minimum government and believe that the government must not be involved in any businesses. On the other hand, the government is desperate for dollars.

“From 1980 we have failed to earn the dollars we need. In 2022, there is a gap of eight billion dollars to meet imports. If we had not defaulted we would have had to pay six billion dollars for debt servicing. How have we filled this gap? We used to make some money from tourism and foreign remittances. We filled the rest of the gap through borrowings and selling assets. Now we are scraping the bottom of the barrel,” he said.

Dissanayake added that another thing that animates privatization advocates is the opportunity to make money out of these transactions. He said that when large state institutions were privatized, those involved in the process made a lot of money.

“When Hingurana sugar was sold, the institution had 7000 acres of cane, a 300-acre plant nursery, a factory, and 70 million rupees in the bank and sugar in store. It was sold for less than sugar in the store. If we look at the current context, Minister Nimal Siripala is desperate to privatize SriLankan catering and ground handling because one of his deals went wrong a few months ago,” he said.

The JVP does not believe that the state should hold onto everything and try to involve itself in every sector, he said. However, the government has the responsibility to ensure that goods and services are available freely at a decent price, in good quality.

“We can control some aspects of the market through regulation. We can also intervene through the cooperative system. If you look at Amul, India’s dairy giant that makes billions of dollars in profit, is a cooperative. Fonterra, the producer of Anchor brand, is a cooperative. Imagine what we can do if we get small and medium scale rice millers into a cooperative and help them with finance and technology? We could easily break the monopoly of big mill owners and reduce the price of rice. Look at the tile sector, two businessmen run the sector, and now apparently people have to wait for months to get tiles. If we believed the advocates of privatization, this shouldn’t be the result of privatization. A JVP government won’t allow monopolies,” he said.



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Prime Minister inaugurates the 2025 Buddha Rashmi Vesak Zone

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The 2025 Buddha Rashmi Vesak Zone, jointly organized by the Hunupitiya Gangaramaya Temple, the Presidential Secretariat, and the Prime Minister’s Office, was ceremonially inaugurated on May 12 by Prime Minister Dr. Harini Amarasuriya.

During the opening ceremony, the Prime Minister shared the following thoughts:

“The Buddha Rashmi Vesak Festival, held with the collective effort of all communities residing in the city of Colombo, is truly special. The religious harmony that exists within Colombo plays a significant role in making this event successful. Thanks to this harmony, we witness a large number of Dansals and Vesak festivities. These Dansals are organized through the collective efforts of people across the city, who contribute both financially and physically to make them possible.

The efforts made by the Chief Incumbent of the Gangaramaya Temple, Venerable Kirinde Assaji Thero, to nurture Sri Lankan Buddhist enlightenment, Buddhist culture, and national identity not only among local Buddhists community but also to foreign Buddhists community and international visitors, must be sincerely appreciated.

At this moment, I also remember with deep sorrow those who lost their lives in yesterday’s tragic bus accident in the Kotmale area, and I extend heartfelt sympathies to their families. I also wish a speedy recovery to those who were injured.”

The event was attended by Minister of Buddha Sasana, Religious and Cultural Affairs, Hiniduma Sunil Senevi, High Commissioner of India, His Excellency Santosh Jha and other High Commissioners and Ambassadors including Secretary to the Prime Minister, Mr. Pradeep Saputhanthri and a distinguished gathering of guests.

(Prime Minister’s Media Division)

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Expert: Mismanagement of CEB hydro resources increases costly oil-powered electricity generation

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Vidura

The Ceylon Electricity Board (CEB) is in one of the strongest hydro storage positions in recent memory, but it has mismanaged key hydropower complexes, causing an increase in oil-powered electricity generation and and costs.

Energy expert Dr. Vidura Ralapanawe has raised serious concerns over CEB’s operational decisions, particularly the skewed use of the Mahaweli and Laxapana hydropower complexes. “By mid-May, the system had ample storage — about 60% overall — which is actually a very good position to be in just before the South-West monsoon rains,” he said. “But within that headline figure is a huge imbalance. Mahaweli reservoirs are near 75%, while Laxapana is languishing at 30%.”

This lopsided storage has already caused direct operational problems. The Canyon power station, which is fed by the Maussakele Reservoir in the Laxapana complex, has been forced to reduce its output. The 60MW plant is now operating at just 40MW due to limited water availability. Downstream, the 100MW New Laxapana station is similarly constrained.

The Laxapana complex is not just another hydropower asset — it plays a vital role in Colombo’s drinking water supply. It is required to run continuously to maintain flows for water treatment plants. “That means the CEB must generate from Laxapana 24/7, no matter what,” Ralapanawe said. “So how did they allow it to reach such a critically low level, especially when Mahaweli reservoirs are full?”

Ralpanawe said: “Instead of making adjustments to maintain operational flexibility, the CEB appears to have run the Laxapana complex harder than necessary in previous months while underutilising Mahaweli, where Victoria and Randenigala are sitting comfortably. The consequence? More reliance on oil-based thermal generation, even as the country’s dams remain well-stocked.”

“This is not just a technical problem — it’s an economic one,” he stressed. “Oil is expensive. When you underutilise hydropower in a year like this, you’re actively choosing to drive up the cost of generation.”

The apparent lack of coordination between the Mahaweli and Laxapana systems is especially baffling given the CEB’s long-standing familiarity with both. “The CEB has operated these systems for over 40 years. They know the inflows, the rainfall patterns, the seasonal irrigation releases — none of this is new,” Ralapanawe said.

Moreover, the growing integration of AI and data-driven forecasting tools in the global energy sector makes such mismanagement increasingly indefensible. “If, in the age of AI, we’re still hearing that ‘it’s too complex’ to manage these reservoirs in tandem, then something is seriously wrong,” he added.

Dr. Ralapanawe urges the CEB to provide an explanation: “Why was Mahaweli underdispatched when it was full? Why was Laxapana overused to the point that we now can’t get full capacity from critical plants like Canyon and New Laxapana? What is the economic impact of burning more oil than necessary?”

The missteps are already costing the public. Higher generation costs will ultimately be passed on to consumers in the form of increased tariffs, a burden made heavier in an already strained economy,” says Dr. Ralapanawe.

Ironically, 2025 was shaping up to be a strong hydro year, offering a rare opportunity for cost savings and reduced fossil fuel use. Instead, mismanagement has left key reservoirs unbalanced and locked the system into a more expensive operating mode — one that benefits oil suppliers but punishes the average household and industry.

Dr. Ralapanawe’s message is blunt: “This is not just about water and electricity. This is about public accountability and economic responsibility. If the CEB cannot manage two hydro systems properly with decades of data at its fingertips, then it must rethink its leadership and planning structures — or risk repeating the same costly mistakes year after year.”

Our efforts to contact CEB officials for comment were in vain.

By Ifham Nizam

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Million Lankan women workers will lose their jobs if Trump’s 44 % tariff goes into effect

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As many as a million Lankan women workers in key export sectors will lose their jobs and income if the 44 percent tariffs imposed by US President Donald Trump come into force at the end of the 90-day pause, Asia News has reported.

Sri Lanka’s main export industries, such as apparel, tea, gems, rubber and cinnamon, that employ mostly women, will be the most affected by the new tariffs since the US market is one of their most lucrative.

Apparel workers reproach the government for its “lethargic attitude” and failure to consider the concerns of workers and unions, not least because their representatives were not asked to participate in the discussions on tariffs.

The apparel industry accounts for about 40 percent of the country’s total exports, and is crucial for its economy. It also employs mainly women from low-income backgrounds in rural areas, for whom these jobs represent a crucial pathway out of poverty.

Since most apparel workers are also breadwinners, their wages help extended family networks in economically disadvantaged regions.

“The Women’s Centre collaborated with 25 other women’s organisations to carry out our campaign against the US tariffs hindering women workers,” said its Executive Director, Padmini Weerasuriya.

If the tariffs go into effect, “Their take-home pay will decrease significantly,” she added. “As orders dip and approximately six million dependents will also be severely impacted.”

“These women need job security as factories are already discussing about possible layoffs of workers, since demand is likely to drop.”

Compared to India and Bangladesh, she warns, Sri Lankan women face greater competition since “the tariffs imposed on Sri Lanka are higher”. That is why several manufacturers are already moving their operations to Vietnam, Bangladesh and Africa.

If plants shut down, more than 350,000 women working will be impacted. AsiaNews met three of them, 33-year-old Subadra Aponsu, 31-year-old Hemamamli Akaravita and 30-year-old Sandamini Tissera who spoke about their difficulties.

“We are the breadwinners of our families as our parents are elderly and sick. Our siblings are married and they are unable to provide for our parents. During the past several years, we have been working hard and providing for our families. If we lose our jobs, we have no option but to mortgage our homes,” they explained.

“During the economic crisis, we had to sell our paddy fields. Currently, our employers are planning to leave the country. We may lose our jobs shortly. We are unable to find employment elsewhere as almost every apparel manufacturer is planning to sell their business. In our boarding house, several women have already lost their jobs.”

According to economic analysts Sampath Amarasinghe and Niroshini Caldera, “due to the new tariffs, there will be a significant decline in export volumes with a severe erosion of Sri Lankan goods’ competitiveness in US markets.” All this, they warn, could result in “many Sri Lankan products ending up out of reach for US consumers and businesses.”

The greatest risk concerns “price- and cost-sensitive categories like garments, where profit margins are already low and competition from other countries is intense.”

The new tariff will see exports to the United States drop by 20 percent, with an annual loss of about US$ 300 million in foreign currency earnings.

As Sri Lanka’s total exports of goods in 2024 reached US$ 13 billion, the experts conclude, this represents “a major blow to the country’s balance of trade” and “economic growth prospects”.

Meanwhile, several women’s groups started a petition last week in the Katunayake Free Trade Zone (the first and largest of the country’s eight FTZs). – (AsiaNews)

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