Govt. unveils vision of revamping SOEs for future-ready economy

Deputy Minister of Finance and Planning Dr. Harshana Suriyapperuma  

• Deputy Finance and Planning Minister Dr. Harshana Suriyapperuma outlines reimagined model to blend public and private sector strengths for economic growth 
• Highlights PPP model as way to boost SOE efficiency 
• Says focus shifts from not whether Govt. should engage in business but on efficiency and governance of SOEs
• Opines Govt. involvement crucial in providing services that private sector might neglect 
• Says once sectors mature and woo private players, need for Govt. competition may decrease 
• States some profitable SOEs have untapped potential, private investments could unlock new opportunities 
• Assures Govt. approach is flexible; some SOEs will remain under public control, others may move to private sector for better efficiency 

By Charumini de Silva

The Government on Wednesday unveiled a bold new approach to State-owned enterprises (SOEs), advocating for a shift away from outdated models toward a dynamic blend of public-private partnership (PPPs). Speaking at the final panel discussion of the Sri Lanka Economic Summit organised by the Ceylon Chamber of Commerce Finance and Planning Deputy Minister Dr. Harshana Suriyapperuma outlined an approach that neither fully embraces nor rejects the involvement of the Government in business but rather calls for a reimagined model that capitalises on both public and private sector strengths to supercharge the growth, unlock untapped potential and embrace reforms to boost the economy.

Drawing comparisons with countries that have successfully blended State participation with private enterprises, he emphasised that the focus should not solely be on whether the Government should engage in business but on the efficiency and governance of SOEs.

He pointed out that Government involvement can be instrumental in providing services that are either unprofitable or neglected by the private sector such as crucial infrastructure projects. However, once these sectors mature and attract private players, the Government competition might no longer be necessary.

“Governments need to operate businesses that are efficiently managed and focused on delivering services that the private sector may not be interested in or may deem unfeasible. When these sectors mature and private operators are active, we must reassess our role,” he added. 

Dr. Suriyapperuma stressed the potential for PPPs as a means to boost performance and scale of SOEs. These partnerships would allow private investors to inject capital and expertise into areas where the Government can still hold a stake, while boosting the entities’ efficiency and competitiveness. 

Acknowledging that some SOEs are currently profitable but have untapped potential, he hinted that inviting private investments could unlock new opportunities both in terms of profitability and market reach.

“Some SOEs could continue to be under even Government control, but others will benefit from private involvement. We are exploring how these entities can contribute more effectively to the economy, potentially by attracting new investments or expanding into new markets,” he added.

Noting that discussions around reforms have been fraught with difficulties in the past particularly due to scepticism among employees and other stakeholders, the Deputy Minister assured the Government is backed by a strong mandate to focus on national interests and is determined to push forward with changes that will modernise and streamline institutions.

He asserted that the Government prioritises reforms that are aligned with national interests and broader economic objectives. “The equation has changes. People have tasked us with finding the best solutions for the country, not just serving the narrow interests. This is why we are confident that the forthcoming negotiations with stakeholders will be more constructive,” he opined.

Dr. Suriyapperuma clarified that the Government’s approach would be flexible. “Although some SOEs would remain in public hands, others might be restructured or handed over to the private sector to enhance efficiency and profitability. Moreover, new entities would be created to harness previously untapped resources with an emphasis on sustainable development and innovation,” he elaborated.

He categorically said SOEs should not be viewed as a burden. “We aim to see SOEs as vehicles for national growth. Whether they remain State-owned, enter into PPPs or transition into private hands — our goal is to maximise their contribution to the economy,” he stressed. 

The Deputy Minister also mentioned potential for a fourth model — public, private and people partnership, which would incorporate community stakeholders in the development process m, thereby ensuring that reforms benefit all layers of society.