SOEs open to private sector investments at assessed value, says Minister Arundika Fernando

• Insists SOEs should not be offered for private sector investments below their assessed value 
• Says initiative aims to ensure transparent investment procedures for enterprises, strengthening financial reserves and fostering orderly management
• Asserts potential investors in SriLankan Airlines must have financial capacity to manage its substantial debt, even if Govt. absorbs part of it
• Reveals Hyatt Hotel and Krrish project face challenges due to previous investors leaving; $ 60 million allocated to Hyatt project, with an additional $ 35 million in debt
• States if no suitable investor found for Colombo Hyatt project, Govt. is ready to complete it with assistance of armed forces and treasury funds
• Advocates for another term for President Ranil Wickremesinghe, citing his leadership through economic crisis

State Minister of Urban Development and Housing Arundika Fernando last week announced that State-owned enterprises (SOEs) are now open to private sector investments, subject to the Government’s assessed value. 

“This directive aligns with President Ranil Wickremesinghe’s instruction to ensure that SOEs are not offered below their assessed value,” he stated at a press briefing held at the Presidential Media Centre.

Fernando emphasised the revival of regional development projects previously halted due to economic difficulties. 

He noted that the Government has granted authorisation to seek private investors for various enterprises under the Urban Development and Housing Ministry. “This move aims to ensure their systematic maintenance and enhance transparency in investment procedures,” he added.

SOEs...

The State Minister highlighted that the Government is keen on securing investments that exceed the assessed value, thus strengthening financial reserves, distributing shares among employees and fostering orderly management of these entities. Key establishments like the Hilton Hotel are among those expected to benefit from this initiative.

Fernando reiterated that there is no room for any private investor to acquire SOE below the Government’s appraisal value. 

He also addressed the substantial debt burden of SriLankan Airlines, stressing that any potential investor must have the financial capacity to manage the remaining debt, even if the Government absorbs a portion of it.

Fernando also discussed other stalled projects, such as the Colombo Hyatt Hotel, Krrish, and Destiny, noting that valuable Government land had been allocated for these ventures. “Regrettably, the investors involved in these ventures have left them. At present, the Krrish project stands as a lingering environmental issue, characterised by a derelict building,” he stressed.

Highlighting the Colombo Hyatt Hotel project, Fernando revealed that $ 60 million has been allocated, primarily from public funds, with an additional $ 35 million in debt. 

“The development has utilised a significant plot of land in Colombo. If an appropriate investor does not emerge, we are prepared to proceed with completion with the assistance of the armed forces, with financing from the Treasury. We are optimistic about a significant increase in foreign investment into the country in the coming months,” Fernando added. 

In a positive development, he said the country has seen a surge in foreign reserves, allowing the resumption of stalled regional development projects. “Under President Wickremesinghe’s economic agenda, funding for the ‘Aswasuma’ social welfare benefit program has tripled compared to the previous ‘Samurdhi’ program. Additionally, the ‘Urumaya’ program, which provides free land deeds for licensed lands, has been swiftly implemented, empowering communities,” he highlighted.

Fernando concluded by advocating for granting President Ranil Wickremesinghe another term, citing his leadership in guiding the country through its most severe economic crisis in history. 

He expressed optimism about a significant increase in foreign investment in the coming months, signalling a remarkable turnaround from recent economic challenges.