Ceylon Chamber of Commerce advocates listing of SoBEs in CSE
View(s):The Ceylon Chamber of Commerce (CCC) has proposed to the government to list Sri Lanka’s State-owned Business Enterprises (SoBE) in the Colombo Stock Exchange to make it viable entities and accountable to the public.
Sri Lanka’s 55 major SoBE should even partly be listed at the bourse to transform it to profitable ventures with a new management, Chairman CCC S.P.S. Ranatunga told the Business Times.
He said the chamber has submitted a set of budget proposals to the Treasury including the suggestion to list SoBE.
These enterprises have not been managed properly during the past 50 years and have become white elephants to the economy burdening the public, he said.
In the past, these enterprises have had lenient financial regulations than government departments, paving the way for the elected ruling party henchmen to misuse them more easily. As a result the existence of state enterprises has become one of the key causes of corruption in the country in the recent past, he added.
Senior government officials revealed that the plan involves restructuring SoBE by strengthening their balance sheets and finding ways for these organisations to seek their own funds, internally, with little or no financial support from the government. Currently most of the SoBE are managed by financial support from the Treasury. On the other hand whatever these state companies collect through revenue or levies is transferred to the Consolidated Fund – through regulation – which in turn is used by the Treasury to return some part of these earnings, back to the organisation for operational and management.
SoBE in Sri Lanka represent a substantial portion of GDP, capital investments, employment and play a dominant role in key sectors of the economy whose performance is of great importance to broad segments of the population and to other parts of the business sector.
According to Finance Ministry statistics, during the first three months of 2015, 11 SoBE contributed towards government’s non-tax revenue by way of paying dividends and levies to the Consolidated Fund totalling Rs. 9.5 billion.