Mihin Lanka financially dying without flying
It’s the case of a state enterprise losing more money under closure than when it is operational. The Cabinet of Ministers decided only months earlier to shut down Mihin Lanka – which has been swallowing up public funds since it was set up on October 27, 2006 by the previous Mahinda Rajapaksa administration.
Just this month, however, the Cabinet decided to recommend that the two state owned banks – the Bank of Ceylon and the People’s Bank – should provide two and half million dollars each. That makes a total of five million US dollars or more than Rs 765 million.
For this purpose the ministers approved that Letters of Comfort should be issued by the General Treasury. Thus, the loans are extended by the state banks on a guarantee from
Even SriLankan Airlines, the country’s virtually bankrupt national carrier is now running under similar Letters of Comfort approved periodically by the Cabinet of Ministers. Yet, the loss-making carrier has on its payroll more than ten top rung members of the management who draw sky-high salaries.
the Government.
The recommendation for approval came from Public Enter prise Development Minister Kabir Hashim. He told his ministerial colleagues that a previous loan for the same amount approved in July 2017 expires on October 7, 2017. The current request, he has said, is for the period October 8 till December 31. Previously, from time to time, ministers have given approval for Letters of Comfort.
Minister Hashim has noted that “Mihin Lanka is currently being wound up” and the money was needed until the process is completed.
Even SriLankan Airlines, the country’s virtually bankrupt national carrier is now running under similar Letters of Comfort approved periodically by the Cabinet of Ministers. Yet, the loss-making carrier has on its payroll more than ten top rung members of the management who draw sky- high salaries.
Efforts so far by the coalition government to lure a foreign airline for a “public- private partnership” to halt colossal losses have proved futile.