On privatisation

I was delighted to read the news that Minister Malik Samarawickrama had announced at the recent Economic Summit that all state-owned enterprises (SOEs) would be privatised.

This is a vindication of what I have been preaching for over 30 years. It is the first time that any Government has had the courage to demolish the barricade against privatisation that the previous regime’s flawed Mahinda Chintanaya raised. Marxists will still continue to rail against privatisation but they should be ignored because their ideology has now been proved to be false all over the world. The simple irrefutable fact is that the Government should not be engaged in commercial activity. Government institutions are not designed for it.

Since the next vital step is implementation let me enunciate certain principles that should be observed if success is to be ensured. 1. The management of the privatised entity (PE)

should be by the private sector. 2. The Chairman of the PE should be a private sector

man with a proven track record. 3. The majority on the board should be private sector men with track records. A shining example of this is Sri Lanka Telecom. I have a reason to be justifiably proud because I persuaded President Chandrika Kumaratunga to privatise Telecom at a meeting the World Bank held in Paris in 1996 where the Treasury Secretary A.S. Jayawardena had informed the audience consisting of leading private sector men and some potential foreign investors that the Government had decided to defer privatization because of strong opposition from the trade union. I persuaded her to ignore this opposition because the number of employees was small when compared to the vast number of citizens who would benefit from privatization. I convinced her that it would be a political triumph; and so it turned out to be.

Similarly the proposed privatization by the Yahapalanaya government will be a political triumph, and the supporters of the previous regime will be left licking their wounds.