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CWE management to be privatised

by Rajmi Manatunga

The management sector of the CWE will be privatised in order to improve efficiency and achieve financial discipline, Commerce and Consumer Affairs Minister Ravi Karunanayake said yesterday.

The CWE will be divided into five sectors for wholesale, retail, delivery and other services whose management will be listed for private investors. However the Minister said the government will still hold the authority over management as only 40 per cent of each unit will be available to private companies.

The Minister pointed out that the CWE is running at a loss due to various financial malpractices at management level and hoped that privatisation will end this.

The CWE's record in 2000 was described by the Auditor General as "careless and risky" owing to its Rs 2,810 million loss and Rs 10606.5 million bank loans whereas the gain was only Rs 338 million. The loss was related to irregularities in buying paddy, wheat flour, misuse of assets and political intervention.

"The CWE is currently saddled with a Rs 4,200 million accumulative loss and a bank overdraft of Rs 6,500 million," the Minister said adding that competition was essential to fulfil the Ministry's sole intention of benefiting the consumer.

A shortage of milk powder has arisen in the CWE as the 40 tonnes purchased for this month has sold out within three days. The Ministry has called a new tender for buying 200 tonnes of milk powder per month and the Minister expressed confidence that consumers would again be able to buy milk powder at a reasonable price within just two months.

Commenting on the impact of the current political instability on foreign investment, Minister Karunanayake admitted that the situation was a cause for concern but not alarming. 

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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