Defunct industries to rise under private sector partnerships
TIE-UPS: There are 120 Government industries which are defunct
and action is being taken to re-open them as government and private
sector partnership companies, Minister of Enterprise Development and
Investment Promotion, Dr. Sarath Amunugama said.
Speaking to the Daily News after opening a regional BoI
administrative office in Mawathagama Free Trade Zone the Minister said
there are many State factories and institutions that have been shut down
due to various reasons.
â€śThis is a crime as the Treasury keeps paying salaries for them. In
addition millions of Rupees worth of machinery is decaying in these
institutions,â€ť the Minister said.
He said President Mahinda Rajapaksa too is keen to re-start these
enterprises, which are mostly under the Public Enterprise Reform
Commission. (PERC). The Minister said that in some cases chairmen who
are in charge of these institutions are not keen to re-start them as
they think that they would lose their perks.
â€śWe canâ€™t help and we are not there to please them,â€ť he said. He said
that as an initial step Hingurana Sugar Company, which was shut down for
over a decade, was re-opened as a government-private enterprise with
LOLC and Browns Group investing. Another enterprise that started work
again was the Thulhiriya textile factory under the MAS holding group.
The Government would keep 51 percent in each enterprise and give out
the remaining shares to the private sector. â€śTherefore this is not
privatisation,â€ť he said.
The Minister said in some instances the Treasury had to settle
outstanding wages of employees without giving a burden to the private
sector who would be investing in these ventures.
Dr. Amunugama said the Governmentâ€™s 51 percent would comprise land
that is available at the site and also machinery on the institution.
â€śThis would help the investor to commence operations easily,â€ť he said.
He said that soon after the Multi fibre agreement was introduced,
which removed the quota system, some banks have been reluctant to
provide credit facilities to the local apparel sector entrepreneurs.
â€śI will meet the bankers and take up this issue,â€ť he said. With
investments in the first quarter of the year reaching Rs. 2 billion the
Board of Investment would be also opening a new BoI zone in Puttalam
The Minister will also be touring Germany next week to meet officials
of the European Union, political leaders and non-governmental
He said that travel advisories from the German Government too would
be discussed during this one-week visit. This visit would be very
important, as Germany would be chairing the European Union.