To attract private partner:

Sri Lankan to be re-vamped

by Sanjeevi Jayasuriya

The government is looking at a suitable model with public-private partnership (PPP) to revive SriLankan Airlines. “The initial restructuring process will take six months from now,” Public Enterprise Development Minister Kabir Hashim told Sunday Observer Business.

“The Treasury will support us for six months and we are confident that SriLankan Airlines could be turned around. It will be a development plan to restructure the airline and recover financial losses,” he said.

Any investment partner showing interest in SriLankan Airlines could make an offer. “However, we have not called for proposals as yet,” he said. “We may be interested in management tie-ups and partnerships, but some changes need to made to recover the colossal losses incurred so far. We will work out a process to enable SriLankan Airlines to become a viable venture by looking at different models,” he said.

According to the Minister, the government is looking at an emergency process and a strategy to revive the airline. The losses amounting to US $ 933 million and total liabilities exceeding US $ 2.1 billion (including the aircraft ordered by the previous government) have made it impossible for the airline to move forward. The PPP would revive the airlines.

“As the Public Enterprise Development Ministry, we are working on a strategy to check the losses which has burdened the Treasury and the country and ensure these enterprises reach breakeven point,” he said. State Minister of International Trade, Sujeewa Senasinghe said the government has no plans to float SriLankan shares on the Colombo Stock Exchange.

“We have no plans to trade the airline shares in the CSE and there is no foreign partner to tie-up with SriLankan Airlines at present. We will look at the best possible strategy for the airline to make it a profit-making enterprise and an investor-friendly venture,” he said.

However, an independent economist told Sunday Observer Business there is a possibility of listing the airline on the share market as it will deepen and widen the market.

“It will bring about a disclosure requirement; ensure good governance and operations would be more transparent. By this the government could earn revenue and be transparent about the restructuring process,” he said.