Money earned from H’tota port lease to meet Govt.’s expenditure: MR
Posted on August 2nd, 2017

 Courtesy The Daily Mirror

Former President Mahinda Rajapaksa said today the 1.12 billion USD earned from the lease of the Hambantota port was to go to the treasury to meet the day to day expenditure of the government instead of paying the loan taken to build the port.

The government will not be using the 1.12 billion USD that comes from the lease of the port to pay the loan taken to build the port. Instead the money is to go to the treasury to meet the day to day expenditure of the government. The USD 1.12 billion raised from the privatisation of the Hambantota port is small change for this government and will soon vanish just like the USD 13.7 billion they raised earlier, he said.

As public indignation mounts at the manner in which the Hambantota port was privatised, yahapalana ministers are now going around saying that my government too had planned to sell the entire Hambantota port to the Chinese. This is a diabolical lie. Everyone knows that my government had an explicit anti-privatisation policy. Not only did my government refrain from privatising any State assets, we reacquired several important assets that had been privatised by previous governments,” he said.

Mr. Rajapaksa said if things continued in the present manner, Sri Lanka would not have any national assets left by the time this government completed its tenure.

The people should band together and organise in the villages, towns and workplaces to oppose this government’s quest to sell Sri Lanka off to foreign buyers,” he said.

He said in a statement that the manner in which the government privatised the Hambantota port had shocked the nation and added that Parliament was not allowed to debate the Agreement to privatise one of Sri Lanka’s most important strategic assets.

No one knows who did the valuation of this asset. No one appears to have seen any technical/financial evaluation report. The government has also not explained to the public on what criteria they selected the company that won the bid when there was clear evidence that the other bid was much more favourable. This headlong quest to sell state assets is a direct result of the economic crisis that the government has plunged this country into. After the yahapalakayas lied their way to the presidency in January 2015, they knew it would not be possible to win the parliamentary election that was soon due by the same means, so they increased the salaries of government servants, reduced the price of fuel, gas and certain foodstuffs in order to bamboozle the people in a different way,” he added.

Mr. Rajapaksa said that the government had increased government expenditure while simultaneously reducing revenue, creating the present financial crisis.

According to the Auditor General’s reports, the Budget deficit which was 5.7% of the GDP in 2014, had almost doubled to 10.5% in 2015 in just one calendar year. The lack of money to meet day to day expenses including the salaries and pensions of state sector employees resulted in massive foreign currency borrowings. In just two and a half years, the yahapalana government has taken foreign currency loans amounting to over USD 13.7 billion. All this money has been spent on consumption. USD 13.7 billion is the equivalent of ten Norochcholai power plants or ten Hambantota Ports, or more than twenty Southern Highways. But the government has nothing to show for all this money that has been borrowed and spent,” he said.

He said under IMF instructions, the value added tax and other taxes were increased in 2016 to raise money to repay these debts.

After imposing taxes even on terminally ill patients, the government was still not able to raise enough money to repay the USD 13.7 billion they borrowed and they have now resorted to increasing non-tax revenue through the sale of state owned assets,” he said.

He said the Budget proposals of the yahapalana government make it clear that they intend privatising all state owned assets ranging from non-strategic business establishments like the Colombo Hilton to strategic assets like the Norochcholai power plant and that the sale of the Hambantota port was just the beginning.

The Prime Minister has already announced that the Mattala airport would be next. Other assets like the Colombo -Katunayake Highway, Southern Highway, Water Board and Electricity Board are also due to be privatized,” he said.

 

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