‘Foreign management of Telco’s happen even during war’ – Shah
In a comprehensive discussion on the future of state-owned enterprises (SOEs) in Sri Lanka, Suresh Shah, Head of the State Owned Enterprise Restructuring Unit, addressed the multifaceted challenges of reforming these entities, particularly emphasizing the national security concerns that arise amid divestment debates.
As the country embarks on another round of attempts to revamp its SOEs, comparisons with regional peers shed light on a path forward that balances economic efficiency with security considerations. Shah, speaking at a forum organized by the Institute of Engineers, underscored the recurrent attempts at SOE reform in Sri Lanka, noting that this cycle of reform efforts has historically been spurred by economic crises.
However, it’s the mention of national security, especially concerning the telecommunications sector, that has sparked intense debate among policymakers and the public alike.
“National security is a significant concern for any country when it comes to divesting state-owned enterprises like Sri Lanka Telecom,” Shah noted, questioning the premise that divestment inherently poses a threat to national security.
Shah was speaking at the IESL Public Lecture: Restructuring State-Owned Enterprises: Is the Government Divesting Everything?
Drawing parallels with regional examples, Shah highlighted how neighboring countries have navigated similar concerns. For instance, during the height of its conflict, Sri Lanka itself saw foreign management of Sri Lanka Telecom, questioning the argument that divestment compromises security. “If there was a national security issue surrounding Sri Lanka Telecom, how is it that during the height of the war, the entity was under the management of a foreign firm?” Shah challenged, pointing to the successful management transitions in sectors deemed sensitive for national security.
Moreover, Shah’s insights into how regional peers like Singapore and Malaysia have tackled SOE reform while maintaining national security offer a blueprint for Sri Lanka.
These nations have managed to attract foreign investment and expertise into their SOEs through strategic partnerships and regulatory frameworks that safeguard national interests without stifling economic growth. “Regulation plays a crucial role in ensuring that while SOEs are managed more efficiently by the private sector, national security interests are not compromised,” Shah explained.
Addressing concerns that divestment might lead to foreign control over critical infrastructure, Shah reassured that stringent regulations and oversight mechanisms could mitigate these risks. He advocated for a balanced approach where economic efficiency and security coexist, drawing lessons from how regional powerhouses have leveraged foreign expertise to bolster their economies while keeping a tight rein on security aspects.
As Sri Lanka grapples with the dual challenges of economic reform and national security, Shah’s commentary provides a nuanced perspective on navigating these complex waters.
The success of regional peers in managing these concerns offers a roadmap for Sri Lanka, suggesting that with the right mix of policies, oversight, and international cooperation, it is possible to achieve the twin goals of economic efficiency and national security. TP
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