Taming the “Monsters”

Preamble
State ownership of public utilities dates back to the colonial period. The early post-Independent years saw the state establish public enterprises that were involved in the production and distribution of key goods and services. The share of state ownership in the economy expanded steadily and gathered momentum in the 1970s when government policy, in the name of socialist or progressive reforms, sought to gain control of the “commanding heights of the economy”. State involvement in production and distribution was rolled back to a certain extent, during the period 1977 – 2005, as successive governments privatized a number of state enterprises. The privatization process has been halted since 2005. The state - owned enterprises sector still accounts for a significant share of the economy (see below). Despite improvements in their performance, these enterprises continue to provide a very low or negative return on investment for the people of Sri Lanka.