This is now a government Hilton. Photo by Dhammika Heenpella
ALL YOUR BASE BELONG TO US. More accurately, SOME OF YOUR BASE IN WHICH WE HAVE SHARES NOW BELONG TO US. Yes, Parliament just passed has passed the Bill on Revival of Underperforming Enterprises and Underutilized Assets, breath, phew, I’m putting a period here. Despite the opposition of pretty much everybody. What does this mean?
What assets are getting nationalized in Sri Lanka? According to Lakbima News (via Jeyaraj), it’s Hotel Developers (Lanka) PLC, the owning company of Colombo Hilton. That company was run pretty dubiously, I guess, but there are also properties and assets being taken from sugar, tractor, and apparel companies galore. 37 institutions in all, including private ones. (Assets The Government Is Grabbing
The problem with this bill is that it’s really a one-time thing which sets a weird precedent. The bill actually does cover some dodgily or dumbly privatized companies that it might make sense to roll back the leases and etceteras for to put them to better use. Successive governments have done a bunch of dodgy privatizations and it is a jungle. Rather than untangling the jungle, however, this bill seems to be selectively retangling it in the current government’s favor.
What’s Going On
What’s weird about Mahinda is that he’s astrangely democratic. He does dictatorly stuff, like abolishing term limits or seizing assets, but he actually does it through the democratic system. He’ll run elections, get the votes, and pass stuff. People can whinge, but he’s actually doing wrong things the right way. In that sense the demonization of the man personally misses the point. Even his patronage of murderer/rapist MPs like Duminda Silva is probably because Duminda brings in votes more than any particular evil of the man. What people don’t do in opposition to Mahinda is, you know, build an Opposition and work the system like he does.
This bill is really about him wanting land and assets to do stuff with, including handing it off to similarly under-performing catchers, but perhaps some performing ones. He could have just seized it, but he did it through the democratic system, just not through an especially long-sighted bill. It’s not legislation so much as a memo. They say it’s not something that will happen in the future, but legislation is explicitly supposed to set precedents.
This means that the bill should spook generic investors. I say generic because any actual investor is actually plugged in and can work within this hacked system as well as any other. The major question, however, is how safe investments are if successive governments roll back whatever their predecessors do, though it’s kinda always been like that.
You can say this is a shame, but I think it’s more because Mahinda actually does have popular support. People think he’s corrupt but don’t care as long as he gets the job done. If he’s not getting the job done he’ll get booted (I firmly believe), but short of that, since he’s using the system, a functional opposition within the system could presumably stymie some of this stuff.
Or in this case, not.