Facebook icon
Twitter icon
e-mail icon

Sri Lanka's Finance Minister vows to press ahead with liberalisation as 2018 budget passes

Sri Lanka’s Finance Minister Mangala Samaraweera vowed to press ahead with liberalising Sri Lanka’s economy and ending what he termed a “nanny-state”, as parliament passed the 2018 budget this week.

In a speech delivered to the parliament, Mr Samaraweera said “for too long our people have been suppressed by an overbearing state and by archaic legislation which are a vestigial link to our colonial past.”

“The Budget focuses on liberalization to unlock the barriers to greater investment, trade, and start-up enterprises,” he added. “There are many who pontificate on the need for Sri Lanka to break away from the forces of globalization and to chart an independent path. But little do they realize that many of our major laws and legislation are still those designed by our former colonial rulers. We remain tied to this colonial legacy and continue to be governed by those diktats.”

He also pledged that his government “will not be a nanny state”.

As part of the move, Mr Samaraweera added that there was a need to liberalise Sri Lanka’s shipping industry “to encourage an environment of healthy competition” by “eliminating unfair trade practices by enacting prudent regulation”. 

However, last month the move was opposed by Sri Lanka's Ports Minister, SLFP MP Mahinda Samarasinghe. “We will discuss the modalities of implementation of these proposals with Hon. Mahinda Samarasinghe, while taking note of his concerns,” said Mr Samaraweera.

The budget was passed with 155 in favour, 56 against in the 225-member parliament.

It will see Sri Lanka face its highest debt repayment in the next two years, with Reuters reporting that Colombo is “in the process enacting legislation to borrow more than the annual budget limit to prevent a possible sovereign debt crisis”.

Sri Lanka also proposed increasing its budget allocation towards defence to USD1.9 billion (LKR290.7 billion) in proposals to parliament. The increase in spending makes the defence budget the top expenditure for Sri Lanka. The second highest expenditure will be interest costs to pay interest on loans taken out to finance previous deficits.

See the full text of his address here.