Sri Lanka’s aviation minister, Nimal Siripala de Silva, has warned that aircraft at SriLankan Airlines may be grounded if the government fails to get stakeholders, including employee groups and unions, to agree to the government’s plans to sell a minority stake in the carrier.
The government aims to sell a 49pc stake in SriLankan Airlines and form a joint venture agreement with the buyer since existing laws prevent the complete privatization of the airline.
The minister emphasised that the trade unions, pilots, engineers, and cabin crews would be the ones to suffer if the privatization plans don’t go through successfully.
SriLankan Airlines currently operates 19 aircraft, including an A320-200N and two A321-200Ns, with one A330-200 parked (out of lease) and going back to the lessor. The airline’s fleet consists entirely of leased aircraft.
The government has yet to officially call for expressions of interest in the minority stake, but the minister mentioned receiving unsolicited inquiries and revealed plans to start the formal process in November.
The Sri Lankan Treasury, in consultation with the World Bank and International Monetary Fund, has decided to appoint the International Finance Corporation (IFC) as an independent advisor to oversee the sale process.
Suresh Shah, head of the government’s State-Owned Enterprises Restructuring Unit, is responsible for driving the privatization of various state-owned enterprises, including SriLankan Airlines.
While unions and employee groups have expressed concerns about privatization in the past, the opposition to these plans has diminished as it is now seen as beneficial for employees and the country’s economy.
