Ceylon Chamber welcomes moves to liberalise petroleum sector, address both economic and ethnic issues

• Says opening of fuel retail distribution business to three additional players will allow for competition
• Calls for transparent processes and governance structures that will facilitate divestiture of non-strategic commercial assets/stakes
• Praises President Wickremesinghe for his resolve to address both economic and ethnic issues to achieve real progress 

In a statement, the Ceylon Chamber of Commerce yesterday welcomed the government’s move to liberalise the country’s petroleum sector and its resolve to address both economic and ethnic issues to achieve real progress. 
“The chamber appreciates the steps taken by the policymakers in the power and energy sector. It is encouraging to note that competition is being introduced to the petroleum sector, which was previously dominated by the state,” the statement said.

“Opening the retail distribution business to three additional players will allow for competition, an increase in quality of service and for outlets to be set up in remote areas of the country. New players being able to import and supply fuel to the country will also reduce the over-reliance on CPC to procure dollars and distribute fuel, thereby reducing the vulnerabilities faced in 2022, due to a shortage of dollars in the banking system,” it added.

However, citing the recent media reports, the chamber pointed out that the EOI responses towards the Hambantota refinery should be analysed with caution.

“Any process, which lacks governance and transparency, could lead to corruption, which is an issue that has hindered the progress of economic development and attracting genuine foreign direct investments. 

Given the complexities inherent in reforms and changing processes, we advise the government to set in place transparent processes and governance structures that will facilitate the divestiture of non-strategic commercial assets/stakes as well as encourage investment in strategic assets such as the Hambantota oil refinery. 

This would also complement the IMF’s engagement with the government, which is aimed at improving the governance framework through a diagnostic analysis, which is a structural benchmark under the Extended Fund Facility with the IMF,” the statement said.  The chamber also hailed the statement made by President Ranil Wickremesinghe at the recent ‘Economic Dialogue – IMF and Beyond’ forum, organised by CA Sri Lanka, where he referred to the two Es in the country – the ethnic issue and economic issue – and the importance of addressing both these issues in order to achieve real progress.  

“The chamber recognises these as fundamental anchors for the future direction of the country. The recognition of the nexus between reconciliation and ethnic harmony and economic reform, is vital. The chamber supports this initiative and will strive to initiate programmes at business level that will complement this agenda,” the statement said.