Government Halts Sale of Sri Lankan Airlines, Plans Restructuring

The decision to stop the sale comes after the previous government had sought to sell a 49% stake in the airline while retaining 51% control. Despite interest from six parties, none qualified for the next stage of the bidding process. SriLankan Airlines, which has accumulated losses amounting to $1.2 billion, reported an operating profit for the period from April 2022 to March 2023.

Chairman Ganegoda emphasized that the airline is crucial for Sri Lanka’s tourism sector, accounting for 50% of the country's tourist arrivals. With ambitious goals to attract 2.3 million tourists this year and five million by 2030, restructuring is seen as essential for the airline's role in supporting this growth.

Although the sale has been halted, Ganegoda revealed plans for restructuring to strengthen the airline’s balance sheet and ensure long-term sustainability. President Dissanayake, who won last month’s presidential election as the leader of the National People’s Power, had pledged during his campaign to prevent the sale of state assets. Shortly after taking office, he dismantled a government unit that had been tasked with selling off loss-making state agencies, including SriLankan Airlines.