Sumal Pereras Access To Mahinda Rajapaksa

Wednesday, 04 March 2015

There's

enough on this planet for

everyone's needs, but not for
everyone's greed - Mahatma
Gandhi.
A visionary no doubt and very
much in the news lately, Mr.
Sumal Joseph Sanjiva Perera,
the Chairman of Access
Group, sitting with me few
weeks ago at his plush office
situated at Access Towers in
Union Place and seen in the following video trying to explain his side of the story. Well,
at least parts of it,

Object 1

Dreading the thought of having a local version of a Kenneth Lay or a Mikhail

Khodorkovsky in our midst, in the interest of my country and my countrymen and
having investigated Mr. Sumal Perera (SP) and his business operations to the best of
my ability, I decided to share the following while extending Mr. Perera the right of reply,
1. Mr. Sumal Perera says he worships the ex-president Mr. Mahinda Rajapaksa (MR)

for winning the war but denies being a confidante or making any campaign donations
for the election campaigns of the ex-president.
2. Access Engineering, owning 84% of SML Frontier Automotive (Private) Limited with
vehicles such as the Defender, Freelander, Discovery, Evoque, Range Rover Sport
and the Range Rover Vogue in its range.
- Interestingly, to circumvent local customs duties in as many as 60 countries, Land
Rover UK (http://www.landrover.com/index.html) appointed M/s Guava International
Limited (http://landrover.guavauk.com/) to sell vehicles to countries like Sri Lanka and
at under-valued prices in order to increase its sales volumes. While Land Rover UK is
a Public Listed entity where all accounts are audited, M/s Guava Internationals
overseas transactions are not so much scrutinized.
- All the Range Rover Evoque models that entered the country under the US$ 35,000/permit were in reality well over US$ 43,000/- CIF price (base model). Hence, the
Evoque model couldnt have been imported in the first place under the said permit.
The Modus operandi of the local agent, M/s SML Frontier Automotive (Pvt) Limited
(http://landrover.lk/) seems to be collecting a sum of Rs. 2,000,000/- as Agent Fee
and which I believe is to offset the undervalued amount. I also believe this Agent Fee
should be added to the CIF price at the time of placing the order. And now that
hundreds if not thousands have been imported already, in order to compensate the
loss of taxes arising out of under-valuations, I believe the end-user and the local agent
should pay at least Rs. 1,000,000/- each to the Department of Customs.
- Allegations of under-valuations when importing Range Rogue Vogue and Sports
models and declaring of false specifications at the time of clearing have surfaced too.
As in the case of Evoques, a sum of Rs. 3,500,000/- has been collected by the local
agent as agent fees when Proforma Invoices were issued for the higher model. In this
case, I believe a minimum amount of Rs. 5,000,000/- should be paid to the
government by the agent and/or by the client for defrauding the Customs Department
for under-valuing CIF prices. Finding a considerable disparity in prices when verifying
selling prices of both M/s Guava International and M/s Land Rover UK should not
come as a surprise either. Verifying Vehicle Identification Numbers (VIN) or Chassis
Numbers with Land Rover UK for exact specifications and cross-checking it with
entries made at the time of clearing at the Department of Customs may also reveal
interesting facts.
- Allegations of VAT Taxes not being paid for over Rs. 360,000,000/- collected by the
agent to the Department of Customs for Defenders imported and sold for the CHOGM
event.

3. Importing of pipes from China for the Eastern Province Water Supply Development
Project (Japanese loan funded) at CIF US$ 4,500,000/- and selling it to the National
Water Supply and Drainage Board (NWSDB) for US$ 5,500,000/- AND making the
NWSDB pay additional fifty plus million rupees as customs duties for the US$
1,000,000/- profit margin (only for importing) of M/s Access Engineering. Hence, the
higher cost being passed on to the end-user, the public.
The million Dollar question is, why M/s Access Engineering did not clear it directly from
the Department of Customs by paying the lower duty (based on the imported CIF
value)? Was it to hide the profit margin? Even more intriguing is the fact that SP
claiming that the Japanese funding agency insisted on the deal in question being
carried out by Access Engineering. Let us also assume the recently elected Chairman
of Building Materials Corporation (BMC), Mr. Amal
Wickrematunge http://www.ft.lk/2015/02/20/amal-wickrematunga-new-bmc-chairman/)
who was the Deputy Chairman of Water Board at that time was unaware of the Rs.
133 million profit margin of Access Engineering (just for importing) on top of the Rs. 50
plus million paid as additional Customs Duty to shield SPs profits.
4. Then Minister of Transport, Mr. Fowzi handing over the monopoly of producing
number plates for vehicles to a subsidiary company of the Access Group under the
name UTSCH (http://www.utsch.com/en/reference/projects/sri-lanka.html), and
supposedly at the request of Deutsche Investitions- und Entwicklungsgesellschaft
mbH (DEG).
Though the MR government claimed to have called for international tenders, it was an
open secret that specifications of the tender process were tailored to suit only
UTSCH. Operating in the premises of Land Transport Authority, considering the paltry
income earned by the government in comparison to the hundreds of millions earned
by the Access Group, it would be interesting to see concerned authorities re-visiting
the whole arrangement and probably reclaiming the rightful share of the State.
Once again, SP is on record saying (on the video) that the Germans insisted on
giving HIS COMPANY the monopoly to issue the said number plates. It is also
interesting to note that this habit of international aid/loan agencies insisting on giving
contracts to the Access Group becoming an accepted norm.
5.
It is indeed noble of SP to make inroads in to the medical sector and as his
website says providing the latest in cutting edge technology and the best of quality
products and solutions to the medical and health care sector, I would assume M/s
Access International (Pvt) Ltd., Medical Division, representing over 30 plus top-tier

global principals including the following, made supplies to local government hospitals
only through tender procedures and in a transparent manner,
General Electric (GE) Diagnostic Imaging (DI) portfolio - USA
TEVA Pharmaceuticals - Israel,
TriLux - Germany
Matachana (CSSD) - Spain
AGFA (Radiology) Belgium
CANON (Subsidiary OPTOTEK Ophthalmic) Slovenia
Smith & Nephew (Subsidiary ADLER Orthopaedic) India
OPHTEC (Ophthalmology) Netherlands
Samsung Electronics Healthcare (LabGeo) Korea
6. Positioning at the right place and right time, the Access Group chartering in
unfamiliar territory once again and on behalf of the infamous Mr. Basil Rajapaksas
Economic Development Ministry and acting as agents by opening a fly-by-night
company called Foresight, gets the government contract to import 22,500 young
female cows (heifers) for US$ 100 million from Wellard Group in Australia.
http://www.farmweekly.com.au/news/agriculture/agribusiness/general-news/wellardstrikes-sri-lankan-dairy-deal/2716110.aspx
Imported at a cost of Rs. 600,000/- (approx.) a head as against the availability of local
cows which costs around Rs. 50,000/-, in order to justify the exorbitant costs in
importing, I assume each imported cow would produce at least 40,000 more liters of
milk than the local ones in its lifetime.
7. Road development projects totaling about Rs. 30,000,000,000/- done by the Access
Group and one can only hope that estimates of engineers from the Yaha Palanaya
(good governance) division would not differ by huge margins,
- Rehabilitation & improvements to the section from Kadawatha to Nittambuwa and

costing Rs. 7,000,000,000/-.

- Widening & improvement of a 1.5 Km stretch between Jaffna Ponnali Point
Pedro Road, which is in front of the ex-Presidents bungalow and costing Rs.
477,000,000/- Rehabilitation and improvements to Mannar-Puttalam Road Project and costing Rs.
1,214,000,000/- Improvement and rehabilitation Of Bangadeniya Andigama Anamaduwa Road
Project and costing Rs. 2,571,000,000/- Rehabilitation and improvements to Ibbagamuwa Kubukgate Madagalle Road, and
costing Rs. 2,861,800,000/- Accessorizing a 21km length for A32 Road and rehabilitation & improvement of
67km length of Navatkuli Karaitivu Mannar Road, and costing Rs. 1,012,600,000/- Improvement & rehabilitation of a 18.5Km stretch between Galagedara
Rambukkana Road. And costing Rs. 1,250,000,000/- Rehabilitation and improvements on Ambepussa Kurunegala -Trincomalee &
Kantale Perathuweli Roads, and costing Rs. 864,700,000/- Rehabilitation & improvement of Jaffna-Kankasanthurai Road, Puttur-Meesalai
Road & Jaffna-Palali Road costing a total of Rs. 3,662,000,000/- Surface improvements to internal roads at Katunayake and Biyagama export
processing zones costing Rs. 360,000,000/- Improvement of Padeniya-Anuradhapura road done costing Rs. 577,500,000/- AFD Project costing Rs. 1,400,000,000/- Rehabilitation & improvements to roads in North Central Province for the Deyata
Kirula in 2012, costing Rs. 473,300,000/- Another Rehabilitation & improvements to roads in North Central Province for the
Deyata Kirula 2012, and costing Rs. 380,200,000/-

- Access Road to Hambantota International Airport at a cost of Rs. 206,000,000/- Improvements to six roads in Killinochchi area and costing Rs. 134,500,000/- Improvements of a stretch of around 10Km on the Negambo-Meerigama Road, and
costing Rs.141,282,000/- Improvements of another stretch of Negambo-Meerigama Road costing Rs.
143,415,000/- Improvements to Badalkumbura-Buttala-Sellakatharagama Road and costing Rs.
141,800,000/- Southern Transport Development Project at a cost of Rs. 900,000,000/- Improvements to the Medawachchiya-Mannar-Thalaimannar Road costing Rs.
533,000,000/- Widening and Improvements to Colombo Kandy Road at Kadawatha Town, and
costing Rs.357,400,000/- Improvements to Malabe-Kaduwela Road at a cost of Rs. 306,000,000/- Sammanthurai Deegavapi Road at a cost Rs. 167,000,000/- Widening and Improvement to Dehiwala Maharagama road and costing Rs.
106,700,000/- Rehabilitation of A 9 Road at a cost of Rs. 170,000,000/8. Island-wide government water works contracts worth over Rs. 12,000,000,000/9. Island-wide government contracts to build flyovers and bridges worth over Rs.
7,000,000/10. Island-wide government contracts for irrigation & drainage works worth almost Rs.
2,000,000,000/-

11. Island-wide government contracts for harbors and marine work totaling Rs.
2,000,000,000/12. Island-wide government contracts for dredging and reclamation works worth Rs.
200,000,000/13. Island-wide government contracts for piling and waste management worth Rs.
500,000,000/14. Island-wide government contracts to construct buildings worth over Rs.
13,000,000,000/15. Government contract for the fuel hydrant project at Hambantota worth Rs.
700,000,000/He may be accused of stealing public funds for himself, for his company and for
members of the previous regime, but SP being a Chartered Accountant, I believe he is
an exceptionally talented individual who had also mastered the art of covering his
tracks. I also believe the real reason behind the public listing of selected subsidiaries
of the group was to escape strict scrutiny from regulators and to falsely portray a
sense of transparency to the unsuspecting public.
With over Rs. 100 billion worth of government contracts under his belt and him
claiming to be a God-fearing Christian, Mr. Sumal Perera needs to acknowledge that
corruption costs ordinary citizens money and make them pay for services which
should be free or minimal. Corruption also makes citizens lose trust and make them
unwilling to participate in their societies. It also has links to criminal elements and
thrives during conflicts and wars. May be that explains SPs close association with Mr.
Duminda Silva of Kolonnawa Drug Cartel fame.
It is an open secret now that Access had direct access to the Rajapaksas when they
were in power and the fact that Access Group appointing consultants (for government
projects) indirectly in order to customize requirements to suit that of the Group. In
essence, occasional tender notifications were not worth the paper they were printed
on.
With all kinds of manipulations and assuming SP and his Group of companies made a
windfall of around 25% from a turnover of over Rs. 100 billion (in government
contracts alone), moving forward and in the interest of all stake holders, I suggest that
Sumal Pereras Access Group pays regulators and anti-corruption forces an amount
not less than Rs. 10 billion in order to get a clean bill of health. After all, Yaha
Palanaya (good governance) is all about continuation of development projects and
without a hitch while at it. Of course there will be due diligence practiced in the future,
but my suggestion just might save the government a lot of money and resources while

the fear/reality of victimization and bankruptcy may cease to exist in the minds of the
Board of Directors of the Group.
At the end of the video interview above, Mr Sumal Perera says that businesses of his
Access Group in the past 5 years performed much better than all his 20 previous
years. Doubt I did not and with that, I thanked him for his time and made my exit.
By Muhammed Fazl
The writer is an independent social/political activist and can be contacted
at muhammedfazl@msn.com and through FB (Fazl Muhammed Nizar).
Previous article
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