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Editorial

Budget, cannabis and reality

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Wednesday 16th November, 2022

President Ranil Wickremesinghe has, in his budget speech, sought to kindle hopes of economic recovery. Claiming that the ongoing talks with the IMF, India, China, etc., would lead to positive outcomes, he has offered to build a ‘social market economy’ or an ‘open economic system of social protection’ whatever that means. However, there is no harm in the Head of State trying to infuse the public with some optimism amidst a national feeling of doom and gloom.

President Wickremesinghe has said a social market economy will help achieve a high economic growth of 7 to 8 percent, increase international trade (as a percentage of GDP) by more than 100 percent, ensure an annual growth of US$ 3 billion from new exports between 2023 and 2032, secure foreign direct investment of more than US$ 3 billion in the next 10 years, and create an internationally competitive workforce within the next decade.

Youth unrest and the resultant protests seem to have prompted the government to undertake to adopt what it calls a youth-oriented approach to economic development. President Wickremesinghe, in his budget speech, chose to call the youth ‘the real national wealth’. He is of the view that attention has not been paid to the country’s youth, and their hopes are fading; they are calling for systemic changes.

It is heartening that the President has realised the need to serve the interests of the youth, but it is not clear how his government intends to set about the task. One can only hope that it is not paying lip service to young citizens’ cause.

Among the measures the government has proposed to boost the foreign currency inflow is to create a business-friendly environment. One of the biggest obstacles to foreign investment is corruption. No foreigner can invest here unless he or she is willing to grease countless palms. How does the President propose to tackle this problem? The culprits are in his government!

Budget 2023 has proposed labour law reforms but stopped short of specifying them. The President has only said the country’s labour laws are outdated and fragmented and there is a pressing need for what he calls a new, unified labour law. Will the proposed labour laws deprive workers of their rights in the name of investment promotion?

The government has also proposed land reforms in all but name. The President has said that a programme will be launched to enable investors to utilise land productively to increase both production and exports. This is an area where the government ought to tread cautiously, for the disposal of state land always leads to rackets.

The proposed macro-fiscal framework is aimed at increasing government revenue from 8.3% to 16% of GDP by 2025, achieving a primary surplus of more than 2% of GDP in 2025, reducing public sector debt from about 110% of GDP to less than 100% in the medium term, bringing inflation to a single-digit level in the medium term, ensuring that interest rates will reach a moderate level, restoring macroeconomic confidence and replenishing exchange reserves with foreign finances to ease pressure on the exchange rate, and enabling the medium-term economic growth to return to about 5% by enhancing structural reforms. This is a tall order, and how the government will fare in pursuing these goals remains to be seen.

Budget 2023 is very clear on the government’s plan to restructure some profit-earning state-owned ventures such as Sri Lanka Telecom and Sri Lanka Insurance, and utilise the proceeds therefrom to strengthen foreign exchange reserves and the rupee. So, a fire-sale of state assets will commence soon.

The government’s desperation for forex is evident from its proposal to set up an expert committee to explore the possibility of producing Triloka Wijayapathra (cannabis or ganja) for export. This is bound to cause quite a stir. President Wickremesinghe is no stranger to controversy. If the government cares to solve farmers’ problems such as the existing fertiliser shortage and high cost of production thereby developing the agricultural sector, and goes all out to recover the country’s stolen funds, there will be no need to grow cannabis.

President Wickremesinghe, on Monday, sought to justify the unconscionable tax increases ratified by Parliament weeks earlier. He proposed to set up a Presidential Commission on Taxation ‘to study and make recommendations on the functioning, coordination and changes to be made in the tax structure, the institutions, procedures, etc.’ It is one’s fervent hope that the government is not contemplating any more tax increases!

The Opposition has dismissed Budget 2023 as something worthless, and flayed the government for not providing relief to the public. The budget is not devoid of flaws, but the question is whether the President could have done better, given the country’s economic situation.

Meanwhile, the government says it is confident that it has enough numbers in Parliament to secure the passage of Budget 2023. But efforts are being made in some quarters to shoot it down. The SLPP-UNP combine is taking precautions and all out to engineer some crossovers from the Opposition. A political war over the national budget has to be avoided for the sake of the ailing economy, which cannot take any more shocks. It is imperative that the warring parties get themselves around the table, with compromises being made in the form of committee-stage changes to the budget, so that there will be no showdown at the expense of the ongoing efforts to stabilise the economy.



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Editorial

Executive brinkmanship

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Pressure is mounting on President Anura Kumara Dissanayake to ensure that an Auditor General is appointed without further delay. But he has remained unmoved. He is determined to wear down the Constitutional Council (CC) and appoint one of his party loyalists as Auditor General. The CC has rejected his nominees—and rightly so; they are not eligible. Former Executive Presidents went all out to railroad the CC into rubber-stamping their decisions. They had no qualms about doing so while claiming to uphold the independence of the public service. President Dissanayake has failed to be different. His refusal to compromise amounts to brinkmanship; he is waiting until the CC blinks.

The NPP’s election manifesto, A Thriving Nation: A Beautiful Life, attributes the deterioration of the public service to ‘political appointments’ and state workers making political decisions. Among the steps the NPP has promised to take to straighten up the public service are ‘merit-based appointments and promotions’. This principle has fallen by the wayside where the question of appointing the Auditor General is concerned.

The government should take cognisance of the possible negative effects of the prolonged delay in appointing the Auditor General during a period of disaster response and international relief and rebuilding support.

The Bar Association of Sri Lanka has called upon President Dissanayake to appoint a person with proven competence, integrity, and independence, who commands wide acceptance as Auditor General forthwith. It has stressed the need to appoint a nonpartisan professional as the Auditor General to safeguard the integrity of the National Audit Office and inspire the confidence of both citizens and international partners in the financial governance of the State.

Transparency International Sri Lanka, the Civil Society Organizations (CSOs) and the other good governance activists, too, have faulted President Dissanayake and his government for the inordinate delay in appointing the Auditor General. They are of the view that a strong, independent Auditor General enables Parliament and the public to scrutinise government expenditure, identify irregularities, prevent misuse of funds, and ensure that those entrusted with public resources are held to account. The delay in appointing the Auditor General has weakened the effectiveness, authority, and the independence of the entire public audit system and created space for inefficiency, mismanagement, and corruption, they have noted. The situation will take a turn for the worse if the government succeeds in having one of its cronies appointed Auditor General.

The government is apparently playing a waiting game in the hope that the reconstitution of the CC due next year will provide a window of opportunity for it to appoint one of its loyalists as Auditor General.

Why the government is so desperate to place a malleable person at the helm of the National Audit Office is not hard to understand. If it succeeds in its endeavour, the next Auditor General will be beholden to the JVP/NPP. When an ineligible person is elevated to a high post, he or she naturally becomes subservient to the appointing authority. Such officials go out of their way to safeguard the interests of their political masters in case of irregularities involving state funds and other accountability issues.

A protracted delay in appointing the Auditor General or the appointment of a government supporter to that post will increase the risk of mismanagement of state funds and corruption, lead to the erosion of public trust and confidence in the National Audit Office, undermine legislative oversight and impair fiscal discipline. Most of all, the government’s failure to appoint a competent, independent person of integrity as Auditor General will diminish donor confidence especially at a time when the country is seeking disaster relief funds from the international community. There is no way the government can justify its refusal to appoint the current Acting Auditor General as the head of the supreme audit institution. He is obviously the most eligible candidate.

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Editorial

Selective transparency

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Saturday 27th December, 2025

The NPP government has released a cordial diplomatic letter from Indian Prime Minister Narendra Modi to President Anura Kumara Dissanayake, and gained a great deal of publicity for it as part of a propaganda campaign to boost Dissanayake’s image. Such moves are not uncommon in politics, especially in the developing world, where the heads of powerful states are deified and their visits, invitations and letters are flaunted as achievements of the leaders of smaller nations. However, the release of PM Modi’s letter to President Dissanayake is counterproductive, for it makes one wonder why the government has not made public the MoUs it has signed with India?

PM Modi’s Sri Lanka visit in April 2025 saw the signing of seven MoUs (or pacts as claimed in some quarters) between New Delhi and Colombo. Prominent among them are the MoUs/pacts on the implementation of HVDC (High-Voltage Direct Current) Interconnection for import/export of power, cooperation among the governments of India, Sri Lanka, and the United Arab Emirates on developing Trincomalee as an energy hub, and defence cooperation between India and Sri Lanka.

The NPP government has violated one of the fundamental tenets of good governance––transparency; there has been no transparency about the aforesaid MoUs or pacts, especially the one on defence cooperation. They cannot be disclosed without India’s consent, the government has said. This is a very lame excuse. The JVP/NPP seems to have a very low opinion of the intelligence of the public, who made its meteoric rise to power.

When the JVP/NPP was in opposition, it would flay the previous governments for signing vital MoUs and pacts without transparency. But it has kept even Parliament in the dark about the MoUs/pacts in question.

Ironically, the JVP, which resorted to mindless violence in a bid to scuttle the signing of the Indo-Lanka Accord in 1987, has sought to justify the inking of an MoU/pact on defence cooperation between Sri Lanka and India and keeping it under wraps, about three and a half decades later. The signing of that particular defence MoU/pact marked the JVP’s biggest-ever Machiavellian U-turn. How would the JVP have reacted if a previous government had entered into MoUs with India and kept them secret? It opposed the proposed Economic and Technology Cooperation Agreement (ETCA) between Sri Lanka and India tooth and nail, didn’t it?

Whenever one sees the aforesaid letter doing the rounds in the digital space, one remembers the MoUs/pacts shrouded in secrecy, which have exposed the pusillanimity of the NPP government, whose leaders cannot so much as disclose their contents without India’s consent.

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Editorial

Desperate political sandbagging

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Friday 26th December, 2025

There is nothing more predictable than surprise in politics. After securing a two-thirds majority in Parliament last year and emerging victorious in most local councils, this year, the JVP-led NPP may have thought that it was plain sailing. But the government now has many unforeseen, seemingly intractable issues to contend with almost on all fronts. The disaster-stricken economy is expected to slow down, with relief and rebuilding costs escalating, and the deadline for the resumption of debt repayment approaching. Vehicle imports are bound to decrease, causing a sharp drop in the government’s tax revenue. The rupee is depreciating fast. As if these were not enough, the government is experiencing serious problems on the political front.

The defeat of the NPP’s budget in the Colombo Municipal Council (CMC), which the JVP/NPP seized control of through extensive horse trading, could not have come at a worse time for the government. The same fate has befallen many other NPP-controlled local councils. Most of all, the NPP has suffered a string of defeats in the cooperative society elections countrywide during the last several months.

Desperate times are said to call for desperate measures. Cyclone Ditwah and the attendant extreme weather events that badly damaged roads, tank bunds and river banks prompted repair teams to resort to sandbag revetment. But there have been many instances where sandbag facings collapsed, unable to withstand the intensity of floods and slope failures. The government politicians who boasted of having carried out swift restoration work have been left red-faced; they have failed to assess the severity of the problems they are trying to solve.

The NPP government has resorted to a method similar to sandbag revetment in a desperate bid to consolidate its control over some local councils which cannot secure the passage of their budgets for want of majorities. Its members have gone to the extent of setting the clock forward in such institutions, meeting in advance of the regular start time and declaring their budgets passed before the arrival of the Opposition councillors. What the NPP did in the Horana Urban Council the other day is a case in point, the Opposition says.

The NPP is accused of having inflated the number of votes for its Galle MC budget amidst a howl of protests from the Opposition and declared victory. The Opposition councillors prevented the council secretary from leaving the auditorium, put the budget to a fresh vote and defeated it. The Opposition has threatened legal action against the Mayors/Chairpersons and the state officials for violating the law. The government is likely to employ a similar method to have the CMC budget passed when it is put to a vote again next week. The JVP has no sense of shame, just like all other political parties that have been in power.

All self-righteous politicians, given to moral grandstanding, lay bare their true faces when their interests are threatened, and they face the prospect of losing their hold on power. The JVP/NPP is now without any right to be critical of its rivals who did not scruple to undermine democratic principles and traditions to retain power.

Gaining control of hung local councils is one thing, but running them to the satisfaction of their members and the public is quite another. The non-majority councils that the Opposition parties have gained control of could face the same fate as the CMC. This situation has come about because the country is without patriotic leaders. Ideally, the political parties that obtained pluralities in the hung councils should have been allowed to control those institutions, and they should have adopted a conciliatory approach and sought their political rivals’ cooperation to serve the public.

The shameful manner in which the NPP acted during the Galle MC budget vote is not unprecedented. One may recall that in January 2024, the SLPP-UNP government did something similar to secure the passage of its despicable Online Safety Bill. The then Speaker Mahinda Yapa Abeywardena stooped so low as to make use of a brawl in the House and declare the Bill passed. Interestingly, the SLPP and the UNP are among those who are raking the NPP over the coals for undermining democratic principles and traditions. So much for the self-proclaimed messiahs and their critics.

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