Features

IMF China and debt-trap

Published

4 years ago

2022/11/12

by N.A.de S. Amaratunga

The above topic is relevant to all countries experiencing economic crises for IMF and China, it appears are alternative and perhaps competing sources for economic aid and they are both accused of causing debt-traps for the recipient countries. IMF is accused by people like Joseph Stiglitz of manipulating the economy of poor countries in such a way that there is a drain of their wealth for the benefit of the rich countries. China is accused of trapping the recipients of its aid to cough out to the Chinese their valuable national assets like harbours and airports. Poor countries have turned to China after realising the apparent folly of following IMF policy and China has willingly stepped in to displace the IMF. In this context IMF is perceived as a tool of the Western powers and China as the alternative power that could stand up against Western imperialism.

Sri Lanka seemingly is in a situation where it is not possible to be choosy. Most of the economic advisers have been asking the government to go for an IMF programme since 2019 when the early symptoms of an economic downturn were visible. However, the then government decided not to go to IMF but tried out other measures like heavy cuts on tax and stabilizing the rupee against the dollar. These plus other blunders like a ban on agro-chemicals brought the country to bankruptcy forcing it to default on debt repayment and to decide to seek IMF assistance. IMF may have already asked the government to adopt policies that may cause lot of hardship to people. Heavy taxation has been brought back. Loss making public enterprises may have to be privatized. Welfarism may have to be curtailed with less public expenditure. Market forces may have to be given more freedom with less government intervention.

All these measures would finally hurt the lower middle class and the poor. This is where the Chinese factor comes in. The relevant questions are whether China is an alternative to IMF, whether its presence as a player in the global debt scenario would give recipient countries the opportunity to negotiate with the IMF for more favourable terms and conditions and whether any of these lenders have designs on the recipients. These are important questions for Sri Lanka at the present moment as negotiations with the IMF are not finalised, rescheduling of debt is still being discussed and nothing is certain yet. And China seems to be closely watching the unfolding events, all the time promising every assistance.

A research study done by James Sundquist (2021) involving 104 developing countries covering the period from 2001 to 2017 has shown that Chinese aid has helped some countries to turn away from the IMF and others to negotiate deals with less damaging conditions. Chinese loans may have achieved much more than the loudest critics of the IMF. Plain criticism of the IMF has not brought any results beneficial to poor countries. But the competition brought on by China has resulted in the change of policy in relation to terms and conditions of the IMF. In 1996 the IMF and the World Bank developed the Heavily Indebted Poor Country (HIPC) Initiative, under which low-income countries with multi-year track records of good policies would qualify for grants in association with their concessional loans.

The HIPC initiative soon came under heavy criticism for “offering too little relief too slowly to too few,” with only four countries obtaining full stock of available debt relief before the end of the century. In 1999, the Bretton Woods institutions “enhanced” the Initiative by lowering the bar for judging whether debt was unsustainable and providing debt relief and grants sooner to qualifying countries. Within three years, enhanced HIPC could deliver almost US$1 billion in debt relief to 25 countries.

Critics of China on its role as an aid-giver accuse China of many dirty tricks including 1) prioritising short term projects instead of long term programmes aimed at sustainable prosperity, 2) non-transparent lending with little regard for issues such as corruption and money laundering and 3) promoting infra-structure projects that benefit China’s economy, for instance its imports of raw materialas and export of manufactured goods.

However, if China is intent on ensnaring poor helpless countries it would target countries like Zimbabwe, but it did not come forward to bail out that country for it was seen that Zimbabwe had no reliable foreign exchange earning capacity. This shows that China focuses on debt sustainability of a country rather than its vulnerability that provides an opportunity to trap them and force them to part with their national assets. Countries which export large volumes of natural resources are the most likely to benefit from Chinese aid. This could mean that China may not be interested in encouraging these countries to develop their technology that would enable them to add value to their natural resources before they export them. Yet there are countries which see China as an alternative to the IMF. China may not be engaged in ensnaring poor countries but it certainly is interested in their natural resources.

Financial Times reports (18^th January 2022) that some 74 low- and middle-income countries “will have to repay an estimated $35 bn to official bilateral and private-sector lenders in 2022”, which is a 45% increase compared with 2020, “with seen as one of most vulnerable.” Ghana, Salvador and Tunisia could also be in jeopardy. Zambia defaulted in 2020 on an amount of $3 billion and the situation has not improved. The Zambian government is negotiating a new loan from the IMF, which, if granted, will demand more austerity measures. As explained in the Financial Times, this surge is a consequence of developing countries contracting ever more debt to face the impact of coronavirus, but also of the rising cost of refinancing existing loans and the resumption of debt repayments that had been suspended during the pandemic. David Malpass, President of the World Bank, warned that the creditors’ insistence on being paid will increase the risk of disorderly defaults. “Countries are facing a resumption of debt payments at precisely the time when they don’t have the resources to be making them,” he said.

Almost all countries take loans from other countries with the US being the biggest borrower. For the rich it is a game they can play and also enjoy very well. But for the poor countries it is a matter of life and death. The slightest mishap, eg; Covid pandemic, and their survival is in danger. This is so mainly because the system involving global debt is so designed that it ensures a flow of wealth from the poor to the rich. The IMF and the World Bank may have changed their policies, but that may be to prevent the total death of the indebted countries but not with the intention of making them prosperous. The idea is to keep the developing countries in a permanant state of poverty and remain suppliers of raw materials and cheap labour. “The hidden agenda, the one that is actually applied, is to subordinate the public and private spheres of all human societies to the capitalist imperative of seeking maximum . The implementation of this hidden agenda results in reproducing poverty rather than reducing it and in increasing inequalities rather than reducing them. It results in stagnation, if not deterioration, of the living conditions of a great majority of the world’s population, concurrently with a greater and greater concentration of wealth in the hands of a smaller and smaller elite. A further result is the continued deterioration of ecological balances, which means that the very future of humanity is in danger” (Eric Toussaint, 2022).

China, if it is not a party to this evil system must try to help change the system. Chinese economy is not entirly profit dependent and neo-liberal. It must come forward, as it has shown in the recent past, at this critical hour to help the poor countries come out of the debt-trap they have got into. It must get together with other like-minded countries to set up an alternative to the IMF. This new organisation could prevent poor countries from being entrapped by the imperialist forces. It could strengthen the negotiating capacity of poor countries which have to obtain loans for their survival. It should be possible for these countries to get some aid without having to mortgage their future survival.

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Features

Proactive peacemaking becomes a paramount need

Published

22 hours ago

2026/06/4

Sahan Weerasooriya

Wasting wars: Some war-displaced people in Lebanon. BBC

It may be some time before the full impact of food inflation is felt in the West. Until such time the world would continue to keep itself in suspense over whether the Trump administration is in earnest when it seeks to convey the impression that it is backing a negotiated solution in West Asia.

As is usually the case, consumer stress would be one of the final determinants of political change. To the degree to which the average US consumer somehow ‘muddles through’ and puts the food on the table, to the same extent would the Republican sections of the US public in particular be tolerant of the Trump administration’s inconsistent handling of the West Asian war and the main issues stemming from it. That is, there would be no grave popular disaffection and a demand for political change in the short term.

However, the indications are that the Trump administration’s support base is suffering some erosion in the wake of the current economic crisis. While reports indicate that Democratic sections are firming-up their opposition to the political centre, Republican support for Trump is also showing signs of waning, we are given to understand.

The above developments are probably why Trump is on record as having given Israeli Prime Minister Benjamin Netanyahu a ‘dressing down’ recently on his seeming intransigence on the question of giving negotiations a chance in West Asia. The show of displeasure could be really aimed by Trump at containing the impatience of the American public.

However, the current ground situation in the Middle East, particularly the uncontained bloodshed, is likely to impress on the thinking sections of the world that more than temporary political change is needed in West Asia and the US.

A well thought out political solution that addresses all the contentious issues at the heart of the Middle East conflict is what enlightened opinion would demand, and very rightly. Right now, the ‘peace efforts’ initiated by the Trump administration give the impression of being piecemeal solutions at best.

There have been, of course, numerous initiatives in the past aimed at bringing permanent peace to the Middle East. These failed mainly because they did not address in full the root causes of the conflict.

At bottom the Middle East conflict is mainly about race and religious hate bred by socio-economic and material inequalities. For instance, if the Palestinian people were not displaced and deprived of land occupied by them at the time of the founding of the Israeli state, ethnic enmities would not have grown to the current unmanageable proportions.

When addressing the above questions, though, it must be remembered that the Israelis too were a displaced people who were entitled to land and a state of their own in the Middle East. Basically, out of these seemingly irreconcilable and conflicting demands have grown the Middle East imbroglio.

Middle East peace is considerably about reconciling these demands and arriving at a solution that would ensure the creation of two states that would opt for peaceful co-existence thereafter.

As long as the US does not see the need for a non-partisan solution that addresses the needs of both ethnicities and religions and goes all-out, as it were, to have it implemented, the Middle East would continue to bleed.

However, staunching the blood flow through the creation of two states would be only half the job done, though a very important part of it. More pernicious, pervasive and difficult to remedy are the inter-ethnic and inter-religious hatreds that have been unleashed over the decades.

However, if substantial, long-lasting peace is to be fostered in the region the latter ‘demons’ would need to be exorcised from the hearts and minds of the communities concerned. No doubt an uphill task but one that must be undertaken by those who wish the region well.

The UN would need to put its ‘best foot forward’ in such undertakings but it is time that it dawned on the international community and other caring quarters that Middle East peace, and all other such uphill challenges, require proactive peacemaking on the part of all civilized sections for their effective management. That is, public involvement in peacemaking too is a must.

Since hatreds are harboured in the human consciousness the enmities embedded in the latter need to be managed and defused judiciously alongside other undertakings in a peace process. In the case of West Asia, such enmities could be even spread globe-wide besides being multi-dimensional. For instance, it ought to be thought-provoking that Iran is insistent on a peace initiative that would also include Lebanon.

Besides security considerations it is also ethnic and religious affiliations that account for Iran making this demand. For instance, the Shias are a numerically important religious community in Lebanon and they provide a significant number of Hizbollah fighters, who are in a vital sense carrying out a ‘proxy war’ for Iran. It also needs to be factored in that Iran is a Shia-majority country.

Thus trans-border religious affiliations could add to the complexities and enormity of ethno-religious conflicts. However, the task of managing centuries-long enmities needs to be launched and prodded on with by peacemakers since a downing of arms alone would not guarantee substantive peace.

It is not realized sufficiently that the process of ending hatreds begins with mutual apologies by antagonists to a conflict for the harm inflicted on each other. This would be anathema in some ears but there is no getting away from the requirement. It is the vital first step to permanent peace anywhere.

In fact there could be no reconciliation worth speaking of without such mutual apologies. It is a point worth re-iterating in these times when even the government of Sri Lanka is voicing the need for national reconciliation. Well, without the words, ‘I am sorry’, there could be no permanent end to enmities – they would do well to remember.

The above requirements may not go down very well with governments, but they resonate in the hearts and minds of most people, since they are inheritors of religious traditions of some kind.

This is a principal reason why peacemaking works well when publics too are involved in them. The effectiveness of such campaigns increases several fold when they have a Mahatma Gandhi or a Jawaharlal Nehru at their helm. A strong proactive involvement by the public in peace could lead to the emergence of such leaders at some point in these campaigns.

Features

Dialog Brings Sri Lanka’s Largest Digital Vesak Experience to Matara

Published

22 hours ago

2026/06/4

Sahan Weerasooriya

From left to right: Hon. Saroja Savithri Paulraj, Hon. Sunil Handunnetti, and Lasantha Theverapperuma experience the Dialog 5G Ultra-powered VR tours.

Official Digital Partner of the 2026 ‘Dakshina Prabha’ National Vesak Zone

Dialog Axiata PLC, Sri Lanka’s #1 connectivity provider, collaborated with the Ministry of Buddha Sasana, Religious and Cultural Affairs to bring one of Sri Lanka’s largest and most technologically advanced Vesak experiences to the ‘Dakshina Prabha’ National Vesak Zone. The three-day celebration, in Matara attracted more than hundred thousand visitors, who engaged with a series of innovative digital activities powered by Dialog 5G Ultra, including Artificial Intelligence (AI) and Virtual Reality (VR) experiences, digital pandols and a Data Dansala. The opening ceremony was attended by Hon. Sunil Handunnetti, Minister of Industry and Entrepreneurship Development and Hon. Saroja Savithri Paulraj, Minister of Women and Child Affairs, along with distinguished guests and Dialog’s senior management.

One of the key attractions at the venue was the Dialog 5G Ultra-powered Virtual Reality (VR) experience, which attracted more than 35,000 participants. The activation enabled devotees to virtually visit and pay homage to sacred Buddhist sites, including the Jaya Sri Maha Bodhi in India and the Atamasthana in Anuradhapura, directly from the Vesak zone in Matara.

Visitors receive complimentary mobile data through Dialog’s QR-powered Data Dansala.

Dialog also conducted an AI Digital Vesak Greeting Card Competition from 21 May to 01 June 2026, attracting numerous entries from across the country. The shortlisted designs were showcased across 20 large LED screens throughout the venue and across Matara City, and were also made available for download via mobile devices. Further, through the use of AI, traditional Jathaka Katha were reimagined in a digital format, demonstrating how technology can be used to preserve and enhance cultural and religious heritage. Together, these initiatives blended traditional Vesak celebrations with emerging technologies, offering visitors a unique and immersive way to engage with Vesak traditions.

Extending the spirit of Vesak through connectivity, Dialog conducted a special Data Dansala powered by its QR Reload platform, enabling visitors to receive complimentary mobile data by scanning QR codes placed across the venue. In addition to the Matara National Vesak Zone, similar Data Dansala activations were also conducted at the Gangaramaya and Bauddhaloka Vesak zones in Colombo.Visitors also had the opportunity to create personalised Vesak-themed digital photos through an AI Photo Booth, generating AI-enhanced portraits using their own photographs and adding a contemporary digital element to the Vesak celebrations.

Visitors watch AI-generated Jathaka Katha

Commenting on the initiative, Hon. Sunil Handunnetti, Minister of Industry and Entrepreneurship Development, said, “The 2026 Dakshina Prabha Vesak Festival marked the first time AI-powered digital innovations were incorporated into a National Vesak Festival in Sri Lanka. Presenting Buddhist stories and teachings through technology created a new and engaging way for visitors to connect with these traditions. We thank Dialog for supporting this initiative and for working closely with us to bring our vision to life. Their contribution played an important role in making this first-of-its-kind event a reality.”

Lasantha Theverapperuma, Group Chief Marketing Officer of Dialog Axiata PLC said, “We thank the Government of Sri Lanka for the opportunity to support the 2026 Dakshina Prabha National Vesak Festival and for embracing technology as part of this year’s celebrations. As the Official Digital Partner, we were privileged to contribute through our Dialog 5G Ultra and AI capabilities, creating new ways for visitors to engage with Vesak traditions while preserving their cultural significance for future generations.”

Beyond supporting the National Vesak Zone in Matara, Dialog also enhanced the Gangaramaya and Bauddhaloka Vesak zones through a range of digital activations during the Vesak season. The company additionally continued its sustainability initiatives, including the Thirasara Aloka Poojawa, which illuminated rural places of worship through solar-powered lighting solutions.

Features

Beauty, elegance and talent…for women

Published

22 hours ago

2026/06/4

Sahan Weerasooriya

Universal Woman is an international pageant focused on “beauty, elegance, and talent” for women, positioning itself as a platform to shape global ambassadors. The 2026 edition will be held in Cambodia, and Sri Lanka will be there, as well.

According to reports coming my way, contestants, at the international event, will work with industry trailblazers, under international standards.

Sri Lankan supermodel, runway and pageant trainer Chulpadmendra Kumarapathirana, is the National Director for Universal Woman Sri Lanka 2026.

With over two decades in the industry, Chula was crowned Miss Sri Lanka 2006, and has since shaped the next generation of titleholders through her Colombo-based Chulpadmendra Catwalk Studio, widely regarded as one of the country’s leading modelling academies.

The team behind Universal Woman Sri Lanka 2026

A former host of Derana Miss Sri Lanka for Miss World 2008 and a judge for Miss Universe Sri Lanka 2025, Chula now serves as National Director for Universal Woman Sri Lanka 2026, leading the franchise’s search for Sri Lanka’s delegate to the international final in Cambodia.

Applications for Universal Woman Sri Lanka 2026 are being taken, via WhatsApp: 077 659 4994, says Chula.

The judging panel for Universal Woman Sri Lanka 2026 includes Senaka De Silva, Pageant Aesthetic Advisor & Chairperson of the Judging Panel, Angela Seneviratne, Caroline Jurie, Rozelle Plunkett, and Suraj Mapa.

Universal Woman Sri Lanka 2026 officially began its journey with a first round of auditions, held in Colombo, marking the start of an exciting new chapter in Sri Lanka’s pageant industry.

Launching the first round of auditions

The platform aims to empower women while selecting an intelligent, confident, and inspiring representative to compete at the Universal Woman International Pageant 2026 in Cambodia, this September.

Universal Woman Sri Lanka now moves forward with the vision of creating one of the country’s most prestigious and empowering pageants while preparing to crown a queen who will proudly represent Sri Lanka on the international stage.