Features
Cold War to COVAX: New US President rallies allies, but no brave new world in sight
by Rajan Philips
Six months in office, President Biden took his first foreign trip last week, attending the first in-person G7 summit after the pandemic over the weekend, at Carbis Bay in Cornwall, England, and meeting with Vladimir Putin on Wednesday in Geneva. In between, he attended a summit gathering of NATO member country leaders on Monday and met with the European Council on Tuesday. The G7, NATO and the EU meetings became occasions for diplomatic China bashing. And China responded in kind and more, through its Embassies in London and in Europe rather than by the mandarins in Beijing. China’s “wolf warrior” diplomacy might be irksome to old school sensibilities, but China seems to be in no hurry to change its modes of diplomacy to please anybody.
Everything is different now from the geopolitics of Cold War. Russia is no longer the West’s main adversary, and capitalism and socialism are not the same weighty words as they once were. Vladimir Putin is, at best, or worst, mostly a significant spoiler. It is China that looms large from the East, pre-occupying western powers, but the terms of engagement now are more competitive and less conflictual. The world is currently without any serious skirmishes, internal or otherwise. There is a lull even in the Middle East, and there are hopes that it might continue with both Benjamin Netanyahu and Donald Trump out of power, at least for now. But where violence has receded, the pandemic has taken over. And Cold War politics has given way to vaccine politics.
When history fails to turn
Yet, after much haggling and despite promises to do a lot more, G7 leaders were not able to come up with anything more than one billion vaccine doses when 11 billion of them are needed to immunize the world’s population. Gordon Brown, former British Finance Minister and later Prime Minister, has called the G7 summit another missed opportunity in the history of summits, “another turning point where history failed to turn.” He blamed G7 leaders for their failure to honour the pre-summit promise of Prime Minister Boris Johnson to vaccinate the entire world.
Besides Johnson, more than 100 former world leaders had called on G7 leaders to pledge $44bn of the $66bn needed to vaccinate the world, or eight billion doses and not one billion. A joint Norway-South Africa plan had worked out that eight billion doses donation would involve 27% contribution from the US and 22% contribution from the EU. The current US promise of 500 million doses amounts to 50%, which is a significant share but of the pathetically scaled down one billion promise of the Group of Seven countries. In early May , President Biden announced America’s support for waiving western vaccine patents to facilitate worldwide production and supply of COVID-19 vaccines. His radical turn surprised many, but found no support in G7 and the summit once again “failed to turn.”
Aid and welfare agencies are palpably disappointed with the poor show of vaccine generosity by the wealthiest of the world’s nations, and these civil societies are not likely to be enthused by President Biden’s clarion call for democracies of the world to unite against its autocrats. Nor are other G7 countries entirely enthusiastic about agreeing with the US policy towards China. A number of them do not want to alienate China which they see has a necessary role to play in the global economic recovery after the pandemic. To non-American observers, Biden’s position on China is not very different from that of Trump; what is different is the absence of Trump’s narcissism and racism. And America’s allies, while relieved at the exit of Trump and the entry of Biden, are also unsure that there will not be another political recession in the US similar to what they have had to unexpectedly encounter over the last five years.
Even though China was the main subject at the summit, the final statement reflected a balance between the pushes and pulls between America and its allies. Perhaps the sharpest note in the 70-point G7 statement could be the reopening of the ‘origin’ controversy involving the coronavirus. The summit’s call to make a “science-based” determination of the origins of COVID-19 may have better served its totally legitimate and objective purpose if the call too could have found a science-based origin rather than adversarial politics. Unfortunately, there is no international mechanism to facilitate such a consensus.
As Secretary General António Guterres rued last September marking the 75th anniversary of the United Nations, “the pandemic is a clear test of international cooperation — a test we have essentially failed.” The G7 summit, while it was positively different with Biden displacing Trump as America’s President, came nowhere near to rectifying the failure of international cooperation that the Secretary General was alluding to. There are many things about China that are not at all unexceptionable, but isolating a giant of a country and economic powerhouse is not the way to foster international co-operation, or to determine the truth about the origins of COVID-19.
Two days after G7, NATO got in on the act of targeting China, for first time in its deliberations, and calling China’s actions as a threat to “rules-based international order.” China responded calling NATO to stop “slandering” and to “devote more of its energy to promoting dialogue”. That NATO’s take on China may have been more a manifestation of bureaucratic overreach and not political consensus became evident from the notes of caution that came from the British and French leaders, among others. Prime Minister Boris Johnson asserted that nobody “around the table wants to descend into a new Cold War with China.” France’s Emmanuel Macron had earlier admonished that “China has little to do with the North Atlantic,” while Germany’s Angela Merkel had apparently emphasized that western alliances are “not about being against something, but for something”.
Positive Initiatives
Besides COVID-19, the summit focused on human rights, again targeting China over human rights violations in Xinjiang and in Hong Kong. A somewhat positively competitive response to China was the announcement of a new global infrastructure plan. In an obvious counter to China’s Belt and Road infrastructure initiative, the G7 group at America’s prompting has come up with an initiative of its own, called “Build Back Better World (B3W).”
The new plan is expected to raise about $40 trillion by 2035, and will focus on improving “climate, health and health security, digital technology, and gender equity and equality” conditions in developing countries. By comparison, China’s Belt and Road initiative launched in 2013 is bankrolled solely by China to the tune of $160 billion and is expected to focus more on hard infrastructure projects. The rest of the world can only applaud the two initiatives while hoping that the two promoters will allow other countries to proportionately benefit from both, and not from one or the other.
An even more far reaching summit outcome is the agreement on global corporate taxation. Already in the run-up to the summit, G7 Finance Ministers had reached a deal on (1) source-taxing corporations (i.e., to tax businesses in the countries where they conduct business and earn income); and (2) a global minimum tax proposal of 15% on businesses. The 15% rate is lower than the business tax rate in every G7 country, so this is not a tax increase in those countries. But what it will do is to expose to taxation multinationals and digital companies that now keep running for tax holidays and tax havens. Netherlands, Luxembourg, Singapore, and Ireland are among the more established tax havens, where “phantom investments” flow but no physical manifestations (as in factories, sales, or jobs) are seen. According to the IMF, “phantom investments” account for 40% of the world’s much coveted FDIs (Foreign Direct Investments). Is Sri Lanka’s Port City meant to be a magnet for its miniscule share of phantom investments?
The G7 agreement over global taxation is really the culmination of a much broader effort involving more than 100 countries working over a number of years. And the estimated revenues from global taxation are quite significant – ranging between $250 billion to $600 billion annually. While the G7 agreements is a big step forward, there are obstacles ahead as nothing can be done without the support of everyone. US Treasury Secretary Janet Yellen mooted the idea for global taxation long before the G7 summit, but it will have to pass muster in the US congress. There is broad support in the EU, but Ireland could be an outlier. The next forum for the global taxation effort will be the gathering of G20 Finance Ministers in Venice in July. Large countries from every continent including China and India will be at the table. Its outcome will offer clues about the pace of global taxation reform.
From Nixon to Biden
The Guardian in one of its editorials last week recalled something that no one in the US or China would seem to have bothered to note so far. It is that next month would be the 50th anniversary of Henry Kissinger’s secret mission to China to prepare the path for President Richard Nixon’s historic visit to China in February 1972. The visit lasted a week, “the week that changed the world,” as President Nixon famously declared. No one, not even President Biden, is going suggest that the new President’s first week of foreign forays in England and in Europe is going to change the world. But there is no denying the extent to which the world has changed between Nixon’s visit to China in 1972 and Biden’s visit to Europe in 2021. It is not that Nixon’s visit changed the world, but only that he seized the opportunity in a world that was already beginning to change.
Henry Kissinger reportedly assured Chinese leaders that “It is the conviction of President Nixon that a strong and developing People’s Republic of China poses no threat to any essential US interest.” Fifty years later, President Biden is calling on democracies to come together against the world’s authoritarian powers, primarily China. In a sense, Biden’s meeting with Russia’s Putin in Geneva last Wednesday caricatures Nixon’s historic visit to China. The summit was a useful necessity even if it was mostly meant for the domestic audiences of the two leaders. Putin wanted to show Russians that under him their country is still a force to reckon with, even though it no longer has the armour of a Soviet Union. For Biden, it yet another demonstration that Trump is gone and America is back. Yet, it was useful that the two leaders have opened a dialogue, which is essential if any headway is to be made, especially in the Middle East.
But it will be paradise lost if America and the West were to fail to open a new dialogue with China without isolating it or ganging up on it. Western leaders made the same mistake after the collapse of the Soviet Union, when they isolated Russia and invited all the former Warsaw Pact countries to join NATO and gang up on Russia. But there is no comparison between Russia without the Soviet Union and 21st century China that is set to surpass the US as the world’s biggest economy in a matter of decades. Yet, there are also growing backlashes against China even as its economic power grows, not only in the West but also in China’s own backyard and wider Asia. The EU, Lithuania and Hungary have recently blocked or put on hold economic partnership prospects with China. On the other side, Australia, South Korea, India, and South Africa are open to aligning themselves with G7 countries. They were all in sidebar attendance at the G7 summit.
If there is paradise to be regained, it can only be through the working of multilateralism. For all its unanticipated problems, the 21st century is remarkable for growing reality of multilateralism in spite of its serious institutional limitations. Beefing up the world’s multilateral institutions should be the first order of business for world leaders in whatever forums they gather. That was not anyone’s agenda at the G7 summit. Nor is it likely to be uppermost in China when it will celebrate, on July 1, the centenary of the Chinese Communist Party.
It was a few years back that a former President of Sri Lanka took it on himself to pronounce SAARC ‘dead’. Since then there have been other sections of Sri Lankan opinion that have joined the critics of SAARC and taken the solemn stance that SAARC has indeed died what may be called a natural death.
Their fatalism is understandable. SAARC has failed to meet at heads of government or state level for the past several years to take the SAARC process notably forward. Regional cooperation has more or less been only an appealing idea. No substantive concrete projects have taken off to make the idea a hard reality. ‘Inner paralysis’ seems to be SAARC’s lot. Hence the fatalism in these circles.
However, being one of the worst cash-strapped regions of the world and a teemingly populated one with people virtually left to their devices, what choices do the ‘SAARC Eight’ have other than to try their best to band together and continue with their cooperation efforts, however small they may be?
There is no escaping the mounting debt trap for many of these countries and bankrupt Sri Lanka is a glaring example, but ‘throwing in the towel’ and abandoning themselves entirely to the diktats of the strongest economies and their agencies will prove a ‘living death’ for many countries in the SAARC fold.
The gains may be meagre but giving-up on SAARC cooperation in full would prove self-defeating for the organization and South Asia. Right now, the collective intention ought to be to salvage what the region could from the tenuous cooperative efforts. Moreover, such initiatives could go some distance to generate a degree of goodwill among the Eight and help in sustaining a dialogue process.
Given this backdrop it proved ‘a stich in time’ for the Regional Centre for Strategic Studies (RCSS), Colombo, to recently host the SAARC Secretary General Ambassador Md. Golam Sarwar to a round table discussion on the unifying potential of SAARC and its future possibilities, besides other related issue areas.
Held on June 24th and moderated by RCSS Executive Director and former ambassador Ravinatha Aryasinha, the forum brought together a vibrant, wide ranging audience comprising academicians, diplomats, senior public servants, civil society activists and many others. Following the presentation by Ambassador Golam Sarwar titled, ‘Reigniting SAARC: Achievements, Challenges and the Way Ahead’, a lively Q&A followed.
The above forum could be described as an act of lighting the proverbial ‘candle’ rather than ‘cursing the darkness.’ It surely is a ‘darkness’ that could be seen as daunting considering that the region’s pivotal powers, India and Pakistan, are failing to act in a spirit of accord but are engaged in bitter finger-pointing on a number of questions of vital importance to SAARC.
On the other hand, what is the rest of the region doing to bring the above sides together? It is disappointing that to date the rest of SAARC has failed to launch a major diplomatic drive to bring peace between the feuding regional heavyweights. It needs to act without delay and establish its earnestness and this effort would need to prove SAARC’s staying power in the unfolding months and even years.
In assessing SAARC’s seeming failure local opinion in particular has failed to factor in what could be described as weak leadership. Since Sheikh Mujibur Rahman of Bangladesh, the founding father of SAARC, the region has failed to produce a visionary leader who could advance the SAARC cause with charisma and drive.
Among other reasons, weak leadership accounts considerably for the faltering and stuttering status, as it were, of SAARC. Badly needed are leaders who could go the extra mile, think less of narrow national interests and work diligently towards the collective well being of the region but SAARC’s millions of ordinary people have been made to wait in vain for leaders of such stature. Instead, they have been burdened with politicians who seem to be relishing the apparently moribund state of SAARC.
Looking back, it could be said that it was the dynamic leadership factor that led to the launching of the Non-Aligned Movement and for its sustenance for a few decades. True, it could be seen in some quarters that NAM is no more, but as in the case of SAARC, the former too has been unfortunate to be burdened over the years with politicians who lack the vision and drive to unflaggingly advance the fortunes of the South. NAM and SAARC lack the dynamism and vision of leaders of the stature of Jawaharlal Nehru, for example, to give them the required guidance and intellectual depth.
The reasons are complex for there not being among us currently political leaders with the vision and the steadfast commitment to advance the legitimate interests of the South. However, it could be stated with conviction that the majority of Southern leaders have too easily caved in to the demands of the global North and its financial agencies.
These leaders have failed to see, for instance, that the largely market economy oriented Northern governments would not view with favour a centrist economic model that attaches priority to the interests of the dis-empowered publics of the South. This realization ought to have dawned on the current government in Sri Lanka, for instance, some while ago but it has no choice but to abide by IMF dictates since economic survival at present is unthinkable without the latter’s succour.
Accordingly for SAARC this should be the time for some soul-searching. Priority needs to be attached to ending the feuding between India and Pakistan since at present the material fortunes of the region hinge largely on these regional giants giving peaceful relations among them a try. This is no easy challenge to meet but some daring, visionary diplomacy needs to take hold among the rest of SAARC.
There is some sense in SAARC bringing the peoples of the region together through programs that address their best collective interests. A meeting of minds among SAARC nations could enable SAARC and its agencies to build a region-wide people’s movement for progressive political and economic change that could in turn lead to the region’s political leaders sensitizing themselves more to the neglected needs of their publics.
However, the time is ‘now’ for the initiation of these progressive changes and the voice of SAARC well wishers would need to drown out those of their critics.
A seminar, “Sri Lanka’s Economic Crossroads: Navigating Recovery, Resilience and Growth” was recently held by the Organisation of Professional Associations of Sri Lanka (OPA) at the OPA Auditorium, bringing together economists, OPA members, and professionals from diverse fields for an insightful discussion on Sri Lanka’s economic recovery and future growth prospects.
The event was held under the patronage of Jayantha Gallehewa, President of the OPA, and was jointly organised by the National Issues Committee (NIC) and the Seminars, Workshops and Programmes Committee of the OPA. The event reaffirmed the organisation’s commitment to advancing professional excellence, fostering insightful intellectual engagement, facilitating interdisciplinary knowledge exchange and creating a constructive platform for informed dialogue on issues of national importance.
The panel of speakers comprised Dr. Harsha Aturupane, Lead Economist and Programme Leader for Human Development at the World Bank for Sri Lanka and the Maldives; Dr. Achinthya Koswatta, Senior Lecturer in Economics at the Open University of Sri Lanka, and Anushan Kapilan, Lead Economist at Verité Research.
In his welcome address, the President of the OPA emphasised that Sri Lanka was at a critical juncture in its economic recovery journey where sustained reforms, effective implementation, and collective national commitment are essential to achieving long-term stability, resilience and inclusive growth. He noted that the country had experienced one of the most severe economic crises in its history with the economy contracting by 7.8 percent in 2022 and a further 11.5 percent in 2023, resulting in significant economic and social challenges.
Delivering his introductory remarks Bhanu Wijeyaratne, Vice President of the OPA and Chairman of the National Issues Committee, underscored the need to move beyond short-term economic stabilisation towards a comprehensive agenda of structural transformation. He observed that the economic crisis had revealed deep-rooted weaknesses within the economy, including persistent fiscal pressures, rising public debt, foreign exchange limitations, and insufficient diversification of the export base. He stressed that addressing these challenges through strategic reforms, institutional strengthening and long-term economic planning would be essential to establishing a more resilient and competitive economy.
While acknowledging recent positive developments, including improved inflation management, tourism recovery and signs of economic stabilisation, Wijeyaratne stressed the need to advance reforms aimed at strengthening fiscal discipline, enhancing productivity, improving competitiveness, developing human capital and reinforcing governance and institutional effectiveness.
He further highlighted the important role of professionals, businesses, academia and other stakeholders in contributing to evidence-based dialogue and supporting Sri Lanka’s journey towards a resilient, inclusive and sustainable economic future.
Delivering the keynote presentation, Dr. Harsha Aturupane provided a comprehensive assessment of Sri Lanka’s economic prospects within the broader context of global economic transformation. He argued that Sri Lanka functioned as a small open economy whose performance is significantly influenced by developments in the global marketplace. External factors could not be controlled, and the country must strengthen its domestic capacity and resilience to respond effectively to international economic shifts, he noted.
Tracing the evolution of global economic systems, Dr. Aturupane highlighted the transition from ideological divisions between state-controlled and market-oriented economies towards increasingly pragmatic approaches focused on growth, competitiveness and development. He noted that Sri Lanka’s own economic journey reflects a similar evolution, with contemporary policy debates now centred on practical solutions for sustainable economic progress.
The presentation also examined the transformative impact of globalisation. Dr. Aturupane observed that global economic integration had enabled several East Asian economies, including South Korea, Singapore, Taiwan and Hong Kong, to achieve remarkable economic advancement through export-led growth strategies. Sri Lanka similarly benefited from this process through the expansion of its apparel industry and increased integration into global value chains.
Turning to Sri Lanka’s recovery programme, Dr. Aturupane emphasised that the ongoing stabilisation process should be viewed as a national programme supported by the International Monetary Fund rather than solely as an IMF initiative. He observed that strong worker remittances, improved tourism earnings, enhanced government revenue mobilisation and prudent import management have contributed significantly to economic stabilisation.
Despite this progress, he cautioned that rebuilding foreign exchange reserves and meeting future debt obligations remain major challenges. He underscored the need to strengthen export performance, attract investment and generate sustainable foreign exchange earnings to ensure long-term economic resilience.
The discussion also focused on monetary stability, inflation management and exchange-rate policy. Dr. Aturupane stressed that maintaining price stability was fundamental to sustainable growth and household welfare, while sound monetary policy remains essential for preserving economic confidence.
Looking beyond stabilisation, he argued that Sri Lanka must transition towards a broader economic transformation agenda. Sustainable growth, he noted, will depend on expanding productive capacity through investment, technological advancement, innovation, skills development and structural reforms.
Among the key constraints identified was the high cost of energy, which continues to affect competitiveness and investment attractiveness. Dr. Aturupane emphasised the importance of improving efficiency and affordability within the energy sector to enhance Sri Lanka’s business environment.
He further highlighted the social dimensions of the crisis, noting the rise in poverty and economic vulnerability among households. Strengthening social protection systems and ensuring inclusive growth, he argued, must remain central components of the national development agenda.
Another critical challenge identified was Sri Lanka’s demographic transition. With an ageing population, outward migration and evolving labour market dynamics, the country is increasingly confronting labour shortages in several sectors. Dr. Aturupane suggested that greater automation, increased labour-force participation and strategic workforce planning would be necessary to address these emerging realities.
Concluding his presentation, he emphasised the need to improve governance, strengthen institutions, enhance competitiveness and create an enabling environment for private sector investment. Sri Lanka’s future success, he noted, will depend on its ability to move decisively beyond crisis management towards a development model founded on resilience, innovation, productivity and inclusive growth.
Dr. Achinthya Koswatta reiterated the importance of policy consistency and predictability in fostering investment and industrial development. She observed that frequent policy changes create uncertainty and discourage long-term investment decisions, whereas stable and coherent policy frameworks build confidence and support sustainable economic transformation.
Meanwhile, Anushan Kapilan highlighted the substantial progress achieved in restoring macroeconomic stability following the recent crisis. He noted significant improvements in fiscal performance, including increased government revenue, reduced reliance on debt financing and a historically low fiscal deficit.
He further observed that public debt levels are declining faster than anticipated, economic growth has exceeded expectations and inflation has been brought under control more rapidly than forecast. Nevertheless, he cautioned that the recovery remains uneven, particularly within the industrial sector and that many households have yet to experience a meaningful improvement in living standards.
The seminar was expertly coordinated by Eng. Chamil Edirimuni, Vice President of the OPA and Chairman of the Seminars, Workshops and Programmes Committee, while the technical moderation and interactive discussion session were facilitated by Bhanu Wijeyaratne, Vice President of the OPA and Chairman of the National Issues Committee.
The event was attended by Tisara De Silva, President-Elect of the OPA, Eng. Ravi Rupasinghe, General Secretary, Past Presidents, members of the Executive Council, representatives of the General Forum and professionals representing a wide range of disciplines.
The seminar concluded with a vibrant exchange of ideas and perspectives, reaffirming the importance of evidence-based policy dialogue, institutional collaboration and collective national commitment in advancing Sri Lanka’s economic recovery, resilience and sustainable growth.
Yes, for UK-based presenter and artiste Samantha Kay, home is where the heart – and the roots – are. And her roots run deep in Sri Lanka.
In an exclusive interview with The Island, Samantha says “I’m proud to be Sri Lankan. My mum is from Kandy and my dad is from Colombo, so Sri Lanka has always held a very special place in my heart.
“Whenever I visit Sri Lanka, I love spending time on the beautiful south coast, especially Hikkaduwa and Mirissa. It’s somewhere I always feel connected to my roots and completely at peace.”
Now living in Bournemouth, on the south coast of England, where, she says, she is lucky to be close to some of the UK’s most beautiful beaches, including the iconic Sandbanks, Samantha has built a career that refuses to fit into one box.
She is a radio presenter, podcast host, singer-songwriter, personal trainer and life coach.
“I genuinely love the variety because every role allows me to connect with people and, hopefully, make a positive difference in someone’s day.”
Of course, music has taken her far.
One of her proudest achievements, she says, was releasing a song with 90s music icon Angie Brown, which reached No. 9 in the UK Club Charts.
She also reached the final stages of The X Factor and performed at Wembley Stadium in front of thousands.
Beyond music, Samantha competed in bikini bodybuilding across the UK, winning several titles. “It taught me discipline, resilience and self-belief,” she recalls.
Today, her focus is on radio, podcasting and coaching women. Her podcast encourages people to live life on their own terms rather than feeling pressured to follow society’s expectations.
Says Samantha: “Whether someone is single, changing careers, travelling solo or simply trying to find their purpose, I want them to know that it’s never too late to create a life that feels authentic. If you’ve ever felt like you don’t fit into the box, maybe you were never meant to.”
Samantha Kay also spent a year in Dubai, performing at five-star hotels, including FIVE, and coaching at the iconic outdoor gym on Palm Jumeirah.
“I taught strength and conditioning classes, and hosted wellness retreats, combining my passion for music, health and inspiring others.”
However, with family matters calling her back to the UK, she made the choice to return. “Family comes first,” she says.
Looking ahead, Samantha plans to grow her radio and podcast work, release more music, and expand her wellness retreats.
“My biggest passion is helping people, especially women, build confidence and believe in themselves,” she says.
“Wherever my career takes me, I hope to continue inspiring others to live with courage, kindness and authenticity, while never forgetting my Sri Lankan roots.”
Current El Niño Status in Sri Lanka
A few showers may occur in the Western, Sabaragamuwa and North-western provinces and in Kandy, Nuwara-Eliya, Galle and Matara districts.
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