Editorial
Dead dodo disposed

Saturday 19th December, 2020
The US has terminated the much-touted 480-million-dollar Millennium Challenge Corporation (MCC) compact with Sri Lanka. In fact, there was no need for the discontinuation of that agreement; it was dead as a dodo following Colombo’s refusal to sign it.
Opinion is divided on the MCC grant. Some observers think the US was acting out of altruism, and Sri Lanka should have grabbed the offer with both hands as it is desperate for foreign exchange. Others who are capable of seeing through the wiles of the US view the compact as a Trojan horse.
The MCC Board of Directors would have us believe that the controversial compact was intended to assist Sri Lanka in addressing two of its ‘binding constraints’: inadequate transport logistics, infrastructure and planning, and lack of access to land for agriculture, the service sector and industrial investors. Why is the US so keen to solve problems here?
The war was Sri Lanka’s biggest problem, and why is it that the countries which sought to prevent it being finished are so concerned about other issues, especially those related to land? Their love for this country cannot be genuine.
It is not out of altruism that the world powers evince an interest in helping the countries situated in strategically important locations in the world. Unfortunately, Sri Lankan rulers have not learnt from the blunders of their predecessors, who fell for the devious strategems of the Portuguese, the Dutch and the English, and entered into disastrous deals, including ill-conceived pacts, with those colonial powers.
It was a huge mistake for the Rajapaksa government (2005-2015) to be lured into involving China in land reclamation and port development projects here and to antagonise India and the western bloc in the process. (India was invited to build the inland port in Hambantota, but it showed no interest, and China grabbed the opportunity.) The yahapalana government blundered by leasing out the Hambantota Port to China for 99 years and allowing a bigger area than the one in the original Port City plan to be reclaimed from the sea, having suspended the project to spite China and please the western powers.
The MCC should not be viewed in isolation, for it is linked to the Status of Forces Agreement (SOFA) and the Acquisition and Cross-Servicing Agreement (ACSA). Taken together, they can be seen as part of the Indo-Pacific strategy of the US, which is maniacally focused on countering China’s Belt and Road initiative.
The MCC directors have said it was the Sri Lankan government (2015-2019) that identified ‘most binding constraints that prevent private sector led growth in Sri Lanka’. One may get the impression that the controversial land project was the brainchild of the yahapalana government and not the US, and, therefore, cannot be inimical to Sri Lanka’s interests. But the fact remains that the same administration co-sponsored the US-crafted UNHRC resolution against this country at the behest of Washington. The yahapalana leaders were ready to do anything to be in the good books of their western masters.
Big powers no longer resort to sheer force to grab resources such as land in other countries. Their methods are sophisticated. Instead of using bullets as the first resort, they employ baits which come in the form of grants, loans and even bribes. They also use various fronts to acquire land and other vital resources in other countries.
Government backers are cock-a-hoop at the discontinuation of the MCC compact. But the problem is far from over. The US move looks a tactical withdrawal. Now that the grant bait has failed to work, the US is likely to use the human rights harpoon. The government had better brace itself for another turn of the screw in Geneva come March 2021, and other such hostile actions.
Editorial
A budget replete with optimism

Tuesday 18th February, 2025
President Anura Kumara Dissanayake, in his capacity as the Minister of Finance, Economic Stabilisation and National Policies, yesterday presented his government’s maiden budget in Parliament. He said the goal of Budget 2025 was to fulfil the aspirations of the people who had voted the NPP into power, hoping for sustainable growth and development.
The NPP government’s efforts to present an election-oriented budget have partially succeeded and borne mixed results. However painful the IMF bailout conditions may be, they have made the new administration remain focused on the need to achieve economic recovery and act with some restraint, ensuring that, inter alia, its revenue will amount to at least 15% of GDP, and the primary account will have a surplus. The Economic Transformation Act (ETA) has also become a kind of straitjacket on the government. With the local government polls approaching, what the NPP administration would have done to garner favour with the public, if not for the IMF programme and the ETA constraints, is anybody’s guess. President Dissanayake has said his government intends to amend the ETA. If it is planning to lower the bar for itself, such politically-motivated action will entail adverse economic consequences.
There is no gainsaying that workers deserve better salaries. However, one wonders whether the NPP government, just like its predecessors, is labouring under the misconception that it can grant relief to the public by increasing the state sector salaries. In the late 1980s, the JVP coined a pithy slogan—kolombata kiri, gamata kekiri (‘milk for Colombo and melon for the village’)—to highlight the glaring urban bias in the allocation of state resources. Today, it looks like a case of kiri for state employees and kekiri for their private sector counterparts, who have to bear the burden of maintaining the ever-burgeoning public sector by paying high taxes. President Dissanayake lamented in Parliament that the state employees’ real income had decreased. The same holds true for the non-state workers, and other members of the public as well, but they have been left fending for themselves.
Among the budget highlights flaunted by the government is what it calls the highest-ever fund allocations for the health and education sectors. The government has undertaken to allocate Rs. 604 billion for health. The cost of social welfare (Aswesuma) will be Rs. 232.5 billion. Capital expenditure will amount to 4% of GDP. Such spending will benefit the public, but much more needs to be done to mitigate the economic hardships they are facing.
Bridging a 6.7% budget deficit will be a gargantuan task. President Dissanayake is hopeful that a 5% economic growth will be attainable in 2025. He says growth will be facilitated by a strong export sector, where the government expects the exports of goods and services to reach an all-time high of close to USD 19 billion in the current year; this growth in non-debt creating inflows along with robust economic growth and a primary account surplus of 2.3 percent of GDP will ensure that Sri Lanka will be well placed to make debt service payments from 2028 onwards.
President Dissanayake has said he expects the relaxation of restrictions on vehicle imports to deliver a bulk of the country’s revenue gains for 2025. It is fervently hoped that he is not being as optimistic as the proverbial poor man who ordered oysters for dinner hoping to settle the bill with pearls he expected to find on his plate. Some economic analysts have argued that there is the possibility of extremely high taxes, which are sure to drive automobile prices up, causing a drop in the sales of imported vehicles and preventing the government from achieving its revenue targets. How does the NPP administration propose to handle such an eventuality?
Editorial
Sailing between Scylla and Charybdis

Monday 17th February, 2025
President Anura Kumara Dissanayake (AKD) may be no hero like Odysseus, and the International Monetary Fund (IMF) and the irate public are certainly no immortal monsters, but the perilous economic voyage AKD has embarked on is akin to sailing between Scylla and Charybdis. The NPP government’s maiden budget is to be presented to Parliament today. It will be the moment of truth for the incumbent dispensation troubled by more than its fair share of problems. What AKD has undertaken to perform on the economic front is a high-wire act, and balance is of the essence; he has had to keep the budget within the confines of the IMF bailout programme while granting relief to the resentful public, whose patience has been wearing thin owing to economic hardships.
It is being claimed in some quarters that the budget to be presented today has already passed muster with the IMF, but even so, problems are far from over for the government. Whether the budget will be acceptable to the public at large remains to be seen. Otherwise, it will entail a heavy political price for the NPP.
In a bid to rally popular support, President Dissanayake has promised pay hikes for state employees, who number more than 1.25 million, according to official statistics, but private sector employees (about 3.63 million) and own-account workers (about 2.8 million) constitute the majority of Sri Lanka’s workforce. The number of contributing family workers is about half a million, according to the Department of Census and Statistics. So, pay hikes for the state employees will leave millions of non-state sector workers disgruntled ahead of an election.
Meanwhile, the relaxation of import restrictions on vehicles may help the government meet the IMF-prescribed revenue target (15% of GDP) without increasing the existing taxes that are already very high or introducing new ones. However, the resumption of vehicle imports is bound to have an adverse impact on the country’s foreign currency reserves, causing the rupee to depreciate and the prices of imports to rise. This is a Catch-22 situation the government may not be able to avoid.
People are in no mood for excuses, and what they expect from the government is the expeditious delivery of its election promises, which range from bringing the prices of essentials down to affordable levels and slashing automobile prices to make cars accessible to everyone. So, the challenge before the government and President Dissanayake is to ensure that today’s budget meets the expectations of the public, with local government elections slated for April.
The government finds itself in the current predicament of having to deliver on its promises even before settling down properly because the JVP-led NPP raised people’s expectations beyond realistic levels to win elections, which looked like promise-making contests, as it were. In the past, the JVP/NPP would take to the streets, asking every newly elected government to grant relief to the public; it called for pay hikes even at the height of the current economic crisis. Now, the boot is on the other foot.
The NPP is being dogged by its own pre-election promises, rhetoric and unreasonable demands during previous governments. One may recall that the NPP in the run-up to last year’s presidential election, claimed that petroleum prices could be reduced by as much as Rs. 160 overnight, and farmers paid Rs. 150 per kilo of paddy. It either did not realise the gravity of the country’s economic situation or erroneously believed that it, too, would be able to get away with broken promises, like past governments, which followed the Machiavellian precept—‘the promise given was a necessity of the past, and the word broken is a necessity of the present’. It is now under pressure from the people who gave it a supermajority to grant them relief.
Editorial
Local elections

The Supreme Court determination on the Local Authorities (Special Provisions) Bill read out in Parliament on Friday makes clear that these elections, last held in 2018, due in 2022 and postponed thereafter on various pretexts must be held in the coming weeks. But the question is when? The opposition urges that they be held after the Sinhala and Tamil New Year holidays are over. They argue that with the president, as finance minister, due to present his first budget which is expected to be voter friendly on Monday and the budget debate will take much of March.
The majority judgment held that the Bill must be passed by a two thirds majority which the present regime holds and has not required a referendum so there will be no legislative challenge. The matter of fixing the election dates is for the Independent Elections Commission and the government should have no say in the matter. Nominations for these elections were called and a polling date fixed in 2023 post aragalaya after President Ranil Wickremesinghe had assumed office. Deposits were paid and nominations received. But the elections were not held on the grounds that the government had no money to fund them. The courts ordered that they be held “as soon as possible.”
Some candidates for that election had entered parliament. Others have emigrated and some have died. There is an obvious need for the refund of deposits and call fresh nominations before polling which the Bill provides for. The question therefore will be in the timing of the election. Certainly it cannot be held before the budget. The present regime is very well aware that the election will be an acid test after its heady election victory and will be intent on demonstrating that it remains popular. The opposition will be determined to regain lost ground. How will events pan out? That is the million dollar question.
Gifting sight to the sightless
At the World Governance Summit hosted by the United Arab Emirates a few days ago, President Anura Kumara Dissanayake made a reference to a subject generally taken for granted by most Lankans and no longer accorded the importance or merit it deserves. This relates to the fact that Sri Lanka is the world leader for eye donations – the gifting of human corneas from those no longer living to the sightless or persons with reduced vision. The president said in his speech that anybody using a smart phone could instantly verify this fact for him or herself. The latest figure at 94,959 corneas sent abroad exceeds the 80,000 stated in the Internet. These eyes have been sent to as many as 114 cities in 57 countries since the Ceylon (now Sri Lanka) Eye Donation Society was founded in 1961 by the late Deshabandu Dr. Hudson Silva. This vast endeavor of gifting sight to the sightless has benefited over 58,000 people locally and also enabled 40,000 plus corneas being made available for research.
In his speech, the president said that the fact that this country is the world leader in overseas eye donations is ample demonstration that we are a warmhearted people, a quality that can win us friends globally. No doubt the Buddhist ethic that permeates this dharmadweepa is surely a factor that has influenced the gifting of eyes by those who no longer have use of them; and corneal grafting is now commonplace in ophthalmology. Dr. Hudson Silva’s was a household name from the 1960s onward when he enthused the nation to participate in this meritorious practice and set up the infrastructure to do so so. But, sadly, he is no longer remembered as well as he should. However, the Sri Lanka Eye Donation Society which later extended its work by setting up a human tissue bank in addition to its original eye bank remains a lasting monument to a truly remarkable man.
As a medical student in 1957, Hudson Silva was inspired by the vision of transplanting corneas from the eyes of those no longer alive to those in need of them. He told his mother to donate his eyes when he was no more. She responded that she was likely to die before him and to make sure that her eyes are donated. From this tiny acorn a mighty oak grew and today the Sri Lanka Eye Donation Society performs a tremendous service free of charge. It attracted support from the Government of Sri Lanka and various other benefactors at home and abroad and today owns an impressive headquarters building at a prime location in Colombo. At the beginning the society collected the corneas of people without custodians in government hospitals, homes for the aged and executed prisoners. It carries in its books the names and addresses of over 22 million people who wishes their eyes to give sight to another after their deaths.
It should be known that a human cornea should be removed within four hours of a death to be of future use. The eyeball can be preserved in ice for 24 hours and thereafter for 14 days after the cornea is separated from the eyeball and preserved in a special fluid. The society has over 250 branches with trained technicians to remove eyeballs so that its coverage is almost island-wide. The late Dr. Hudson Silva who captured national headlines calling the government health department “a sick giant” when he was in government service had brilliant public relations skills and media savvy for his time so that the story of what little Sri Lanka was doing in this field was carried the world-over by the international press. Thus it is gratifying that a short excerpt of a speech that the president made at a global summit has once again attracted attention both nationally and intentionally to what Sri Lanka is doing in the area of giving sight to the sightless.
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