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DEW: Rs. 229 bn relief package will lead to printing more money



… says govt. has got priorities mixed up

By Shamindra Ferdinando

Former Minister D.E.W. Gunasekera says that the cash-strapped government lacked the wherewithal to implement the much publicized Rs 229 bn relief package.

Therefore, the one-time General Secretary of the Communist Party said the government had no option but to print more money at the expense of financial stability at a time the country was under tremendous pressure. The former minister quit the top party post in August 2020.

CP organ ‘Aththa,’ in its January 09, 2022 edition quoted the former lawmaker as having alleged that the Rs 229 bn relief package meant for the public sector, pensioners and Samurdhi recipients was nothing but a political strategy to revive the waning popularity of the government.

Declaring that he had no issue with the government providing relief to the public sector et al, the ex-MP warned that such measures wouldn’t help resolve the growing crisis. The outspoken former minister said that the controversial relief package should be examined against the backdrop of the failure on the part of the government to allocate the required funds through the 2022 budget.

Mr. Gunasekera last served as a National List MP from 2010 to 2015.

Reiterating that such a move had been necessitated by political compulsions, the veteran Communist warned of the grave risk of rising inflation. The CP member questioned the absence of a mechanism to assist those in the private sector, small and medium scale industries as well as the unregulated economy. The much weakened national economy couldn’t be revived unless the government paid attention to the neglected sectors.

The veteran politician explained how the global Covid-19 epidemic devastated the unregulated economy world over. However, the government hasn’t taken into consideration the fuller picture. Instead the government sought to use the financial package to counter dissenting views within the government.

The ex-Minister said that even if printing money caused inflation, the government could have achieved positive results if the total amount was used to increase domestic production. Had that happened, the government could have accomplished both political and economic objectives.

The former MP said that incumbent Finance Minister Basil Rajapaksa hadn’t still understood the developing economic crisis.

Mr. Gunasekera told The Island that the private sector, including the plantation companies had quite clearly turned down the government request to match the special Rs. 5,000 monthly grant to employees. The government seemed not to have examined the situation at all, the former MP said, asserting that the current crisis could be the worst ever in post-independence Sri Lanka.

Continuing political instability in the wake of serious differences among coalition members with three ministers challenging a cabinet decision in the Supreme Court has jeopardized recovery attempts, Mr. Gunasekera said.

The one-time Chairman of the Committee on Public Enterprises (COPE) emphasized the pivotal importance of some real effort to reach consensus on the country’s response to the emerging threat. “We are almost overwhelmed. Unless tangible measures are taken there can be a catastrophe. Losses are likely to be immeasurable and irrevocable.”


India and Sri Lanka commit to more cooperation in education and skills training at ITEC Day Celebration



Participants at the event

To mark 59 years of capacity building partnership between India and Sri Lanka through Indian Technical and Economic Cooperation (ITEC), the High Commission of India in Colombo celebrated ITEC Day 2023 on 27 September.

Dr. Suren Raghavan, State Minister of Higher Education, and Dr. Satyanjal Pandey, Deputy High Commissioner, graced the occasion as the Chief Guest and the Guest of Honour, respectively. The event was attended by over 100 participants, which included ITEC alumni from Sri Lanka, officials, and professionals from diverse sectors who have participated in various training courses in India under different ITEC programmes.

In his address, State Minister of Higher Education lauded the historically close relations between India and Sri Lanka. Dr. Raghavan congratulated India for the successful Chandrayaan-3 mission and especially praised Indian women scientists involved in the lunar mission. He appreciated India for offering ITEC slots and annual scholarships to Sri Lankan nationals, and thanked Delhi for the financial support extended to Sri Lanka in recent months.

The State Minister also highlighted the scope for further cooperation between the two countries in the field of higher education, skill development and capacity building, especially in STEM (Science, Technology, Engineering and Mathematics) and IT sectors. He encouraged the beneficiaries of ITEC programmes to contribute not only to the development of Sri Lanka but also to take India-Sri Lanka relationship to the next level.

Indian Deputy High Commissioner Dr. Satyanjal Pandey noted the enormous interest shown by Sri Lankan officials for the ITEC programme over the years. The Deputy High Commissioner highlighted India’s endeavour to help Sri Lanka in the education sector, including in higher education through partnership between higher education institutes in India and Sri Lanka, besides the current 402 ITEC slots annually. The Deputy High Commissioner reiterated that India is guided by the philosophy of ‘Vasudhaiva Kutumbakam’ which means ‘the world is one family’ and India would continue to be in the forefront of capacity building programmes for Sri Lanka.

Senior officials reminisced and shared their experiences of ITEC training in India and appreciated the holistic content of the different ITEC programmes, such as Gender Responsive Governance, Climate Change Policy Development and Financing for Effective Implementation of SDGs, Integrating Industry Four Dot Zero (4.0) Competency and Twenty First Century Skills in Educational Institutions, and Parliamentary Internship programme.

ITEC is a flagship programme of the Government of India launched in September 1964 for extending technical assistance and building capacities of developing countries. It has emerged as an important vehicle for India’s contribution to human resource development of partner countries with over 200,000 persons from 160 fellow developing countries having participated in the programme. Sri Lanka is currently allotted 402 training slots annually for the ITEC programme. ‘ITEC Day’ is celebrated every year by Indian diplomatic Missions all over the world to mark this unique pillar of South-South partnership.

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Great power rivalry, geopolitics hamper economic recovery of Global South: RW



The west has labelled China’s Belt and Road Initiative as a cohesive programme, and the participating countries like Sri Lanka are looked upon with suspicion, President Ranil Wickremesinghe said on Thursday (28) at the Berlin Global Conference.

“This will further hurt economic prospects in the global South, and the polarisation will become more evident,” he said.

Great power rivalries and geopolitics have been an emerging threat to open access to trade, investment, capital, and technology that are vital for the economic recovery of the developing world, President Wickremesinghe said.

The President also mentioned that recently US national security advisor Jake Sullivan had rejected the Washington Consensus at an address at the Brookings Institute.

“With the new concept of de-risking and decoupling, the developing South, which was compelled to follow the Washington Consensus, is now asked to do a 180 degree turn even without consultation with us. With decoupling, whatever it is, we have been asked to change the system. We were compelled to get into it. Now, we are told it is no longer relevant.”

Wickremesinghe went on to say the global south is now looking for alternative leadership, given the expansion of the BRICS and the downgrading of G20. In 2024, the US leadership might change and that people are wondering what policy changes would ensue.

“We know in 2024, the US leadership may not be there. Then who is going to act? So I think it’s a chance for the EU to come up and work with the other countries. There’s no one else. So I am suggesting that the EU, together with G20 BRICS, certainly the USA, and some selected other Asian and African nations, the IMF and the NDBs, and you can bring in the big financial institutions, private ones, sit down and find urgent solutions.”

The world requires a constructive dialogue between the West and China, said the President.

“We need a constructive dialogue between the US and China. We need a constructive dialogue between the EU and China. Otherwise we will not move forward. So this is the stark reality. It’s a question of how we get together and how we work, and who’s going to take the lead in 2024.”

The following are excerpts of the speech: “I don’t think in any other period of modern history have we gone through this type of a crisis. And in all these instances, it’s the developing economies and the global south that has suffered extremely. We are now faced with stubbornly high inflation in advanced economies, oil prices edging towards US $100 a barrel, and monetary tightening by the global central banks.

“One example is that Sri Lanka’s export to Europe has not increased at all this year … so far this year. That’s an indication of how we are being affected as we try to recover from the crisis we face. The confluences of factors face serious risk for many developing countries. In the global south, we are facing rising import costs, food, energy, insecurity, and the problems of our exports. The resulting balance of payment stress translates into a weaker economy for all of us. The difference between the advanced economies and the developing nations is that you all have all the buffers and reserves to deal with these shocks. We haven’t. And it’s from here that the sovereign debt crisis started.

“In this context, I think the world may be in another crisis if corrective measures are not taken immediately. Many developing countries find themselves with large debt burdens. For example, the IMF has no mechanism to face this new situation. When Sri Lanka declared bankruptcy, all foreign funding ceased and that started the political crisis. If not for the help given by the World Bank in regraduating Sri Lanka, and the help given by my old friend Samantha Power in funding us with fertilisers, the chances were I would not be able to come here today. I would not have been in the position.

“The funding on the table is woefully inadequate to address the vast challenges at hand. So we haven’t got any money. But we do have 100 billion with the IMF. Let’s start with that money. 100 billion is better than nothing. Then let’s see how we can raise the rest of it. Because though I talk of Sri Lanka, I must say Africa’s needs, especially of the low-income countries, are far greater than ours. And the problems Africa faces need not be described by me because I think there are enough representatives here. The developing countries require financing up to US 5.9 trillion to fulfil their nationally determined contributions. Then further US 4 trillion, for clean energy technology to achieve net zero emissions, look at Sri Lanka’s financing needs for our climate prosperity plan to succeed. We need 26 five billion US dollars by 2030.

“These is a country that’s bankrupt. And with the IMF states, we’ll have for the next few years a growth rate of 3.5% if you are lucky. Here again, global coordination and leadership to resolve these challenges have simply not been sufficient to address the magnitude of the urgency of the problem. So what we need here is a new architecture.

Now we’ve been talking of the many crises and shocks we have discussed today. And we’ve been talking about what we have to do. First, we’ve all agreed that the core of the international financial architecture today was designed almost 80 years ago. The world has seen dramatic changes since then with many emerging economies in Asia, Middle East, South America, and Africa becoming global economic powerhouses.”

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GL alerts country to danger of ‘thought-police’ by way of Online Safety Commission



By Rathindra Kuruwita

The government is bent on ensuring that people have no access to truthful information by the time of the presidential election next year, Freedom People’s Congress (FPC) MP, Prof. G.L. Peiris said, commenting on the proposed Online Safety Bill.

The Ranil Wickremesinghe administration knows that it can’t win elections and has postponed every election it can, he said. “However, the presidential election can’t be postponed. The government is curbing freedom of speech and the right to share information in a desperate bid to have a monopoly on information. There is no other reason to bring the Online Safety Bill.”

The Bill establishes an Online Safety Commission tasked with overseeing its implementation and addressing complaints related to online harm. Members of the commission are appointed by the President. “The commission will have five members. The President will appoint them the way he wants. The President can also get rid of them any time he wants. No one else has a say in whether the President’s decisions, with regard to the commission are fair. The power of appointing members should have been given to the Constitutional Council, which appoints members to all other independent commissions,” he said.

Prof. Peiris added that the digital space must be made safe and that there are a number of young people who have become victims of the unscrupulous activities of nefarious people. However, the proposed cure by the government is more dangerous than the disease.

Prof. Peiris said that Sri Lanka has been trying to attract foreign revenue into the country, mainly through tourism, trade and FDIs. Investments will not come into a country that passes draconian laws on a regular basis, he said.

“There are several sections that should scare anyone. There are sections that say people must obey the directives of the commission, established by the Online Safety Bill. If not, a person can be sent to jail for five years. This does not only apply to Sri Lankans, but also to global companies. For these companies, Sri Lanka is a small market. These companies will avoid Sri Lanka. We will just regress 30 years.”

If the Online Safety Bill and the Anti-Terrorism Act, which have been re-gazetted, pass, none of the democratic rights we have enjoyed will last, the MP said. “Social media has played a big role in the recent elections. When science and technology change, how people interact changes. We can’t avoid the digital space.”

Prof. Peiris said that he has been in Parliament for decades and that he has never seen a government this desperate to pass laws that restrict freedom of expression. “The Budget for 2024 will be presented mid-November. Nothing else can be done in Parliament for the next month following the Budget. The government is desperate to pass several draconian laws before the Budget.”

A team of Opposition MPs will meet the IMF representatives in Sri Lanka next week, he said.

“IMF money is to make the lives of people better. It’s not for the government. We want to tell the IMF that they have a duty to ensure that the money they provide is not pocketed by powerful people. We have to pay the loan, and people will have to pay. The IMF agreed that there is a lot of corruption here.”

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