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Global recession? Impact on Sri lanka

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by Kumar David

Whether there will be a global recession within a year or two and what its impact on Sri Lanka may be, are debated among the cognoscenti. On the first question there is little agreement among economists, Central Bankers and investors the world over. If there is a global recession the nature of its impact on Sri Lanka however is better understood. What there is universal agreement about is that inflation is rising the world over and in this country the rate will be high for two more years – in August 2022 it was 106% year on year, seventh highest in the world. In most countries shown on Hanke’s Inflation Dashboard reproduced above inflation is on the rise for the same reason as Sri Lanka. For decades consumption outpaced production and the shortfall was made up by foreign and debt and domestic deficit. Then one day fate caught up and debts fell due. The collapse was sudden and painful; Covid aggravated the pain but was not the root.

In some cases, the reasons are special. Cuba’s financial patron collapsed; Ukraine is caught up in a war; in Zimbabwe it was corruption and mismanagement on an incredible scale; Venezuela, Argentina and Turkey are examples of economic mismanagement on a lesser scale and Burma is a pariah military dictatorship which all the world except China shuns. Inflation is rising across Europe for more complex reasons to do with unexpected energy shortfalls (especially Germany), monetary and tax policy and industrial decline (UK for example) and social and/or political conflict (the Baltic states, Sudan, Hungary, Czechia – that is former Bohemia – Bulgaria and Poland).

The USA

The USA is an interesting special case. The Biden Administration has for reasons to do with domestic politics and to retain the country’s position as a premier global power, pumped a huge amount of money into the economy as employment and consumption support though inflation reached 9% (headline) 6% (core) leaving the FED’s much proclaimed 2% target in tatters. Salespersons, pre-school teachers, tellers and counter staff are in severe short supply because it’s better to work less hours and collect part-employment benefits than to work full time. Right now, there are two vacancies for one every unemployed person.

There is a genuine fear among economists that dreaded stagflation (simultaneous stagnation and high inflation) may be difficult to avoid in the coming years. The last time this occurred in the late 1970s the Regan-Paulson assault on US living standards sparked global neo-liberalism and, in the UK Mrs Thatcher, responded with a ruthless battering of trade unions. This reactionary global trend was not pushed back till the late 1990s by mass anti-privatisation mobilisations in developing countries and progressive political trends in the West such as the rise of Barrack Obama, China’s increased economic heft and the global ideological defeat of neo-liberalism and neo-conservatism.

Inflation has come to stay in the US since it is clear that the FED will allow the core rate to stay above 7% till 2024. The Dow Jones Industrial average is falling and it will be allowed to continue to decline. In order to retain its global position, the Biden Administration is unlikely to shrink consumer demand or slow down monetary expansion. The political scene also appears to be propitious. Donald Trump is being investigated for a slew of illegal activities and it is possible he may be convicted; in which case he will not be eligible to run for the presidency in 2024. That’s a big headache out of the way for Biden. Taking everything into account including even disrupted global supply chains, and assuming that the US economy will set the trend for the world, it seems unlikely that there will be a global economic recession within say two years.

Is Ranil fit to be Head of State?

Frankly the answer has to be in the negative; he has not been above the ugly. The link between his name and the Batalanda torture chambers is a black mark he cannot live down; the minorities will never forgive his participation in JR’s overtly racist government; the same goes for Ranasinghe Premadasa. Without denying that the JVP committed political suicide, these two men lorded it over a string of torture sites that mushroomed across the country in the 1989-93 period. As if this isn’t bad enough, the moment he took over the reins Ranil Wickremesinghe sent his khakied thugs and military goons early in the morning to beat up aragalaya protestors who were still asleep. This man does not stand above petty politics and for that reason is unfit to be Head of State or to replicate the role of QEII, William Gopallawa or Droupadi Murmu. This underlines the importance of finding a suitable Head of State.

The passing of Lilibet (Elizabeth) provides an occasion to reflect on two matters. The Monarch must be (must appear to be) above the grime of day to day politics; that is to say the roles of a Head of State and a Head of Government must be, or at least must appear to be distinct. This allows the Head of State to create public confidence in the institution of state (as opposed to the cut and thrust of politics). The second matter that Lilibet’s reign highlights is the transition from Empire to Commonwealth of Nations which the good lady and her close advisors managed with consummate skill.

There are 54 members of the Commonwealth, four more than at the end of WW2 with a population of 2.4 billion. Only two have left, Ireland in 1949 (unavoidable) and Zimbabwe in 2003 (good riddance!). The most recent four to join – Mozambique (former Portuguese colony), Rwanda, Gabon and Togo (three ex-French territories) – have no historical ties to the Empire. The frustrated sun must have hoped that at last it will have a chance to set on the blithering Empire. No such luck! Work it out, from the Pacific coast of Canada, to the South Sea Islands, NZ, Australia, the Malay Archipelago, then the huge Sub-Continent, Seychelles, Bahrain, East, Central and West Africa and the Caribbean. The odds against the sun setting on Commonwealth are getting longer by the day! Credit goes to Lilibet; Charlie-Boy may not keep it up though he is the beneficiary of “Darling Mama’s” 70-year stewardship.

Does this remark about the Commonwealth have relevance for Sri Lanka; indeed, it does. Membership of the club provides an opportunity for contact and succour from the countries of the Subcontinent, the UK, Malaysia and Australia. The opportunity to participate in gatherings brings significant benefits. Sri Lanka’s Head of State must fit the role uncontroversially.

What’s for Lanka if a global recession is unlikely?

As I have pointed out in this column previously it seems that capitalism will remain stable globally in the short-term; no one in his right mind will venture to make medium or long-term predictions in an unstable world. Given RW’s awkwardness as a prospective Head of State it is possible to kill two birds with one stone. A new constitution will have to be enacted within say a year and obviously the new president will be selected by the constituent assembly or the first parliament. There are a few suitable candidates I can think of, probably there are many more. No names at this stage please! Parliamentary elections will need to be held within say a year and it this time the front runners appear to be a Ranil+ alliance or the JVP. By Ranil+ I mean Ranil-Sajith, or some combination of SJB people with brains (there are a few) with a UNP contingent. The rump of the SLPP, the Dullas clique, the 10-party comedy and the SLFP will be wiped out. Whoever secures a legitimate and constitutional electoral mandate let him/her be PM, be it Sajith, Namal, Ranil, Anura Kumara, Tom, Dick or Harry. If we seek democracy this right is unquestionable.

If capitalism survives globally for say five plus more years (which is the same as saying a global recession is avoided for now) our country’s economy will need to navigate new waters. Few will wager anything in these parlous times except perhaps that WW3 is unlikely. If capitalism is the global option then to my mind the JVP is the natural parliamentary opposition. This is reminiscent of the reds in the Legislative Council and Parliament in the 1930s and 1950-60s. Most of the 1940s they were locked up or in exile. I have spoken of global uncertainties, so will capitalism be shaken globally to its foundations within a decade? Wow, the topic is way beyond the reach of this essay.



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Ranking public services with AI — A roadmap to reviving institutions like SriLankan Airlines

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Efficacy measures an organisation’s capacity to achieve its mission and intended outcomes under planned or optimal conditions. It differs from efficiency, which focuses on achieving objectives with minimal resources, and effectiveness, which evaluates results in real-world conditions. Today, modern AI tools, using publicly available data, enable objective assessment of the efficacy of Sri Lanka’s government institutions.

Among key public bodies, the Supreme Court of Sri Lanka emerges as the most efficacious, outperforming the Department of Inland Revenue, Sri Lanka Customs, the Election Commission, and Parliament. In the financial and regulatory sector, the Central Bank of Sri Lanka (CBSL) ranks highest, ahead of the Securities and Exchange Commission, the Public Utilities Commission, the Telecommunications Regulatory Commission, the Insurance Regulatory Commission, and the Sri Lanka Standards Institution.

Among state-owned enterprises, the Sri Lanka Ports Authority (SLPA) leads in efficacy, followed by Bank of Ceylon and People’s Bank. Other institutions assessed included the State Pharmaceuticals Corporation, the National Water Supply and Drainage Board, the Ceylon Electricity Board, the Ceylon Petroleum Corporation, and the Sri Lanka Transport Board. At the lower end of the spectrum were Lanka Sathosa and Sri Lankan Airlines, highlighting a critical challenge for the national economy.

Sri Lankan Airlines, consistently ranked at the bottom, has long been a financial drain. Despite successive governments’ reform attempts, sustainable solutions remain elusive.

Globally, the most profitable airlines operate as highly integrated, technology-enabled ecosystems rather than as fragmented departments. Operations, finance, fleet management, route planning, engineering, marketing, and customer service are closely coordinated, sharing real-time data to maximise efficiency, safety, and profitability.

The challenge for Sri Lankan Airlines is structural. Its operations are fragmented, overly hierarchical, and poorly aligned. Simply replacing the CEO or senior leadership will not address these deep-seated weaknesses. What the airline needs is a cohesive, integrated organisational ecosystem that leverages technology for cross-functional planning and real-time decision-making.

The government must urgently consider restructuring Sri Lankan Airlines to encourage:

=Joint planning across operational divisions

=Data-driven, evidence-based decision-making

=Continuous cross-functional consultation

=Collaborative strategic decisions on route rationalisation, fleet renewal, partnerships, and cost management, rather than exclusive top-down mandates

Sustainable reform requires systemic change. Without modernised organisational structures, stronger accountability, and aligned incentives across divisions, financial recovery will remain out of reach. An integrated, performance-oriented model offers the most realistic path to operational efficiency and long-term viability.

Reforming loss-making institutions like Sri Lankan Airlines is not merely a matter of leadership change — it is a structural overhaul essential to ensuring these entities contribute productively to the national economy rather than remain perpetual burdens.

By Chula Goonasekera – Citizen Analyst

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Why Pi Day?

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International Day of Mathematics falls tomorrow

The approximate value of Pi (π) is 3.14 in mathematics. Therefore, the day 14 March is celebrated as the Pi Day. In 2019, UNESCO proclaimed 14 March as the International Day of Mathematics.

Ancient Babylonians and Egyptians figured out that the circumference of a circle is slightly more than three times its diameter. But they could not come up with an exact value for this ratio although they knew that it is a constant. This constant was later named as π which is a letter in the Greek alphabet.

Archimedes

It was the Greek mathematician Archimedes (250 BC) who was able to find an upper bound and a lower bound for this constant. He drew a circle of diameter one unit and drew hexagons inside and outside the circle such that the sides of each hexagon touch the sides of the circle. In mathematics the circle passing through all vertices of a polygon is called a ‘circumcircle’ and the largest circle that fits inside a polygon tangent to all its sides is called an ‘incircle’. The total length of the smaller hexagon then becomes the lower bound of π and the length of the hexagon outside the circle is the upper bound. He realised that by increasing the number of sides of the polygon can make the bounds get closer to the value of Pi and increased the number of sides to 12,24,48 and 60. He argued that by increasing the number of sides will ultimately result in obtaining the original circle, thereby laying the foundation for the theory of limits. He ended up with the lower bound as 22/7 and the upper bound 223/71. He could not continue his research as his hometown Syracuse was invaded by Romans and was killed by one of the soldiers. His last words were ‘do not disturb my circles’, perhaps a reference to his continuing efforts to find the value of π to a greater accuracy.

Archimedes can be considered as the father of geometry. His contributions revolutionised geometry and his methods anticipated integral calculus. He invented the pulley and the hydraulic screw for drawing water from a well. He also discovered the law of hydrostatics. He formulated the law of levers which states that a smaller weight placed farther from a pivot can balance a much heavier weight closer to it. He famously said “Give me a lever long enough and a place to stand and I will move the earth”.

Mathematicians have found many expressions for π as a sum of infinite series that converge to its value. One such famous series is the Leibniz Series found in 1674 by the German mathematician Gottfried Leibniz, which is given below.

π = 4 ( 1 – 1/3 + 1/5 – 1/7 + 1/9 – ………….)

The Indian mathematical genius Ramanujan came up with a magnificent formula in 1910. The short form of the formula is as follows.

π = 9801/(1103 √8)

For practical applications an approximation is sufficient. Even NASA uses only the approximation 3.141592653589793 for its interplanetary navigation calculations.

It is not just an interesting and curious number. It is used for calculations in navigation, encryption, space exploration, video game development and even in medicine. As π is fundamental to spherical geometry, it is at the heart of positioning systems in GPS navigations. It also contributes significantly to cybersecurity. As it is an irrational number it is an excellent foundation for generating randomness required in encryption and securing communications. In the medical field, it helps to calculate blood flow rates and pressure differentials. In diagnostic tools such as CT scans and MRI, pi is an important component in mathematical algorithms and signal processing techniques.

This elegant, never-ending number demonstrates how mathematics transforms into practical applications that shape our world. The possibilities of what it can do are infinite as the number itself. It has become a symbol of beauty and complexity in mathematics. “It matters little who first arrives at an idea, rather what is significant is how far that idea can go.” said Sophie Germain.

Mathematics fans are intrigued by this irrational number and attempt to calculate it as far as they can. In March 2022, Emma Haruka Iwao of Japan calculated it to 100 trillion decimal places in Google Cloud. It had taken 157 days. The Guinness World Record for reciting the number from memory is held by Rajveer Meena of India for 70000 decimal places over 10 hours.

Happy Pi Day!

The author is a senior examiner of the International Baccalaureate in the UK and an educational consultant at the Overseas School of Colombo.

by R N A de Silva

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Sheer rise of Realpolitik making the world see the brink

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A combined US-Israel attack on Iran.(BBC)

The recent humanly costly torpedoing of an Iranian naval vessel in Sri Lanka’s Exclusive Economic Zone by a US submarine has raised a number of issues of great importance to international political discourse and law that call for elucidation. It is best that enlightened commentary is brought to bear in such discussions because at present misleading and uninformed speculation on questions arising from the incident are being aired by particularly jingoistic politicians of Sri Lanka’s South which could prove deleterious.

As matters stand, there seems to be no credible evidence that the Indian state was aware of the impending torpedoing of the Iranian vessel but these acerbic-tongued politicians of Sri Lanka’s South would have the local public believe that the tragedy was triggered with India’s connivance. Likewise, India is accused of ‘embroiling’ Sri Lanka in the incident on account of seemingly having prior knowledge of it and not warning Sri Lanka about the impending disaster.

It is plain that a process is once again afoot to raise anti-India hysteria in Sri Lanka. An obligation is cast on the Sri Lankan government to ensure that incendiary speculation of the above kind is defeated and India-Sri Lanka relations are prevented from being in any way harmed. Proactive measures are needed by the Sri Lankan government and well meaning quarters to ensure that public discourse in such matters have a factual and rational basis. ‘Knowledge gaps’ could prove hazardous.

Meanwhile, there could be no doubt that Sri Lanka’s sovereignty was violated by the US because the sinking of the Iranian vessel took place in Sri Lanka’s Exclusive Economic Zone. While there is no international decrying of the incident, and this is to be regretted, Sri Lanka’s helplessness and small player status would enable the US to ‘get away with it’.

Could anything be done by the international community to hold the US to account over the act of lawlessness in question? None is the answer at present. This is because in the current ‘Global Disorder’ major powers could commit the gravest international irregularities with impunity. As the threadbare cliché declares, ‘Might is Right’….. or so it seems.

Unfortunately, the UN could only merely verbally denounce any violations of International Law by the world’s foremost powers. It cannot use countervailing force against violators of the law, for example, on account of the divided nature of the UN Security Council, whose permanent members have shown incapability of seeing eye-to-eye on grave matters relating to International Law and order over the decades.

The foregoing considerations could force the conclusion on uncritical sections that Political Realism or Realpolitik has won out in the end. A basic premise of the school of thought known as Political Realism is that power or force wielded by states and international actors determine the shape, direction and substance of international relations. This school stands in marked contrast to political idealists who essentially proclaim that moral norms and values determine the nature of local and international politics.

While, British political scientist Thomas Hobbes, for instance, was a proponent of Political Realism, political idealism has its roots in the teachings of Socrates, Plato and latterly Friedrich Hegel of Germany, to name just few such notables.

On the face of it, therefore, there is no getting way from the conclusion that coercive force is the deciding factor in international politics. If this were not so, US President Donald Trump in collaboration with Israeli Rightist Premier Benjamin Natanyahu could not have wielded the ‘big stick’, so to speak, on Iran, killed its Supreme Head of State, terrorized the Iranian public and gone ‘scot-free’. That is, currently, the US’ impunity seems to be limitless.

Moreover, the evidence is that the Western bloc is reuniting in the face of Iran’s threats to stymie the flow of oil from West Asia to the rest of the world. The recent G7 summit witnessed a coming together of the foremost powers of the global North to ensure that the West does not suffer grave negative consequences from any future blocking of western oil supplies.

Meanwhile, Israel is having a ‘free run’ of the Middle East, so to speak, picking out perceived adversarial powers, such as Lebanon, and militarily neutralizing them; once again with impunity. On the other hand, Iran has been bringing under assault, with no questions asked, Gulf states that are seen as allying with the US and Israel. West Asia is facing a compounded crisis and International Law seems to be helplessly silent.

Wittingly or unwittingly, matters at the heart of International Law and peace are being obfuscated by some pro-Trump administration commentators meanwhile. For example, retired US Navy Captain Brent Sadler has cited Article 51 of the UN Charter, which provides for the right to self or collective self-defence of UN member states in the face of armed attacks, as justifying the US sinking of the Iranian vessel (See page 2 of The Island of March 10, 2026). But the Article makes it clear that such measures could be resorted to by UN members only ‘ if an armed attack occurs’ against them and under no other circumstances. But no such thing happened in the incident in question and the US acted under a sheer threat perception.

Clearly, the US has violated the Article through its action and has once again demonstrated its tendency to arbitrarily use military might. The general drift of Sadler’s thinking is that in the face of pressing national priorities, obligations of a state under International Law could be side-stepped. This is a sure recipe for international anarchy because in such a policy environment states could pursue their national interests, irrespective of their merits, disregarding in the process their obligations towards the international community.

Moreover, Article 51 repeatedly reiterates the authority of the UN Security Council and the obligation of those states that act in self-defence to report to the Council and be guided by it. Sadler, therefore, could be said to have cited the Article very selectively, whereas, right along member states’ commitments to the UNSC are stressed.

However, it is beyond doubt that international anarchy has strengthened its grip over the world. While the US set destabilizing precedents after the crumbling of the Cold War that paved the way for the current anarchic situation, Russia further aggravated these degenerative trends through its invasion of Ukraine. Stepping back from anarchy has thus emerged as the prime challenge for the world community.

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