Tuesday 15th March, 2022
Matilda may have told dreadful lies that made ‘one gasp and stretch one’s eyes’, but her lies, or what has been said of them, to be exact, pale into childish prattle in comparison to what Sri Lankan politicians tell the public, especially when they seek votes and face trouble after being ensconced in power.
It is only natural that Sri Lankans tend to believe the very obverse of what ruling party politicians and their propaganda lackeys tell them. The President’s Media Division announced, the other day, that power cuts would be over after a few days; people did not buy into its claim, and stocked up on candles! The Ceylon Electricity Board (CEB) went ahead with load shedding, and the hapless public continues to be troubled by power cuts. Several moons ago, Trade Minister Bandula Gunawardena vowed to make rice freely available at affordable prices, but rice prices have since gone through the roof.
All shortages that plague the country boil down to one thing—lack of dollars. If the government could find enough dollars to pay for essential imports, nothing would be in short supply, and queues at fuel stations, gas sales points, etc., would be over. The dollar crisis has become the elephant in the room where government politicians are concerned because the Finance Ministry, which is responsible for the current economic mess, is under Basil Rajapaksa, who is the power behind the throne. Ministers have chosen to bark up the wrong tree, and tell lies with a short lifespan lest they should incur the wrath of the powers that be and lose their portfolios.
Minister of Power Pavithra Wanniarachchi would have us believe that the existing power crisis has come about because the CEB’s generation capacity is low. Nothing could be further from the truth. Former Power and Energy Minister Champika Ranawaka has recently told Parliament that the CEB could generate 4,887MW of electricity a day while the daily demand for power does not exceed 2,700MW and, therefore, the CEB’s generation capacity has nothing to do with the current power crisis. He insists that the power crisis is due to lack of foreign exchange to pay for fuel imports to feed the thermal power plants. Ranawaka, an electrical engineer, has thus put his finger on the actual reason for the power crisis. Energy Minister Gamini Lokuge is also wary of telling the public the truth. His predecessor, Udaya Gammanpila, revealed the truth and got under the skins of the SLPP leaders in the process. He did not know what hit him; he lost his ministerial portfolio.
Minister Lokuge has declared that the fuel crisis will be over soon. Last week, he said the Ceylon Petroleum Corporation (CPC) would not increase fuel prices. The following day, the Lanka IOC jacked up prices; two days later the CPC matched the LIOC prices! When he was the Power Minister, Lokuge said there would be no power cuts!
Prime Minister Mahinda Rajapaksa has claimed that there is no fuel shortage. If so, tens of thousands of people must be waiting in long queues near filling stations for the fun of it! Chief Government Whip and Highway Minister Johnston Fernando has gone a step further; he says some sinister elements are conspiring against the government and spreading false rumours of a fuel shortage! The less said about him, the better; he is troubled by bats in his belfry if his behaviour in Parliament is any indication.
The discerning public is aware of the real causes of the present crises, which could have been averted. If the government had refrained from effecting huge tax cuts for the benefit of big businesses, mostly its cronies, and cared to rationalise pandemic-related expenditure instead of throwing money around, the rupee crisis would not have arisen. The situation further deteriorated following the unveiling of a massive relief package, which has benefited mostly state employees; the ill-conceived relief measures cost the state coffers as much as Rs. 229 billion! The government could have used these funds to cushion the fuel price hike shocks by reducing taxes on diesel, petrol and kerosene. The government has not cracked down on the foreign currency black market, which has been thriving at the expense of the banking system, depriving the state coffers of much-needed dollars. It also got its priorities mixed up and chose to spend colossal amounts of funds on development projects whose expenditure has a sizeable foreign exchange component. Road development is a case in point. If nonessential imports had been restricted when the first signs of the forex crisis were felt, the outflow of dollars could have been curtailed greatly.
Matilda’s story has a tragic end. Our skilled liars are going places, having lied their way into office, but at the rate public anger is welling up, their fate is very likely to be far worse than death—nothing could be more dreadful and hurtful to politicians than to be relegated to the political dustbin.
The India – Canada spat
Opinion will surely be divided on whether Foreign Minister Ali Sabry should have waded into the ongoing spat between India and Canada on the assassination of a Sikh Canadian citizen allegedly by Indian agents according to Canadian Prime Minister Justin Trudeau. Sabry got a lot of media play in India characterizing Trudeau’s statement to Parliament as “outrageous.” Colombo, of course, continues to smart under the Canadian PM’s recent remarks about “genocide” in this country which Sabry says “everybody knows” did not happen. No wonder then our minister thought it fit to tell an Indian television station that “sometimes Prime Minister Trudeau comes out with outrageous and unsubstantiated allegations.”
Given India’s generosity to Sri Lanka during the ongoing economic crisis ,Colombo would surely like to score brownie points in New Delhi. This despite clear knowledge that free lunches are not part of global international relations and the need to steer clear of rivalries between India and China in big power contests. Sri Lanka professes non-alignment and is even now grappling with issues arising from an upcoming port call by a second Chinese research ship about which Indian and U.S. concerns have been expressed.
In such situations it makes sense in not resorting to the tit for tat reactions of the kind displayed by both Ottawa and New Delhi over the Hardeep Singh Nijjar assassination. Many would regard Minister Ali Sabry’s remarks on the India – China row as partly reflective of Colombo’s resentment of genocide and pro-LTTE references emanating from Canada.
Lankans, of course, are well aware that pro-LTTE rhetoric is part of domestic politics in Canada. Some 200,000 Sri Lankan Tamils, comprising about 0.7 percent of the total Canadian population live in that country. These numbers are sufficient to make a difference between the two major parties at elections and much of the Canadian political discourse reflects that factor.
Similarly, Sikhs are also a significant segment of the Canadian population with the highest population of Sikhs outside their home state of Punjab living in that country. According to the 2021 census, 770,000 Sikhs live in Canada and they would therefore be a more influential factor than Sri Lanka Tamils in Canadian domestic politics. Hence the various statements tilted towards these communities emanating from Canada.
Good relations with India must always be a cornerstone of Sri Lanka’s foreign policy. Such relations sank to abysmal depths during the civil war when India allowed the separatist LTTE to train and stage from Indian territory much to Sri Lanka’s detriment. The war would have probably ended long before it actually did in 2009 if Operation Vadamarachi was not aborted by India’s incursion into Sri Lanka’s air space and the infamous parippu airdrop.
The Indo – Lanka Accord and the arrival of the Indian Peace Keeping Force (IPKF) followed. Today it can be said that relations between us and our giant neighbour have never been better. True there are reservations that Big Brother is taking economic advantage of Sri Lanka’s current predicament but these are issues that must be sensibly navigated.
It must be noted that Prime Minister Trudeau did not claim ironclad evidence on the assassination of the Sikh activist in British Columbia. He merely said there were “credible allegations” (emphasis ours) on that score. Whether hard evidence could ever be unearthed on this matter is an open question. There have been media reports of early signs that both Canada and India, after the initial sound and fury, are resorting to quiet diplomacy to resolve their differences. That would be in the interest of both countries as well as the wider world.
There have also been reports that intercepts of diplomatic communications from the Indian High Commission in Ottawa possibly by the ‘Five Eyes’ intelligence grouping between Australia, Canada, New Zealand, United Kingdom and the U.S., had a role in Trudeau’s allegations. However that be, the Canadian premier would not have got out on a limb with his allegation, rightly or wrongly, if he was not convinced that he was on terra firma.
End of IMF review mission
Despite the polite noises made at its closing press conference, there appears to have been no agreement yet between the Government of Sri Lanka and the IMF review mission which concluded its two weeks-long visit on Wednesday. There was no word on when the disbursement of the second tranche of the deal would begin. There is no way that the IMF board will disburse the next tranche until the staff level agreement is concluded.
The closing statement reported “remarkable resilience” of the Sri Lankan people in the face of enormous challenges and “commendable progress” in implementing much needed reforms. While reporting a string of achievements it said that “discussions are ongoing” and the authorities are making progress on their revenue mobilization targets and anti-corruption efforts. But there was no word that a desired staff level agreement has been reached or when the funds will be released.
Two weeks ago when the review began, then acting Finance Minister Ranjit Siyambalapitiya said he was “very hopeful of getting the second tranche of $330 million” from the IMF. But obviously there is more ground to cover and the funds are not likely to be available in the short term. The Financial Times in Britain reported on Thursday that Sri Lanka has failed “to reach agreement to unlock the IMF bailout tranche” and “the delay threatens to slow the country’s recovery from the worst economic crisis in its history.”
Saturday 30th September, 2023
The government and the Opposition may be at daggers drawn, but they do see eye to eye on matters that are mutually beneficial to them, such as the MPs’ perks and privileges, which they jealously guard. Such concord and coadjuvancy, however, are conspicuous by their absence where issues that affect the national interest are concerned. Not even the country’s worst-ever crisis has prompted them to make peace and put their shoulders to the wheel jointly to drag the nation out of economic morass of their own making.
The Opposition has gleefully declared that the IMF bailout programme is dead in the water. It would have the public believe that the IMF delegation, which was here for a review of their programme, left unsatisfied with the government’s revenue shortfall, and the next tranche of the lender’s extended fund facility is not likely to be unlocked. Acting Finance Minister Shehan Semasinghe has denied the Opposition’s claim, insisting that the next installment of the IMF loan will be released soon, after some issues are hashed out with the IMF headquarters.
The Opposition seems to be deriving some perverse pleasure from the fact that the IMF has not announced the release of the second tranche of its loan immediately after the conclusion of the review meeting. It is bashing the government for the revenue shortfall, which the IMF has frowned on.
Taxes and tariffs have already been increased exponentially so much so that many professionals have left the country in a huff never to return; the Ceylon Electricity Board is reported to have asked the Public Utilities Commission’s nod for another price hike. How does the Opposition think the government could increase the state revenue further?
The Opposition insists that it will be able to resolve the economic crisis in next to no time when it forms a government. In other words, it will not reveal what it claims to be its secret formula for economic recovery until such time, regardless of the woes of the hapless public.
Elections are not likely to be held until the latter part of next year, and the Opposition cannot topple the government by parliamentary means anytime soon. Supposing its claim of being able to turn the economy around is true, then one can accuse it of cruelly perpetuating the suffering of the public to advance its political agenda.
The government ought to explain why it has failed to meet its revenue targets in spite of the unbearable economic burden it has heaped on the public by way of unprecedented tax and tariff hikes, which have brought about significant increase in the state revenue, compared to 2022.
This situation may be due to defects in the tax collection process, and the government’s failure to curtail its expenditure and prevent waste, losses caused by corruption and the mismanagement of public resources. If action is taken to sort them out, among other things, it may be possible to turn the economy around sooner than expected.
The Opposition, for its part, ought to keep a watchful eye on the economic recovery process while keeping pressure on the government to ensure frugal management of public resources and make a serious effort to curtail waste and corruption. Regrettably, instead of acting as an alternative government and facilitating economic recovery for the sake of the public, the Opposition has chosen to settle old political scores with some government leaders, bellow rhetoric and cry wolf ad nauseam. It claims that the government has failed, but the question is whether it has not.
The brainless and brain drain
Friday 29th September, 2023
The Rajapaksa-Wickremesinghe government continues to be at loggerheads with irate professionals, who are demanding solutions to their problems. Many of them have already left the country never to return thanks to the government’s callous disregard for their grievances.
University teachers staged a protest in Colombo the other day in a bid to jolt the government into addressing the various issues that affect the education sector, but it is doubtful whether they succeeded in their endeavour. Instead of heeding the voice of the educated Sri Lankans on the warpath, the government has chosen to unleash its propaganda hounds on them.
One of the main issues that drive resentful professionals to street protests is the unbearable personal taxes. They have made it abundantly clear that they are not refusing to pay taxes; they are only demanding some relief, given the unexpected circumstances that have left them struggling to make ends meet. They are also demanding that the country’s tax revenue be properly utilised.
The government does not care to curtail the waste of state resources, as can be seen from the sheer number of politicians and officials junketing overseas at the expense of the public. Why should millions of dollars be spent on their pleasure trips which are made out to be official visits? The Health Ministry has become a metaphor for corruption, but the government continues to defend the Health Minister and corrupt officials. The same goes for all other ministries.
The government is sure to use the IMF’s recent statement that Sri Lanka’s tax revenue is very low to justify its refusal to grant any relief to the protesting professionals. But if it streamlines tax collection, it may be able to increase its tax revenue without squeezing the fixed-income earners dry.
Parliament has reportedly decided to take up the multi-faceted problem of brain drain for debate––at last. The fact that it has not already had an extensive discussion on brain drain, much less striven to find a solution thereto, is proof of the appallingly low priority it has assigned to this vital issue, which will have a bearing on the country’s future.
Regrettably, some government members do not seem to have realised the gravity of brain drain. If their unintelligent utterances in Parliament are anything to go by, they are labouring under the misconception that the exodus of Sri Lankan professionals is not something bad; they have said it will help boost the country’s inward remittances! They have mistakenly equated the mass emigration of the country’s best brains for good with the migration of unskilled workers. Figuring out the gravity of a problem is half the battle in finding a solution.
The worst that can happen to a country is for its educated youth to think they have no future at home, for their disillusionment manifests itself in brain drain, reduced innovation and socio-political unrest. True, brain drain is a global phenomenon that affects all countries to varying degrees, but it becomes a crisis when it assumes exodus proportions, as has been Sri Lanka’s experience. The ever-increasing human capital flight, which has adversely impacted all sectors here, is bound to make the task of resolving the country’s economic crisis even more uphill.
The task of having a comprehensive debate on so complex an issue as brain drain, with emphasis on its causes, consequences and a potential solution, requires brains.
What the so-called people’s representatives on both sides of the House, maintained with public funds, ought to do is to have a decent debate on the issue, confess collectively to having ruined the economy, show some remorse for their wrongful actions and dereliction of duty, resolve to avoid their past mistakes and make a concerted effort to sort out the economy.
If they are going to play the blame game once again, resort to slanging matches replete with invectives and raw filth, and drag one another’s names through the mud, as they often do, they might as well forget about the debate they are scheduled to have on brain drain.
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