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Editorial

Reality as a casualty

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Tuesday 27th August, 2024

Election fever is running high, and campaign rhetoric seems to have distracted everyone from the fragile state of the economy. Presidential candidates are all out to outspend and outpromise one another. They have reduced the economic crisis to a mere political slogan and are making various promises.

President Ranil Wickremesinghe has challenged SJB Leader Sajith Premadasa and JVP/NPP Leader Anura Kumara Dissanayake to a debate on the agreement between Sri Lanka and the IMF. The importance of such a debate which will enable the public to evaluate the main presidential candidates in terms of their grasp of economic affairs cannot be overstated. However, the same cannot be said about Wickremesinghe’s offer to arrange for a virtual discussion between the IMF and the presidential candidates. The wisdom of involving the IMF in a debate among the frontrunners in the presidential race stands questioned; the IMF or any other international organisation should not be elevated above its worth, so to speak.

Whoever wins the upcoming presidential election, the IMF programme must go on, not because it offers the best solution to the current economic crisis but because Sri Lanka is left with no viable alternative. In fact, the IMF has stipulated by way of its bailout conditions what Sri Lanka should have done of its own volition years ago. Nobody can go on spending more than what he or she earns, for a long time. The same goes for the countries that mismanage their economies and allow their debts to accumulate beyond sustainability, Sri Lanka being a case in point.

It requires no knowledge of the ‘dismal science’ as such for anyone to realise the vital importance of achieving debt sustainability. President Wickremesinghe has asked other presidential candidates not to make promises that cannot be fulfilled, such as tax cuts. He and his spokespersons insist that it is not possible to revise the agreement between Sri Lanka and the IMF; they consider it a fait accompli. But the President himself has offered to revise taxes and grant the public sector employees salary increases, which will stand in the way of the pursuit of the prescribed revenue goals set by the IMF. Can these two contradictory positions be reconciled?

Meanwhile, the government has indicated its willingness to ease restrictions on vehicle imports. Is this another election promise meant to be broken, or is the government serious about allowing vehicle imports at a time when the country’s forex reserves have to be managed frugally in view of the distressful global economic trends?

All signs are that the Middle East is heading for a full-blown war, with Israel and Hezbollah trading fire. If war breaks out, there will be massive increases in petroleum prices, and sharp drops in remittances from Sri Lankans employed in that part of the world. The war in Ukraine is also very likely to take a turn for the worse; Ukrainian President Volodymyr Zelensky has threatened to target Moscow itself. Whether he is equal to the task he has undertaken may be a moot point, but the fact remains that Russia cannot afford to lose the ongoing war and is bound to unveil new military capabilities in a bid to secure victory, and the US and its allies are likely to try to match them. An escalation of the war between Russia and Ukraine will also take its toll on the Sri Lankan economy.

The US economy is troubled by recession signals, and speculation is rife that the global economy is also likely to shrink. If what is feared comes to pass, countries such as Sri Lanka will be in deep trouble.

It is hoped that all presidential candidates will take cognisance of the economic ground reality here and the emerging global economic trends, which are disconcerting, and act realistically and responsibly. The public must not be misled with false hopes.



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Editorial

Coal giant awakes, but uncertainty prevails

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Saturday 15th February, 2025

The Norochcholai coal-fired power plant, which came to a standstill on Sunday due to an emergency grid shutdown across the country, shuddered back into life yesterday, feeding the starved grid. The Ceylon Electricity Board (CEB) announced that there would be no more power cuts. The public, troubled by planned power outages, which are as problematic as unplanned ones, must have heaved a sigh of relief. However, there is no guarantee that the problems that caused the Norochcholai plant shutdown will not recur, for their root causes have not been eliminated.

Minister Kumara Jayakody, who is in charge of the power sector, blamed Sunday’s countrywide power failure on an unfortunate monkey that caused a short circuit at a grid substation in Panadura by touching a transformer and dying in the process. The CEB said a cascading safety shutdown had led to the Norochcholai plant failure. A group of CEB engineers claimed that a steep increase in the solar power generation and a drop in the demand for power on Sunday had rendered the national grid unstable and caused a countrywide blackout. There are still many monkeys around grid substations, and solar power continues to be generated with the demand for power remaining low on Sunday. So, the possibility of another countrywide power failure occurring tomorrow or later cannot be ruled out.

Opposition Leader Sajith Premadasa, speaking in Parliament, yesterday, asked Minister Jayakody to inform the House whether the CEB would be able to ensure an uninterrupted power supply tomorrow, given the low demand for electricity on Sundays. But Leader of the House and Minister Bimal Ratnayake, true to form, sprang to his feet, insisting that yesterday’s special parliamentary session had been summoned for the Supreme Court determination on the Local Authorities (Special Provisions) Bill to be announced, and therefore the Opposition should stick to the order paper. The Opposition argued that yesterday’s parliamentary sitting had cost the public millions of rupees, and therefore serious problems affecting them had to be discussed in the House. Minister Jayakody however refused to be drawn in. The government members’ protests and/or silence are not going to solve the problems in the power sector.

The CEB should explain why it has not adopted technological solutions to the problems that cause system shutdowns, especially the Norochcholai power plant breakdowns, which lead to scheduled power cuts. What one gathers from views expressed by power sector experts on Sunday’s nationwide blackout is that it is possible to prevent the Norochcholai plant shutdown with the help of a power infrastructure upgrade. Technological solutions are available, they insist. Is it that the CEB has not adopted them because the CEB has to buy power from oil-fired power plants at exorbitant rates when the Norochcholai power station shuts down? The latest Norochcholai plant failure is believed to have cost the country Rs. 1.2 billion extra a day to keep the grid running. Has anyone laughed all the way to the bank?

The CEB’s losses are conveniently passed on to the public. Hence the need for a high-level probe to find out what really caused Sunday’s power failure and the shutdown of the coal-fired power plant, and whether some vested interests undermined the national grid, as claimed in some quarters.

It is also possible that the so-called oil and coal lobbies are trying to discourage solar power production to advance their own interests. This angle of the issue of power failures must not go uninvestigated. Curiously, a claim is being floated that a fire that destroyed a factory in Horana on Thursday had been triggered by a solar panel that caught fire due to the prevailing dry spell and intense heat. Is it also part of the ongoing campaign against power generation from renewable energy sources?

Problems in the power sector are too complex and serious to be tackled in an ad hoc manner. They must be properly identified before remedies are attempted. A thorough, systematic approach is called for. We suggest that a special presidential commission of inquiry be appointed to investigate unresolved issues, allegations of malpractices, etc., in the power sector, which is Sri Lanka’s Augean Stables.

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Editorial

Mini polls finally within sight!

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Friday 14th February, 2025

Speaker Dr. Jagath Wickramaratne is scheduled to announce the Supreme Court (SC) determination on the Local Authorities Elections (Special Provisions) Bill in Parliament, today. He was expected to do so last week, but he stated that he had not received any communication from the apex court, by that time, regarding its determination in question. The Opposition created quite a stir, making various allegations, but the Speaker stood his ground. The rumour mill went into overdrive, alleging that the government was attempting to postpone the LG polls.

The process of ratifying the LG elections Bill will get underway after the Speaker’s much-awaited announcement. It is heartening that the LG authorities will cease to be under Special Commissioners appointed by the Provincial Governors, who report directly to the President. Since 2022, when the LG polls were first postponed, three Presidents, including an unelected one, have effectively run one-man shows by keeping all three tiers of government—Parliament, the Provincial Councils (PCs) and the LG authorities—under their thumbs. They have controlled the PCs and the LG bodies by appointing their cronies as Governors. This anomaly has eroded public trust in the electoral process to a considerable extent.

Elections must not be postponed. All political parties represented in the current Parliament have committed the cardinal political sin of putting off elections or helping governments to do so. In 2017, the UNP-led Yahapalana government presented a Bill to amend the Provincial Council Elections Act to postpone the PC polls, and it was passed unanimously! The JVP backed that administration to the hilt, going so far as to prop it up after the SLFP’s breakaway in October 2018. The SLPP government under President Gotabaya Rajapaksa’s stewardship put off the LG elections in 2022 for fear of suffering a midterm electoral setback. It misused the powers vested in the Minister of Local Government to do so. That administration under Ranil Wickremesinghe’s presidency again postponed the LG polls the following year for the same reason. President Wickremesinghe claimed that funds could not be allocated for elections due to his government’s pecuniary woes.

Now, thanks to an SC intervention, the much-delayed LG polls will have to be held expeditiously. However, there are some legal and political issues that need to be sorted out. The bill seeking to amend the LG laws has to be passed by Parliament for nominations to be called afresh. Some of those who were nominated to contest the LG polls in 2023 have entered Parliament or left the country.

Meanwhile, a group of politicians representing the Opposition yesterday urged the EC to ensure that the upcoming budget debate would not stand in the way of their LG election campaigns. They said the government was planning to use the budget debate to confine the Opposition MPs to Parliament in the run-up to the LG polls. They also asked the EC to refund the deposits made by their candidates who were to contest the LG polls, which were postponed. They told the media afterwards that their parties were cash-strapped unlike the JVP-led NPP, which received as much as Rs. 50 million a month as its MPs’ salaries. One could argue that what the NPP MPs do with their own salaries is their personal business, and should not concern the Opposition.

The Opposition has reportedly requested the EC to hold the LG polls after the traditional New Year in April so that there will be ample time for its MPs to take part in their parties’ election campaigns.

The EC ought to heed the Opposition’s concerns and create a level playing field. It has done commendably well so far, and we believe that it will live up to its reputation.

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Editorial

Groping in the dark

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Thursday 13th February, 2025

Sri Lanka continues to be in the throes of multiple crises because their root causes usually go unaddressed. If the past governments, especially the Gotabaya Rajapaksa administration, had cared to tackle the issue of the country’s national debt becoming unmanageable by taking steps to shore up foreign currency reserves and increasing state revenue substantially, the current economic crisis could have been averted.

A mega crisis has been developing in the power sector for decades, but nobody seems to care. Successive governments have only paid lip service to the pressing need to address it. Sunday’s countrywide power outage has left the government, the Opposition, the Ceylon Electricity Board (CEB) and other stakeholders behaving like the proverbial visually-impaired men who tried to figure out the shape of an elephant by touching different parts of the animal’s anatomy, and came to absurd conclusions. No sooner had the power failure occurred than Minister in charge of the power sector, Kumara Jayakody, declared that a monkey had done it! His claim had the whole world in stitches, with international media giving it much prominence owing to its high entertainment value. It also made one wonder whether Sri Lanka’s national grid was so primitive that it lacked resilience to withstand the shock from a monkey coming into contact with a transformer in a grid substation. Even ferocious Tigers could not shut down the national grid despite all their terror attacks on the country’s power infrastructure.

Senior CEB engineers lost no time in attributing Sunday’s power outage to an increase in solar power generation, which, they said, had rendered the national grid unstable on account of a drop in demand. That sounded a tall tale and betrayed the engineers’ prejudice against power generation from renewable sources. The CEB Technological Engineers Union has rubbished the engineers’ claim; it has said that according to a report prepared by a committee consisting of 35 experts including some of the serving CEB high-rankers, the national grid is capable of accommodating 2,600 MW of power from renewable sources, and solar power production amounts to only 1,400 MW at present. The CEB stands accused of short-changing the solar power producers in a bid to perpetuate the country’s overdependence on lucrative thermal power production. It will be interesting to see what the CEB engineers have to say about the aforesaid expert committee report.

There have been several previous instances where we experienced countrywide power outages that lasted for hours. During the past decade or so, every regime change has been followed by a nationwide power failure. The UNP-led UNF formed the Yahapalana government in 2015 after ousting the Mahinda Rajapaksa administration, and a countrywide blackout occurred in 2016. Grid defects were blamed for the eight-hour power outage, but no action was taken to find out what had really caused it.

The SLPP toppled the Yahapalana administration, and formed a government by winning the 2019 presidential election and the 2020 parliamentary polls; the country experienced a nationwide power failure in 2021. The issue was relegated to the limbo of forgotten things after the restoration of power supply and some half-hearted attempts to identify the causes thereof. Prolonged power cuts came thereafter for want of fuel to generate electricity.

Another countrywide power failure was experienced in 2023 about one year after the ouster of President Rajapaksa and Ranil Wickremesinghe’s fortuitous elevation to the presidency. The latest nationwide power outage has come only a few months after a regime change.

Sunday’s power failure must be thoroughly probed and the causative factors identified as a national priority. It must also be ascertained whether some vested interests deliberately undermined the national grid to advance their own interests. Given the existence of various powerful lobbies, popularly known as Mafias, in Sri Lanka’s power sector, anything is possible.

The government should give serious thought to launching a clean-up of the power sector, which is rotten to the core, under its Clean Sri Lanka initiative.

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