Rightwing economics or centre-left Opposition?
By Dr. DAYAN JAYATILLEKA
The situation is ripe for a progressive, social democratic, centre-left Opposition with necessarily populist appeal, but can there be one if an archaic, conservative, rightist economic theory is propounded as an alternative to the government’s oligarchic crony-capitalism?
How can the main Opposition party become a truly progressive-centrist formation which can be a magnet for voters from the vast bloc that voted for the Rajapaksas/Pohottuwa? What must it do?
The answer to that is clear and simple, and it isn’t mine. Thirty years ago, the UNP held power at the Presidential, Parliamentary and Pradesheeya Sabha levels, i.e., executive, legislative and local authority levels. That was the last time it did so. The leader responsible for that achievement made a typically unorthodox and fascinating remark while addressing his last May Day rally in 1992, at Galle Face, a year before he was assassinated by a Tiger suicide-bomber. Ranasinghe Premadasa made a surprising and pointed reference to SWRD Bandaranaike:
“…The late Prime Minister SWRD Bandaranaike…left the UNP and formed the Sri Lanka Freedom Party because he thought that his views cannot be implemented through the UNP. If one were to take into account the changes that have taken place in the UNP between then and now, I am sure that if he were still alive, he would have rejoined the UNP…When you look at it from that point of view, you will be able to guess which May Day rally he would have attended if he were alive—the rally at Galle Face or the one at Campbell Park.” (President Premadasa: His Vision and Mission, Selected Speeches, p 192)
What Premadasa says here is that SWRD Bandaranaike with the progressive, moderate nationalist, centre-left views (the SLFP’s founding document used the definition ‘social democratic’) he held at the time he ruptured with the UNP because he thought they could not be accommodated, would have felt compelled and comfortable enough to rejoin the UNP because it had been transformed so radically as to be able to accommodate and represent such personalities and perspectives.
Translated into today’s politics, it can be understood as an injunction to the post-UNP successor party (led by Premadasa’s son) to be a party so configured that it can win over the voters and personalities of the progressive centre, the moderate nationalists, by representing their ideology, sentiments and grievances. In short, an Opposition party capable of winning over the centre-left SLFP and SLPP voters; the Rajapaksa voters.
JR-Ranil or Premadasa?
The ongoing and deepening economic crisis is tailor-made for a ‘Premadasist’ intervention, for three reasons:
(a) Globally, the Covid-19 pandemic has been acknowledged as proving the need for more investment in public goods and social infrastructure, rather than rely on the ‘magic of the marketplace’ with its profit motive.
(b) President Premadasa demonstrated that even in a context of extreme crisis, is it practically possible to revive economic growth, increase industrial exports and foreign investment while simultaneously, not sequentially, transferring real income to the poorest, increasing the real wages of the people and reducing inequality.
(c) The Opposition is led by his only son. It would be as absurdly incongruous for an Opposition party, led by President Ranasinghe Premadasa’s son not to adopt the Premadasa development paradigm and policy as it would be someday for an Opposition party led by Namal Rajapaksa, not to have his father Mahinda Rajapaksa’s as symbol, his achievements as template, and Mahinda Chinthanaya as the basis of its guiding ideology.
The problem is that there is an ideological inclination on the part of some in society and Opposition politics, to ignore the Premadasa development model and philosophy, pat him on the back for ‘reforms’, and elevate instead, rightwing economic doctrines. In international terms these are the economic ideas that President George HW Bush (Bush Sr.), a moderate Republican, derided as “voodoo economics”.
The UNP never won a Presidential election, won only two parliamentary elections, 15 years apart, with never a second consecutive term in governmental office, after it dumped the Premadasa development paradigm and shifted to neoliberal economics, or shifted back to the pre-Premadasa economic model which helped cause the Southern uprising.
With its leadership and Presidential candidate who did far better in November 2019 than the party did before (Feb 2018) or since, the post-UNP Opposition is more organically suited for a frankly neo-Premadasist strategy for economic revival and social upliftment, which the current crisis demands.
A slightly surreal slogan was tweeted recently, claiming that “we need JR+Shenoy reform once again”. This relates to the ideas of rightwing economist BR Shenoy who produced a pamphlet in 1966 which was adopted as a policy platform by JR Jayewardene, then a Minister in the Dudley Senanayake Cabinet of 1965-’70.
This policy perspective is wrong headed several times over, starting with the contextual fact that the JR+Shenoy platform was not conceived as alternative to the parental precursor of the current Rajapaksa government’s policies, namely the Sirimavo Bandaranaike-NM Perera policies of the coalition government of 1970-’77.
The JRJ-Shenoy policy doctrine was one corner of an intra-governmental UNP policy debate in the mid-1960s. Today it is being revived at the second corner of a bipolar patterning of policy discourse, i.e., in an unhealthy polarisation.
As a precocious lad who spent time in the editorial offices of Lake House and hung out with my father and his journalist colleagues and buddies, I was quite aware of the Shenoy episode real-time, because BR Shenoy was tapped, and his product promoted, by Esmond Wickremesinghe, the Managing Director of Lake House (and Ranil’s father). That episode was part of a policy debate that rocked the UNP government of Prime Minister Dudley Senanayake in 1965-1970.
Far from being the antipode of the statist closed economy of the Sirimavo regime, the JR+Shenoy (actually JR+Esmond+Shenoy) platform squarely targeted the genuinely liberal-welfarist economics of the PM Dudley Senanayake and his Planning Ministry tzar, Dr Gamini Corea.
It is absurd and dangerous to exalt the JR+BR Shenoy line today, when the logic of the Dudley Senanayake-Gamani Corea response at that time has been tragically validated by our political history: “It is wiser to spend on welfare, than to cut welfare and have to spend much more on military expenditure later.”
As the John Attygalle Report (he was the IGP, but the report was co-authored by D.I.G Ana Seneviratne) on the pre-1971 JVP revealed, and the statements of the accused in the main trial of the Criminal Justice Commission (CJC) confirmed, the movement was founded for armed revolution partly as a response to the ideological struggle within the UNP government. Rohana Wijeweera’s view was that the JR Jayewardene-BR Shenoy project would require the ouster of the Senanayake faction, the installation of an Indonesian style dictatorship, and the scrapping of national elections scheduled for 1970.
This was not as wildly outlandish as it seemed. The Indonesian coup and massacre had taken place in September 1965. Esmond Wickremesinghe and those who backed the JR+Shenoy programme against Senanayake liberal-welfarism, were applauding the post-coup Indonesian economic model. My father Mervyn de Silva had been in Indonesia (with his wife and son) at the invitation of President Sukarno’s Foreign Minister Dr. Subandrio for the celebration by Afro-Asian journalists of the 10th anniversary of the Bandung conference virtually on the eve of the coup. Mervyn was the last foreign journalist to interview DN Aidit, leader of the PKI (the non-violent Indonesian Communist Party) who was murdered by the Army a few months later while in hiding, unarmed. My father was among the few (I’m being generous here) in the Lake House press writing against the Indonesian coup and the massacre of 1965, while “the Indonesian model” was being promoted.
Coiled for armed resistance to a dictatorship which never came at the hands of the UNP Right identified as JRJ and Esmond Wickremesinghe equipped with the BR Shenoy agenda, the JVP uncoiled uncontrollably on the watch of the elected successor government, the SLFP-led UF coalition in 1971.
It is not that today’s JVP or FSP is dabbling in any way with violent resistance or ever likely to, but a worker-peasant-student social movement radicalised by the policies and political culture of the Gotabaya presidency, has grown to almost the same capacity as in the 1960s, and if ‘JR+Shenoy’ economic policies are followed after the Rajapaksa regime is inevitably turfed-out, the social explosion will occur no less inevitably on the watch of the incoming ex-UNP administration.
Today’s Lankan economic neoliberals (who call themselves ‘economic liberals’) target a giant of Third World economic thinking, Raul Prebisch. The bridge to the tradition of Prebisch, and indeed the great Ceylonese contribution to the global economic debate, was not the Sirimavo Bandaranaike-NM Perera regime, but rather, those who had been the targets of JRJ and Shenoy in the policy debate within the UNP of 1965-1970: the liberal-welfarist progressives of the Planning Ministry under Prime Minister Dudley Senanayake, namely Dr. Gamani Corea and his deputy, Godfrey Gunatilleke.
In the 1970s, the Lankan node of ‘Third Worldist’ progressive development thinking was the MARGA Institute, which was targeted by the UF coalition government, especially the rightwing Minister Felix Dias Bandaranaike and the Communist Party.
The Gamani Corea-Godfrey Gunatilleke perspective that JRJ+BR Shenoy (plus Esmond Wickremesinghe) had targeted within the UNP government of 1965-1970 and eventually supplanted, found itself revived, revised and reaccommodated within the economic paradigm of Ranasinghe Premadasa.
Prime Minister Premadasa’s extempore remarks at the panel discussion on the sidelines of the UNGA 1980; his invocation of justice for the global South at the UNGA 1980 and the Nonaligned Conference in Harare 1986, are evidence of his commitment to the international tradition of development thinking which Dr. Gamani Corea was a giant of, but is reviled by today’s para-UNP economic neoliberals. (https://www.unmultimedia.org/avlibrary/asset/2114/2114561/)
It is hardly accidental that the founder-Chairperson of the Institute of Policy Studies (IPS), at its initiation by Finance Minister Ronnie de Mel and through the Premadasa Presidency, was Dr. Gamani Corea rather than an ‘economic libertarian’ or ‘classic economic liberal’.
The formula that ‘we need JR+Shenoy reform once again’ also overlooks the history of the evolution of policy within the UNP in the Opposition in 1970-1973. The Dudley Senanayake line was being eclipsed, the JRJ line was becoming dominant, but a third line was coming into view, which was to be validated by real history when the ‘JR+Shenoy’ paradigm was a causative factor of the civil war in the south.
This ‘third paradigm’ was Ranasinghe Premadasa’s, an early articulation of which was his 4th April 1973 address to the Colombo West Rotary Club. He was so committed to that speech (delivered several years before Susil Sirivardhana joined him) that he republished it in the ‘SAARC Summit special supplement’ of the Daily News during his Presidency, accompanied by an introduction in bold type which read: “The seeds of today’s concepts were sown years ago…President Ranasinghe Premadasa, then First Member of Parliament for Colombo Central was invited by the Colombo West Rotary Club to deliver an address on the topic ‘A Plan for Sri Lanka’ at a luncheon meeting of the Club. The speech was delivered when President Ranasinghe Premadasa was only an Opposition member of Parliament and portrays the vision of a young politician of what he thought was the best for Sri Lanka”.
That he chose to reproduce it in the SAARC special supplement (1991) indicates that this perspective is one he wanted the outside world to know about, and which he hoped to radiate in the region.
In April 1973, he wrestled with the same problem that the economy faces today– the crisis of foreign exchange and dependency—and gave an answer that is distinctively redolent of the Rooseveltian New Deal (his 1988 Presidential election manifesto was to be entitled ‘a New Vision, a New Deal’):
“…If the problems of foreign exchange, development and unemployment are to be satisfactorily tackled, a massive development venture has to be launched to provide the necessary infra-structure such as a network of roads, a network of electricity, a network of irrigation and a network of domestic water supply. With the launching of such a scheme large number of people could be gainfully employed. Together with development of the infrastructure the country’s agricultural and industrial ventures will automatically improve. As a result, foreign exchange could be conserved. People will get more money into their hands thus enabling them to purchase their requirements. The question of subsidies will eventually be eliminated. We can solve our problems. Scarcity of foreign exchange is no obstacle. To earn foreign exchange, we must increase production; to increase production we must develop our national resources, and if we are to develop our national resources, we must harness the human potential that we have in abundance. It is futile to go on bended knees to foreign countries begging for assistance…” (Republished as ‘People’s Participation in Government’, CDN Nov. 21, 1991.)
After the UNP victory of 1977 and the installation of ‘JR+Shenoy reforms’ the evidence of its downside piled up in the 1980s from the reports of various UN agencies which had replaced ‘classical liberal economics’ with indices of inequality, the physical quality of life index (PQLI) and later the Human Development report (HDR), under the intellectual impact of a global struggle for ‘Another Development’ (as it was conceptualized) in which Gamini Corea and Godfrey Gunatilleke were the foremost Sri Lankan figures.
Prime Minister Premadasa appointed the Warnasena Rasaputram Commission. Janasaviya was Premadasa’s response to the revelations of the Rasaputram Report. The hubris of the Open economy and the ‘JR +Shenoy reform’ model had evaporated with the bloody near-extermination of the UNP in the latter half of the 1980s by Sinhala youth from the South (just as Premadasa had predicted).
Open Economy, ‘Economic Democracy’
“If anything, I am for economic democracy” Premadasa told civil service legend Neville Jayaweera in a substantive interview given to the latter published as ‘Charter for Democracy’ (1990). For him, ‘economic democracy’ meant “turning the nation into one where ‘have-nots’ become ‘haves’”.
This was Premadasa’s perspective on the open economy:
“In a world of economic interdependence, those who are self-dependent grow in strength. We live in a world society. We cannot close ourselves off from the world. Yet, we must be free to live and develop as we wish to. We will provide all the conditions for economic growth in an open economy. But an open economy does not mean an economy dictated to by others. An open economy does not mean an economy run for the benefit of others. An open economy must first benefit Sri Lankans before it benefits outsiders.” (‘Address at the Inauguration of the Koggala Export Processing Zone’-June 14th 1991, in ‘President Premadasa: His Vision & Mission-Selected Speeches’, pp 89-92.)
The Premadasa economic philosophy, though partly based on the Open Economy, is not that of ‘JR+BR Shenoy reforms’ of 1977 still less of 1966. It is a different, far more progressive policy paradigm or economic episteme. It is Sri Lankan Social Democracy.
Growing foreign dependency and India’s USD 4 bn lifeline
By Shamindra Ferdinando
The Japanese embassy and UNICEF (United Nations Children’s Fund, previously known as United Nations International Children’s Emergency Fund), on 16 March, 2023, issued a joint statement that dealt with the impact the developing political-economic-social crisis is having on the poor in Sri Lanka.
The statement focused on the suffering of the children and measures taken by UNICEF, in consultation with the Governments of Japan and Sri Lanka, to provide relief to the needy.
However, what really captured public attention was the declaration made by the Japanese Ambassador, in Colombo, Mizukoshi Hideak, that with the latest contribution, amounting to USD 1.8 mn, the total Japanese financial assistance, provided through UNICEF alone, exceeded USD 3.8 mn, since the beginning of last year. That is definitely a significant package provided through a single UN agency, particularly against the backdrop of the unceremonious cancellation of the Japan- funded Light Rail Transit (LRT) project, in late Sept., 2020, by the Gotabaya Rajapaksa Government.
The directive, in this regard, was issued on 21 Sept., 2020, by Dr. P. B. Jayasundera, in his capacity as Secretary to the President, to the then Transport Secretary, Monti Ranatunga. That move ruined Sri Lanka’s relations with Japan.
Whoever advised the then President Gotabaya Rajapaksa to terminate the project, without consulting Japan, as head of the Cabinet-of-Ministers, he couldn’t absolve himself of the responsibility for the ruination of vital relationship with Tokyo. Had it not been the case, Japan, most probably, would have delivered a substantial assistance to Sri Lanka, at the onset of the ongoing unprecedented crisis.
Sri Lanka made a failed bid to secure as much as USD 3.5 bn loan from Japan, during the tenure of Sanjiv Gunasekara as Sri Lanka’s Ambassador in Tokyo. Gunasekara, a close associate of President Gotabaya Rajapaksa, resigned in the wake of the 09 May, 2022, violence, that gave a turbo boost to the campaign against his government.
Unlike Japan, India provided direct aid in various forms to Sri Lanka, struggling to cope up with what became an insurmountable crisis to overcome on our own. India has repeatedly declared that the continuing assistance is in line with Premier Narendra Modi’s much touted ‘Neighbourhood First’ policy. Sri Lanka received concessional credit facility, amounting to USD 1 bn, in March last year. In addition to that, by the second week of March this year, Sri Lanka received other lines of credit, worth over USD 3 bn. Therefore, the total Indian assistance is worth over USD 4 bn, a staggering amount as Sri Lanka’s debt before the Japanese and Indian interventions stood at over USD 53 bn. Indian intervention cannot be compared, under any circumstances, with assistance provided by any other country.
The Indian assistance is of immense importance as the International Monetary Fund (IMF), after much deliberation, promised USD 2.9 bn over a period of four years. The delay on the part of China to provide an assurance as regards debt-restructuring support, hindered the finalization of the tripartite agreement involving Sri Lanka, creditors and IMF. Finally, China gave that assurance, in writing, early this month.
The situation was so precarious, Sri Lanka couldn’t have even provided the free text books that have been given, annually, to the student population ,from the time of the JRJ regime. Those who had been at the helm of political power, over the past three decades, to varying degrees, ruined the economy, and, by 2021/2022, Sri Lanka was unable to provide even the basic requirements, like cooking gas, kerosene, petrol, etc., as even remittances from our expatriate workers, which in the past amounted to about seven billion dollars per year, dropped drastically due to the illegal underground banking system, hawala/undiyal, hijacking much of it from the normal banks. The government didn’t have the means to provide school text books for the 2023 academic year. In consultation with India, of the USD 1 bn concessional credit facility, over USD 10 mn was utilized by the State Printing Corporation, and private importers, to procure printing paper and other material from India. India met 45% (four mn students) of the total requirement. Indian High Commissioner Gopal Baglay visited the SPC, on 09 March, 2023, to dispatch a consignment of textbooks to schools. Education Minister Dr. Susil Premjayantha joined Baglay. The Indian High Commission statement, issued two days later,, was aptly titled ‘India’s support for text books investment in Sri Lanka’s future.’
The government and the Opposition should be ashamed of their failure to provide for the children’s need.
Perhaps, a Parliamentary Select Committee (PSC) should be appointed to examine the circumstances leading to Sri Lanka’s bankruptcy status. Decades of utterly irresponsible management of the economy, coupled with an explosive mixture of causes – waste, corruption and irregularities – caused the current crisis.
Political parties, represented in Parliament, are responsible for the continuing crisis, to varying degrees.
Controversy over ISBs
The Island discussed some of the issues at hand in last week’s midweek piece, headlined ‘All praise for Lanka’s saviours!
What Dr. Coomaraswamy didn’t say was that as the CB Governor, he was also directly responsible for the Yahapalana government borrowing a record USD 12.5 bn from the international bond market, at high interest rates, from private lenders, primarily in the West. So what did that government achieve with such huge borrowings? All that the Yahapalana regime achieved, with all that money, we cannot see, except to lay the foundation for the current debt crisis?
Our comment on the basis of recent claims that the Governor of the Central Bank, Dr. Coomaraswamy (2016-2019), only told one side of the truth, attracted responses from several parties, including the Central Bank.
Consequently, the writer discussed the borrowing of USD 12.5 bn, and related matters, and was told the following: First, it is important to point out that the Governor, Central Bank, has no authority to approve or undertake any borrowing on behalf of the government. The borrowing limit, in any given year, is set by Parliament. Therefore, the government cannot borrow beyond the limit set by Parliament. In addition, all external borrowing has to be approved by the Finance Minister, and the Cabinet of Ministers. The Governor and the CBSL only have an advisory role. On ISBs, they have marketing and issuance as additional responsibilities once the Cabinet approved the transaction.
It is also important to recognize that ISBs are only one channel for external commercial borrowings. Others include short-term SWAPs, foreign term loans/syndicated loans and external flows into government rupee securities. The article dealt with only one instrument, having ignored the switching that was undertaken during 2015-19 to increase the maturity and reduce the cost of foreign borrowing.
As regards the USD 10 bn increase in ISBs outstanding during 2015-19, USD 5 bn of this increase can be attributed to switching away from shorter term (one year or less) and more expensive SWAPs and highly volatile foreign portfolio investment (hot money) in Government rupee securities to longer term (5 and 10 years) and less costly ISBs. SWAPs were reduced from approximately USD 2.5 bn to USD 500 mn.
Volatile and foreign investment in government rupee securities was reduced from USD 3.5 bn to USD 600 mn. In addition, during the course of 2019, a second ISB of USD 2 bn was issued to create a stronger buffer of external reserves to address the inevitable increase in uncertainty going into elections due shortly thereafter. (The money required for 2019 had been raised through an ISB, issued in March 2019.)
So about USD 7 bn of the USD 10 bn increase in the stock of ISBs outstanding, during 2015-19 may be attributed to increasing the stability and reducing the cost of the ISBs outstanding by switching instruments and raising the buffer provided by external reserves prior to a period of uncertainty, associated with elections.
The remaining increase of USD 3 bn may be partly attributed to the fact that borrowing incurred earlier had not resulted in a sufficient increase and/or saving of foreign exchange. Hence money had to be borrowed to repay debt incurred earlier. In fact, Verite Research found that 89 percent of external debt, repaid during 2015-19, could be accounted for by liabilities incurred prior to 2015.
The adverse debt dynamics were recognized and the Medium Term Debt Management Strategy was published in April 2019 to chart the way to sustainability. In addition, the Active Liability Management Act (2018) was introduced to expand the tools available to the CBSL for managing external debt sustainably. The CBSL, as the economic adviser to the Government, also advocated that there should be a primary surplus in the budget and that non-debt creating inflows (such as exports, remittances, tourism proceeds, FDI, inflows into the CSE and government securities) should be increased to enhance the capacity to service debt while supporting the level of imports necessary to achieve the growth potential of the economy.
They also pointed out that only one of the ISBs, issued during 2015-19, has been settled to date. This amounted to USD 500mn. They expressed the view that it is not possible to sustain the argument that servicing ISBs, incurred during 2015-19 ,led to the standstill in debt repayments in April 2023.
Treasury bond scams and tax cuts
Sweeping tax concessions to the rich and reduction of VAT, that had been introduced by President Gotabaya Rajapaksa’s government to encourage business in 2019/2020, escalated the financial crisis, leading to the declaration of the state of bankruptcy, two years later. No one in the Gotabaya Rajapaksa’s cabinet dared to challenge such far reaching tax concessions and VAT reduction.
How the loss of as much as Rs 600 bn in revenue, as alleged by the Opposition ,due to tax concessions and reduction of VAT, contributed to the current crisis, should be examined, also taking into consideration (1) Treasury bond scams perpetrated in Feb, 2015 and March 2016 at a time the CBSL has been under the then Prime Minister Ranil Wickremesinghe, in his capacity as Minister of Policy Planning and Economic Affairs (2) Enactment of new Foreign Exchange Act in 2017 in the wake of Treasury bond scams. Critics say the repealing of time-tested exchange control law that has been in place for decades paved the way for exporters to ‘park’ export proceeds overseas. Of the 225 MPs, 94 voted for the new law whereas 18 voted against. In spite of Justice Minister, Dr. Wijeyadasa Rajapakse, PC, taking up this issue, both in and outside Parliament, remedial measures hasn’t been taken, to date. The Finance Ministry owed an explanation as to how it intended to compel the exporters to bring back export proceeds (3) Continuing public-private sector partnership in corrupt practices, particularly mis-invoicing (under invoicing and over invoicing of imports/exports) (4) Pivithuru Hela Urumaya leader Udaya Gammanpila, MP, has moved the Supreme Court against the Central Bank Bill. The Attorney-at-Law alleged that the new law violated Article 3 and 4 of the Constitution hence needing the approval of the people at a referendum. In addition to Gammanpila, Dr. Gunadasa Amarasekera and Jathika Nidahas Peramuna leader Wimal Weerawansa, too, moved the Supreme Court in terms of the Article 121 against the Bill titled ‘Central Bank of Sri Lanka.’ Former JVP MP Wasantha Samarasinghe, on behalf of the Jathika Jana Balavegaya (JJB), too, moved the Supreme Court in this regard.
A warning from Hanke
The country is in a bind. In spite of the execution of the agreement with the IMF later this month, the situation remains dicey. The absence of economic recovery plan continues to cause further instability.
Therefore, the government and the Opposition should seek a consensus on a national action plan, even if Local Government polls cannot be conducted in late April, regardless of the Supreme Court intervention.
Steve Hanke, Professor of Applied Economics, at Johns Hopkins University, in the USA, recently issued a dire warning to Sri Lanka. Appearing on CNBC’s ‘Squawk Box Asia,’ Prof. Hanke declared Sri Lanka needs institutional reforms in order to achieve long-term debt sustainability.
Referring to Sri Lanka and what was described as emerging markets (Argentina and Montenegro), where he played a key role in establishing new currency regime, former economic advisor to US President Ronald Reagan warned “Unless you change the institutions and the rules of the game, governing these countries, they’re always going to remain in the same … situation that they’ve been in for a long time.”
Prof. Hanke added: “In fact, most of the personalities, involved in Sri Lanka ,at the high level, are exactly the same as they’ve been for years. So nothing has changed.”
In other words, those who have ruined Sri Lanka are spearheading the economic recovery process. The American is spot on. Sri Lanka is in a pathetic situation. Those who had systematically brought Sri Lanka to its knees, by pursuing ill-fated policies, emerged as its saviours. That is the bitter truth. The role of the executive, legislature, and judiciary, needs to be examined. Those who have moved the Supreme Court against the Bill, titled ‘Central Bank of Sri Lanka,’ have quite conveniently forgotten how the Yahapalana government, and Central Bank, twice perpetrated Treasury bond scams. What would have Prof. Hanke said if CNBC raised Treasury bonds scams during ‘Squawk Box Asia.’
If not for Deepa Seneviratne, the then head of Public Debt Department, Governor Arjuna Mahendran’s role couldn’t have been proved. Former Auditor General Gamini Wijesinghe said so at an event organized by the Colombo Municipal Council years ago.
Sri Lanka cannot forget Prof. Hanke’s remark in the CNBC programme. “You have to remember that we have a country that since 1965 has had 16 IMF programmes and they’ve all failed. You get temporary relief in anticipation of a bailout. But in the long run … none of these IMF programmes work.”
It would be pertinent to briefly examine how interested parties brazenly protected perpetrators of the Treasury bond scams.
Having named Mahendran as the Governor, regardless of the opposition from President Maithripala Sirisena, those planning to commit the first daylight robbery of the Central Bank moved Deepa Seneviratne to the Public Debt Department as its head, in spite of her not having had any previous experience in the particular division. It seems they had obviously felt comfortable in having a lady officer there they thought they could manipulate her to suit their need. But Seneviratne turned tables on the bond thieves by putting up a note to register her strong opposition to Mahendran’s move. She should have been rewarded for her fearless stand with at least a national honour if not an international one, even from bodies like the UN, the Transparency International, Amnesty International, etc. But it seems that even these international busy bodies have their own political angles.
It would be of pivotal importance to keep in mind that President Sirisena appointed a Commission of Inquiry (CoI) in January 2017, about 10 months after the second robbery, and two years after the first.
The Commission comprised Justice K.T. Chitrasiri, the late Justice P S Jayawardena and retired Deputy Auditor General V. Kandasamy. Sumathipala Udugamsuriya functioned as its Secretary. CoI issued a devastating report that implicated Perpetual Treasuries Limited (PTL) in the Treasury bond scams.
President Sirisena went to the extent of dissolving Parliament, in June 2015, to prevent the Committee on Public Enterprises (COPE) tabling its report on the first bond scam. SLFP leader Sirisena owes an explanation. Justice Chitrasiri’s CoI didn’t inquire into that aspect. Sri Lanka’s response to waste, corruption, irregularities and mismanagement is baffling. Let me end this piece reminding how the Bar Association of Sri Lanka (BASL) secured a substantial sponsorship from Perpetual Treasuries Limited (PTL) deeply mired in a bond scam, in 2016, for the Law Asia Conference during the tenure of its then President Geoffrey Alagaratnam, PC. The BASL never explained why it obtained PTL sponsorship even after the exposure of Treasury bond scams. That partnership also escaped the CoI. The rest is history.
Knowing what is now happening to the US economy with a string of bank failures and unprecedented bailouts, especially due to hoodoo economics it introduced in recent decades, like repeated quantitative easing (blindly printing trillions of dollars leading many to say the dollar is now only good as toilet paper) that has been practiced to ensure its world hegemony, the whole world might be hit with bank failures and even by a depression worse than the one that befell with the stock market crash of 1929. Already the contagion has spread to Europe with some leading banks there also requiring help.
Washington’s debt now stands at USD 31 trillion and climbing, but our own debt burden is still under USD 55 billion. So if we can get our exporters, who have stashed export earnings abroad, to bring them back, the picture here will not be as scary as it is made out to be. Even Minister Wijeyadasa Rajapakse has said that our export proceeds that have been parked overseas is in the region of USD 55 billion.
Soonwe will start receiving the IMF bailout, but our economic whiz kids have not done anything to plug the massive foreign exchange leak that has been freely draining foreign currency from the country, since the nineties, by way of private foreign exchange dealers who have been allowed to sell foreign exchange to any Tom, Dick and Harry, including drug dealers, to take their sales proceeds out of the country!
We would also like to ask the relevant authorities what they have done to recover monies stashed abroad by Lankans illegally that were exposed in great detail by the likes of Panama Papers and Pandora Papers.
A Miscellany of Thought
N. A. de S. Amaratunga (2022)
A Review by G. H. Peiris
I cannot claim to have the scholarly competence to place under critical scrutiny all items in this collection of writings authored by Professor N. A. de S. Amaratunga, and published in The Island from time to time since the early years of the present century. Accordingly, this ‘review’ is no more than an attempt to convey to a wide readership my gratitude for what I have learnt from Professor Amaratunga’s insights on a series of metaphysical and secular issues that have figured prominently during the recent past in the arena of debate and discussion among our intellectual elite, my appreciation of his rational perceptions and his subtle banter in responding to bizarre elements in our public affairs.
As a brief introduction to the author I should state that Professor Amaratunga’s career record is featured by several decades of distinguished and dedicated service to the University of Peradeniya in teaching, research and clinical work. Acquiring advanced skills in the field of ‘Maxillofacial Surgery’, he has provided physical and psychological relief of life-long impact to thousands of patients. He is also credited to have trained several of his junior colleagues in the Faculty of Dental Science, had has served as its Dean. The offer he received from the Peradeniya University of the Prestigious Award of the ‘Degree of Doctor of Science’ is testimony to his eminence in Sri Lanka’s community of scholars and professionals.
What probably enhances Professor Amaratunga’s status among the intellectual elite of Sri Lanka is the fact that his talents, interests, and concerns have not been confined to professional expertise. He has authored several creative writings in Sinhala which the cognoscenti place at par with the best works of that genre. More relevant than all else to the present ‘commentary’ is his capacity for elucidating the essence of certain complex metaphysical issues – especially those of Buddhist philosophy ‒ with the same clarity of thought seen in his contributions to media forums on current affairs.
In his ‘Introduction’ to the volume Professor Amaratunga makes a categorical statement regarding the paradigmatic guidelines of his ‘thoughts’. They are rendered below in abridged form as follows:
(a) The distinctive elements of our island civilisation are derived from Theravada Buddhism and the Sinhala language.
(b) The leadership of Sri Lanka’s mainstream politics since the termination of British rule in the mid-20th century has continued to be impaired by a cultural duality – on one side of the divide, the ‘alienated’ whose behavioural values and norms bear the imprint of subservience to values prescribed by the ‘West’, and, on the other side, those who treasure our civilisational heritage and understand the needs and aspirations of the majority of our people.
(c) His standpoint is that of an ardent ‘nationalist’, in the sense that he is unequivocally committed to safeguarding and promoting Sri Lanka’s national interests.
On literature, Professor Amaratunga adds that he is inclined towards the need for ‘social relevance’ of the fine arts, and believes that the paradigm of ars gratia artis (‘art for art’s sake’) is inappropriate for Sri Lanka, especially in creative writing.
The ‘miscellany’ of this volume is structured to constitute four ‘Sections’ – titled as: 1. ‘Literature and Culture’; 2. ‘Religion’; 3. ‘Economy’; and 4. ‘Health’. The first two of these ‘Sections’, consist respectively of 25 and 19 essays of unequal length. In these ‘Sections’ the reader could pick out from different points of the temporal sequence in which they are arranged items that constitute a mutually cohesive group from the viewpoint of content. For example, in the first ‘Section’, there are six such items, each serving as a contribution to an ongoing media debate, but when considered as a group would be seen as an invaluable enrichment of understanding on a significant feature of the educational system of the country – such as, say, the impact of the nation-wide ‘Fifth-standard Scholarship Examination’ or ‘The general decline of standards in higher education’. Likewise, in the total of 18 articles in ‘Section’ 2, thirteen items could be considered as a mutually cohesive group of thoughts that illuminates certain vitally significant aspect of Buddha Dhamma and Buddhism as practiced in Sri Lanka.
The forgoing observations do not detract from the intrinsic value of the short contributions referred to. Indeed, in my amateur assessment, in Section 1, the items titled ‘Quality of University Education’, ‘Purpose of the Novel and its Appraisal’, and the twin items titled ‘Darwinian Evolution vs. Intelligent Design’; and in Section 2, ‘Truth in Buddhism and Realism in Literature’, and ‘Mind, Matter and Nirvana in Mahayana and Theravada Buddhism’, are examples of the author’s extraordinary depth of understanding and his skill of disseminating that knowledge in a lucid form.
It is in the 3rd Section of the volume titled ‘Politics’ that the real ‘miscellany’ of Thought is found, consisting of 78 items, and accounting for well over half the total page-length of the volume. Since they have been presented in a chronological order ‒ with the first item published in 2001, and the last in 2021‒ the list of items, at first glance, looks like a total mess which, indeed, is how our politics look. But a closer scrutiny show that all items in this list could be placed in one or another of 6 ‘Sub-Sections’ titled as ‘Ethnic Relations’, ‘Foreign Affairs’, ‘Electoral Politics’, ‘Development Plans and Projects’, and ‘Constitutional Issues’, with the chronology of the list providing the vicissitudinous background of each contribution which Professor Amaratunga has made, and each discussion or debate in which he has participated.
Once again I should emphasise that foregoing observation does not imply that the ‘Thoughts’ in this section, read individually, are either uninteresting or irrelevant to our present concerns. On the contrary they offer ideal readings both as reminders of the volatile scenarios we have passed though during the past two decades as well as the unshakable faith our politicians appear to have on the widespread dementia among the voter-population and on their own ability to hoodwink the electorate. Professor Amaratunga’s thoughts could re-kindle fading memories, especially on repeated failures to fulfil campaign pledges, the large-scale losses due to financial malpractices, the allegations of ‘war-crimes’ and of ‘violation of human rights’ in the counter-attack by the major powers of the North Atlantic alliance in retaliation to Sri Lanka’s close relations with the People’s Republic of China, the ingredients of success in the US-sponsored ‘regime change’ effort culminating in the establishment in 2015 of a puppet government in Colombo, the betrayal of our national interests by our own self-seeking representatives at the protracted Geneva inquisitions, the constitutional fiasco of August 2018, the euphoric Gotabhaya victory about a year thereafter, and then, the stunning exposure by the pandemic of the fundamental weakness of our dependent economy.
In the 4th Section of the volume titled ‘Health’, most of the items are devoted to diverse experiences witnessed globally and in Sri Lanka during the Covid-19 pandemic, but in an unconventional manner in the sense that they emphasise significant aspects that have not received adequate attention in the analytical writings on the pandemic. In my view the most significant issue highlighted in this section is the need for Sri Lanka to adopt development strategies towards self-reliance, especially in the availability of medicinal drugs and on food-security. Implicit in several items of this section is a forewarning of the risks entailed in the pursuit of development policies that enhance Sri Lanka’s macroeconomic dependence on the major global and regional powers.
Many items in this miscellany of thoughts contain a prominent element of dissent and disagreement with other participants in the media debates and discussion for which The Island has served as a major forum. But that dissent has all along been featured by a laudable sense of “civilised intelligence”. As a professional whose skills have an intense demand, his interests and concerns have not remained confined to his professional expertise – a feature often seen among other ‘specialists’ including those of the university community.
This volume is, first of all, a demonstration of intense and well-informed concern on a wide range of issues of vital importance to Sri Lanka. Had that quality been more widespread it is unlikely that those earning six-figure incomes would threaten collective action to bring the economy to a standstill to express their dissatisfaction on a relatively marginal erosion of monthly emoluments at a time of unprecedented national crisis, attempting to conceal their avarice with a façade of safeguarding democracy, or eliminating public corruption, or on grounds of their capacity to earn higher incomes outside Sri Lanka.
Yet another exemplary feature I discern in this ‘Miscellany of Thoughts’ is that its contents are not angry knee-jerk reactions when provoked by thoughts different to his own. Professor Amaratunga’s dissent is entirely free of the crude clashes often seen in the so-called social media. Nor are his thoughts based on a hurried consumption of internet ‘short-eats’. In his thoughts that extend beyond brief corrective interjections of ‘common sense’, what we see is an extraordinary depth of knowledge acquired through serious reading and a thorough understanding of the issues on which he had focused.
Loneliness of the Bottom Half
By Lynn Ockersz
There you crouch by your hearth,
Seeing your fires sputtering out;
Your hopes of a bubbly pot of rice,
Ending in inflationary smoke spirals,
Leaving you with the painful thought,
That your dignity as mother and wife,
Is gravely harmed and beyond repair,
For, a turn of events not of your making,
Has reduced you and yours to penury,
So much for that Trickle-down Theory,
That Pundits say will end your misery,
But they tell you not to stop dreaming,
Because soon you will be bailed out,
Of your State of longsuffering;
Thanks to Princely tips from ancient Italy.
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