Tuesday 21st March, 2023

Sri Lanka finds itself in a distressingly unprecedented and unenviable situation. All three tiers of government—Parliament, the Provincial Councils and the local government institutions—are now under the Executive President indefinitely thanks to the postponement of the Provincial Council and local government elections. President Ranil Wickremesinghe is the head of government and therefore has Parliament under his direct control. The Provincial Governors appointed by the President exercise control over the Provincial Councils as well as the public officials under whom the local government (LG) institutions are to be placed.

The separation of powers has become a thing of the past to all intents and purposes. Although his party, the UNP, has only one parliamentary seat, President Wickremesinghe has the legislature under his thumb because he is now constitutionally empowered to dissolve Parliament at a time of his choosing. He can leverage this power, if he so desires, to enhance his bargaining power vis-à-vis the SLPP, upon which he is dependent for legislative support. He spends more time in Parliament than all his predecessors did while holding the presidency, and even tells the Opposition MPs to shut up and sit down when they express dissenting views! Thus, he imposes his will on the legislature!

The Rajapaksa-Wickremesinghe government, which bankrupted the economy, has turned the country’s economic woes to its advantage; it is all out to avoid a crushing electoral setback by refusing funds for the LG polls. President Wickremesinghe has rendered the Election Commission toothless by blocking funds for elections. His action has caused a severe erosion of public faith in the electoral process.

Worse, the government is now in overdrive to tame the judiciary! Some MPs are reportedly planning to question judges!

Having taken exception to a recent Supreme Court interim order that public officials refrain from blocking the release of budgetary allocations for the EC, the government claims that the judiciary has caused a breach of parliamentary privileges! There is no reason for the ruling party grandees to see red; the SC has only asked the Secretary to the Finance Ministry and others to carry out what the government has undertaken to do in Budget 2023, in respect of the EC. Having made an issue out of a non-issue, the government has decided to have it probed by a parliamentary committee. Will anyone in authority care to reveal the educational qualifications of the MPs who are to be tasked with questioning the judges and, more importantly, whether there are court cases against any of those worthies? Judges must not be insulted in this manner!

In 2017, the UNP put off the PC polls by amending the PC Elections Act in the most despicable manner with the help of the SLFP, the JVP, the SLMC and the TNA; it stuffed the amendment bill with a slew of sections sans judicial sanction at the committee stage, and secured its passage amidst protests from the then ‘Joint Opposition’ bigwigs, who have now thrown in their lot with President Wickremesinghe and are endorsing all his actions, including his refusal to make funds available for elections on some flimsy pretext.

What is unfolding on the political front reminds us of an Aesopian fable. A camel happens to move its bowels while walking along a babbling brook downstream, and sees its dung racing past it; puzzled, it wonders how on earth what should be behind it is going ahead of it. The learned judges facing the prospect of having to suffer indignities at the hands of a bunch of political dregs must be in a similar dilemma. But they can rest assured that all right-thinking people are on their side. One can only hope that the people’s struggle to exercise their franchise and knock the lowest of the low in politics off their perches will receive a judicial boost.

The police and the military are busy doing full-time political work. Senior police officers seeking promotions and political generals receiving gallantry medals in peacetime are hell-bent on cracking down on pro-democracy protests to humour the powers that be. Unidentified persons in military uniform, armed with assault rifles and iron rods, operate alongside the army and the police to crush anti-government protests. Both the army and the police have categorically said these characters are not their personnel? If so, who are they? Are they mercenaries? It is a non-bailable criminal offence for anyone to carry firearms without permission from the defence authorities. Why haven’t the police arrested those armed men? The Opposition must flog this issue aggressively in Parliament and elsewhere. But it is all at sea and too impotent to take on the government the way it should to safeguard the interests of the public. It floats like a bee and stings like a butterfly, so to speak! The country certainly can do without such a feckless Opposition, which however is an invaluable asset to any dictatorial regime.

How could it be denied that we are witnessing the rise of the Sri Lankan version of the Third Reich?

Monday 20th March, 2023

The US and its allies are in seventh heaven over the International Criminal Court (ICC) arrest warrant for their bete noire, Russian President Vladimir Putin, for the alleged deportation of Ukrainian children. The US lost no time in welcoming the ICC warrant, and so did Ukraine. Russia has sought to pooh-pooh the ICC move and called it ‘outrageous and unacceptable’. The ICC action and the reactions of the US-led western bloc, Russia and Ukraine thereto reek of partiality and duplicity.

There are allegations that thousands of Ukrainian children are being unlawfully sent to Russia, and such despicable acts no doubt amount to war crimes, which must not go unpunished. So, there is no way Russia could make light of them. But these allegations must be properly probed and the veracity thereof established before arrest warrants are issued. The ICC seems to have been in a mighty hurry to initiate action against the Russian leader, presumably at the behest of the western bloc; it has thereby left itself wide open to criticism.

Ukrainian President Volodymyr Zelensky has welcomed the ICC warrant as ‘historic’ and called upon the world to take action against the Russian leader. He ought to realise that he has also blundered by antagonising Russia, and providing Putin with a casus belli. He should have known better than to allow the US and other NATO members to use him as a cat’s paw to further their geostrategic interests vis-à-vis Russia, at the expense of Ukraine. True, Russia’s military response to the ‘Ukrainian threat’ has been disproportionate, but the blame for what has befallen Ukraine should be apportioned to Zelensky, the US and its NATO allies as well.

There have been numerous instances where the US also reacted, just like Russia, to threats to its security; it has invaded countries and killed thousands of people besides engineering military coups to dislodge democratically-elected foreign governments and install dictatorships.

Zelensky is receiving military assistance from the US, the UK, etc., and they also make him feel important by inviting him to address their parliaments, but he should not lose sight of the fact that it is his people who are dying and his country runs the risk of being left in the lurch like other nations that sided with the US in the past. It requires vision and experience for a leader to navigate the so-called big power rivalry, which has become the order of the day.

Interestingly, ICC Chief Prosecutor Karim Khan has said, in a media interview, that the message from Friday’s warrant “must be that basic principles of humanity bind everybody. Nobody should feel they have a free pass. Nobody should feel they can enact with abandon. And definitely nobody should feel they can act and commit genocide or crimes against humanity or war crimes with impunity.” Really? Has the ICC acted in a similar manner in respect of the US and its allies? Will it explain why it did not issue arrest warrants for US President George W. Bush and British Prime Minister Tony Blair over hundreds of thousands of civilian deaths in Iraq due to an illegal war waged on the basis of falsified intelligence reports?

There has been irrefutable evidence that the Iraq war and sanctions caused many deaths. Madeleine Albright, who became the Secretary of State, herself admitted this fact. When the CBS channel, in an interview with her, pointed out that half a million Iraqi children had died due to the war and sanctions and asked her whether the price was worth it, she promptly said, “I think that is a very hard choice, but the price, we think, is worth it.” Strangely, no action was taken against either President George H. W. Bush or his son, President George W. Bush, for the war crimes in Iraq. And, President Joe Biden has welcomed the ICC arrest warrant for Putin, and taken moral high ground!

The ICC took no action against Tony Blair as well despite the Chilcot report on the Iraq war. It trotted out some lame excuses. The report, which is a damning indictment of Blair, has basically said, among other things, that there was no imminent threat from Saddam Hussein; the UK intelligence furnished ‘flawed information’ and Blair exaggerated the case for the war.

Sadly, the ICC has failed to resist pressure from some western powers and remain impartial. This, however, does not mean that what Russia is accused of doing in Ukraine should go uninvestigated. Allegations against it must be probed but in a credible manner. However, the so-called world order is governed by Rafferty’s rules or no rules at all, and the big powers do not have to worry about the consequences of their actions. There’s the rub.

All indications are that the executive board of the International Monetary Fund will sign off tomorrow on the $2.9 billion bailout package its staff worked out with Sri Lanka in September. President Ranil Wickremesinghe can no doubt claim credit for clinching a deal on which work began at the height of the island’s economic crisis.

Ministers and government politicians are already trumpeting the impending success. They see it as a way out of the unprecedented financial crisis precipitated by their own SLPP administration. There is no argument that the country was pushed into bankruptcy following the foolish tax and agricultural policies of Gotabaya Rajapaksa who, together with the country, paid a high price for his folly.

With all that murky water under the Kelani bridge, the real question is whether nine tranches of $300 million spread over 48 months can revive Sri Lanka’s economy and deliver the reliefs promised by Ranil Wickremesinghe.

No sooner the Executive board signs off on the bail out, the IMF is likely to release its first tranche. That may appear like loose change in the scheme of international finance – the bailout of Credit Suisse last week was reportedly $53.7 billion, about two thirds of Sri Lanka’s GDP.

Media Minister Bandula Gunawardana is on record saying that it is not the amount of the bailout, but the signal that Sri Lanka’s economy is now under IMF supervision that will give confidence to lenders and potential investors. Some of the currently frozen bilateral funding, especially from Japan, could be made available, but will any private capital rush in where prudent investors fear to tread? Will creditors who bought into Sri Lanka’s oft repeated boast that it had never defaulted on its foreign obligations think of putting their money in Sri Lanka after the unprecedented sovereign default of April 2022? At the time, Sri Lanka’s external debt was $46 billion according to revised government figures.

The IMF deal was based on the strict understanding that Sri Lanka’s creditors agree to restructure the debt in such a way it will fit into the “Debt Substantiability Analysis” carried out by the Washington-based lender of last resort. What does this really mean? How much of a haircut will bilateral lenders agree to? Will the private creditors, also known as the International Sovereign Bond (ISB) holders, agree to the same terms? Out of Sri Lanka’s foreign debt, more than 50 percent is owned by private creditors.

It is common knowledge by now that getting the IMF bailout was held up for months mainly because of a delay in securing “financial assurances” from China which accounts for 52 percent of Sri Lanka’s bilateral credit. Whether one likes it or not, China can still make or break the deal.

Those who believe in a quick recovery after the expected good news from the IMF tomorrow would do well to realize that it’s a long way to Tipperary. The “financial assurances” must now be negotiated, and actual numbers established. How much Sri Lanka can pay back in the next four years? President Wickremesinghe in his candid statement to parliament on March 7 made it clear that Sri Lanka on its own does not have the capacity to payback 6.0 to 7.0 billion dollars annually till the end of 2029.

As a leader with little or no political base, except the fickle support of the SLPP, can Wickremesinghe steer the course? Sri Lanka has had 16 programs (aka bailouts) from the IMF since 1965. Sri Lanka’s track record with the Fund is not inspiring. Apart from being a repeat offender, Sri Lanka has completed only nine out of the 16 programs. In the early days, not drawing down the funds allocated to the island could have been taken as a good sign – an indication that the country was able to get out of the woods even ahead of schedule.

But the last program in 2016 clearly underlined the policy instability that has plagued the country. The program was almost on track when Gotabaya Rajapaksa jettisoned the IMF without completing it. Gotabaya Rajapaksa can also take credit for pushing the country to the abyss by spurning the concessionary credit of Japan and scuttling the multi-billion-dollar Light Rail Transit (LRT) project. A minimum $1.5 billion investment he spurned with another $480 million grant from the Millennium Challenge Corporation (MCC) of the United States.

By the end of next year, Sri Lanka will have to face a presidential election and the outcome of that will decide if the country has the courage to keep up the reforms. Even before that, trade union pressure will test the government’s resolve to remain with the IMF deal. Wickremesinghe can also call a parliamentary election anytime of his choosing if he wants to test the public mood which doesn’t appear to favour him or his governing partner the SLPP.

Austerity is never popular but demonstrating that the rulers are also leading frugal lifestyles is necessary to win public confidence. This is woefully lacking. Those who think that an IMF bailout alone will be a quick fix to all Sri Lanka’s economic woes must think again.