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Midweek Review

Significance of CPC-HIPG MoU



Dec 09, 2017: A jubilant PM Wickremesinghe at the formal handing over of HIP to China. The UNP leader holds a cheque written in favour of the Sri Lanka Ports Authority.


By Shamindra Ferdinando

The Ceylon Petroleum Corporation (CPC), on behalf of Sri Lanka, recently entered into an unprecedented Memorandum of Understanding (MoU) with the Hambantota International Port Group (HIPG) to expand its storage and bulk distribution facilities.

Why did CPC need a MoU with HIPG to go ahead with the project?

The signing of the MoU took place on June 8 at the Energy Ministry with Johnson Liu, CEO of HIPG, and Sumith Wijesinghe, Chairman, CPC, representing the two parties. Energy Minister Udaya Gammanpila was present at the signing ceremony. The MoU dealt with the agreement signed between the CPC and the strategic public-private partnership, involving Sri Lanka and China Merchants Port Holdings (CMPort).

The CPC issued just a picture of the event on the day after the signing of the MoU. According to a statement, comprising nine lines, among those present at the signing, in addition to Minister Gammanpila, were Energy Secretary K.D.R. Olga, Additional Secretary, Chaminda Hettiarachchi, and Managing Director of CPC, Buddhika Madihewa.

Tyron Devotta, on behalf of Public Relations firm, Media 360, handling HIPG, issued a comprehensive statement, on June 14, as regards the MoU finalized on June 8. Veteran journalist and columnist, Devotta, quoted, CEO Johnson Liu as having told the June 8 gathering at the Energy Ministry: “The vision of HIPG is to develop the Hambantota International Port (HIP) to become an energy hub for South Asia. Whilst HIPG has put the infrastructure in place to realize that goal, we are also aware that we cannot achieve it without the participation of all the players in the equation. To this end, we recognize the importance of Ceylon Petroleum Corporation as a vital cog in the machinery. The Hambantota Port is encouraged by this move, by the corporation, and as much as it will support the smooth and efficient supply of fuel to the customer, it will also strengthen the position of this Sri Lankan port on the global maritime map.”

The overall project is also subject to the approval of the Sri Lanka Ports Authority (SLPA) in view of its stake in the Hambantota Port project.

The CPC intends to establish a separate state-of-the-art storage terminal and other required facilities on a 50 acre Mahaweli Authority land, for both domestic and export purposes, connected to the HIP, via a pipeline.

Why did the media receive a separate statement that dealt with the issue at hand, lucidly? Devotta explained why Sri Lanka required far larger storage facilities to ensure energy security. Let me quote

Media 360 release verbatim: “The existing storage facility of CPC/CPSTL is sufficient to store refined petroleum product requirements of the entire country for a period of only one month, a capacity below the requirements of ensuring the energy security of the country. CPC currently imports refined petroleum products to cater to, approximately, 70% of the country’s demand, via the Colombo port, and suburbs. The CPC has identified the need to increase its fuel storage capacity to cater to at least three months’ of the country’s demand.”


Energy sector neglected

Successive governments neglected the energy sector, though all recognized the pivotal importance of ensuring energy security. Even after the successful conclusion of the war, in May 2009, the political leadership lacked the vision to take tangible measures to expand storage and bulk distribution facilities, as well as to set up a new refinery.

Over 12 years after the eradication of the Liberation Tigers of Tamil Eelam (LTTE), measures are being taken to develop HIP as a strategic energy centre but, unfortunately, the port is no longer in Sri Lanka’s hands due to the short-sighted policies of the previous yahapalana regime. The statement issued by Media 360 signified the change in the Hambantota scenario brought on during the previous Sirisena-Wickremesinghe administration. The bottom line is that Sri Lanka energy sector projects et al are subject to HIPG approval. That is the reality.

Having invested USD 974 mn in the HIP, as mentioned in the HIPG website, CMPort owns a strong 85 percent of the shares in it, whereas the SLPA’s stake is 15 per cent. CMPort received HIP’s commanding control in 2017 on a 99-year lease granted by the Government of Sri Lanka (GOSL) to develop, manage and operate the port area. The Sirisena-Wickremesinghe government signed the Hambantota port deal in late July 2017.

The then Ports and Shipping Minister Mahinda Samarasinghe, a confidant of President Maithripala Sirisena, signed the agreement, on behalf of Sri Lanka, after Arjuna Ranatunga gave up the portfolios in opposition to the transaction. Ranatunga, who unsuccessfully contested the last general election on the UNP ticket, told the writer recently he couldn’t have accepted the agreement as it was not fair by Sri Lanka. Samarasinghe now represents the SLPP parliamentary group having entered Parliament from the Kalutara District. At that time, Samarasinghe signed the agreement, he was a National List MP courtesy President Sirisena. The President, in his capacity as the SLFP leader, accommodated Samarasinghe on the National List after he failed to retain his seat.

Ranatunga explained how interested parties brazenly manipulated the whole process to the advantage of those seeking control of the HIP. The recently finalized CPC-HIPG MoU underscored that 99-year lease to HIP actually meant the strategic asset cannot be regained in the gainful life time of any Lankan living now. That is the undeniable unpalatable truth. A government that had secured a five-year mandate at the 2015 general election ended up losing an incomparable strategic asset.

Lawmaker Vasudeva Nanayakkara, during the Sirisena-Wickremesinghe administration, made an abortive bid to halt the handing over of the Hambantota port by way of court action. The Supreme Court, however, dismissed Nanayakkara’s action. Today, Nanayakkara and the SLFP that facilitated the Hambantota transaction are represented in President Gotabaya Rajapaksa’s cabinet.

In the wake of the 2015 change of government, the UNP-led administration adopted an extremely hostile stand Vis-a-Vis China. Having accepted US leadership as well as US-India-Japan-Australia security-political and economic partnership, the Sirisena-Wickremesinghe government engaged in a dangerous game much to the discomfort of the public. But, China managed to outmaneuver forces ranged against it and manipulated rapid developments in post-election period. The finalization of agreement in late July 2017 on HIP is nothing but a strategic achievement for Chinese diplomacy. The then Joint Opposition (JO) now recognized as the Sri Lanka Podujana Peramuna (SLPP) had no option but to keep quiet for obvious reasons. It would be pertinent to mention that following the 2015 defeat, Mahinda Rajapaksa, accompanied by former External Affairs Minister Prof. G.L. Peiris, visited Beijing amidst severe criticism of China-Sri Lanka relationship under the previous Rajapaksa government.


The signing of the MoU between the CPC and HIPG didn’t attract the media attention it deserved. The MoU came into being between Minister Gammanpila’s declaration on June 6 on the proposed new refinery at Sapugaskanda to be built at a cost of USD 3 bn (Rs 6,000 bn) on BOT (Build, Operate and Transfer) basis and his announcement of upward revision of fuel prices on Jun 11. The fuel price hike triggered a political turmoil, with SLPP General Secretary Sagara Kariyawasam, MP, of course, with SLPP founder Basil Rajapaksa’s blessings, demanded Minister Gammanpila’s resignation.

Former Attorney General’s Department employee, Attorney-at-Law Kariyawasam received the backing of the vast majority of the SLPP parliamentary group as he took on a small group of government lawmakers, who declared their support for Gammanpila. The battle caused a dicey situation with some speculating a division among the Rajapaksas as regards not only political strategy but future direction of the party as well. The country is in such economic dire straits with the lockdown alone costing billions to the exchequer daily, the ruling coalition cannot, under any circumstances, pave the way for internal squabbles to cause further deterioration. SLPP General Secretary Kariyawasam found fault with the Energy Minister for the substantial price hike. But, can the Pivithuru Hela Urumaya (PHU) leader be held responsible for waste, corruption, irregularities and negligence over a period of time that resulted in the CPC being in debt to the tune of Rs 652 bn to the Bank of Ceylon and the People’s Bank. Both Minister Gammanpila and the Presidential Media Division (PMD) warned that CPC’s loans amounting to Rs 652 bn and the Ceylon Electricity Board’s Rs 85 bn debt could undermine the banking sector and reminded the crisis the country was in.

Unchecked corruption has weakened the national economy to such a degree over the years, the incumbent government is now facing a massive cash flow crisis as it has literally nothing to fall back on.

Unfortunately, corruption continues, unabatedly. Examination of proceedings of the parliamentary watchdog committee reveal corruption is on the march with the support of those constitutionally empowered to address the issue. Debilitated by corruption, successive governments have pursued a despicable strategy in selling national assets. Trade Minister Bandula Gunawardena shamelessly justified the strategy in Parliament on June 8. What Minister Gunawardena basically said was to sell off whatever assets to bridge the budget deficit. Gunawardena owed the electorate an explanation as to how the country would cope once all assets are disposed of, regardless of the consequences.

The previous yahapalana administration reached consensus with Indian investments on four major projects, namely Mattala airport, East Container Terminal (ECT) of the Colombo port, remaining oil tanks at the Trincomalee oil tank farm, and an LNG power plant in Sampur. The collapse of the UNP-SLFP partnership disrupted Indo-Lanka projects. But, the SLPP, having had discussions with India early this year, decided to go ahead with the ECT project, though strong opposition within compelled the government to drop the idea. The SLPP has accused the Weerawansa-Gammanpila-Vasudeva led alliance of sabotaging the ECT project.


Cocktail of political and financial turmoil

Growing Chinese influence by way of investments et al here should be examined in the context of India-US relationship and the ‘Quad Alliance’, comprising US-India-Japan-Australia ganging up to confront real or imagined threats from fast growing China.

The question is whether India is looking for an unnecessary internecine conflict with China thereby unwittingly doing the bidding of the West. All indications are this is Asia’s century with China being the new world number one and India a close second. As we have said before, if these two clash, the traditional West would only be watching with glee the killing of two birds with one stone.

It would be suicidal for Sri Lanka to get entangled or even to wish for any kind of conflict between India and China, both being nuclear armed powers.

Delhi should also keep in mind that it was not China that lit separatist fires right across India into the late 80s and many of those Indian separatist groups had their rear bases in the traditional West.

These big talkers who now lectures at every opportunity about rules based order, followed no rules when they plundered much of the world often committing genocide to grab other people’s lands and unashamedly enslaved millions of black people in particular.

So why is India, having been a victim of such grave humiliation and plunder, now wants to kiss and forgive the same oppressors?

Imagine if there was no China, the West would have ganged up to prevent India from becoming a superpower

It is granted we shouldn’t ignore India’s current and future security concerns. But as long as the Chinese are for mutual economic benefit why can’t India even enter into lucrative trilateral partnerships here.

However given the built up paranoia in New Delhi, India is unlikely to give up its hold on key sectors. The Indian High Commission reacted decisively and swiftly when Energy Minister Gammanpila declared in Colombo on Feb 17, 2021 that the Trincomalee oil tank farm would come under Sri Lanka’s purview. The declaration was made in the presence of Prime Minister Mahinda Rajapaksa at an event to pay compensation for people affected by development projects undertaken by his Ministry. Minister Gammanpila said that he had been able to conclude talks the previous Sunday with the Indian High Commissioner Gopal Bagley (Gammanpila didn’t mention the HC’s name) regarding the taking over of the Trincomalee oil tank farm. He claimed that the High Commissioner accepted his government proposals in that regard though they weren’t compatible with India’s agreement with the Sirisena-Wickremesinghe administration.

Gammanpila expressed confidence in working with the Lanka IOC to develop Trincomalee facilities.

Responding to a media query on joint development of the Upper Oil Tank Farms in Trincomalee (Gammanpila didn’t make any reference to Upper Oil Tank Farms in Trincomalee), the Spokesperson of the Indian High Commission said: “India and Sri Lanka have identified energy partnership as one of the priority dimensions of their cooperation. India is committed to working together with Sri Lanka for the Island’s energy security. In this context, consultation and discussions have been undertaken to promote mutually beneficial cooperation for development and operation of the Upper Oil Tank Farms in Trincomalee. We look forward to continuing our productive engagement with Sri Lanka in this regard”.

Indian HC Bagley visited Lanka IOC’s Trincomalee oil terminal on March 14, 2021. Bagley, in his first visit there, also inspected a grease plant under construction. Once it started production, it would be able to meet Sri Lanka’s entire demand for grease. Perhaps what is significant is Bagley’s inspection of both Upper and Lower Tank farms in Trincomalee. A statement issued by Lanka IOC said that during the visit to the Upper Tank Farm, the High Commissioner was briefed in detail about the current status and the possibilities regarding its usage and development. The visit was made during HC Bagley’s tour of the Northern and Eastern Provinces

In the wake of the 2019 change of government, the incumbent government sounded the possibility of reviewing the agreement on the HIP. China swiftly ruled out that possibility. Sri Lanka (both the government and the Opposition responsible for the present financial crisis, seems to be wholly inadequate to meet the challenges. Decline in the financial and political situation has been further escalated by the raging global pandemic

Covid-19 has paved the way for predatory moves by interested parties.

The US declaration that Sri Lanka wouldn’t be considered for MCC (Millennium Challenge Corporation) Compact and apparent collapse of SOFA (Status of Forces Agreement), also with the US, do not mean end of those endeavours. Sri Lanka entered into ACSA (Access and Cross Servicing Agreement) in August 2017 with the US though MCC and SOFA failed, perhaps a temporary setback for Washington.

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Midweek Review

Shades of Beddegama in teeming Hong Kong




Even after being closely connected to Hong Kong for 26 years, I am still amazed by the contrasts there. Professionals earn the highest salaries in the world while destitute old women scavenge for cardboard boxes. Tycoons live in the world’s most expensive mansions while the poorest live in tiny subdivided flats. Perhaps the most striking contrast is the crowded urban areas of Central, Kowloon, and Mong Kok, and the deserted villages in the rural parts of the New Territories, where I lived.

Hong Kong is barely 500 square miles, and only half of that is inhabited; the rest is given over to hillsides and country parks. They are seven million tightly packed people. Then, how does one explain deserted villages?


Wong Chuk Yeung

Leonard Woolf’s classic Village in the Jungle, set in colonial Ceylon, narrates the slow decline of a small, isolated village, Beddegama. As the people leave or die out, the jungle gradually covers the crumbling, miserable huts. The last survivor is Punchi Menika. In the final scene, as Punchi Menika lies in her dilapidated hut, a giant wild boar glides in like a mythical devil to gore her. This scene came to mind when, during a hike, I stumbled upon the village of Wong Chuk Yeung. Located about 3 km uphill from the lovely seaside town of Sai Kung, the village lies within a country park, at the end of a narrow, twisting road. On the way up, the road winds through a steep slope on the left and a forest to the right. Uphill, trees press on the road from either side, forming a canopy.

At its first appearance, the village gave the idea of being inhabited, with strands of electricity, street lights, and a functioning water service. The one mailbox overflowed with recently delivered mail, mainly electric and water bills. However, the lichen-covered houses and the trash-strewn, weed-choked alleyways indicated a lack of life. Rice fields and fruit trees long abandoned and overgrown with weeds surrounded the village. Butterflies and dragonflies fluttered. Signs of rooting by wild boars was everywhere, and the fragile barking deer scampered off at my approach. Five-meter long Burmese pythons had been seen nearby. Old graves stood sentinel.

Long ago, the village was occupied by rice and vegetable farmers of the Li clan. They lacked proper roads, schools, electricity, or water service, but this simple life style suited the villagers. Then, imported rice became much cheaper. Rice also became hard to grow because a nearby iron mine caused a drop in the water table. Lacking even public transport, the younger generation preferred the comforts of urban Hong Kong or emigrated to Britain.

The last survivor Since that first encounter, I visited the village, on and off, over a number of years. An elderly man dressed smartly in a jacket and trousers, carrying a rolled-up umbrella, would pass me by on his way to town. I would also see him in town, chatting with people his age or doing a little shopping.

Later, I also noticed a younger man from the village, laboriously pushing his bicycle uphill, laden with plastic shopping bags. He would pause often on the way, squatting on the ground to rest before attempting a further stretch of the steep road. He did not make eye contact or return my greetings.

Then, I stopped seeing the elderly gentleman. He had died. I also learned that his wife used to carry home-made cakes on a shoulder pole for sale in Sai Kung. She had passed away before my time. The younger man, the last survivor of the village, was their son. The family had emigrated to Britain but returned to Hong Kong and to Wong Chuk Yeung for some reason.

As the years went by, the last survivor no longer had his bicycle. Instead, three dogs with matted fur would accompany him all the way to town and back. I would sometimes see him in town, feeding the dogs with scraps of bread, and reading crumpled racing sheets that he may have found in trash cans. At the village, I had noticed a ramshackle house with garbage strewn outside, the dogs loitering at the door barking fiercely at my approach. That’s perhaps where he lived.

Eventually, only one dog was left. For the last survivor, life must have been horrendous. The eerily quiet nights would have been fearsomely lonely, perhaps the ghosts of departed ancestors his only company. Occasionally, a police vehicle would pass me on the way to the village, so they must have been keeping an eye on his safety.

On my way down to Sai Kung town, splendid views of the island-studded bay, a golf course, and of a distant reservoir opened up. Although other hikers appeared on weekends, the road was mainly deserted during weekdays. Domestic helpers walking their employers’ dogs could be seen, but they too become fewer when the heat of summer set in. On some mornings, paragliders would be floating down towards Sai Kung town, adding colour to the clear blue sky.

Driving home from Sai Kung on a blisteringly hot afternoon, I saw the last survivor struggling home and stopped to give him a ride, going out of my way to the village. As my car struggled up the steep climb on first gear, we drove in silence. When he opened the door to get down, I extended my hand and said “George”. He repeated “Georgie” in the Cantonese style that I find so affectionate. Pointing to himself, he said “Li”. He had finally spoken.

Nasty” Developers

The front page banner headline in the South China Morning Post came like a bolt from the blue. Forgotten Wong Chuk Yeung was in the news, with a bang, for illegal deals between developers and villagers domiciled in Britain.


Villagers profit in secret land deals

Indigenous residents sign away small housing rights in exchange for HK$500,000 or a new flat at the site, which helps developers avoid rezoning and premiums

Cheung Chi-faiNov 04, 2011

The article mentioned that the village was 350-years old, and once contained 96 houses. Obviously a substantial village, although I had not seen that many ruins; some crumbling structures may have been covered by weeds, or dissolved into the ground. But, every plot had an owner, and the developers were methodically buying up all the plots.

I had been writing-up my visits to the village on a blogsite, along with photos, and former villagers now in Britain had been reading my entries. In the comments section of the blog, the following message appeared:

Hi George, found your blog and found it fascinating. Great pictures. This is my family’s village, it is a lovely village, though very run down I still like to go and visit it whenever I am in HK – with much sadness all the villagers involved have now signed the papers for the land to be sold off to a development company. Not everyone wanted this but the majority won and it is now in process of exchange. I am extremely sad about this as the land has a lot of history. The buildings, the wildlife (the numerous beautiful butterflies!) in the land all needs to be preserved – Hong Kong needs to preserve old ancestral lands such as Wong Chuk Yeung before it’s too late.

Another villager in Britain, fiercely proud of his heritage, commented that he “will do everything it takes for Wong Chuk Yeung to stay in the Li family name”. He, and the last survivor, Mr. Li, may be what stood between the village and “development” that would erase all traces of a bygone-era.


Last days

I stopped visiting the village, but would see Mr. Li in Sai Kung town, sitting at McDonalds, engrossed in a newspaper that appears to have been salvaged from the garbage. He held the paper very close to his face, which probably meant he was nearsighted. That may have also accounted for his shyness and avoidance of people, because he couldn’t see well.

Over the years, his favourite place in town had been the Hong Kong Jockey Club betting centre. Even in the last days I saw him, he would be squatting on the pavement near the betting centre, carefully reading the racing sheet. He had shirtless, shoeless, the bicycle and the dogs long gone. He was become much scrawnier and unkempt over the years. Even when I said “Hello Mr. Li”, he would not look up or return my greeting.

I left Sai Kung in 2015. Recently, I saw that the following message had been left on my blogsite:

I’m sorry to announce that the lone survivor died at the beginning of this year (2015) and within weeks the developers moved in and put up 10 foot high corrugated hoardings fencing off the land from the public access road. This is a major eyesore and even worse is the bulldozing of the trees and wildlife areas (lush green grasslands that covered former paddy fields that were farmed by the villagers in the 50s and 60s).

I wonder about Mr. Li’s last days. Were they as wretched as Punchi Menika’s in Beddegama? Did he die alone, and discovered days later, or did someone find him before it was too late?

As for Wong Chuk Yeung, I have no wish to return. I prefer to remember it from all those years ago.

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Midweek Review

The trust deficit



Nelum Kuluna: “It’s the folly of such investments that has created the debt problem.”


by Usvatte-aratchi


‘If liberty means anything at all, it means the right to tell people what they do not want to hear.’

George Orwell


When this government was elected to office, there was wild jubilation, almost countrywide. People danced in the streets. But totally unexpectedly that ecstasy lasted a short time. This was no more strongly revealed than when the Cardinal, the leader of the Roman Catholic community in the country, publicly prayed to God that as he and his community could not get justice from secular authority. May God mete out justice to those who destroyed the lives of many members of his community! It was a pitiful cry of desperation (crie de coeur) that touched many people, no matter their religious faith or lack thereof. There were several well-known members of the Bhikkhu Sangha, who spoke most unhappily about the government for betraying the undertakings that had been given to them, when the now government sought election to office. The betrayal was bitter to a large sections of the population when the saubhagyaya (plentifulness), so prominently promised by the winning political party in 2019, turned out to be simply its opposite in 2021. The impending economic austerity, after the yahapalanaya government, glared in the face of all thoughtful people in 2019 but the winning party impressed upon the electorate that the party had worked out strategies and policies that would bring in prosperity which the opponents failed to achieve. The public were not shown the strategies and policies. When something is too good to believe, it is either not genuine or not true. It was sheer stupidity on the part of the electorate to believe that the key to El Dorado was in the hands of one individual or even the few who were on the path of wisdom (viyath maga); perhaps, inevitable given the alternative. It took three serious unexpected disasters to persuade two ministers of the government to explain in Parliament the dire economic situation in the country and their lack of policies to meet those perilous challenges. The first was the invasion of the SARS-CoV-2 infection that came along with tourists. After a promising start, the government floundered helplessly in 2021, failing to use effectively a fine public health structure that had many victories to its credit, including control of malaria, elimination of polio, typhoid and DPT. In mid-2021, the death rate among those infected rose above 1 percent, double that which prevailed in May 2021 and yet better than in most parts of the world. The government could not make use of the work of government servants who had information on the location and the age of people who lived there (Electoral lists in the offices of grama niladhari). The disaster that the Ministry of Shipping cluelessly invited into our seas destroyed not merely the eco system but with it the lives and livelihoods of millions of people, not necessarily only along the coast. The claim by a government minister that deaths on a large scale of sea creatures, both large and small, soon after the shipping disaster, was a regular feature in the stormy season (varakan) was shockingly disingenuous. The government handled both these disasters so incompetently that the electorate lost whatever trust they had about the government’s capacity to govern the country. The ill-timed policy to eliminate the use of synthetic chemicals in agriculture (which itself is not a bad idea in an ideal world) raised the ire of the mass of peasants and farmers and threatened the supply of food in the country and the continued production of tea and rubber. The persistent assertion by the Minister of Agriculture that there was plentiful fertiliser, herbicides and pesticides flew in the face of demonstrations by thousands of cultivators all around the country. Are these protestors true hirelings of fertiliser importers? The threat to import organic fertiliser is fraught with untold dangers, because that fertilizer carries organisms that could be dangerous to human, animal and plant health, here. More directly, that policy openly contradicted the pledges given in the manifesto of the party that fertiliser would be given to peasants free and freely.

In liberal democracies, governance is a matter of trust between the government and the governed. Governments are elected by the people periodically on the basis of manifestoes issued by political parties in which the parties lay out the policies that they would implement, if elected to office. Some unexpected emergencies inevitably arise and the policies they adopt to meet those emergencies must be governed by approaches to policy announced in their manifesto. The governed expect that government has spoken honestly in their manifestoes and would implement them in the people’s interest and not for the pecuniary gains of those that govern. When parties seeking office (not power, as we commonly say) systematically lie to seek election and the voters are either not sharp enough to see through the falsehoods or are swayed by other propaganda, (e.g. finding a small ethnic or religious group in the country whose electoral strength is petty, against whom a political party can whip up a frenzy) governments have a problem retaining the trust of the governed. ‘These leaders might invoke a lost imperial grandeur …. (Rajarata, in our case). They adopt sophisticated propaganda techniques (which may include events of spectacular destruction) in which to demolish adversaries and bolster their own egos… This charisma is leveraged to project an aura of virility that is supposed to protect a helpless citizenry against lawlessness and an endangered nation against the invasive impurities of alien and internal enemies.’ (Ariel Dorfman, 2021.) When lying came to light, the governed lost trust in government.

A fortnight ago, two Ministers who spoke in Parliament to defend the decision of the government to raise the prices of petroleum products (which itself is reasonable) laid out clearly, for the first time, the economic plight of the nation and the impecuniosity of the government. One was the redoubtable Bandula Gunawardana; the other, the lawyer Gammanpila. Later the new Minister of finance, whilst taking office, spoke about the ‘grave situation (bararum thatvaya)’ of the economy and the finances. We wish him well, in a difficult job. Why did it take 21 months for the government to take the people into confidence and explain the dire situation of the economy and the finances when they took over from the yahapalanaya government? There was, then, the added advantage of an escape goat ready for slaughter, a second time.


The government was so keen on standing by their propaganda that the president, soon after taking office, abolished the PAYE scheme, drastically reduced both direct and indirect taxes and renewed his promise to give new employment to hundreds of thousands of university graduates, which promise he fulfilled later under pressure. (The public were told, very late, that tax revenue had fallen sharply in 2020.) Independent observers were taken aback by these decisions which may have been so enthusiastically adopted only by a government, with an economy with strong sinews and a Treasury with bottomless reserves. The public awaited a miracle. They should not have, because the horn of plenty is only a fairy tale for toddlers not economics for adults. In government, one should have ‘soft hearts and hard heads’ and not the other way around, which seems to be partly the problem with the new government.

Now that some members of the government have given expression to the true nature of the economic situation and the financial imbroglio of the government, what about the way out of these predicaments? There was widespread antipathy to the idea of seeking assistance from IMF on account of the eventual necessity to agree to conditions they would lay down to come to the assistance of the economy. The IMF lays down those conditions because it wants to ensure that the objectives it sets out to achieve, require countries to follow those policies. The IMF conditions that the government disapproved of included austerity measures to ensure that the economy has a surplus with which to service debt. (It is the obverse of more resources than we produced when we borrowed from abroad.) There is no escape from seeking such drop in the domestic use of domestical output to pay back debts incurred. In addition, there was an equally widespread objection to seeking assistance from abroad and much enthusiasm for working out our own solutions. These strategies and policies now on display feature the following. There is widespread austerity in the country, fulfilling the first condition that could have been demanded by the IMF. The supply of goods of all kinds has fallen. That scarcity has resulted from many measures that government implemented. The direct reduction of imports is the most visible. Any shopper in a supermarket can observe empty shelves. Fertiliser and agrochemicals are scarce. The Covid epidemic, the shipping disaster and the scarcity of fertiliser and agrochemicals will reduce incomes cutting down total demand and demand for imports. The other means of enforcing austerity is to raise prices to make goods and services beyond the budget of most people. Fortuitously, the fall in employment has reduced levels of income and cut down living conditions. Printing money large scale brought about the rise in prices. Whether the government wished it or not, austerity which IMF would have recommended is here with us. No matter which party formed the government, this austerity was inevitable, not because we borrowed but because we invested foolishly. The public are in austerity. What is absent is a programme to reschedule debt repayment.

Individuals, corporations and governments all borrow and prosper out of debt. The secret is in the uses made of the loan proceedings. Large scale borrowing was resorted to in the years 2010-2015. We had been impoverished by a long drawn out civil war. Borrowing was welcomed by society because there were large scale projects, employment in construction ran high and the rate of economic growth was elevated. By 2015, the rate of growth had come down and the government was voted out of office. Among other reasons, the poor performance of the economy was of major importance. With large investments in the early years which helped raise the growth of the economy, the failure of the investments to raise output (summarily, high incremental capital/output ratios – ICOR) dampened the rate of growth. The failure of investments to earn a return on it was all too clear to see: Hambantota Port still does not make an adequate return; the International Conference Hall lies idle; Mattala airport receives an occasional flight; Nelum Pokuna has a more attractive garden than audiences shouting acclaim for plays on its fine stage; and the Nelum Kuluna stands solitary guard over the Colombo Port City. It is the folly of these investments that created the debt problem, not borrowing itself. Yahapalanaya government failed to realise that unless they explained to the public the dire situation in the country and imposed austerity to pay back the loans, that they would hand over to the successor government a debt burden impossible to bear. That is exactly what has happened. Saubhagya government that succeeded the Yahapalanaya government completely failed to read the economy correctly or imagined that they could hoodwink the public to believe that they had strategies and policies to meet these exigencies. The public evidently took in the latter, hook, line and sinker. That the same strategist who promoted the infrastructure programmes in 2010-2015 was appointed today to manage the economy and that his first project was an infrastructure project is cause for deep concern.

We need to put in place a programme to restructure debt service payments so that the government can manage to avoid a catastrophic further fall in living standards of the people. To agree to reschedule debt repayment, creditors need an organization, in which they have faith, that it will enforce an agreed upon reschedule. Most of the time that organization has been the IMF. Interest rates in international capital markets have begun to rise with widespread fears of incipient inflation in developed countries. The prices of materials like aluminum, copper and rare minerals have been rising for several months. The tendency for interest rates to rise is further strengthened by the initiative of central banks to disgorge their bursting portfolios of financial assets. The cheap credit regime may have come to an end. A reschedule itself may be now more expensive than earlier.

If the government does not wish to use the IMF, they will have to find a substitute. There are no other solutions.

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Midweek Review

From ‘multi-ethnicity’ to multiculturalism



by Susantha Hewa

Being able to speak only one language (monolingualism) is becoming the exception rather than the rule. More and more Sri Lankans whose home language is either Sinhala or Tamil are learning English as their second language (L2). Not many Sinhala speakers or Tamil speakers select each other’s language, namely, Tamil or Sinhala as their L2 for a few obvious reasons.

With due respect to both Sinhala and Tamil, neither of them has the social recognition that English commands in this country. Secondly, being perhaps the widest read and spoken global language, English has a utility value far exceeding that of Sinhala or Tamil, for all those who engage in higher studies, research, preparing for private sector employment, administrative work, translation, journalism and diplomatic service, among others. Many graduates realise at job interviews that a good command of English can often eclipse academic excellence, which has resulted in English becoming a major ingredient in all recipes for gainful ‘employability.’ In short, proficiency in English can be a big bonus for anybody aspiring to move ahead in any chosen path. That monolingualism among Sinhala or Tamil speakers is now appearing to be an anomaly and a deprivation needs little persuasion. However, opinions differ on how early a child should start learning English as his L2 to reap all its benefits. Is early exposure to an L2 harmful? Will it make him culturally rootless?

Let’s take an example from the Sri Lankan context. It’s not news that if a child’s parents spoke two languages, say, Sinhala and Tamil, the child would learn to speak both almost equally fluently provided that they were spoken often enough at home. So quite reasonably, she will have two mother tongues – Sinhala and Tamil, and thus be a bilingual if she were to continue speaking both languages into her adulthood. Alternatively, if only one language was spoken to the exclusion of the other at home she would be monolingual, which could be described as an instance of a lost opportunity given the time and difficulty involved in learning the other language at a later stage. What’s more, the former who acquires both languages simultaneously will have an edge over the latter in more ways than being fluent in two languages.

For instance, she would develop a better empathy with the speakers of either language and an increased awareness of their respective cultures, language being the most pervasive and fluid transmitter of the shared values of a community. Surely, it would be a better option than being excluded from one ethos depending on which of the two languages is to be her home language. Further, the exposure to two cultures would be an excellent opportunity for her to take a balanced view of both and grow up to be more unbiased about each. Such a child is unlikely to be overemotional about one culture and will find herself at home with either community as a grownup. Thirdly, as linguists point out, a bilingual is better adapted than a monolingual to learn a new language. Thus, early bilinguals in general will be more versatile than monolinguals in socialising, language learning and more open-minded about and less susceptible to synthetic divisions based on imagined/self-imposed identities. In other words, multilingualism may significantly bring down the volatility inherent in the so-called “multi-ethnic” societies.

Our longstanding tradition of being moulded by a single culture with only one home language may urge us to cast doubts about the soundness of being multilingual/multicultural from childhood, prompting us to consider it a denial of the right to have firm roots in a single culture. However, those who entertain this view may perhaps be ardent believers of “uniqueness” and “sanctity” of each culture- those who rely on “purity of stock” to be the mainstay of best human behaviour. Just take the above example of the bilingual child. If her Tamil speaking father or Sinhala speaking mother was adamant that only his or her language would be spoken at home wouldn’t it lead to a serious crisis? Can anyone determine with any justification whether mother or father’s decision should carry the day? On what grounds can anyone say that one linguistic/cultural environment is better than or superior to the other? If the parents had saner heads they would let the language mix be a blessing in disguise instead of making it a recipe for disaster. Surely, it would apply with equal validity on the broad canvas of society.

Come to think of it, it is usually our cultural seclusion that makes us feel rootless when we are placed in an unfamiliar social milieu as a grown up, which is more likely than not in the modern world where many cannot afford to stick to one job or place for long. Young children who migrate find it easier to adapt to the new setting than their parents do. As we have seen, children living in multicultural settings don’t seem to suffer any “rootlessness” whatsoever; on the contrary, they are often more confident and skilled in socializing. A bicultural is unlikely to be feeling any more estranged than an amphibian in water. It is often the insularity resulting from our cultural segregation in childhood that seems to prompt us to demonize cultural intermixing as a dangerous dilution, or worse, an out and out contamination of “inherited” values.

As such, linguistic “isolation” in childhood may contribute in no small measure to the emergence and hardening of divisive feelings continually attributed to “ethnicity” – a label which has always proved to be more harmful than useful. If bilingualism or, better still, multilingualism can dilute this unserviceable sense of segregation, why thwart it? Can we think of any instance where humans have run in to a crisis for not knowing who belonged to what “ethnicity?”

However, being a bilingual from the cradle is too good to be true. In most families, children have to be content with one home language, often, Tamil or Sinhala. Thus, to compensate for this customary language seclusion in early childhood, the L2 has to be made available to children as early as possible. As linguists claim, changes in brain plasticity make delayed L2 learning more taxing- the older you get the more laborious it becomes. In the L2 learning continuum, the earlier you start, the closer you are to the natural L1 acquisition process, which gradually shifts from its “acquisition mode” to a more artificial “learning mode” as you age, and the latter is far less effective than the former notwithstanding the extra time and effort it requires. Furthermore, while early acquisition of an L2 tends to be more comprehensive and enriching, late learning is often narrowly focused and inhibited. Many adult learners, for example, a good number of undergraduates grudgingly learn it to fulfill a necessary condition to get their degree certificate and “be employable.”

A child’s growing inhibition towards learning a second language with the passing of years is nowhere more manifest than in universities where students wanting in English language skills are conspicuous in their absence in kaduwa classes. Thus, undoubtedly, the most prudent, scientific and result-oriented approach to teaching English, or any L2 for that matter, is to focus on primary and secondary level students without delaying it until their language learning mechanisms have risen to their, so to speak, “level of incompetence.”

Surely, university entrants aren’t at their best age to contend with English because they are in an age category in which their L2 assimilation mechanism is shifting gear from acquisition to learning. The most affected by this change are those whose medium of instruction happens to be English. Their lack of proficiency in English, which is the result of inadequate exposure to it during their primary and secondary education, makes them pay a heavy price now, at least in three ways. Firstly, it makes them cut kaduwa classes to avoid looking “foolish” in the presence of their more privileged colleagues. It also drastically reduces their grasp of academic lectures, which directly affects their performance at exams, especially, in the first semester. What is most unfair is that in a system in which the first semester grades of the academic subjects determine their eligibility for field selection, those who get lower grades due to their lack of English language skills but with no deficiency in cognitive skills, are often denied of getting into their desired field. This is just one undesirable outcome of prolonged monolingualism, which can be easily avoided by placing more emphasis on early bilingualism.

Therefore, the most prudent, profitable and scientific approach to teaching English as an L2 is to focus on the young students in primary and secondary grades which will ease the pressure exerted on undergraduates who are compelled to mug up English for passing exams and be “employable.” A good command of the English language can help create a level playing for all new entrants. Only a few of them enter university to study English as a subject and all those who learn other subjects – particularly, those who study in the English medium must not be penalized for being deficient in it. After all they belong to the brightest bulbs of our youth. That English is given an excessive importance in higher studies amounts to making those who lack kaduwa pay for the “sins” of a flawed L2 teaching system, which is made absurdly top-heavy to compensate for the lack of sufficient attention given to English in early years.

With so much evidence in support of early bilingualism, ‘better late than never’ policy would only be a good joke when it comes to teaching English as an L2 in our country. In a broader sense, making English accessible to all young students may help reduce the ills of an unproductive and costly “multi-ethnic” system, which should have long been upgraded to a truly multilingual and multicultural system sans “ethnic” fault lines. Bilinguals will outdo monolinguals even if we are forced to learn another language- let it be any language from China to Peru.



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