In the past year, we repeatedly urged the government and Central Bank against holding the dollar at Rs. 200, as it benefitted neither the Government nor the people of this country. Excessive money printing undermined the credibility of the US dollar peg at Rs. 200, as a result vital foreign exchange began to flow through unofficial channels. Inward remittances particularly witnessed a drop of 62% in January 2021 compared to the year before. In the last seven months alone, remittances have reduced by approximately $2.5 billion. Dollar peg and laws such as 25% forced conversions of profits pushed exporters, of both goods and services, to keep their profits overseas. Consequently, the Central Bank has ‘burned’ at least $1.5 billion to defend the peg at 200, thus we can deduce that the Government has made a staggering loss of $4 billion due to detrimental political decision making on the economy.
Central Bank Governor Nivard Cabraal has decided to increase interest rates by 1% and devalue the dollar to Rs. 230. However, it should be noted that this is not a depreciation of the rupee, instead a devaluation to a rate decided by political forces. Thus, we immediately warned that this is not sustainable, as it is not the rate determined by the market. Nonetheless, this morning we learned that the Cabinet has decided to give an additional Rs. 38 to each dollar for remittances, but it is not clear if this additional Rs. 38 is to the previous pegged rate of Rs. 202 or the rate fixed last night for Rs. 230 by the Central Bank. In the case that it is for the previous pegged rate of Rs. 202, it means that they would be offering Rs. 240 to the dollar. It is a complete muddle, as no one knows whether the rate is Rs. 230 as stated by the Central Bank or Rs. 240 decided by the Finance Minister, as a result foreign exchange markets have all frozen today. All government policy directives have been blunders thus far, when will they listen to expert advice? Either they float the currency and let the market decide the rate or they initiate a consistent and sustainable policy direction.
Moreover, the Government ought to understand that increasing the interest rate by only 1% is purely insufficient to defend the rupee at Rs. 230 or Rs. 240. Economic theory demonstrates that it is impossible to implement a stabilisation programme with a mere 1% increase. Both the devaluation and increase of interest rates have to go hand in hand. Take for example; the 1% increase of policy interest rates to 7.5%, while the inflation stands at 17% is insufficient because there is still a massive 9.5% difference. It is impossible to stabilise the economy with a negative 10% interest rate, one change without the other is actually impeding sustainable change. Additionally, it should be noted that other individuals have tried implementing a dual rate but it has not worked, thus I urge the Government to devalue the rupee to a rate much closer to the blackmarket rate. We as a responsible Opposition have repeatedly stated our views and suggestions to the Government over the past two years, however they went unheard. These policy blunders have cost the Sri Lankan taxpayers dearly approximately $4 billion!
The Central Bank Governor reiterated his firm stance, the day before yesterday, that he will not devalue the rupee, it was nevertheless decided to devalue the rupee last night following a phone conversation between Jaikshanar and Basil Rajapaksa. Furthermore, the current devaluation is solely to please the Indians in order for the Finance Minister Basil Rajapaksa to secure a visit, as devaluation was a precondition for the meeting. We would not be in this current crisis if we had devalued the rupee sooner consequently, we are in the midst of the biggest forex crisis that independent Sri Lanka has ever faced due to egotistic, uncoordinated and short-term policy making by the incompetent Rajapaksa government.
Dr. Harsha de Silva, MP
Our long-forgotten friend can help mitigate impact of fuel shortage
The importance of the bicycle as a mode of transportation is seemingly re-emerging in Sri Lanka. This sudden drive is mainly attributable to the ongoing economic crisis the country is faced with. The forex crisis, together with ever increasing fuel prices, has made the Sri Lankans remember their long-forgotten friend––the bicycle.
We see more and more people taking to cycling today for their daily activities out of desperation more than anything else. However, this trend needs to be encouraged not only for its economic benefits but also for its health, environmental, social (and many other) advantages.
The benefits of promoting cycling
– The economics of transportation has become a major woe. The main energy source used today in transportation in Sri Lanka is fossil fuel. This amounts to 2,081 Mn USD (or 64 % of the total fuel cost of the country) a year. In terms of percentage spending of the total foreign imports, this amounts to a whopping 10.3 %. (Source: Kumarage AS, Repositioning Sri Lanka’s Transport and Logistics Sector to lead the Economic Recovery in Sri Lanka, Organization of Professionals’ Association Journal, April 2022). By promoting the use of bicycles, we can expect to reduce a sizable amount of this colossal expenditure.
Cycling is also known to be conducive to the small-scale trader, as he comes in contact with the cyclists more often than the motorists. Thus, cycling will positively influence the small-scale economy of the country as well.
– A number of studies have shown that cycling reduces the risk of non-communicable diseases (NCDs) such as Acute Myocardial Infarction, Coronary Heart Disease, Cerebro Vascular Disease, Type 2 Diabetes, stress and many psychological diseases. Cycling, while improving the overall health of the people, will also reduce the healthcare costs, appreciably in the long term.
– Increased use of fossil fuels for transportation has in turn become one of the leading causes of environmental pollution, global warming and climate change, the world over, three of the major calamities the world has come to be plagued with today. By cycling we can reduce air pollution by reducing the noxious gases, such as carbon oxides, nitrogen oxides, sulphur dioxide, benzene and particulate matter. It also reduces noise pollution, and helps in mitigating global warming and climate change.
– Cycling is also known to promote social interactions among people by encouraging networking and collaborations between them. This will influence the social health of the community positively.
The activities proposed
– The programme to promote cycling should be implemented, as a pilot project, with the participation of the state sector employees in some selected districts. Depending on the success thereof, it could be extended to the other sectors and districts.
1. As the first step towards promoting cycling nationwide, we propose that it be promoted among the state employees as their main mode of travel (to work). In this regard, we propose that they be paid an incentive in keeping with the distance they cover.
2. Bicycles could also be used by those who live far away from their workplace; they can cycle to the main bus or railway station. In both these situations, the cyclists should be paid accordingly.
3. Cyclists should be provided with facilities for bathing and changing at workplaces.
4. The government should take all measures aimed at making travel, safe and hassle free for cyclists. New laws should be made for this purpose, if necessary.
5. To lessen traffic congestion and increase safety of the cyclists, one-way traffic for the motorists in parallel roads should be encouraged wherever possible.
6. Cyclists should be provided with facilities to purchase bicycles, spare parts and accessories at discount rates.
7. Encourage production of bicycles, spare parts and accessories in Sri Lanka. Promote bicycle repair services countrywide.
8. Plant and maintain trees on the roadside for the benefit of cyclists. This will also help reduce air pollution and ambient temperature.
9. Liaise with major cycling associations in the world like the World Cycling Association, the Dutch Cycling Embassy, etc, in order to update knowledge and skills relating to promoting cycling in the country.
10. In keeping with the principle of “polluter pays” a dedicated tax could be imposed on motor vehicles, and the revenue therefrom used to promote cycling.
Dr. PRASANNA COORAY
Consumers & Customers Union
Catastrophe that has hit Ukraine
The coup, or revolution, in Ukraine in 2014, as a result of the Maidan Square uprising, enabled extremist forces to take control of Ukraine. Many of them have Fascist ideology even to this day. In 1945, Russia had chased the German Nazis back to Berlin at a terrible cost in Russian lives. Now, people with this same mentality have taken power in Kiev with the devilish help of the American CIA – and they are hostile to Russians in Russia and even Russian-speaking Ukrainians, who number about a third of the total population of 60 million Ukrainians.
This minority of Russian-speaking people are mostly located towards the East of the country, with many centred in the towns and cities known as the Donbas. These people did not want to be subjected to Nazi, Fascist unpleasant treatment, so they agitated to be independent. They formed their own militias, men from the army defected and brought weapons from the army! The army and the militias fought each other to a standstill. In response, the Ukrainian army-built lines of trenches and other defences along the Donbas, especially near towns with important or vital industries.
Over time, relations deteriorated and the army started indiscriminately shelling the Donbas – they were killing their own people! This tragedy occurred for a period of eight years. About 14,000 civilians were killed by illegal random fire. No reporting on this in the “morally correct” west, and this story was ignored. Fascist thugs made Mariupol steelworks their headquarters in the Donbas. Early this year, 2022, the Ukrainian army was seen massing nearby for a full-scale attack on the rebels of the Donbas. Around 200, 000 of the best fighting men of all the Ukrainian army were to be used to finally crush the Russian-speaking rebels of the Donbas.
At the same time, the US was gearing up to take some land in the Donbas area – possibly in Crimea. The US considered Ukraine as their backyard, and they wanted to control the Black Sea and pin down Russian access to the sea – more devilish ideas to undermine and weaken Russia!
Russian ‘Special Military Operation
But Russia was watching, and on 24 February, it launched its ‘Special Military Operation’ to counter the hostile actions in the Donbas. The first thing they did was to destroy all the ground radars, rendering the Ukrainian air force incapable of targeting accurately. Then came a great parade of propaganda and lies about Russian failures and losses, all fictions and distortions which were untrue, but were misleading to those without access to the facts. President Putin had so many ailments he alone could fill a hospital! All fiction. The west’s propaganda war is a remarkable feature of this military excursion.
At the outset of the Special Military Operation there were many similarities between the Russian and Ukrainian forces, and their equipment. But there were some glaring differences, too.
Russian forces were full time, professional soldiers, well trained in the specific tasks they were responsible for: they were a fully professional, competent army operating advanced equipment. They had high-tech equipment and knew how to handle it and use it to its fullest, to its best.
Each aircraft, battle tank, drone or radar station carries electronic equipment. This creates a node forming part of a computer network which exchanges information. The information fed into this network is processed by powerful computers. The result is that the targeting of enemy positions is exact, resulting in highly efficient warfare. It is efficient, not least because the Russian army wants to avoid targeting civilians. In the Donbas, all the people were related kinsfolk, being Russian speakers.
This required much caution in targeting, as the Ukrainian army was hiding among the civilians. The Russian army was obliged to advance slowly, so as to do as little damage as possible. This targeting efficiency also had the benefit of using ammunition economically. It was a progressive, brutal de-militarization of the Ukrainian army in Donbas using the combined military forces of Russia.
No-body knows when peace will arrive in Ukraine. It seems likely that, after going to all this effort, Russia will continue on and conquer the port of Odessa, and may even continue onwards to link up with Transnistria.
Note that this death and destruction could all have been avoided if Ukraine had implemented the Minsk Accords. They acted in bad faith and now suffer the consequences of that dishonesty.
Wild speculations are made in the West about the dangers of nuclear war. But these generals, colonels and western elites should know, as a matter of personal professional pride, that the official “Russian Military Doctrine” spells out in sections 26 and 27 the criteria for the use of nuclear weapons. This will happen only when outside actions pose an existential (real) threat to Russia. Russia will react with Nukes either: if Russia is hit by a nuclear explosion or if an army invades and approaches the centre, say, Moscow.
A Professional Army using High–tech Equipment:
For this success, Russian soldiers had to be well educated in maths and physics, and because of the extreme complexity of modern war, they must have a serious attitude. They had to know all about military science: operational art and planning, informational nodes, and net centric warfare. The Russian army engages in reconnaissance, intelligence gathering, surveillance, and targeting. Radar can give targeting information in 23 seconds, requiring defence alertness and readiness.
It is unlikely the Ukrainian army is so well educated and trained. Firing indiscriminately on the Donbas and killing people and the use of prohibited cassette munitions as seen on world news sites, does indicate a lack of discipline. This unprofessionalism has cost them dearly.
The Ukrainian army gives losses at approximately: 20,000 killed, 64,000 missing in action, and perhaps 30,000 men wounded. Russians give about: 5,000 men in special Russian holding camps and 2,500 men in Donbas holding camps.
Legal experts in Russia, and Donbas experts, are, even now sifting through all the cases of the detained men. Normal soldiers will be given trials and sentencing for any wrongdoing, but those with a background of supporting Fascism will be shipped to Siberia for further investigation. One of the stated aims of the Russian establishment is to de-Nazify the Ukrainian army.
The Role of Education in Development of a Country
: Throughout their lives Russian children get much more science, physics and mathematics (STEM) than schools in the west. The standard set by the best Russian college entrance examinations is high, putting the American schools and colleges in the shade. There are no multiple-choice questions, answers are either right or wrong. These best Russian schools are attended by many bright, thirsty minds, each waiting to drink up the education offered.
This careful selection and development of bright scientific minds has enabled Russia to develop really advanced weapons and rockets, way ahead of the USA. For example, it launched the orbiting Sputnik into space well before the Americans. This act alone sent the US administration into a panic. They, in response, developed the high altitude U2 spy plane to go and see what the Russians were up to! Recently, because the US Shuttle was out of service, Russia was providing the Americans with a shuttle service to the international space station. A group of young engineers, all under 30 years, designed the SU 57, a highly successful fighter. Russia has designed and successfully tested hypersonic weapons – which the USA is struggling to catch up with.
In truth, the main war between East and West is being played out at the school desk, and Russia is winning!
See Larry Johnson’s film on YouTube – in English
Save us from our govt.!
When watching daily news bulletins, on several local TV channels, one could observe two significant matters.
One is how Gotabaya Rajapaksa shamelessly meets foreign diplomats and officers of international organizations, who are well aware of the grave situation of the country, and also the prime reason for it.
Remember, as kids, how we hide from our parents, or teachers, when some small mistake happens – that is because we were ashamed, and afraid of punishment. And ther, too, it would have been only our own mistake, not by the whole family of ours!
Next is how the Police and armed forces are let loose on the men, women and children who have been waiting in queues for hours or days. The authorities are not finding ways to stop queuing or at least maintain some order at those places, but chastise the people, for electing as Basil Rajapaksa had said, a stupid, clueless president and an incompetent government.
The greatest disasters we have faced since Independence are the JVP insurrection, the LTTE war and the tsunami in 2004, and during those times the people were protected by then governments; now Sri Lankans have to struggle against the government, which is steadily throttling them to death.
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