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WHY THE GOVERNMENT SHOULD HAVE HONOURED THE MOC ON THE EAST CONTAINER TERMINAL

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by Sanjeewa Jayaweera

The announcement that the Sri Lanka Port Authority (SLPA) will be the sole owner and operator of the East Container Terminal at the Colombo Port has been greeted by many as a tremendous victory for the country. Leading up to the announcement, we were inundated by news reports as to why we should not be selling a national asset to a foreign party and that the country’s sovereignty and even security was at stake. This despite 80 per cent of ports worldwide been developed and operated as joint ventures involving foreign investors. Two of the existing terminals at the Colombo port are operated with the involvement of foreign investors, and as shown later in this article, they contribute handsomely to the overall profitability of SLPA.

The unionized employees attached to the Jaya Terminal (JCT) were at the forefront of the agitation, egged on by the Janatha Vimukthi Peramuna (JVP), a few cabinet ministers and Buddhist monks and some sections of the media. The trade unions used their favourite tactic of threatening industrial action if the government did not give a written undertaking that the ECT would be 100% owned and operated by the SLPA.

In the middle of all this, the Indian High Commission in Colombo released a press statement stating that the Government of India expected an expeditious implementation of the trilateral Memorandum of Cooperation (MOC) signed in May 2019 and that the commitment of the Government of Sri Lanka (GOSL) with regard to the ECT has been conveyed several times in the recent past, including at leadership level. They drew attention to the fact that the Sri Lanka cabinet also decided three months ago to implement the project with foreign investors. By any reckoning, it was a pretty forthright statement.

By staying that a commitment has been made at leadership level, they confirmed that our President and Prime Minister had assured them that the project will go ahead. It is not unheard of for governments to go back on undertakings given. However, in this instance, it seems that the GOSL has gone back on repeated assurances and as recently as a few days, weeks and months ago. It is a poor reflection on our country and in particular those who govern it. For most, it will appear as if the GOSL caved in to the demands of the trade unions and various other interested parties. Naturally, questions will be posed as to whether government to government agreements can be rescinded due to mob pressure.

GOSL is keen to attract Foreign Direct Investments (FDI) to Sri Lanka, and there is no doubt that the country’s development needs lots of it. Even hardline Communist countries like China and Vietnam have actively sought and obtained FDI. They have created the necessary environment for foreigners to invest in their countries. Unfortunately, in Sri Lanka, as is the case in most other issues, we only pay lip service to attract FDI. Corruption, bureaucratic inefficiency, lethargy, archaic labour laws and misplaced nationalistic idealism try their best to dissuade those who wish to invest their capital in our country. That is why we have stagnated for over 70 years. There is no doubt that the actions of both the Yahapalana and the current government has seriously impacted our country’s image regarding FDI.

The misinformation perpetuated by those opposing the trilateral MOC was disingenuous. The project proposal was to grant a lease of 35 years to the parties who would invest and operate the ECT. It was to be on a Built Operate Transfer (BOT) model. The land was never going to be sold, as stated by some. This was totally incorrect. In most countries, a lease of 99 years, as granted for the Hambantota port, is understood to be freehold and can be deemed a sale. However, to repeatedly state on various forums that the country is selling its national assets was dishonest.

It was envisaged that SLPA would own 51% of the project. It is fair to assume that the Adani group would have sought the participation of a local company who owned a minimum of 15% of the project. This would have meant that the SLPA and the Sri Lankan company together would have owned 66% of the project. So, I am at a loss to understand as to how people could say that Sri Lanka was selling a national asset.

The development of the ECT would require an investment of around US $ 650 million. This is equivalent to Rs. 130 Billion. The SLPA had already spent approximately US $ 80 million, developing a 400-meter finger berth and some backup yard space. The question is, who is going to fund the balance of US $ 570 Million (Rs. 114 Billion)? Certainly, SLPA on its own, does not have the financial capacity. I presume it will be the GOSL. According to the Annual Report (AR) of the SLPA for the year ended 31st December 2018 (FY 2018), there is an existing debt due to GOSL of Rs. 60 billion. Obviously, the SLPA can borrow part of the money as debt in all probability under a GOSL guarantee. Some amount of this debt would need to be dollars. They would certainly need to pay a premium interest rate given the negative credit rating of the country. In FY 2018 the SLPA provided Rs. 11.3 billion as an expense to the income statement as foreign exchange losses. This reflects the exposure to existing foreign currency debt. One can only imagine what it would be in the future with further depreciation of the Sri Lankan rupee and additional dollar debt.

It is evident to any sensible person that in the context of the current economic and financial crises that our country is facing, we do not need any additional financial commitments. This is especially so when capital is readily available from local and foreign entities. The GOSL need to invest in education, health, and many other vital areas. In my view, this itself is a good enough reason to allow foreign investors who would have brought much needed foreign currency to the country.

Secondly, in addition to capital, foreign investors would bring superior technology and best practices along with a good marketing plan that would attract the bigger shipping lines. Additionally, management would be in the hands of professionals with proven skills and capabilities in the maritime industry. A recent discussion highlighted the complete transformation of Sri Lanka Telecom (SLT) once it was privatized and a Japanese investor took over the management. I should know, because in 1993 when I built a house and applied for a telephone connection, I was told that the waiting period was two years! Given that transhipment volumes account for about 80% of the Colombo port’s business, most of which is to India, an Indian investor’s presence would undoubtedly enhance and ensure the ECT’s success.

Thirdly we know that the JCT terminal operated by the SLPA is inefficient and the profit generated is not commensurate to the revenue. According to the Annual Report (AR) for FY 2018 of SLPA, Rs. 8 billion was received for the year from the two privately managed terminals as Lease rentals, Royalties and Dividend Income. This is income from just being the “Landlord” and a 15% investor in these two terminals. I understand that various other revenue streams are generated and received from the two terminals. So it seems that just being a “Landlord” and a minority shareholder is far more profitable for the SLPA, GOSL and obviously for the citizens of this country than SLPA undertaking the entire investment and operation of the ECT terminal. According to the AR 2018, the Return on Capital of SLPA is only 2%.

The current Chairman of the SLPA, General Daya Ratnayake, in a television talk show said that there are 10,000 employees at the JCT terminal when the actual requirement is only 3,000! In my opinion, this too is excessive. The two privately owned terminals handle more than twice the volumes handled by SLPA at the JCT terminal with a staff cadre less than 3,000. A reflection of efficiency and productivity! It is a fact that many politicians of both parties have used the SLPA as a convenient source of employment for their supporters. Their wages and various other perks will make most public servants, and even those in the private sector cry in frustration. Even 40 years ago, I remembered stories of how some port workers would get a friend to sign their attendance while they were doing another job or sleeping at home!

According to AR 2018 the overall salaries, wages, allowances and other related staff costs at the Colombo port is around Rs. 20 billion paid to 8,948 employees. An average cost of Rs. 2.2 million per employee. The Rs. 20 billion includes an overtime cost of Rs. 3.6 billion despite being significantly overstaffed! I presume a reflection of poor work norms? No wonder the unions were agitating.

Unfortunately, this is how state enterprises work and the reason for their sorry state. Only a handful of state enterprises make money. The losses posted by the Ceylon Electricity Board, Ceylon Petroleum Corporation, SriLankan Airlines and the National Water Board are staggering. The fact of the matter is that ordinary citizens are funding these losses through both direct and indirect taxes. It is generally acknowledged that governments must not involve themselves in running businesses because of their lack of entrepreneurial skills. Into that equation when you add rampant corruption and nepotism, we have an ideal recipe for failure!

Fourthly, whether we like it or not, keeping India happy is essential. She is the regional power under whose umbrella we take refuge. Long gone are the days when Mrs Sirima Bandaranaike masterfully navigated our foreign policy to remain non-aligned. To her eternal credit, she kept both India and Pakistan as our friends during and after the 1971 Indo Pakistan war. Since 1977 we have had a plethora of Foreign Ministers, to whom the subject of foreign affairs was double Dutch. We need to exclude from that list the late Mr Lakshman Kadirgamar, a skilled and highly competent Foreign Minister.

No doubt, the world has become much more complicated since Mrs Bandaranaike’s time.After the collapse of the Soviet Union, we have seen China’s inexorable rise as an economic superpower. They now want to be recognized as such with a status similar to the USA. In this scenario, many countries are forced to align themselves to either the USA and its allies or China. President George W Bush in September 2001 stated “Every nation, in every region, now has a decision to make. Either you are with us, or you are with the terrorists.” I must hasten to say that he was not referring to China; however, the message is quite clear.

In the last 50 years, India has played a decisive role in our country’s affairs, and it is our misfortunate that India and China are not the best of friends. However, geopolitical reality is that we need to be friends with India just as much with China which is at odds with what President Bush said! The actions of the GOSL in abrogating the MOC might adversely impact our relations with India. This is when the country’s economy is in dire straits, fighting a raging pandemic and facing a barrage of issues at the forthcoming UNHRC meeting. Not the best of times to antagonize Big Brother!

It was announced that the cabinet has approved for the “West Terminal” at the Colombo Port to be developed as a joint venture with the Indian and Japanese governments and their nominees. One must assume that many who agitated against the ECT would again take to the streets and protest. Will India and Japan be once bitten twice shy? In case both the ECT and the West terminals are developed parallely will there be sufficient business volume for both the terminals to make money or will ECT become a White Elephant?



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President picks up the gauntlet

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by Jehan Perera

By proroguing parliament President Ranil Wickremesinghe has given the parliamentarians, and the country at large, a reminder of the power of the presidency. There was no evident reason for the president to suddenly decide to prorogue parliament. More than 40 parliamentary committees, including important ones concerning public finances, enterprises and accounts have ceased to function. The president’s office has said that when parliament reconvenes on February 8, after the celebration of the country’s 75th Independence Day on February 4, the president will announce new policies and laws, which will be implemented until the centenary celebrations of Sri Lanka’s independence in 2048. Prime Minister Lee Kwan Yew transformed Singapore from a relatively underdeveloped and impoverished agrarian society into one of the world’s most developed countries in the same 25 years that the president has set for Sri Lanka.

President Wickremesinghe has been getting increasingly assertive regarding his position on issues. Recently he attended a large gathering of Muslim clerics, where he was firm in saying that society needs to modernise, and so do religious practices. He has also held fast to his positions on reviving the economy and resolving the economy. There have been widespread protests against the tax hikes being implemented which have eroded the purchasing power of taxpayers. First they had to absorb the impact of inflation that rose to a rate of 80 percent at the time the country reneged on its foreign debt repayments and declared bankruptcy. Now they find their much diminished real incomes being further reduced by a tax rate that reaches 36 percent.

But the government is not relenting. President Wickremesinghe, who holds the finance minister’s portfolio, is going against popular sentiment in being unyielding on the matter of taxes. He appears determined to force the country away from decades of government policies that took the easy route of offering subsidies rather than imposing taxes to use for government expenses and development purposes. In Sri Lanka, the government’s tax revenue is less than 8 percent, whereas in comparable countries the tax revenue is around 20 to 25 percent. The long term cost of living off foreign borrowings rather than generating resources domestically through taxation has been evident for a long while in the slow growth of the economy even prior to the economic collapse.

13TH AMENDMENT

Another area in which the president appears to have taken the decision to stand firm is the issue of finding a solution to the ethnic conflict. This problem has proven to be unresolvable by governments and political leaders who give deference to ethnic nationalism. Being an ethnic nationalist in the context of Sri Lanka’s ethnic and religious divisions has been a sure way of gaining votes and securing election victories. No leader in Sri Lanka has to date been able to implement the compromise solutions that they periodically arrived at, the last being the 13th Amendment. Earlier ones included the Bandaranaike-Chelvanayakam Pact of 1957 and the Dudley Senanayake-Chelvanayakam Pact of 1965 which could not even be started to be implemented.

At the All Party meeting that he summoned to discuss the ethnic conflict and national reconciliation, President Wickremesinghe took the bull by the horns. He exchanged words with ethnic nationalist parliamentarians who sought to challenge his legitimacy to be making changes. He said, “It is my responsibility as the Executive to carry out the current law. For approximately 37 years, the 13th Amendment has been a part of the constitution. I must implement or someone has to abolish it by way of a 22nd amendment to the constitution by moving a private member’s bill. If the bill was voted against by the majority in the House, then the 13th amendment would have to be implemented. We can’t remain in a middle position saying that either we don’t implement the 13th amendment or abolish it.”

The 13th Amendment has not been fully implemented since it was passed by parliament with a 2/3 majority in 1987. Successive governments, including ones the president has been a member of variously as a minister or prime minister, have failed to implement it in a significant manner, especially as regards the devolution of police and land powers. When parliament reconvenes on February 8 after prorogation, President Wickremesinghe will be provided the opportunity to address both the parliament and the country on the way forward. Having demonstrated the power of the presidency to prorogue parliament at his discretion, he will be able to set forth his vision of the solution to the ethnic conflict and the roadmap that needs to be followed to get to national reconciliation.

IRONIC PERSECUTION

It is significant that on February 20, the president will also acquire the power to dissolve parliament at his discretion. By proroguing parliament, the president has sent a message to both parliamentarians and the larger society that he will soon have the power to dissolve parliament with the same suddenness that he prorogued parliament. On February 20, the parliament would have been in existence for two and a half years. The 21st Amendment empowers the president to dissolve parliament after two and a half years. Most of the parliamentarians belonging to the ruling party are no longer in a position to go to their electorates let alone canvass for votes among the people. Under these fraught circumstances, they would not wish to challenge the president or his commitment to implementing the 13th Amendment in full.

On the other hand, the taming of parliament by the president does not guarantee the success of an accommodation on the ethnic conflict and a sustainable political solution. The ethnic conflict evokes the primordial sentiments of the different ethnic and religious communities. Political parties and politicians are often portrayed as the villains who led the country to decades of ethnic conflict and to war. However, the conflict in the country predates the political parties. In 1928, in response to demands from community leaders in Ceylon as it was then known, the British colonial rulers sent a commission to the country to ascertain whether it was ready for self-rule. The assessment was negative—the Donoughmore commission wrote that the representatives of the biggest community held to the position that their interest was the national interest. All the representatives of the smaller communities who were divided one against the other were united against the biggest.

An important role therefore devolves upon civil society not to fall prey to the divisions that come down the years. There is a need for enlightened leaders of civil society to work with commitment to explain to the people the need for a political solution and inter-ethnic power sharing that the 13th Amendment makes possible. There were signs of this during the height of the Aragalaya when the youth leading the protests called publicly for equal citizenship and non-discrimination on the basis of ethnicity, religion and caste. They pledged not to be divided by ethnic nationalist politicians for their narrow electoral purposes. It is ironic that the government led by President Wickremesinghe has made these enlightened youth leaders the target of a campaign of persecution instead of making them a part of the solution by constructively engaging with them and issuing a general amnesty.

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Privatisation of education and demonising of students of Lanka

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Student union leader Wasantha Mudalige with prison guards

by Anushka Kahandagamage

Sri Lanka is trapped in debt due to decades of corruption and short-sighted economic policies. To come out of the trap or, I would say, escape the moment, the government is seeking loans from the IMF, or anybody else who is willing to lend, no matter the conditions. To this end, under the IMF’s tutelage, the government is seeking to privatise education, aware that it will face the wrath of the people. In this setting, to suppress the protests, the government has adopted a strategy of demonising students, in the public education system.

School children as “drug addicts”

A media empire, which has strong ties with the current Lankan regime, recently sent shockwaves through schools, and their communities, by reporting cases of school children hooked on harmful narcotics. Following these reports, there were many write ups, social media content and stories published on the menace of drug addiction, among Sri Lankan students. That media network even released a video, interviewing two schoolgirls who claimed to be addicted to harmful substances. In the midst of the media frenzy, the police carried out surprise checks in schools, searching students’ bags. The state humiliated and terrified school children by using the police to conduct surprise checks in the schools and peek into the students’ backpacks, instead of investigating the avenues through which dangerous drugs enter the country. After a week, the Minister of Education claimed he was unaware that the police were conducting surprise checks in schools, with sniffer dogs, adding that there was no need to deploy the police force for this purpose. If the Minister was not aware that the police raided schools, it is not surprising that the state would also turn a blind eye to how narcotics enter the country. While there is a risk of students addicting to dangerous drugs, the state cannot place all the blame on students. Instead of taking responsibility for the state of affairs, and acting to keep harmful substances off the island, the state places the burden on schoolchildren and simply refers to them as “drug addicts.”

Bhikku students as “alcoholics”

The next example is from the Buddhist and Pali University, in Homagama. Similar to the first story, the same media network reported some irregularities occurring in the University. Those irregularities included the student monks forcing incoming students, also monks, to consume weed, liquor and party. Following this news report, some investigations were conducted in the University and empty liquor bottles were found in an abandoned well. Then we witnessed several press conferences where University authorities questioned the student monk leaders. While one cannot and should not disregard students’ violence upon another student, it is interesting to note the way the government is taking up the particular incident, at this particular point of time. There was a massive social media campaign to show that the student-monks are immoral and unworthy of education. It cannot be a coincidence that the student monks, at this University, were actively involved in the Aragalaya. In other words, the government was trying to defame the University, and the students, by labelling them as oppressors and alcoholics.

The Rajapaksa regime continuously used Buddhist monks, in their political operations, especially to incite conflict and win elections. The state has frequently deployed Buddhist monks to further its nationalist agendas. When the state used monks for their agendas, including to instigate violence, the monks were not framed as ‘immoral.’ The higher Buddhist authorities did not take action against groups, like Bodu Bala Sena, or Ravana Balaya, or their violent activities. It is ironic that the Government seems to be concerned about the ‘morality’ or ‘discipline’ of Bhikkus at this moment when many student Bhikkus have joined hands with the people to protest against the state.

University students as “terrorists”

The last example is the most pressing at this moment. On 18th of August, 2022, the police arrested Wasantha Mudalige, the Convenor of the Inter-University Students Federation, under the Prevention of Terrorism Act (PTA). Along with him, the authorities detained Hashan Jeewantha and the convener of the Inter University Bhikku Federation (IUBF), Galwewa Siridhamma Thera. The state labelled the politically active university students as “terrorists”. Again, this cannot have happened by chance; we all know the Aragalaya against the Rajapaksa dictatorship was heavily influenced by the Inter-University Students Federation and the Inter University Bhikku Federation. The student unions were the muscle of the people’s protests against the oppressive and corrupt regime. The Ranil-Rajapaksa regime labelled the student leaders’ terrorists and started arresting them.

The state’s stamping of University students as terrorists is a folly. If the state labels its own youth as “terrorists,” it means that the state has failed miserably because it is its own actions that have pushed them toward what is labelled as “terrorism.” The state should take a step back and reconsider its decisions.

Privatization of Education

The government and the government-validating media demonize students, labelling them as drug addicts, alcoholics and terrorists. The government undermines and defames the country’s student body. By doing so, the government is strategically isolating the students from the larger society and eroding public faith in them. Ironically, drug addicts, alcoholics, and terrorists are all confined to the public school and state university system, not private educational institutions. The media propagates the idea that students enrolled in the state education system are ‘immoral’ and ‘disobedient’. Meanwhile, Ranil Wickremesinghe, the puppet President of the Rajapaksa allies, proposes a new economic system which he thinks will counter the current balance of payment crisis. The proposal includes establishing an educational hub in Sri Lanka, which promises to privatise higher education in the long-term.

The state agenda of privatizing education is not a recent one, but it has been reenergized by the Ranil-Rajapaksa government in the context of crisis. Well before demonising the students, in the public education system, in June 2022 the government, national education commission, came up with an education policy framework.

Biased towards Rajapaksa ideologies, the national education commission that developed the policy, proposed to expand the privatization of higher education. In their report, the committee presents a table demonstrating how Sri Lanka allocates less money on higher education compared with the other middle-income countries. The next section outlines the way Sri Lanka relies more on government grants for higher education than other middle-income countries, which is confusing and contradictory, perhaps reflecting the grossly inadequate overall investment in higher education in the country. Then the report goes on to analyse how the poor school education system creates an unskillful student who is unable to think critically. It finally recommends promoting private participation in higher education, not only through funding but also by matching the curricula to fit the market and increase the “employability” of students. While on the one hand government pushes for privatising higher education, on the other, it demonizes the students in the public educational system. The State has seized the problem by its tail. The government is unable to perceive its own flaws in short-sighted policymaking, law enforcement, and corruption, and instead accuses and defames students, to distract them from its concerted effort to privatise education.

Kuppi is a politics and pedagogy happening on the margins of the lecture hall that parodies, subverts, and simultaneously reaffirms social hierarchies.

(Anushka Kahandagamage is reading for her PhD in the School of Social Sciences, University of Otago)

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Janaka…Keeping the Elvis scene alive

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Janaka Palapathwala: Recreating the Presley era…through song.......

For the past three years, local performers have certainly felt the heat, where work is concerned, beginning with the Easter Sunday tragedy, followed by Covid-19 restrictions, and then the political situation

Right now, there seems to be a glimmer of light, at the end of the tunnel, and musicians are hoping that, finally, the scene would brighten up for the entertainment industry.

Janaka Palapathwala, whose singing style, and repertoire, is reminiscent of the late Elvis Presley, says he was so sad and disappointed that he could not reach out to his fans, around the world, because of the situation that cropped up in the country.

However, he did the next best thing possible – a Virtual Concert, early last year, and had this to say about it:

“The concert was witnessed by so many people around the world, in 12 different countries, and I take this opportunity to thank all those who showed a great interest, around the world, to make the show a mighty success. Lasantha Fernando of Minneapolis, Minnesota, in the USA, went out of the way to pull a huge crowd, in the States, to make the concert a massive success. Lasantha, by the way, has done many shows, in Minnesota, including a concert of mine, four years ago.”

Toward the end of 2022, the showbiz scene started to look good, with musicians having work coming their way – shows, sing-alongs, events, overseas tours, recordings, etc.

Janaka added that the Gold FM ’70s show was back after six years, and that the music industry is grateful to Gold FM for supporting musicians with such an awesome event.

“Also, the unity and the togetherness of the Sri Lankan western musicians, scattered around the globe, were brought together, once again, by the guidance of Melantha Perera.

“The song ‘Baby Jesus Is Fast Asleep’, written, composed and directed by Melantha, was a true Christmas gift to people around the world.”

Referring to his career, Janaka said that these days he is involved in a mega video production project.

“I intend to do a road show for a total Dinner Dance Promotion package, titled ‘Janaka with Melantha and the Sign’.

“Phase One of the project is already completed, and we are now heading for the second phase, where we plan to get Sohan Weerasinghe, Clifford Richards and Stephanie Siriwardane involved in the cast”.

Janaka also spoke excitedly about his forthcoming trip to the USA.

“I’m so excited to tour the USA, after three years. The ‘Spring Tour USA 2023′ is going to be different.

“I’ve done formal concerts, in the States, but this Spring Tour will be a series of Dinner Dances where I would be seen in action, along with the top ranked DJ of Washington D.C., Shawn Groove, and some of the best domestic bands in the States, and I can assure all my friends, and fans, in the US, that this new venture is going to be doubly exciting.”

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