Features
Seeing the market through the spectre
By Panduka Karunanayake
Leftist ideologues like to create an image of ‘the market’ as a terrible place, like how grown-ups frighten children with their ghost stories. The market is portrayed as a ruthless, heartless machine that thrives on unfairness and corruption, crushing the poor and fattening the rich. It must have become easier to create this image after the Soviet bloc fell in the 1990s and China emerged out of communism soon afterwards, because after that people quickly forgot that socialist and communist economies too have markets – even markets every bit as ruthless, heartless, unfair and corrupt as any capitalist market. Today, these ideologues can write as if the market and capitalism are synonyms. Everything ‘un-socialist’ can be easily ‘explained away’ by saying that it ‘promotes marketisation’.
No amount of argument or explanation would change these ideologues’ minds – after all, an ideologue is a person who pursues an ideology in an inflexible manner. But let me set out some related matters, for the benefit of the rest of us.
Emergence and evolution of the market
Markets have probably existed throughout human existence, because human beings are social animals that thrive on social interaction. There is an illuminating passage in Charles Darwin’s book The Voyage of the Beagle, where he described an encounter with the inhabitants of Tierra del Fuego in South America, who were ‘primitive’ hunter-gatherers and nomads with no previous encounter with civilisation:
“Some of the Feugians plainly showed that they had a fair notion of barter. I gave one man a large nail (a most valuable present) without making any signs for a return; but he immediately picked out two fish, and handed them up on the point of his spear. If any present was designed for one canoe, and it fell near another, it was invariably given to the right owner.”
This passage shows that they were well-versed in the moral principles – such as free choice, trust, fairness and reciprocity – associated with exchange of goods and services that form the basis of the functioning market.
The market became prominent after the emergence of agriculture about 10,000 year ago. Agriculture enabled farmers to produce a food surplus, which then enabled the rest of the villagers to work on other crafts – promoting division of labour and specialisation. This created an overall increase in the quality of the villagers’ lives, because they now had a wider variety of produce to consume. Villagers now depended on each other more, for the produce they wished to consume. As the village increased in size and complexity, a place where producers and consumers could meet, to exchange goods and services, became a necessity. In the physical realm this was the marketplace, and in the conceptual realm it was the market. Initially, exchange occurred through the barter system without a medium of exchange, but the invention of money made it easier.
But until industrialisation, this market was small and sluggish. It produced very little, compared to today. Most of what a village produced was consumed within it, and only a tiny proportion of it left the village, to be consumed by outsiders – the market was still not much more than the marketplace.
Reason for smallness
The reason for this smallness was not entirely because there were no industrial factories. The villagers could have produced more if they wanted to, but they didn’t, because they saw that any extra produce created problems. There were difficulties with storing it, protecting it, preserving it or transporting it elswhere, and in any event the lords could easily expropriate it under the feudalistic modes of production. Items that were considered luxury items were an exception; they were carried to distant destinations by camel, caravan or boat.
But starting in the eighteenth century, industrialisation changed all that. Factories produced large quantities of produce (or ‘commodities’) cheaply, and the market expanded to distribute a much larger variety and quantity of goods much more widely. Specialisation became the norm and a necessity. The crucial factor that made all this possible was probably the improvement in transport. Look at your lunch plate today, and try to figure out from where and how far each of the food items on it – not to mention the plate itself or the energy for the fire that cooked your lunch – have come from.
Today, production and consumption are almost totally separated from each other (with a few exceptions, like farmers who sell their produce by the roadside in front of their homes, and ‘factory outlets’). It is the market that enables this to happen. The market, which is no longer simply the marketplace, gives us access to a bewildering variety of goods and services, thereby enabling us – even the poorest amongst us – to enjoy a greater choice and higher quality of life, compared to pre-industrial times. The healthcare and education that even the poorest amongst us enjoy would not reach them if not for the market.
As an example, let us take soap. Until industrialisation this was a luxury item that only the elite enjoyed. In Roman times, even the elite cleaned themselves mostly by simply immersing themselves in their baths and rubbing off dirt; indeed, using soap would have made the bath too disgusting to get into. Soap was available only to those in the very highest echelons of society. The masses were ‘dirty’ and their skin was infested with scabies, pediculosis and lice, and they commonly suffered diseases like impetigo and erysipelas – they lacked even the water necessary to wash themselves (especially hot water in cold climates). But today, soap is so ubiquitous that we take it for granted – it was industrialisation that enabled its cheap mass production and the market that enabled its wide distribution.
Value of simple things
The real value of something as simple as soap was driven home powerfully to me in the aftermath of the 2004 tsunami, when people had lost everything and were accommodated in make-shift camps. What did they ask for, from the donors and volunteers who went to help them? First, they asked for food, water and certain medicines. A few days later, they began asking for soap, a change of clothing and sanitary pads: after three or four days, they were itching and suffering with fungal skin infections. That was an unfortunate re-enactment and reminder of the pre-industrial life of the masses. I remembered how a textbook of public health that I had read a few decades earlier had cleverly classified infectious diseases according to whether they were prevented by soap and water, clean drinking water, safe food, and so on. The post-tsunami experience showed me the sagacity of that – and the value of the ubiquitous soap, industrialisation and the market.
In his book The Third Wave, Alvin Toffler compared a modern-day market to an efficient telephone exchange or switchboard. A switchboard connects thousands of senders and recipients accurately and enables messages to be sent across to their intended destinations – like producers, consumers, and goods and services in the market. Like telephone messages, goods and services are produced, sent across and consumed according to need and availability: demand and supply.
Such a market cannot exist on its own. It needs inputs from important sectors in society, such as law and order (which upholds the right to private property, prevents or punishes theft, and arbitrates when there are contractual disagreements), education (which creates an educated and trained workforce, not only for manufacture but also for distribution), communication, energy, transport, ports, etc. Such external supports have existed not only in capitalist markets but also in pre-capitalist and socialist markets. These supports are provided because everybody realises that markets are useful to everyone, especially when the population expands and the demand for commodities increases.
So, to say that something should be abhorred because it promotes ‘marketisation’ is disingenuous.
Organising the market
Markets can be organised in various ways. It helps to think of these as lying on a spectrum ranging from capitalism to communism, which are the extreme forms at the two ends. In-between, there are lots of compromises, combinations or ‘middle ways’. For instance, the current Chineses model is sometimes called state capitalism – a good example of a middle way.
But the natural form of the market that emerged spontaneously was the free market: a market where no authority-imposed restrictions or controls, nor introduced any encouragements or inducements. The activities in the free market merely recognised the concepts of private property and voluntary exchange, and operated on demand and supply. That was all.
Opponents
Throughout this time, the free market has had many opponents who have tried to impose limits or controls to it. Division of labour and specialisation were resisted – by the cultural elite who tried to maintain the status quo in society, such as the caste system in ancient society and feudal-peasant relations in medieval times. During industrialisation when factories came up, that was resisted too – by guildsmen who felt that their business was threatened, and those like the Luddites who felt threatened by the new manufacturing technology. Karl Marx proposed that private property, including ‘the means of production’, should be taken over by the state and brought under its control.
Some of the concepts that they used against the growth of the free market were traditional values such as loyalty and caste-based duties (especially upheld by the cultural elite), simplicity in life and charity as well as opposition to ‘ursury’ and banks (especially the clergy), and equality. It is only now, after centuries of change, that words like ‘industry’ (which initially meant industriousness), ‘entrepreneurship’ and ‘individualism’ have emerged as ‘good words’, to create an environment conducive to a free market. Charles Dickens’ novel Martin Chuzzlewit nicely captured the mood of the era when industrialisation was struggling to emerge through the feudal society, by portraying the struggle of a typical ‘upstart’ who had to go to America to make a fresh start.
According to Stephen Fry, even today, the typical British comedy mostly parodies the upstart’s ineptness (“celebrate failure”), whereas the typical American comedy glorifies the industrious entrepreneur or smart-aleck (“life is improvable”). When we read comments about the market, we must take care to ‘read’ this subtext too.
Inequality
Ironically, inequality had previously been tolerated and even celebrated, as long as the only inequality was between the elite and the masses – the masses were ‘equal’ in their poverty and the elite were rich by birthright. But after industrialisation, the moment the masses gradually became enriched and a middle class emerged, inequality became a big social issue. When a part of the masses remained poor and another part became better-off, socialism was born. Different segments of the masses quickly became each other’s enemies – thanks to socialism. It was an example of applying the brakes even before the vehicle had started to move in earnest. They were ennobled by socialism’s new words, like ‘fraternity’ and ‘equality’ – which basically meant, ‘Those who are not poor like you are not one of you, and have no right to be rich if you too cannot be rich’.
But while the leaders of socialism may have harboured such beliefs, their proletariat comrades had simpler minds. In his book The Road to Wigan Pier written after World War One, George Orwell, himself a socialist, reflecting on the tensions and contradictions in English society as it grappled with this new-found inequality and ‘class struggle’, wrote:
“To the ordinary working man, the sort you would meet in any pub on Saturday night, Socialism does not mean much more than better wages and shorter hours and nobody bossing you about….[No] genuine working man grasps the deeper implications of Socialism. Often, in my opinion, he is a truer Socialist than the orthodox Marxist, because he does remember what the other so often forgets, that Socialism means justice and common decency….His vision of the Socialist future is a vision of present society with the worst abuses left out, and with interest centring round the same things as at present – family life, the pub, football, and local politics.”
Orwell’s main message was that any effort to ‘improve’ society, by whatever name, that had lost touch with the common man was bound to deteriorate into a fascism. The remainder of the twentieth century proved him right.
Today, Orwell’s England has come through quite nicely in spite of the disintegration of the British Empire soon afterwards, and shows none of the class struggle and poverty Orwell’s and Dickens’ books have recorded. So, should we champion an equality of the poor, or should we patiently work towards a gradually enriching society with a tolerable level of inequality?
Necessary controls
At the same time, it is also advisable to control some forms of exchange in the market. For instance, if a country considers that it is necessary to ensure food security through its own, local cultivation of important crops, it is wise to put in place some safeguards to protect local agriculture from the adverse effects of competition from imported foods, at least for important foods. Even advanced capitalist countries like USA and Japan do this (for wheat and rice, respectively).
Similarly, it would be prudent to protect certain crucial markets, such as the energy sector and ports. It is also important to ensure distribution of crucial goods & services (such as healthcare, basic education, basic housing, basic clothing, basic transport) for all members of society, with a view to protecting the poor who have limited purchasing power. This requires the institution of safety nets and price control. In this age of climate change, resource depletion and environmental degradation, nobody would argue against environmental protection, which naturally requires the imposition of certain restrictions on the free market. Finally, nobody would argue that sectors such as national defence and law & order should be floated in the free market. So markets do need judicious controls and regulation.
More than ‘free’
On the flip side, in some markets there are mechanisms created specifically to encourage a bigger flow of goods & services than what the natural, ‘free’ market would sustain. These include patent laws, laws restricting monopolies, bankruptcy laws, the financial and share market, and so on; some of them may be good, while others are not.
The market is then not merely a place of exchange; it is also a place to make massive profits, where the falling crumbs accumulate to produce huge volumes of ‘wealth’. There are those who would profit exactly from this, while such ‘wealth generation’ or ‘productivity’ brings no intrinsic value to society while needlessly destroying our environment and culture – this can then become the new status quo that these new elite wish to protect.
Conclusion
A free market would promote exchange of goods & services and increase the volume of exchange, and this in turn would increase employment, productivity, taxation and funds for welfare expenditure. Both restricting it and encouraging it, while sometimes necessary, must be done only cautiously. Naturally, therefore, both extremes – and their supportive ideologies – are not good. What we need to have is a ‘middle-way’ market that enables enough economic activity and protects the poor, while protecting the environment for future generations.
So, there is no need to fear the market. What we need to do is understand it, be able to predict its behaviour, and try to modify it so that it creates the benefits we need and avoids harm. The child must grow up, overcome the fear of ghosts and learn to deal with darkness. Disingenuous, sleight-of-hand arguments that promote the darkness are of no use, and their supportive ideologies can only lead to fascism – as the twentieth century amply taught us.
The writer teaches medicine in the University of Colombo (email:
panduka@clinmed.cmb.ac.lk). He acknowledges helpful comments from Professor Sirimal Abeyratne (Professor of Economics, University of Colombo) and Dr G. Usvatte-aratchi.
by Dr Gotabhya Ranasinghe
Senior Consultant Cardiologist
National Hospital Sri Lanka
When we sought a meeting with Hon Dr. Ramesh Pathirana, Minister of Health, he graciously cleared his busy schedule to accommodate us. Renowned for his attentive listening and deep understanding, Minister Pathirana is dedicated to advancing the health sector. His openness and transparency exemplify the qualities of an exemplary politician and minister.
Dr. Palitha Mahipala, the current Health Secretary, demonstrates both commendable enthusiasm and unwavering support. This combination of attributes makes him a highly compatible colleague for the esteemed Minister of Health.
Our discussion centered on a project that has been in the works for the past 30 years, one that no other minister had managed to advance.
Minister Pathirana, however, recognized the project’s significance and its potential to revolutionize care for heart patients.
The project involves the construction of a state-of-the-art facility at the premises of the National Hospital Colombo. The project’s location within the premises of the National Hospital underscores its importance and relevance to the healthcare infrastructure of the nation.
This facility will include a cardiology building and a tertiary care center, equipped with the latest technology to handle and treat all types of heart-related conditions and surgeries.
Securing funding was a major milestone for this initiative. Minister Pathirana successfully obtained approval for a $40 billion loan from the Asian Development Bank. With the funding in place, the foundation stone is scheduled to be laid in September this year, and construction will begin in January 2025.
This project guarantees a consistent and uninterrupted supply of stents and related medications for heart patients. As a result, patients will have timely access to essential medical supplies during their treatment and recovery. By securing these critical resources, the project aims to enhance patient outcomes, minimize treatment delays, and maintain the highest standards of cardiac care.
Upon its fruition, this monumental building will serve as a beacon of hope and healing, symbolizing the unwavering dedication to improving patient outcomes and fostering a healthier society.We anticipate a future marked by significant progress and positive outcomes in Sri Lanka’s cardiovascular treatment landscape within the foreseeable timeframe.
by Fr. Emmanuel Fernando, OMI
Jesuit Fr. Aloysius Pieris (affectionately called Fr. Aloy) celebrated his 90th birthday on April 9, 2024 and I, as the editor of our Oblate Journal, THE MISSIONARY OBLATE had gone to press by that time. Immediately I decided to publish an article, appreciating the untiring selfless services he continues to offer for inter-Faith dialogue, the renewal of the Catholic Church, his concern for the poor and the suffering Sri Lankan masses and to me, the present writer.
It was in 1988, when I was appointed Director of the Oblate Scholastics at Ampitiya by the then Oblate Provincial Fr. Anselm Silva, that I came to know Fr. Aloy more closely. Knowing well his expertise in matters spiritual, theological, Indological and pastoral, and with the collaborative spirit of my companion-formators, our Oblate Scholastics were sent to Tulana, the Research and Encounter Centre, Kelaniya, of which he is the Founder-Director, for ‘exposure-programmes’ on matters spiritual, biblical, theological and pastoral. Some of these dimensions according to my view and that of my companion-formators, were not available at the National Seminary, Ampitiya.
Ever since that time, our Oblate formators/ accompaniers at the Oblate Scholasticate, Ampitiya , have continued to send our Oblate Scholastics to Tulana Centre for deepening their insights and convictions regarding matters needed to serve the people in today’s context. Fr. Aloy also had tried very enthusiastically with the Oblate team headed by Frs. Oswald Firth and Clement Waidyasekara to begin a Theologate, directed by the Religious Congregations in Sri Lanka, for the contextual formation/ accompaniment of their members. It should very well be a desired goal of the Leaders / Provincials of the Religious Congregations.
Besides being a formator/accompanier at the Oblate Scholasticate, I was entrusted also with the task of editing and publishing our Oblate journal, ‘The Missionary Oblate’. To maintain the quality of the journal I continue to depend on Fr. Aloy for his thought-provoking and stimulating articles on Biblical Spirituality, Biblical Theology and Ecclesiology. I am very grateful to him for his generous assistance. Of late, his writings on renewal of the Church, initiated by Pope St. John XX111 and continued by Pope Francis through the Synodal path, published in our Oblate journal, enable our readers to focus their attention also on the needed renewal in the Catholic Church in Sri Lanka. Fr. Aloy appreciated very much the Synodal path adopted by the Jesuit Pope Francis for the renewal of the Church, rooted very much on prayerful discernment. In my Religious and presbyteral life, Fr.Aloy continues to be my spiritual animator / guide and ongoing formator / acccompanier.
Fr. Aloysius Pieris, BA Hons (Lond), LPh (SHC, India), STL (PFT, Naples), PhD (SLU/VC), ThD (Tilburg), D.Ltt (KU), has been one of the eminent Asian theologians well recognized internationally and one who has lectured and held visiting chairs in many universities both in the West and in the East. Many members of Religious Congregations from Asian countries have benefited from his lectures and guidance in the East Asian Pastoral Institute (EAPI) in Manila, Philippines. He had been a Theologian consulted by the Federation of Asian Bishops’ Conferences for many years. During his professorship at the Gregorian University in Rome, he was called to be a member of a special group of advisers on other religions consulted by Pope Paul VI.
Fr. Aloy is the author of more than 30 books and well over 500 Research Papers. Some of his books and articles have been translated and published in several countries. Among those books, one can find the following: 1) The Genesis of an Asian Theology of Liberation (An Autobiographical Excursus on the Art of Theologising in Asia, 2) An Asian Theology of Liberation, 3) Providential Timeliness of Vatican 11 (a long-overdue halt to a scandalous millennium, 4) Give Vatican 11 a chance, 5) Leadership in the Church, 6) Relishing our faith in working for justice (Themes for study and discussion), 7) A Message meant mainly, not exclusively for Jesuits (Background information necessary for helping Francis renew the Church), 8) Lent in Lanka (Reflections and Resolutions, 9) Love meets wisdom (A Christian Experience of Buddhism, 10) Fire and Water 11) God’s Reign for God’s poor, 12) Our Unhiddden Agenda (How we Jesuits work, pray and form our men). He is also the Editor of two journals, Vagdevi, Journal of Religious Reflection and Dialogue, New Series.
Fr. Aloy has a BA in Pali and Sanskrit from the University of London and a Ph.D in Buddhist Philosophy from the University of Sri Lankan, Vidyodaya Campus. On Nov. 23, 2019, he was awarded the prestigious honorary Doctorate of Literature (D.Litt) by the Chancellor of the University of Kelaniya, the Most Venerable Welamitiyawe Dharmakirthi Sri Kusala Dhamma Thera.
Fr. Aloy continues to be a promoter of Gospel values and virtues. Justice as a constitutive dimension of love and social concern for the downtrodden masses are very much noted in his life and work. He had very much appreciated the commitment of the late Fr. Joseph (Joe) Fernando, the National Director of the Social and Economic Centre (SEDEC) for the poor.
In Sri Lanka, a few religious Congregations – the Good Shepherd Sisters, the Christian Brothers, the Marist Brothers and the Oblates – have invited him to animate their members especially during their Provincial Congresses, Chapters and International Conferences. The mainline Christian Churches also have sought his advice and followed his seminars. I, for one, regret very much, that the Sri Lankan authorities of the Catholic Church –today’s Hierarchy—- have not sought Fr.
Aloy’s expertise for the renewal of the Catholic Church in Sri Lanka and thus have not benefited from the immense store of wisdom and insight that he can offer to our local Church while the Sri Lankan bishops who governed the Catholic church in the immediate aftermath of the Second Vatican Council (Edmund Fernando OMI, Anthony de Saram, Leo Nanayakkara OSB, Frank Marcus Fernando, Paul Perera,) visited him and consulted him on many matters. Among the Tamil Bishops, Bishop Rayappu Joseph was keeping close contact with him and Bishop J. Deogupillai hosted him and his team visiting him after the horrible Black July massacre of Tamils.
Sri Lanka-Singapore Free Trade Agreement
By Gomi Senadhira
senadhiragomi@gmail.com
“You might tell fairy tales, but the progress of a country cannot be achieved through such narratives. A country cannot be developed by making false promises. The country moved backward because of the electoral promises made by political parties throughout time. We have witnessed that the ultimate result of this is the country becoming bankrupt. Unfortunately, many segments of the population have not come to realize this yet.” – President Ranil Wickremesinghe, 2024 Budget speech
Any Sri Lankan would agree with the above words of President Wickremesinghe on the false promises our politicians and officials make and the fairy tales they narrate which bankrupted this country. So, to understand this, let’s look at one such fairy tale with lots of false promises; Ranil Wickremesinghe’s greatest achievement in the area of international trade and investment promotion during the Yahapalana period, Sri Lanka-Singapore Free Trade Agreement (SLSFTA).
It is appropriate and timely to do it now as Finance Minister Wickremesinghe has just presented to parliament a bill on the National Policy on Economic Transformation which includes the establishment of an Office for International Trade and the Sri Lanka Institute of Economics and International Trade.
Was SLSFTA a “Cleverly negotiated Free Trade Agreement” as stated by the (former) Minister of Development Strategies and International Trade Malik Samarawickrama during the Parliamentary Debate on the SLSFTA in July 2018, or a colossal blunder covered up with lies, false promises, and fairy tales? After SLSFTA was signed there were a number of fairy tales published on this agreement by the Ministry of Development Strategies and International, Institute of Policy Studies, and others.
However, for this article, I would like to limit my comments to the speech by Minister Samarawickrama during the Parliamentary Debate, and the two most important areas in the agreement which were covered up with lies, fairy tales, and false promises, namely: revenue loss for Sri Lanka and Investment from Singapore. On the other important area, “Waste products dumping” I do not want to comment here as I have written extensively on the issue.
1. The revenue loss
During the Parliamentary Debate in July 2018, Minister Samarawickrama stated “…. let me reiterate that this FTA with Singapore has been very cleverly negotiated by us…. The liberalisation programme under this FTA has been carefully designed to have the least impact on domestic industry and revenue collection. We have included all revenue sensitive items in the negative list of items which will not be subject to removal of tariff. Therefore, 97.8% revenue from Customs duty is protected. Our tariff liberalisation will take place over a period of 12-15 years! In fact, the revenue earned through tariffs on goods imported from Singapore last year was Rs. 35 billion.
The revenue loss for over the next 15 years due to the FTA is only Rs. 733 million– which when annualised, on average, is just Rs. 51 million. That is just 0.14% per year! So anyone who claims the Singapore FTA causes revenue loss to the Government cannot do basic arithmetic! Mr. Speaker, in conclusion, I call on my fellow members of this House – don’t mislead the public with baseless criticism that is not grounded in facts. Don’t look at petty politics and use these issues for your own political survival.”
I was surprised to read the minister’s speech because an article published in January 2018 in “The Straits Times“, based on information released by the Singaporean Negotiators stated, “…. With the FTA, tariff savings for Singapore exports are estimated to hit $10 million annually“.
As the annual tariff savings (that is the revenue loss for Sri Lanka) calculated by the Singaporean Negotiators, Singaporean $ 10 million (Sri Lankan rupees 1,200 million in 2018) was way above the rupees’ 733 million revenue loss for 15 years estimated by the Sri Lankan negotiators, it was clear to any observer that one of the parties to the agreement had not done the basic arithmetic!
Six years later, according to a report published by “The Morning” newspaper, speaking at the Committee on Public Finance (COPF) on 7th May 2024, Mr Samarawickrama’s chief trade negotiator K.J. Weerasinghehad had admitted “…. that forecasted revenue loss for the Government of Sri Lanka through the Singapore FTA is Rs. 450 million in 2023 and Rs. 1.3 billion in 2024.”
If these numbers are correct, as tariff liberalisation under the SLSFTA has just started, we will pass Rs 2 billion very soon. Then, the question is how Sri Lanka’s trade negotiators made such a colossal blunder. Didn’t they do their basic arithmetic? If they didn’t know how to do basic arithmetic they should have at least done their basic readings. For example, the headline of the article published in The Straits Times in January 2018 was “Singapore, Sri Lanka sign FTA, annual savings of $10m expected”.
Anyway, as Sri Lanka’s chief negotiator reiterated at the COPF meeting that “…. since 99% of the tariffs in Singapore have zero rates of duty, Sri Lanka has agreed on 80% tariff liberalisation over a period of 15 years while expecting Singapore investments to address the imbalance in trade,” let’s turn towards investment.
Investment from Singapore
In July 2018, speaking during the Parliamentary Debate on the FTA this is what Minister Malik Samarawickrama stated on investment from Singapore, “Already, thanks to this FTA, in just the past two-and-a-half months since the agreement came into effect we have received a proposal from Singapore for investment amounting to $ 14.8 billion in an oil refinery for export of petroleum products. In addition, we have proposals for a steel manufacturing plant for exports ($ 1 billion investment), flour milling plant ($ 50 million), sugar refinery ($ 200 million). This adds up to more than $ 16.05 billion in the pipeline on these projects alone.
And all of these projects will create thousands of more jobs for our people. In principle approval has already been granted by the BOI and the investors are awaiting the release of land the environmental approvals to commence the project.
I request the Opposition and those with vested interests to change their narrow-minded thinking and join us to develop our country. We must always look at what is best for the whole community, not just the few who may oppose. We owe it to our people to courageously take decisions that will change their lives for the better.”
According to the media report I quoted earlier, speaking at the Committee on Public Finance (COPF) Chief Negotiator Weerasinghe has admitted that Sri Lanka was not happy with overall Singapore investments that have come in the past few years in return for the trade liberalisation under the Singapore-Sri Lanka Free Trade Agreement. He has added that between 2021 and 2023 the total investment from Singapore had been around $162 million!
What happened to those projects worth $16 billion negotiated, thanks to the SLSFTA, in just the two-and-a-half months after the agreement came into effect and approved by the BOI? I do not know about the steel manufacturing plant for exports ($ 1 billion investment), flour milling plant ($ 50 million) and sugar refinery ($ 200 million).
However, story of the multibillion-dollar investment in the Petroleum Refinery unfolded in a manner that would qualify it as the best fairy tale with false promises presented by our politicians and the officials, prior to 2019 elections.
Though many Sri Lankans got to know, through the media which repeatedly highlighted a plethora of issues surrounding the project and the questionable credentials of the Singaporean investor, the construction work on the Mirrijiwela Oil Refinery along with the cement factory began on the24th of March 2019 with a bang and Minister Ranil Wickremesinghe and his ministers along with the foreign and local dignitaries laid the foundation stones.
That was few months before the 2019 Presidential elections. Inaugurating the construction work Prime Minister Ranil Wickremesinghe said the projects will create thousands of job opportunities in the area and surrounding districts.
The oil refinery, which was to be built over 200 acres of land, with the capacity to refine 200,000 barrels of crude oil per day, was to generate US$7 billion of exports and create 1,500 direct and 3,000 indirect jobs. The construction of the refinery was to be completed in 44 months. Four years later, in August 2023 the Cabinet of Ministers approved the proposal presented by President Ranil Wickremesinghe to cancel the agreement with the investors of the refinery as the project has not been implemented! Can they explain to the country how much money was wasted to produce that fairy tale?
It is obvious that the President, ministers, and officials had made huge blunders and had deliberately misled the public and the parliament on the revenue loss and potential investment from SLSFTA with fairy tales and false promises.
As the president himself said, a country cannot be developed by making false promises or with fairy tales and these false promises and fairy tales had bankrupted the country. “Unfortunately, many segments of the population have not come to realize this yet”.
(The writer, a specialist and an activist on trade and development issues . )
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