Features
The JRJ Cabinet and Finance Minister Ronnie de Mel
It would be fair to say that JRJ had the most competent Cabinet of Ministers of modern times. As usual the new Prime Minster (he was elected PM in 1977 before he became president via a constitutional amendment a year later: ed) had been very thorough in his decision making. He first accommodated all the seniors who were Cabinet ministers in previous UNP governments. Premadasa, M.D.H. Jayawardene, Montague Jayawickreme, E.L. Senanayake, Mohamed and Hurulle were all thus accommodated.
He also brought in party seniors who had helped him like Mathew, Hameed, Festus Perera, Jayasuriya and Wijetunga. Having secured that flank he chose two technocrats Ronnie de Mel and Nissanka Wijeratne, both ex-CCS, to man key ministries – Finance for de Mel and Education for Wijeyaratne. Last, he inducted two young stars of the party, Gamini Dissanayake and Lalith Athulathmudali. They too were given plum portfolios. Everybody could see the logic of the leader’s decisions and there was little of the heartburn that usually follows the selection of cabinet ministers.
Another key factor was that JRJ was clearly ‘Primus inter pares’. While he acknowledged that the victory was a combined effort, ministers knew that he was supreme, having brought the UNP to a historic and unprecedented win which would have been unthinkable under the Senanayakes. He also made it known that he would not brook any underhand maneuvering which had been a regular feature of Sri Lankan party politics.
Later on, we will see that there was some dissatisfaction among his senior colleagues – M.D.H. Jayawardana, Gamini Jayasuriya and E.L. Senanayake. JRJ showed no mercy to them in asking for their resignation from their ministerial positions when disagreements came to the surface. But both sides stuck to the rules and the transitions took place in a civilized manner with JRJ writing to them to thank them for services rendered.
While the cabinet ministers were able and willing, several of them were highly ambitious and had no doubts about their fitness to succeed the Old Man who in his own words had “climbed to the top of the greasy pole” at the ripe age of 72. He was fighting fit and unfailingly followed every morning, a rigorous exercise regime tailored for the Canadian Air Force, but that did not prevent several of his Ministers nursing ambitions of succeeding him one day.
Their hopes were raised even before the 1977 election when JRJ, with no warning, held a straw poll to form a 10-man committee to manage the election campaign. Premadasa came first by a small margin. The surprise was Gamini Dissanayake’s performance coming a strong second, thus fueling his already vaulting ambition. Ronnie de Mel and Lalith Athulathmudali also made it to the group. It sent a clear signal to Premadasa and the party seniors that they would not have a cakewalk to the top. It also created a sense of competition among the front runners which simmered right through JRJ’s two terms and blew the party apart after Premadasa donned the mantle.
While this competition helped in running an efficient administration it must be recognized that it exacerbated tensions among the front runners. JRJ gave ear to them all and while not discouraging them did not overtly back any one of them either. He was a master at giving each of them hope, while not showing his hand in any way. To complicate matters there were two others outside this ring who believed that they had JRJ’s blessings to go to the top.
One was Anandatissa de Alwis, a party grandee who managed both the political and personal entanglements of Sir John Kotelawala. He was the kingpin of the UNP youth league in the early days and had been recruited by JRJ as his Permanent Secretary in the 1965 Dudley-led administration. They were close friends and the leader’s unilateral decision to make him Speaker of the House did not please Ananda who wanted to be a Minister, preferably in charge of the old ministry of JRJ’s (State) he was Permanent Secretary. The other was Upali Wijewardene, JRJ’s cousin who had emerged as a clever and ambitious business magnate.
He wrapped himself in the mantle of a hero of the south because his mother and the source of his wealth came from a prominent family in the southern heartland. ‘This was a direct affront to Ronnie de Mel, who also was burnishing his southern credentials as the representative for Devinuwara, the abode of Vishnu – the guardian god of the South. Vishnu is believed to be the only god who did not run away when the Buddha was threatened by Mara.
Ronnie de Mel
The JRJ administration of 1977 was chiefly marked by its radical change of the country’s economic policies. By 1977 the previous administration led by Mrs. B was hated by the general public.It was an era of shortages and stagnation. The inward looking policies of the PM and her Finance Minister N.M. Perera, had failed and had created immense difficulties for the public in its wake.
So much so that a wing of the SLFP led by Felix and Anura Bandaranaike, began to publicly criticize NMs socialist policies. They drew attention to the epochal changes that were shaking up western economies and driving hard bitten communist regimes in the USSR and Eastern Europe to extinction. The new free market economy which spelt doom for socialist economies was led by President Reagan in the US and Prime Minister Thatcher in the UK. Their USSR counterpart Gorbachev was also taking the first steps ‘along the capitalist road’ as the Chinese leaders described it.The world was entering a new economic cycle of free markets and globalisation. Who would be best to help JRJ to transform the moribund economy? The President unhesitatingly chose Ronnie de Mel. “Cometh the hour; cometh the man”.
Though the JRJ Cabinet had many clever Ministers, the crucial post of Minister of Finance was given to the best qualified person- Ronnie de Mel. In a sense this appointment was waiting for him since he entered politics late in life. The SLFP which was his first party of choice had many envious seniors who prevailed on Mrs. B not to offer him a portfolio. The SLFP was a one man or one woman show and it placed greater store on loyalty than on talent.
Ronnie was a brilliant scholar who had refused the offer of a research assignment in Cambridge or Oxford as a historian based on his examination performance. He chose the CCS and was ear-marked from the start as an outstanding public servant. He had socialist leanings and was a favourite official of Philip Gunawardena when he was Minister of Agriculture in 1956. As with many CCS colleagues of his time he married into a wealthy family. Like JRJ he was without money worries but did not show off like the new rich who were now coming into politics under the SLFP. His wife Mallika was a dynamic and capable lady who undertook the responsibility of nursing her husband’s electorate as he was not a “hail fellow well met” type of politician.
In that he shared many personality traits with JRJ who looked upon him as a very valuable colleague. Both had an abiding interest in looking after the poor and underprivileged though they did not resort to popular gimmicks. Both JRJ and Ronnie came from a strong Anglican background and had an intellectual approach to Buddhism which did not view popular Buddhism and ritual with favour. Even when Ronnie was a fierce critic of the UNP, JRJ decided to woo Ronnie and playing on Mrs. B’s inability to accommodate him, slowly won him over to his side.
Ronnie was so important to the President that when he lost the Devinuwara seat in 1983 when JR sought re-election and the Referendum that followed, he was brought in on the national list of the UNP. Ronnie was so well accommodated in the UNP that he also brought along his friend and CCS colleague Nissanka Wijeryaatne, who was smarting under Mrs. B’s rejection of him for daring to contest her uncle Paranagama for the post of Diyawadana Nilame and beating him. Nissanka contested the Dedigama seat and became the Minister of Education. The luring of this duo of talented SLFPers was a feather in JRJ’s cap and presaged the trouble that was in store for Mrs. B in the 1977 election.
The opening of the economy in 1977, under the directions of JRJ, was implemented by Ronnie. It was a ‘tour de force’ which showed great skill and intelligence. De Silva and Wriggins in their biography of JRJ summarize the reforms envisaged in Ronnie’s first budget of 1977. “He asserted that the principal objective of the Budget was the establishment of a free economy after more than 20 years of controls and restrictions which had hampered economic growth….The budget marked a fundamental shift in Sri Lanka’s monetary and fiscal perspectives, through liberalized economic policies which emphasized great reliance on the market mechanism, liberalization of trade and payments and a large increase in external finance.
Most direct controls on prices, imports and external payments were dismantled, government operations in processing and distribution of basic commodities were reduced if not removed, and attractive incentives were provided to producers. There was also the unification of the exchange rate at a depreciated level and the introduction of a flexible exchange rate policy.” [P335] The rupee exchange rate was brought to its market value. All governments before that had artificially kept the rupee below its real value thereby distorting the country’s economy. It led to a black economy and the energies of the Government was diverted to catching currency racketeers as in Felix’s time. The next step was to deal with subsidies, particularly the rice subsidy – a major factor in electoral politics. Under the JRJ regime the subsidy for rice was restricted to those who earned under 300 rupees a month.
In order to cushion this poor segment from rising food prices it was decided to give a cash allowance in lieu of the rice ration. We in the Ministry of Information under Anandatissa put our heads together to fashion an Information strategy to popularize the cash grant. Together with Irvin Weerakkody of Phoenix Advertising we created a ‘Salli Potha’ or cash book as an alternative to the ‘Ration book’. The poor citizen could use the cash coupon to buy commodities of his choice subject to the ceiling imposed on the grant. This became so popular that the opposition which was still licking its wounds could not respond. Later they printed fake rice ration books to show that they too provided relief in their time. This was clearly illegal and the “fake ration book” trial dragged on in the courts for a long time.
By that time Ossie Abeygunasekere, the main accused in the case, had crossed over to the Premadasa camp and the matter was hushed up. Another prong of the Government strategy was to create a welcoming approach to foreign investment. The Board of Investment (originally called the ‘Greater Colombo Economic Commission’) was set up under Upali Wijewardene and a special investment zone was established in Katunayake.
At the same time the modernization of the Colombo Port with Japanese aid and the Mahaweli scheme with multiple foreign assistance was launched. With so many of the projects off the ground it was Ronnie who kept a tight leash on the funding with JRJ’s support. This financial control was not to the liking particularly of the PM Premadasa and Lalith Athulathmudali but they had no option but to accept the overseeing functions of the Finance Ministry.
There were also turf wars regarding funding for the accelerated Mahaweli project. But JRJ backed Gamin Dissanayake’s efforts to seek funding and he and Ronnie worked together fairly cordially. Ronnie established the “Aid Sri Lanka Club” of donors under the umbrella of the World Bank. This donors’ meeting was held annually in the World Bank and OECD Office in Paris. A well prepared ‘laundry list’ of projects approved by the Finance Ministry were discussed with high level representatives of the donor countries as well as representatives of multilateral institutions.
Once agreement was reached on funding it was included in the national budget for the following year which was presented to Parliament. This meeting also reviewed progress of the foreign funded projects then underway. All in all, these arrangements which were coordinated by Ronnie smoothed the way for a rapid take off and was later copied by many developing countries at the urging of the World Bank.
Ronnie depended very much on his civil service colleagues like Chandi Chanmugam, J.V. Fonseka, Chandra Fonseka, Gaya Kumaratunga and Akiel Mohammed who formed the bedrock of the divisions of the Finance Ministry. He also reached out to the Central Bank and co-opted officials from there – which had become the practice by that time. Illangaratne as acting Finance Minister of the 1970 cabinet had earlier inducted the `Kandyan twins’ – Kelegama and Karandawela, from the Central Bank and the practice has persisted with all subsequent Finance Ministers.
In addition the President used the services of Raju Coomaraswamy who had retired from the UN and returned to Sri Lanka, as his special envoy. When relations with the World Bank deteriorated to such an extent that JRJ wanted to close down its Colombo Office it was Raju who urged caution and got the Bank to support the Mahaweli project. JR had a special affection for Raju as he was part of his team when he was Minister of Finance in the DS Cabinet. He was thinking of fielding Raju as a candidate for a seat in the North and a Cabinet assignment, when the latter died of a sudden heart attack.
Raju’s son – the popular and capable Indrajit was seconded from the Central Bank to be Ronnie’s assistant and dogsbody. It must be mentioned here that subsequent Ministers of Finance, particularly CBK did not handle the ‘Aid Club’ very well. Her trips to Paris were not so productive. In fact she took a number of her ministers along with her. They were clueless about the purpose of the meeting and concentrated on the social events including a farewell party at the Crillon.I can reveal that it was a misunderstanding between CBK and S.B. Dissanayake whom she had taken along to Paris, that began the rupture that led to SB’s defection and the fall of her Cabinet in 2001.
Right along Ronnie had a special concern for the underprivileged. He served for a long time as a senior official in Philip Gunawardena’s ministry and was held in high regard by Philip. Ronnie, then in the prime of his life, naturally harbored ambitions of advancement. Premadasa, Athulathmudali and Upali were suspicious of his motives as the latter two hankered to be Minister of Finance. This led to much tension in the Cabinet which sometimes flared out as criticisms of the Finance Ministry.
But JRJ, who had been a Finance Minister himself, backed Ronnie. Much later at the tail end of his career JRJ was disappointed when Ronnie offered him only lukewarm support for the Indo-Lanka agreement and remained in his Geekiyanakanda estate, not even returning the President’s telephone calls. I had a close relationship with Ronnie and facilitated his rapprochement with President Wijetunga in 1993.Later I played ‘broker’ in getting him into CBK’s Cabinet in 2000. CBK always had a good rapport with him and Ronnie returned as a senior Cabinet Minister for a short duration which I shall describe in volume three of my autobiography.
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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