Features
A radical shift needed
By Faraz Shauketaly
Most people in Sri Lanka are fully aware that a growing number of the republic are protesting and publicly complaining of a myriad of problems. To be fair, Sri Lanka’s economy has always remained a little over the danger zone and it would be safe to say it has been for quite a while in the amber zone. In the past, growth was remarkable and principal indicators were resilient and stable. Indeed, such was the case throughout the Mahinda Rajapaksa Presidency with – for example – the exchange rate maintaining a position and not losing ground in any way to cause investor alarm.
All this changed, of course, with the advent of a new government grandly proclaiming Yahapalanaya or Good governance to be the base of their outlook for Sri Lanka. Sadly, for the nation, the bunch of self-styled good-governance advocates instead quite literally helped themselves.
There was the infamous Bond scam, there were the turning of the Nelsonian eye when it came to Excise collections, under payment of duties for most anything including vehicles especially at the upper end, Minister’s actively discarding due process and established procedure and the list went on and on – except, of course, the manifesto promises were never kept.
In between all of this no one expected a pandemic to come along and wreak havoc upon our shores. Claim and counter claim does its rounds but the fact is no one quite had the expertise to handle CV19 – a new global phenomenon.
The impact on our Tourism industry and on our remittances from our expatriate workers has caused absolute havoc on our economy.
The time may now be opportune for all our political parties to form a joint governance team to embark upon a radical change to our governance outlook.
No amount of confident speak that is put out by the master at the Central Bank can overlook some of the happenings that abound in Sri Lanka. These happenings always – not almost – affect the decision-making processes of overseas based investors seeking new and better opportunities to maximise returns.
The rule of law is always a hotbed of concern. Imagine would be investors studying that aspect of the Sri Lanka way: they will discover the strange goings on within the judicial circle. The Attorney General’s department having presumably studied case files decide to indict persons. At times these persons have temporarily lost their freedom being remanded. Thereafter, the same Attorney General’s department decides to withdraw the charges. And (in a strange twist) the one-time Attorney General is now the Chief Justice. Most liberal minded persons may be unable to comprehend what is going on or will take a pretty dim view of the original indictments and wonder if they were suffering from political lesions.
Of course, the Yahaplanists, too, departed from established procedure. They had a committee based around Temple Trees that basically decided which cases should be taken up by the then newly created FCID. There was a steady stream of persons going to the FCID, some remanded, and it was a virtual circus of the clowns. To so arbitrarily decide whom to look at is a departure from process. It could be argued then that this government was only putting right what was a departure in the past!
All of this is not by the way. It ought not to be so. Sri Lanka will need to up its ante when it comes to the application of the Rule of Law. All sensible investors with the medium to long term pitch in mind will want to feel secure that they are investing in a country that has people who are fairly well educated, where the infrastructure is also more or less par for the course, where the political stability is established and where they can if needed rely on the rule of law to protect their brand and their investment.
At the moment the nation additionally appears to need stability of policy. Not a system where the government is ruling quite often by the issuance of Gazette notices and equally as often changing those notices or amending them within a short period. This indicates that there appears to be a lack of planning and 360-degree consultative processes.
The move towards an all green economy is commendable and will have excellent benefits for our nation’s image in the future once we are well entrenched within a green economy, food, buildings, warts and all.
Save, of course, that none of this can be done literally overnight. The President had no sooner spoken that the import of all non-organic fertilisers was banned. The reaction was spontaneous. Farmers protested, the tea industry was particularly concerned that their exports of 300 million kilos of Ceylon’s finest would be challenged in some discerning markets at least, including the Japanese market.
Our Prime Minister, President Mahinda Rajapaksa the veteran politician that he is, was eloquent and on point when he called for unity within the ruling alliance which after all gave this government the majority they sought – a two thirds majority which they maintain is required for strong government. President Mahinda Rajapaksa pointed to the apparent exodus of the youth of Sri Lanka seeking opportunities in other territories. It is clear, that Sri Lanka is in an economic mire with the people of our country in an abyss of despair.
President Gotabaya Rajapaksa has not missed a beat: he too has alluded to the political disunity and has openly stated that there are two types of persona in so far as his governance is concerned. He has clarified what prompted him to appoint a monk who has been known to be controversial.
No matter what the justification alluded to, the fact is that this appointment has caused much concern not only in our own Sri Lanka but amongst our trading partners whose inputs are essential to the progress of our nation.
One rule, one country is welcome by all of us here in Sri Lanka. However, to appoint a person who is considered a hardliner to the detriment of the minorities in our country is to stir the pot of disharmony and disunity. It could verily fan the flames of communal disharmony.
After 30 plus years of a communally-driven near civil war, all of us, in Sri Lanka, are only too aware of the damage this causes to the growth of our economy apart from the lost opportunities of communal unity. If we need one example it would be to study the phenomenal explosion of tourism in Sri Lanka post 2009. No liberal minded traveller or any corporate worth its salt, will wish to consider Sri Lanka if the country is again a de-facto war zone where personal security is at stake.
President Gotabaya called for and assured a revolutionary change. God bless him for at least saying that. It is exactly what we need on a number of fronts.
Leading the package of revolutionary change will necessarily be the attitude of all governments to that perennial problem of corruption and politically sponsored impunity.
Revolutionary change will need to address inclusivity: consultative processes may well be a tedious impediment to achieve fast-tracked development of government policies. It is unfortunately a case of that old but true adage, ‘Rome was not built in a day’. Any government will need to demonstrate real commitment to address corruption wastage and graft. Not mere words but action real at that is what is required.
It really is quite simple. Sri Lanka’s economy has so very badly been affected that there is no leeway for development and corruption at the same time. Our economy has reached a sort of plateau. If we are to forge ahead, we must have a zero-tolerance towards corruption and waste – the twin impediments that are currently raging across all important sectors.
The losses to state banks after having indulged politically exposed persons – read cronies of any government holding the reins of power – remains at an all-time high. The Minister of Finance has proposed that a principal amount of Rs 8,500,000,000 be returned to the Central Bank, calling it ‘illegally made money’. Most followers of that circus known as the Central Bank Bond Scam will no doubt be reminded that Perpetual Treasuries, the company at the epi-centre, reported profits totalling more than Rs 18 Billion.
A weekend newspaper reported that corporates with cross shareholdings and or directorships with Perpetual separately owed state banks and other state bodies sums greater than Rs 10 Billion. This may well be a smart move by the Minister of Finance enabling President Gothabya to maintain that at least one part of his manifesto undertakings has been completed at least by 50 percent. Nevertheless, the adventure that the former Guvnor of the Central Bank Mahendran embarked upon has cost our country very dearly indeed. It is unlikely that the principal shareholders have assets anywhere close to the monies our country has lost thanks to this escapade. The monies made have been distributed to several who also had a hand in this sordid affair and much of it would have taken flight to other jurisdictions. We are constantly reminded that the Guvnor who went back to his adoptive Singapore never did return to the land of his birth to answer questions that the Police in Sri Lanka would like very much to pose to him. We would not be surprised that if the rest of the profits found its way to friends, family and property and other fixed assets in other countries.
It is not a Radical Revolution change we need, rather we need all the perpetrators not just those now indicted for this matter, be indicted and in the event a custodial sentence be ordered it would arguably perhaps be best if the keys to those cells be thrown into the Indian Ocean.
President Gotabaya was elected because the people truly believed that he would be able to emulate some of what he achieved at the Defence Ministry and the Urban Development Authority. The vagaries and intricacies of Sri Lankan politics dictated that he be nominated by a registered political party in order to contest the election for the presidency. Very unfortunately it is some members of that very party that propelled him into the throne room who have withheld his progress. And when it comes to family, there really is a thin line between family and anything else. Friends and hangers on attached mainly to the former President Mahinda are costing this President dearly in terms of plummeting popularity. Just like what happened to President Mahinda – admittedly in that debacle, members of the family played a key role too.
The saving grace is that the government has approximately three more years to go before they will be obliged to go to the polls.
Presumably before that time, the SLPP will want to put a few cases behind their back – like the Bond scam – sort out the food production and of course stabilise the forex rates.
Much depends on the myopic nature of the Sri Lankan mind-set. If they forget about the hardships, we have endured for the past three years they may neglect to elect a whole new set of people – emulating President Gotabaya’s expressly stated advisory delivered recently.
In which case what will be in store for us? More of the same? Can we really expect a revolutionary change? Hope springs eternal.
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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