Features
A Tragedy of Relying on Misinformation
Import Ban on Synthetic Fertilizers –
by Buddhi Marambe,
Faculty of Agriculture, University of Peradeniya
The ban on importation of synthetic fertilizers and pesticides was imposed on May 6, 2021 through the Extraordinary Gazette Notification No 2226/48. This was one of the 20 activities approved by the Cabinet of Ministers under the theme “Creating a Green Socio-economy with Sustainable Solutions for Climate Change”. The theme carries a long term noble objective. However, the approach suggested for achieving the objective in the agriculture sector is not at all practical, even to maintain the current levels of crop production and productivity in the country thus, threatening food security.
Use of organic matter as a soil conditioner, and a supplementary nutrient source to a certain extent, have always been encouraged by many and practiced by farmers at different levels with various objectives. Organic farming is a specialty practice with product and process certification. It has a good but niche export market and also a promising foreign exchange earner. It is heartening to see that organic fertilizer production and compost production are taking place at a mass scale in the country, in response to this policy decision. However, even with the novel technologies, organic fertilizer and/or compost alone would not suffice in providing the required nutrition to plants at the correct time and quantities. A high crop productivity could be achieved when appropriate strategies are used to match the patterns of supply of nutrients from fertilizer (organic or mineral) and absorption of nutrients by plants/crops. This aspect has been much deliberated and hence, I will not elaborate on the same further.
We have now learned that the decision to ban import of agrochemicals was made due to speculation that the farmers in many parts of the country suffer from many Non-Communicable Diseases (NCDs) including kidney disease and also that the serious damages done to the environment with the use of mineral fertilizers. Furthermore, we were also informed that the government spends huge amounts of foreign exchange annually on mineral fertilizer imports, inferring that there is a foreign currency issue that has also set the base for this decision. The author of this article strongly believe that the decision to ban agrochemicals has been taken on misinformation provided to His Excellency the President. Hence, the correct facts regarding the mineral fertilizer and their utilization in Sri Lanka are presented in this article to debunk the unscientific justifications made by some individuals and groups that would probably have led to the policy directive.
Fertilizer Imports and use in Sri Lanka
The Kethata Aruna fertilizer material subsidy programme was introduced in 2005 and dismantled in 2016-2017 replaced by a cash subsidy. The fertilizer material subsidy was re-introduced thereafter since 2018 in different forms. The import of mineral fertilizers is governed by the Regulation of Fertilizer Act No. 68 of 1988. This is under the purview of the National Fertilizer Secretariat (NFS). It must be noted that all quantities of fertilizer imported are decided by the NFS based on the advice and recommendations of the respective state agencies, i.e. Department of Agriculture, Research Institutes responsible for tea, rubber, coconut, sugarcane, etc. The quantities to be imported are decided annually considering the existing extent (for perennial crops) and anticipated extent (e.g. annual food crops) of cultivation, considering the fertilizer recommendations given by state agencies based on crop-nutrient requirements.
For example, according to the NFS, the anticipated paddy cultivation in Sri Lanka in 2021 (both Yala and Maha seasons together) is 1.3 million ha and the required quantity of fertilizer to be imported is 247,000 mt of Urea, 61,000 mt of Triple Super Phosphate (TSP) and 74,000 mt of Muriate of Potash (MOP). As per government regulations, all paddy fertilizer (subsidized fertilizer) can only be imported and distributed through the government-controlled mechanism. Excluding paddy, the anticipated fertilizer import in 2021 to provide required nutrients to other food crops and perennial/plantation crops for an estimated extent of 1.47 million ha amounts to 298,983 mt of Urea, 102,928 mt of TSP and 243,743 mt of MOP. There are other types of fertilizer also imported under the licenses issued by NFS. Further, excluding the subsidized fertilizer for paddy, the NFS issues permits to the private sector to import fertilizer for other crops on an agreed quota system.
It is important to note that no individual or agency in Sri Lanka (government-owned or private sector) can import fertilizer without an import permit issued by the NFS. The import permits are issued based on the actual crop requirements and anticipated cultivated extents. Therefore, it is clear that the quantity of fertilizer imported to Sri Lanka is not done on an ad hoc basis, but on a clear scientific methodology. Farmers should receive fertilizer at quantities decided by the NFS as recommended by the state institutions, and up to what is required by the country – not in excess. When this is done following an accepted procedure, there is no point in arguing that Sri Lanka is importing more “chemical”/synthetic fertilizers than what is required in a given year. However, many policy makers and professionals still blame farmers for overusing fertilizer, which theoretically cannot be true as the fertilizer quantities are imported based on the actual crop requirements as estimated by the state agencies.
If the correct quantities of fertilizer are imported and their distribution is regulated (assuming no illegal entry of fertilizer to the country), the claims for overuse of fertilizer should not have arisen. Further, there should be false alarms ringing to politicians and decision makers that undue quantities of fertilizer has been imported with a huge pressure on foreign exchange drain, and causing severe impacts on the environment. Such false alarms would also have provided a window of opportunity for some to create the “fertilizer demon”.
Once the fertilizer or any other agricultural input is heavily subsidized, their misuse is the most highly likely (mal)practice. In this context, if the state agencies and the NFS have done a fairly accurate estimate for the fertilizer requirement and imports, the best option available would be to remove the fertilizer subsidy (at once or in a phased-out manner) and make “chemical” and organic fertilizers readily available in the market allowing the farmers to take a judicious decision on the fertilizer use on their own. Farmers also need proper training on the judicious use of “chemical” fertilizers with organic matter, i.e. integrated plant nutrient systems (IPNS), and obviously pesticides. Without such well-targeted capacity building, it is not wise to put the blame on the farming community for misusing or overusing agrochemicals and thereby polluting the environment.
Furthermore, some scientists and professionals claim that Sri Lanka uses the highest quantity of fertilizer among those in Asia (or South Asia). The latest FAO statistics available for all countries clearly indicate the low rate of fertilizer use in Sri Lanka (Figure 1), except for few years. Regarding pesticide use, too, Sri Lanka stands at very low rates of application. Hence, the popular notion of heavy use of fertilizers leading to health hazards and environmental pollution is an erroneous conclusion drawn without considering the scientific facts.
Eco-friendly fertilizer use
Organic amendments in agriculture is not an alien practice to our farmers. The IPNS in crop production; i.e. the use of organic matter with “chemical” fertilizers, has been recommended since time immemorial to improve the fertilizer and nutrient use efficiency and to minimize environmental pollution caused by leaching. The Department of Agriculture (DOA) has formally promoted the adoption of Good Agricultural Practices (GAP) to minimize any misuse of agrochemicals, since 2015.The GAP programme has started gaining momentum in 2020. Prior to the current policy directive, the Ministry of Agriculture even had plans to distribute organic fertilizers produced by different private companies to selected paddy growers during 2021 Yala season, together with “chemical” fertilizer. The proportionate allocation of fertilizer for this IPNS was 30% organic fertilizer, and 70% urea, 50% TSP and 70% MOP as per recommendation of the DOA. Similar proportions were also used in the case of bio-fertilizers. This was an excellent initiative. However, the current policy directive will derail this good practice and would create disastrous impacts on crop production.
Figure 1.
Fertilizer use (kg per ha of cropland) in developed and developing countries. Data labels are for the year 2018 (Source: FAOSTAT)
Low quality fertilizer imports
The Sri Lanka Standards Institute (SLSI) has set up standards for the “chemical” and organic fertilizers to be used in Sri Lanka. The NFS relies on such standards, which are adopted for any fertilizer used in Sri Lanka (imported or locally produced). The sparkling revelation made by the Hon. Minister of Agriculture, which also appeared in the Government Audit Report of 2020 which says that 55 fertilizer analysis reports have been tampered to allow inferior quality fertilizers to be released in Sri Lanka. Release of 12,000 mt of imported TSP in 2020 having heavy metals such as lead (Pb) contents higher than the limit set by SLSI (maximum Pb content allowed in TSP is 30 ppm) was reported in electronic and social media, and also raised at the Parliament causing serious concerns over the mishandling of state affairs by certain officials. Hats off to the Hon. Minister of Agriculture who took stern punitive action against some officials for tampering the analytical reports of the fertilizer samples.
Recently, we also heard that organic fertilizer has been imported without proper approvals. Any plant-based organic fertilizer requires the approval and a permit of the DG of the DOA under the Plant Protection Act No 35 of 1999. We also heard that such imports have been done in the past, which should not have been allowed due to multi-folded negative impacts than what is even speculated against agrochemicals. The efforts made by officers of the DOA and the Sri Lanka Customs, and no signs of political interference in releasing the imported consignment is noteworthy and require special commendations.
All such incidents indicate that the well-articulated fertilizer regulatory process has been breached by some people with vested interests. These are daylight robberies of government (people’s) money and efforts to rape the environment (similar to misuse of any other agricultural inputs). The penalties have been imposed in some cases but it is high time that openings for mal-practices be sealed-off so that even in the future, import of any type of fertilizers is stringently governed.
The case of non-communicable diseases
Agrochemicals are generally considered as the causal factors for many of the non-communicable diseases (NCDs), especially the chronic kidney disease of uncertain etiology (CKDu). Such unproven ideology has been forced into minds of people who are suffering from the disease. Some even dubbed CKDu as ‘Agricultural kidney disease’. This propaganda campaign has brainwashed not only the unfortunate patients, but also the general public and policy makers and thus, creating fear against an important agricultural input.
In those claims, nutrients are probably not targeted as the causal factor for NCDs. For example, both mineral and organic fertilizers provide the essential plant nutrient “Nitrogen” in the form Nitrate (NO3–) or Ammonium (NH4+) ions to be taken up by plants. Further, amino acid supplements providing 13-19% nitrogen can also be taken up by plants directly. The loss of Nitrates in the ecosystems, especially polluting ground water, can be minimized by split application of fertilizer (which is the recommended practice) and with the application of organic matter (manure, fertilizer or composts) as soil amendments. The organic amendments have limited plant nutrient supply (e.g. 1-3.5% N, or rarely up to 6% depending on the source). Lack of soil organic matter (e.g. sandy soils) will create a negative scenario as observed in isolated incidents such as Kalpitiya area. Hence, the popular argument on the impact of fertilizer on human health and environment issues could mainly be focused on the potential contaminants in fertilizers, such as heavy metals.
Nitrogen being the most difficult element to tackle in nature, let me take an example for urea. The maximum limits allowed by the SLS standards for Arsenic (As), Cadmium (Cd) and Lead (Pb) for urea fertilizer used in Sri Lanka is 0.1, 0.1 and 0.1 ppm, respectively. As for solid organic fertilizers the corresponding values are 3, 1.5 and 30 ppm, respectively (SLS 1704:2021). This indicates the danger that could arise from application of solid organic fertilizer with the objective of providing nitrogen to the crops. Extremely low and stringent heavy metal limits have been adopted for urea as there is hardly any chance for such contamination, but the maximum allowable limits for such elements in solid organic fertilizers are higher owing to higher potential for contamination. If the municipal solid waste is used as the source to produce composts for agricultural land, then the maximum allowable limits for As, Cd and Pb are 5, 3 and 150 ppm (SLS 1634:2019), respectively. This needs no further explanation to prove the fact that organic fertilizer targeting Nitrogen could pollute the environment at a higher level than urea.
The popular talk on “Agrochemicals as a causal factor for rising incidence of cancer in Sri Lanka” has surfaced again. I am not a medical professional to provide details on such. However, as per Figure 1, the amount of fertilizer added per ha of cropland in 2018 in Australia was 86 kg, Bangladesh 318 kg and Sri Lanka 138 kg. But, the statistics presented by GLOBOCAN 2020 revealed that five-year prevalence in cancer as a proportion for 100,000 population in Australia is 3,172, Bangladesh 164, and Sri Lanka 354. I will leave it with the learned readers to draw conclusions.
The “demon” created in people’s mind with respect to use of fertilizer and its impact on NCDs such as CKDu was comprehensively refuted recently by the Chairman of the National Research Council (NRC) of Sri Lanka, appearing in a popular TV discussion. The Chairman/NRC clearly stated that the most recent research completed under the funding from NRC has concluded that not drinking adequate volumes of water and the high fluoride content in ground water as the two major causal factors for the CKDu in Anuradhapura area. He further stated that the disease is not due to heavy metals and that this information has been provided to the Ministry of Health.
Need for evidence-based policy making
National policies need to be set based on evidence. Policies driven by advice from those who want their whims and fancies to be realized at the expense of national budget will result in detrimental and irreversible impact on the national economy. Further, the spread of unproven and non-scientific ideologies across the society have already made complete change in focus of the efforts made to find solutions to major issues in the Sri Lankan society, including finding causal factors for human health related problems such as CKDu. Many intellectuals have alarmed that the import ban on “chemical” fertilizers would lead to food shortages and high food prices. In this context, Sri Lanka is likely to import a major portion of basic food needs such as rice, as experienced by Bhutan in their failed attempt to become the first organic country by 2020, adding a huge burden to the government treasury.
The fear generated on agrochemicals thus, seems to be due to chemophobia (irrational fear of chemicals) of some people, who have unduly fed the same into the authorities. His Excellency and the Cabinet of Ministers should not fall prey to ideologies spread by some people that could have unprecedented negative effects, in making decisions in relation to the country’s economy. It is still not late to revisit the decision to ban the import of agrochemicals. Being misinformed is more dangerous than being not informed.
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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