Features
Birth of a new world order
by Kumar David
Revolting devastation and human suffering in this war is borne by Ukraine but profound changes will come in Russia. The overpowering player in the medium term will be China. Deeply significant will be the long-term alterations of global political-economy. Do I have ballpark notions of the three periods? Well let me stick my thumb in the air and say one, five and 10+ years, respectively. The war, Putin’s blackeye, dogged Ukrainian resistance, sanctions, refugees and the determination of Western capitalism and public opinion are the topics of conversation. The glorious democracy Germany will prosecute those who support Russia in public. The ultra-right-wing Economist of March 27 carries a lurid outburst of hatred and insinuation unsupported by evidence against Putin baked into three pages of venom (“Greyness, greed and grievance”). No attention is paid by intellectually handicapped Western media and “scholarship” to how the world will alter down the road.
Were you to call the deeply religious Christian-Orthodox Vladimir Putin (VP) a reincarnation of Vlad the Impaler, who am I to disagree? There will paradoxically however, be unintended benefits for the Russian economy, people and state. The opprobrium that VP has brought upon himself is the least of my concerns. What has he to show for reducing Mariupol to rubble, five million refugees, exposing his military as incompetent and its toolkit rusted, a 4,000-long sanctions list (the harshest ever) and confiscation of Russia’s external assets by new-imperialism? Thousands of civilian deaths, maybe ten to twenty thousand soldiers as well. OK, it’s true that after this clobbering Ukraine will never join NATO, but this VP could have achieved by craft, diplomacy and threat. Six-gun Putin knows nought of the finesse of Sun Tzu and Machiavelli. So here’s my first punch-line: The bitter-sweet truth is that Russia for its economic survival has nowhere to turn but to China (unless sanctions are lifted). That’s point-one in my three-pronged hypothesis.
[For a different assessment of Putin’s military objectives visit two URLs supplied at the end of this article #]
My second point is that the reign of the bloodsucking oligarchs, much wider than VP’s yacht sharing, dacha inhabiting buddies, who bled, robbed and corrupted Russia since America (and MIT) rigged its economic system in the Yeltsin years, is finished. The corrupt deals that made Roman Abramovich (Chelsea football club owner) a fortune is just one of many examples. After buying oil company Sibneft from the Russian government in a rigged auction in 1995 for $250m, he sold it back to the government for $13bn in 2005. (He magically materialised at the negotiations a few days ago; VP’s Rasputin?)! The list of bloodsucking oligarchs is long and sickening. The post-Putin era, irrespective of whether VP is kicked out in a palace coup, weakened or brought under supervision, will see transformations of economy, state and polity. Economic-power relationships will go upside down. Will political power be less dictatorial? Too much to hope for?
Russia has no choice; it has no fall back but China. This is a lesson for life even after sanctions are lifted. True only 3% of current Chinese exports are Russia-bound, the US and EU take about 15% each and the “developing” world 55%. This 3% may jump to 10% as sanctions bite and Russia struggles for consumer durables, chips, tech-stuff, luxury brands, Kentucky Fries and Big Macs. As Western investors of all complexion flee, Chinese equivalents can fill the gap. China will however will be wary of risking secondary sanctions for a small market and for a broke customer who will need to buy on tick initially. What the Chinese will eye are natural resources; Russia is the world’s resource-richest ($75 trillion) country, ahead of the US ($45 trillion) and China ($25 trillion). Its resource rankings are as follows timber (1; its forest area exceeds Brazil’s), coal (2), gas (2), minerals (2), oil (3) and gold (3). Though in land area it is the largest of any country, arable land is only 7.5% of all land due to the harsh climate, hence it comes third behind India (57 % of all land is cultivated) and the US (17% cultivated) in total hectares of cultivated land.
Resource-wise this is El Dorado for the exploding Chinese economic engine seeking global investment opportunities. Young educated manpower and technological sophistication put Russia leagues ahead of basket-cases Africa, Pakistan and Sri Lanka. The best part of the multibillion-dollar Sino-European railway passes through Russia. The needs of broke and broken Russia with quality manpower and potential resource benefits for ambitious China fit like hand and glove. Political-economic logic and its consummation are nevertheless, many pitfalls apart. But the contours of what may be viable within a year or two of the ending of hostilities in Ukraine are visible.
The Ukraine war has snapped shut the Thucydides Trap enmeshing Western neo-imperialism and China with unexpected suddenness. It was always there, always threatening, often taking a bite here and there; the ban on Huawei, charges of intellectual property theft and sanctions on individuals were signs. Upending Russia, isolating it from global financial and trade make it stark that this is China’s future when the Trap is fully sprung. Biden declares “NATO has never been so united”. German Fraus and their little kinder joyfully prepare to freeze for freedom (Really?). The Chinese have so far only been shocked into wakefulness, but who doesn’t see that the big match is yet to come; which Chinaman doesn’t feel in his bones that VP’s rout is a mere dress-rehearsal before politico-economic warfare against the real target? It is a last chance to pushback a China which has been gaining inexorably for three decades in economic clout and global influence. For neo-imperialism it is a final, a life or death encounter. But in a deeper sense it is not Putin, Biden, colourful clowns Britain’s BoJo or Ukrain’s Yellingsky that matter; they are puny catalysts. “All the world’s a stage and all the men and women merely players”. A realignment of the world has become unavoidable – the French Revolution, WW1, WW2 and the fall of the USSR have left so much unfinished clutter. All that I say in this essay I say cold-bloodedly without taking this side or that, as far as possible.
So my medium-term argument: It is in China’s economic and political interest to turn Russia into a resource-rich partner in a new world order even after sanctions are lifted. If you are thinking of a new Cold War you’ve got it wrong. In USSR-times that bloc plus China accounted for a mere 15% of global output. Today it’s more than 30% and growing; more if you include Vietnam, the five landlocked Central Asian -Stans, the socialist inclined governments of South America and “left” dictatorships Cuba, Venezuela and Nicaragua. I am selecting countries which will readily do business with a presumptive Sino-Russian alliance. China is already the largest trading partner of over 100 countries, nevertheless it will be wary and play its cards carefully. Midgets (not Vietnam), consume peanuts, are miniscule markets, and mere dollops as economic partners. Russia of course can absorb $200 -300 billion in annual Chinese investment in mining, timber & land, infrastructure, tech-manufacturing-military, food processing and the service sector.
That was the third, global, last facet of my crystal-ball gazing: The longer-term two decades beyond the present. You may think me as wacky as Nostradamus but no matter, if you read up to this point you may as well persevere for one more para. The presumptive Sino-Russian Alliance espied here and others who cosy up to it, will constitute an assemblage more porous to cross-boundary economic flows and politically more elastic than the defunct Soviet Bloc of Cold War times. Political plasticity aside it will be porous in trade and investment. I envisage dollar-divested trade and investment, and as the group gains strength spurning neo-imperialist sanctions on each another. A new world has to be built; there’s no other way.
Aside from those named so far, potential collaborators are Iran (world’s largest gas reserves), India, South Africa, Nigeria, North Korea and perhaps at the margin Saudi Arabia (largest oil reserves) and some Gulf States. India, South Africa, the -Stans, North Korea and of course China abstained in the UN vote condemning Russia at the UN. The socialist-left and “left”-dictatorships voted with Russia. India is critical to securing the credibility of this ensemble and the key to that is Beijing. China will have to make boundary concessions to woo India away from QUAD and ease its security concerns. This oh dear is the fly in the ointment. The Chinese are said to be intelligent, but on territorial issues experience is entirely the opposite! Nationalists the world over are universal idiots. Oh, for a reincarnated Samuel Johnson.
# Two well-known American publications give a sharply different assessment of Putin’s war objectives:
https://www.newsweek.com/putins-bombers-could-devastate-ukraine-hes-holding-back-heres-why-1690494
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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