Features
‘Qingdao organic fertiliser shipment is pathogen free’: How scientifically acceptable is test report?
by Prof. Devika de Costa
(Chair Professor of Plant Protection, Faculty of Agriculture, University of Peradeniya)
Background
The bulk carrier, Hippo Spirit, carrying an organic fertiliser shipment of 20,000 metric tons manufactured by the Qingdao Seawin Biotech Group Co. Ltd., China,started to sail to its destination, Colombo, Sri Lanka, from Qingdao port, China, on the 22 September 2021. Seventy-two days after its departure, on the 04 December 2021, Hippo Spirit left the Sri Lankan waters heading towards Singapore without unloading its shipment of organic fertiliser at the planned destination.
The reason for not allowing the shipment to be unloaded by the Sri Lankan authorities was the detection of the contamination of the organic fertiliser onboard with a plant pathogenic bacterium named Erwinia spp. and another group of bacteria of Bacillus spp., as confirmed twice by the National Plant Quarantine Service, Sri Lanka (NPQS). As per the Plant Protection Act No. 35, 1999 of Sri Lanka, material containing any organism harmful to, or injurious to, or destructive of plants and for the sanitation of plants in Sri Lanka, is not allowed to be imported.
Qingdao Seawin Biotech Group Co. Ltd., the supplier, directed the Hippo Spirit, along with the bulk organic fertiliser shipment, to a test laboratory in Singapore, with the intention of getting a sample of the shipment tested for its quality by a third party and to initiate an international arbitration procedure.
The third party testing laboratory that the Qingdao Seawin selected was SGS Testing & Control Services Singapore Pvt. Ltd. (SGS). The reason for obtaining the services of a third party for the testing procedure was to support the allegations made by Qingdao Seawin against the NPQS. Qingdao Seawin denied the fact that their shipment was contaminated with the bacterium Erwinia, emphasising that NPQS had not conducted the test procedures scientifically and had not followed standard methodologies adopted by the International Plant Protection Convention (IPPC).
Accordingly, a sample of the organic fertiliser shipment in Hippo Spirit was submitted to the SGS laboratory for testing its microbial quality on the 13 December 2021. At the SGS laboratory, this sample was tested to detect the presence of a specific group of bacteria, according to a standard test procedure, and the test results were released on 20 December 2021.
SGS test report Figure 1
shows an image of the test report released by the SGS laboratory on the 20 December 2021. According to the report, the submitted sample was tested by two standard methods, namely ISO 21528-1 (2017) and ISO 21528-2 (2017), to detect bacteria belonging to the Family Enterobacteriaceae, a sub-group within the large taxonomic group of bacteria.
The testing period of the sample has been reported as seven days from the 13th to the 20 December 2021. Results released by the SGS laboratory reveal that bacteria belonging to Enterobacteriaceae have not been detected in the sample subjected to the above two testing procedures.
(see Figure 1: The SGS test report)
What are Enterobacteriaceae bacteria?
Enterobacteriaceae is a large family of bacteria consisting of 53 bacterial genera (Reference No. 1). According to ‘Gram Staining’, the standard staining technique used in bacteriology for initial categorisation of bacteria, the bacteria belonging to this Enterobacteriaceae are classified as ‘Gram negative’. A majority of the bacterial genera belonging to this family are inhabitants of the human and animal intestine. Such bacteria are termed as ‘enteric bacteria’. In addition to the enteric bacteria, some of the genera belonging to the family Enterobacteriaceae live in natural environments such as soil and water.
There are some bacterial genera of this family, which are pathogenic (i.e. having the ability to cause diseases) to plants and animals. Most of the bacterial members of this family grow well at a temperature of 37 oC but there are some bacteria that show a better growth at a temperature range of 25 – 30 oC. Therefore, it is clear that within the same bacterial family, there are different bacterial genera and species with different physical, nutritional and functional characteristics. It is equivalent to siblings of a given family having differences in terms of their external morphological features, behaviour, attitudes, performances, working efficiency, etc.
Scientific basis of the test protocol to determine the quality of the sample
ISO 21528-1 (2017) and ISO 21528-2 (2017) are recommended test protocols to detect the presence of bacteria belonging to the Family Enterobacteriaceae in food samples used for human/animal consumption or to test the environmental samples used for primary food production, food production and food handling. Using the above test protocols it is possible to detect the presence of ‘culturable bacteria’ (i.e. bacteria which are capable of growing on synthetic culture media) belonging to the family Enterobacteriaceae. This means that the selected test protocols are suitable for detecting only a limited, focused group of bacteria and that these specific test protocols have not targeted the detection of all types of bacteria. The specificity of this test protocol to target only the culturable type bacteria of the Enterobacteriaceae family has been achieved through the specific synthetic culture medium used in the protocol. The culture medium used here is called the ‘Violet Red Bile Glucose Agar medium (VRBGA)’. Microbiologically, the culture media which specifically target a particular group of bacteria or microorganisms are termed ‘selective media’. Such selective media favour the growth of a particular group of microorganisms while suppressing the growth of all other types.
Selectivity of the VRBGA medium is determined by the ingredients used when preparing it. For example, the chemical stain called crystal violet and bile salts are used when preparing the VRBGA medium and both these chemical ingredients suppress the growth of Gram positive type bacteria. Moreover, the bile salts used in this medium encourages the growth of bacteria that are resistant to bile salts. In other words, only the bacteria which are not destroyed by the action of bile salts will grow on the VRBGA medium.
On the other hand, the bacteria which cannot tolerate bile salts will not grow on this selective medium even if they are present in the test sample.
Enteric bacteria naturally inhabit in an environment containing bile salts (i.e. the gut of animals and humans) and consequently are usually resistant to bile salts. Therefore, growth of such bacteria will not be suppressed when a test sample is allowed to grow on the VRBGA medium. However, non-enteric bacteria usually live in environments such as soil or plant tissue, and therefore, have no exposure to bile salts. Accordingly, they are not accustomed to grow in an environment containing bile salts. As a consequence, the growth of non-enteric bacteria is suppressed on the VRBGA medium. Therefore, it is clear that a test protocol using the VRBGA medium is not appropriate to test the presence of microorganisms or bacteria in a test sample of plant origin such as the organic fertilizer consignment from Qingdao Seawin Biotech Group Co. Ltd. More importantly, this renders the conclusion by the SGS test report invalid.
Erwinia spp. grow naturally in plant tissues which have no bile salts in them. Thus it is a group of non-enteric bacteria. As explained above, the growth of such non-enteric bacteria is heavily suppressed on the VRBGA medium. According to the results of the publication given as Reference Number 2, the VRBGA medium has been identified as a medium which underestimates the presence of plant bacteria such as Erwinia, despite Erwinia being a member of the Family Enterobacteriaceae. Therefore, it should be clear that even if bacteria belonging to Erwinia spp. had been present in the tested organic fertilizer sample from Qingdao, there was a very high probability for them not being able to develop colonies on the VRBGA medium. Thus, the conclusion that the sample is free from Erwinia is erroneous and inconclusive.
Scientific reasons for not agreeing with the conclusions made by the SGS report
The SGS report concludes that based on ISO 21528-1 (2017) and ISO 21528-2 (2017) test protocols, the sample does not contain bacteria belonging to the family Enterobacteriaceae, and therefore, the sample is free from Erwinia as well. Based on the above test report, news reports were released through public media (Daily News, 24th of December 2021 and News First, 22nd of December 2021) saying that the organic fertiliser shipment was free from plant, animal and human pathogens including Erwinia.
Given below are the scientific reasons to emphasise that the conclusion drawn is erroneous:
(a) Because of the highly selective nature of the VRBGA medium, all bacteria in the Enterobacteriaceae family will not develop colonies on it when the sample is tested by the above ISO procedures. Accordingly, Non-enteric bacteria and bacteria which are usual inhabitants of bile salt-free environments, and hence are not resistant to the effect of bile salts will not develop on the culture medium even if they are present in the test sample. Therefore, it is erroneous to conclude that the sample is free from Erwinia;
(b)
As a selective medium, VRBGA targets the detection of bacteria belonging to the Enterobacteriaceae family only. This medium suppresses the growth of all Gram positive type bacteria and other non-Enterobacteriaceae bacteria. There are many plant, animal and human pathogenic bacteria which belong to many other taxonomic families (i.e. other than Enterobacteriaceae/non-Enterobacteriaceae). Therefore, based on this test report, it is not possible to conclude that the sample is free from plant, animal and human pathogens from taxonomic families other than Enterobacteriaceae;
(c)
In giving their conclusion, the SGS report assumes that Erwinia belongs to the family Entereobacteriaceae. However, according to the most recent taxonomic classification of bacteria as given in Reference No. 3, the genus Erwinia is no longer a member of the Family Enterobacteriaceae. Accordingly, Erwinia genus is now included in a separate family named Erwiniaceae. This recent taxonomic classification is based on molecular biological methods of bacteria identification. In contrast, the previous classification, under which the genus Erwinia had been classified within the Family Enterobacteriaceae, was based on morphological and biochemical features of bacteria. It is widely acknowledged that molecular biological methods of bacteria identification are superior to methods based on morphological and biochemical features. This is equivalent to identifying a person by his/her genetic make-up as opposed to his/her external features and performance.
Organisms/microorganisms belonging to different taxonomic strata have unique behaviours and unique characteristics. These specific behaviours and features should be considered carefully when selecting appropriate methods for detecting microorganisms. Inappropriate selection of detection methodology leaves a very high possibility for a majority of microorganisms passing undetected, leading to erroneous conclusions about test samples.
If the fertiliser supplying company had the intention of clearing its good name that the shipment was free from Erwinia, the most appropriate methodology was to use specific, standard microbiological methods that are available to specifically detect the genus Erwinia or selected species of Erwinia. Or, the most logical and scientific approach should have been to test the sample for the presence of any culturable microorganism (using a standard microbiological technique suitable for this purpose) and if microorganisms were detected, to confirm their identity for genus Erwinia or species of Erwinia, subsequently. Instead what has been attempted through the test procedures that have been adopted by the SGS laboratory in Singapore was to try to convince the absence of Erwinia in an indirect way using a less sensitive and highly selective method targeting a particular group of bacteria with a questionable approach.
According to ISO 21528-1 (2017) and ISO 21528-2 (2017) test procedures, there is no specific guideline on the way of sampling. It is stated that the sampling is done on a case-specific way (if standard procedures are available for a given sampling material) and when such standards are not available, it is done via mutual agreement of the relevant parties.
According to the SGS report, the sample submitted for testing (Figure 2) is a parcel with approximate dimensions of 30 cm x 15 cm. The content within it could be estimated to be about 500 – 1000 g. It is highly questionable whether the amount of fertiliser sample submitted for testing was truly representative of the whole bulk of the 20,000 metric ton shipment. Furthermore, the number of samples submitted for testing seems to be only one, which is also not a sufficient number to represent the bulk of the shipment. There are widely-accepted sampling protocols that should have been used to obtain a series of representative samples. In scientific research, results based on a single sample are rarely, if ever, accepted as valid.
(See Figure 2: The sample used for testing as shown in the SGS test report)
ISO 21528-1 (2017) and ISO 21528-2 (2017) test procedures emphasise that the samples used for testing should be a proper representation of the bulk. In addition they provide clear guidelines on the quality of the sample at the time of its submission for testing. Accordingly, the sample should not have been damaged or changed during transport and storage. It is highly doubtful if the latter requirement could have been fulfilled from a shipment that had been stored in a bulk carrier for more than three months. Therefore, the validity/accuracy of the test results is questionable as the results do not reflect the initial quality/status of the shipment.
Based on above questionable/doubtful test procedures, it is not possible to conclude that the organic fertiliser sample tested by the SGS laboratory is free from plant, animal and human pathogens including Erwinia. The biggest concern arising from the conclusions of this nature is their negative impact on policy decisions and thereby the potential catastrophes that could be encountered by the nation as a whole. For example, the potential disease damage to a wide range of crops grown in Sri Lanka that could be caused by application of an organic fertiliser containing a plant pathogen such as Erwinia is enormous and could last for a very long period, incurring billions of rupees. Similarly, diseases to plants, animals and humans that could be caused by the wide range of microorganisms that are not detected by these highly-selective test protocols adopted by the SGS could lead to substantial economic and environmental damage along with human health hazards. These could take several years and several billions of rupees to be brought under control.
The meek response of the Sri Lankan authorities to the legal challenge of Qingdao based on the erroneous and questionable SGS test report from Singapore demonstrates their readiness to accept anything coming from an international agency while ignoring the scientifically-valid tests and conclusions of the Sri Lankan scientists. This sends a very negative detrimental signal to the national scientific community and to the nation as a whole.
References:
1. UK Standards for Microbiology Investigations: Identification of Enterobacteriaceae (2013), Issued by the Standards Unit, Microbiology Services, Public Health England, 32 pp.
2. Baruzzi, F., Cefola, M., Carito, A., Vanadia, S. and Calabrese, N., (2012). Changes in bacterial composition of zucchini flowers exposed to refrigeration temperatures. The Scientific World Journal, https://doi.org/10.1100/2012/127805, 6 pp.
3. Adeolu, M., Alnajar, S., Naushad, S. and Gupta, R.S., (2016). Genome-based phylogeny and taxonomy of the ‘Enterobacteriales’: proposal for Enterobacterales ord. nov. divided into the families Enterobacteriaceae, Erwiniaceae fam. nov., Pectobacteriaceae fam. nov., Yersiniaceae fam. nov., Hafniaceae fam. nov., Morganellaceae fam. nov., and Budviciaceae fam. nov. International Journal of Systematic and Evolutionary Microbiology, 66(12), 5575-5599.
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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