News
Successive governments’ budgetary operations caused financial instability
Ex-CBSL Governor Dr. Coomaraswamy:
‘My generation has failed the country…’
By Shmaindra Ferdinando
Former Governor of the Central Bank Dr. Indrajit Coomaraswamy says the failure on the part of successive governments to manage expenditure since the country gained Independence has caused the current economic instability.
Throughout Sri Lanka had been plagued by a toxic combination of populist politics and an entrenched entitlement culture among the people, Dr. Coomaraswamy told The Island. “Time and again, the electoral calendar has undermined fiscal discipline,” Dr. Coomaraswamy, who had served as the Governor (July 2016 to Dec. 2019) said.
Dr. Coomaraswamy said so when he was asked to explain why he had advised the electorate to be extremely cautious in exercising their franchise during the yahapalana administration at a time when the national economy was in a much better shape.
Dr. Coomaraswamy was testifying before a Presidential Commission of Inquiry (PCoI) probing rampant corruption in the public sector.
President Maithripala Sirisena brought in Dr. Coomaraswamy as the Central Bank Governor in the wake of the second Treasury bond scam. Dr. Coomaraswamy who had previously served the CBSL for a period of 15 years in its Departments of Economic Research, Statistics and Bank Supervision. He had also worked at the Finance and Planning Ministry from 1981 – 1989 during the UNP administration.
The Island
raised the issues at hand with Dr. Coomaraswamy close on the heels of one-time Auditor General Gamini Wijesinghe lashing out at the Parliament for its failure to ensure fiscal discipline. Wijesinghe, who served as the AG (2015-2019) alleged that the country was paying a huge price today for electing those who pursued destructive agenda. Wijesinghe said that he felt the electorate lacked the political sense to elect sensible people.
Dr. Coomaraswamy explained that for many decades, Sri Lankans had lived beyond their means and got away with it due to generous inflows of concessional loans and grants. However, the situation had changed though those elected seemed bent on following the same policies, he said.
Sri Lanka should not forget that the country had graduated to middle-income country status and was no longer eligible for concessional assistance, the former Central Bank Governor said. “At the same time, there has also been a reduction in the availability of long-term lending from official sources. As a result, since then there has had to be greater reliance on more expensive borrowing from international capital markets. This is an entirely different paradigm. Increased exposure to capital markets and rating agencies requires far greater discipline in macroeconomic policy-making.”
The former CB Governor emphasised that the much-needed discipline could be achieved only if politicians understood the parameters within which macroeconomic policies should be set. “They should also have sufficient understanding to provide leadership in raising the awareness of the people regarding the most urgent need for fiscal discipline. So, it is important that Sri Lankans exercise their franchise judiciously to make sure the right people are in Parliament.”
Commenting on the responsibility of those who manage the economy especially at a time the country was in turmoil, Dr. Coomaraswamy stressed that large budget deficits led to what he called excessive aggregate demand, which fuelled inflation and exerted balance of payments pressure. It would be pertinent to stress that large budget deficits ultimately undermined the value of the currency.
Those were the main negative impacts on the people as a result of politicians not exercising parliamentary oversight of public finance in a responsible manner, Dr. Coomaraswamy said.
“There are challenges on many fronts. My generation has failed the country. It is now up to the young people to chart a new course for the country. I hope a sufficient number of the talented ones remain in the country to do so,” he said.
Dr. Coomaraswamy however expressed confidence in talented youth remaining in the country amidst reports of many seeking to migrate.
Dr. Coomaraswamy and Gamini Wijesinghe demanded immediate remedial measures to restore financial discipline as President Gotabaya Rajapaksa finally confirmed negotiations with the International Monetary Fund (IMF) to overcome the financial crisis.
Former Deputy Governor of the Central Bank Dr. W.A. Wijewardena has recently said that Sri Lanka should have sought the IMF’s intervention in April 2021 during Prof. W.D. Lakshman’s tenure as the Governor of the CBSL. The government compelled Prof. Lakshman to quit in September 2021 to bring in the incumbent Governor Ajith Nivard Cabraal.
The U.S. Embassy in Colombo welcomed the U.S. Sports Envoys to Sri Lanka, former National Basketball Association (NBA) and Women’s National Basketball Association (WNBA) players Stephen Howard and Astou Ndiaye, from June 8 through 14.
The Public Diplomacy section of the U.S. Embassy said that it would launch a weeklong basketball program intended to harness the unifying power of sports, made possible through collaboration with Foundation of Goodness and IImpact Hoop Lab.
While in Sri Lanka, Howard and Ndiaye, both retired professional basketball players, will conduct a weeklong program, Hoops for Hope: Bridging Borders through Basketball. The Sports Envoys will lead basketball clinics and exhibition matches and engage in leadership sessions in Colombo and Southern Province for youth aged 14-18 from Northern, Uva, Eastern and Western Provinces, offering skills and leadership training both on and off the court. The U.S. Envoys will also share their expertise with the Sri Lanka Basketball Federation, national coaches, and players, furthering the development of basketball in the country. Beyond the clinics, they will collaborate with Sri Lankan schoolchildren to take part in a community service project in the Colombo area.
“We are so proud to welcome Stephen and Astou as our Sports Envoys to Sri Lanka, to build on the strong people-to-people connections between the United States and Sri Lanka,” said U.S. Ambassador Julie Chung. “The lessons that will be shared by our Sports Envoys – communication, teamwork, resilience, inclusion, and conflict resolution – are essential for leadership development, community building, equality, and peace. The U.S. Sports Envoy program is a testament to our belief that sports can be a powerful tool in promoting peace and unity.”
SJB Colombo District MP Mujibur Rahuman in parliament demanded to know from the government the reasons for CEB suspending the leave of all its employees until further notice from Thursday.
MP Rahuman said that the CEB has got an acting General Manager anew and the latter yesterday morning issued a circular suspending leave of all CEB employees with immediate effect until further notice.
“We demand that Minister Kanchana Wijesekera should explain this to the House. This circular was issued while this debate on the new Electricity Amendment Bill was pending. There are many who oppose this Bill. The Minister must tell parliament the reason for the urge to cancel the leave of CEB employees,” the MP said.However, Speaker Mahinda Yapa Abeywardena prevented Minister Wijesekera responding to the query and said that the matter raised by MP Rahuman was not relevant.
The Chartered Institute of Personnel Management (CIPM) successfully concluded the 8th Annual CIPM Symposium, which took place on 31st May 2024. Themed “Nurturing the Human Element—Redefining HRM in a Rapidly Changing World,” the symposium underscored the pivotal role of human resource management (HRM) in today’s dynamic global landscape. Since its inception in 1959, CIPM has been dedicated to advancing the HR profession through education, professional development, and advocacy, solidifying its position as Sri Lanka’s leading professional body for HRM.
Ken Vijayakumar, the President of the CIPM, graced the occasion as the chief guest. The symposium commenced with the welcome address by the Chairperson, Prof. Arosha Adikaram, followed by the Web Launch of the Symposium Proceedings and Abstract Book by the CIPM President. The event featured distinguished addresses, including a speech by Chief Guest Ken Vijayakumar, President of CIPM, and an address by Guest of Honor Shakthi Ranatunga, Chief Operating Officer of MAS Holdings Pvt. Ltd., Sri Lanka.
The symposium also featured an inspiring keynote address by Prof. Mario Fernando, Professor of Management and Director of the Centre for Cross Cultural Management (CCCM) at the University of Wollongong, Australia.
Vote of Thanks of the inauguration session was delivered by Dr. Dillanjani Weeratunga, Symposium Co-chair.
The symposium served as a comprehensive platform for researchers to present their findings across a wide range of critical topics in HRM. These included Cultural Diversity and Inclusion, Talent Development and Retention, Ethical Leadership and Corporate Social Responsibility, Adapting to Technological Advancements, Mental Health and Well-being at Work, Global Workforce Challenges, Employee Empowerment, and Reskilling and Upskilling.
The plenary session was led by Prof. Wasantha Rajapakse. Certificates were awarded to the best paper presenters during the valedictory session, followed by a vote of thanks delivered by Kamani Perera, Manager of Research and Development.
The annual symposium of CIPM was a truly inclusive event, attracting a diverse audience that spanned undergraduates, graduates, working professionals, research scholars and lecturers. This widespread interest highlights the symposium’s significance in the field of HRM, offering a unique opportunity for everyone to network and learn from scholarly brains.The CIPM International Research Symposium was sponsored by Hambantota International Port, Sri Lanka Institute of Information Technology (SLIIT), E B Creasy & Co. PLC, and Print Xcel Company.
US sports envoys to Lanka to champion youth development
Rahuman questions sudden cancellation of leave of CEB employees
