By Harim Peiris
The young Sri Lankan cricket team has done the impossible and in the past couple of weeks; they have beaten the powerful Aussie cricket team several times in the shorter formats of the game, giving Sri Lankans the much needed respite and cheer. The games have been played to packed crowds, notwithstanding lingering covid spread that threatenes with the TV viewership also reportedly high, demonstrating that people understandably seek some avenue of cheer from the misery which Rajapaksa rule has plunged our nation to.
In contrast, the Gotabaya Rajapaka/Ranil Wickremesinghe administration has only managed to guide our ravaged economy to a near crash landing and an effective standstill. Government servants are asked to stay at home, school children are again online due to effectively non-existent fuel supplies in the country. During the five weeks of Ranil’s government, its seeming only role has been in coordinating the scarce foreign aid, almost exclusively from India and not in effecting many of the significant and required reform measures, economic or political. It sought to argue that political reforms are not required and only emergency management of the economic crisis was needed. There was a basic game plan, backed by a politically naïve business elite, which was to get the white knight IMF in as soon as possible and until then use political contacts to get bridging finance to keep the economy moving.
Well, this plan has not worked for reasons which the young people of Sri Lanka correctly understand, but our political and business elites continue to want to ignore. It is that we have an economic crisis on our hands precisely because of and due to our politics. After all the coming calamity was not sudden but forecast and warned about, most famously by former Finance Minister late Mangala Samaraweera. Even more recently as the proverbial writing was on the wall, using foreign reserves to defend the rupee at a ridiculous over valuation, printing money, not going to the IMF and not commencing early negotiations with our international creditors was the bombastic claim to fame of the lunatic leadership of our politicised Central Bank. It was relatively recently that we turned down a half billion-dollar grant (not loan) from the American Millennium Challenge Corporation (MCC) and opposed another half billion in Indian investment into the East Container Terminal (ECT). A billion dollars we could desperately use now. That is our politics, which drive our economics. The majoritarian ethno-religious nationalism which won big in 2019, drove our politics and drove us to our knees. We were advised by those who should know better to get a Hitler like administration (as opposed to a Mandela) and we voted for one, which has now resulted in our own defeat at Stalingrad, leading to the eventual destruction and fall of Berlin.
The IMF white knight
There is great hope in the business community because of the naïve belief that the IMF, as a white knight, will bail us out of trouble. That is because the business community does not fully appreciate the political constraints to the implementation of the required economic reforms. Reforms which are more painful now, because the economy has crashed, rather than when we were healthy. Any bailout / bridging finance by the IMF and/or bilateral lenders require our debt to be sustainable. In other words, that we can come out of bankruptcy and start honouring our obligations, including the bridging finance we are seeking now.
We need to raise revenue and rationalise government expenditure. We cannot as a nation afford to spend more on peace time defence than we do on both education and health combined. But that is Rajapaksa politics. We cannot afford badly targeted generally subsidies though we can and must have a social safety net which takes care of those most vulnerable amongst us, which number is growing daily. We need to privatise our loss-making state-owned enterprises. Rajapaksa politics was to re-nationalise Sri Lankan Airlines and kick out Emirates Airlines. Our politics have brought our economic collapse. We need to remove the anti-export bias in our economy and regulatory framework and the failed import substitution of the 1970s towards which the Viyath maga and Eliya crowd at Shangri-La was dragging us. That would diminish the role of local oligarchs and replace rent seeking wheeler-dealing with internationally competitive businesses following best practices, as drivers of economic growth.
Elections the only solution
Ranil’s interim government has not been able to elect a woman deputy speaker, pass the 21st Amendment or most likely not even pass a genuinely reforms oriented interim budget. It has on the contrary given a major reprieve to the Rajapaksas’, taken the steam out of the Aragalaya and sought to solidify the status quo. We need the new, not the status quo ante. The reason is because Wickremesinghe is now Prime Minister of an essentially SLPP Government, of which he is nominally the vice-captain, but does not lead. The Rajapaksas still call the shots. An internal family reshuffle and image makeover, denying any course correction does not provide the reforms which make our debt sustainable, which is what the IMF and all our creditors require. We would not be able to go there and do that with the leadership which brought us to this ruin.
Self-realisation of failure dawns slowly, if at all for some people. The Rajapaksa administration and the SLPP are in denial mode and a fractious Opposition has not helped the nation by easing up the pressure for the Rajapaksas’ to go. The Opposition should challenge the interim government to present to parliament a Cabinet approved minimum common programme, which it has not unveiled and can garner bi-partisan support from the Opposition or move a motion to dissolve parliament and go for a general election, because Sri Lanka requires a government with political legitimacy and a mandate to deal with the mess created by those mandated in 2019, to create “vistas of prosperity” who instead bankrupted us. As a recent Verite Research report pointed out, we would spend less on an election than we are on a new defence ministry headquarters or barely more than just the loan, interest component only, for the Kotelawala Defence University’s teaching hospital.
Sri Lankans are inordinately proud of their state and we have much we can be proud of. Regular elections have been a big social safety valve of releasing pent up political frustrations, empowering the people and they reinforce the legitimacy of governments. We can and must go for parliamentary elections, sooner rather than later.
Disclaimer: Ranil’s government’s failure was inevitable – elections the only way forward - Views expressed by writers in this section are their own and do not necessarily reflect Latheefarook.com point-of-view