Recovery First


The economic crisis that is affecting Sri Lanka has reached massive proportions and acquired social dimensions that threaten the very fabric of our society. The Forex Reserve, which averaged around USD 7 to 8 billion before the crisis, has dropped to a mere USD 50 million, the lowest figure in our history, as revealed by then Finance Minister Ali Sabry. The resulting dollar scarcity has led to a sharp drop in the import of essentials like fuel, LP gas, medicines and food items. This has led to mile long queues of vehicles at petrol sheds, often for several days, and similarly for LP gas at gas stations. Sathosa, super markets and other retail outlets find their shelves empty. The outcome is hunger, starvation, unemployment, frustration and anger. This not only affects the poor but also the middle and upper classes of society.  Only the unscrupulous mega rich and a few politicians escape harassment.

This situation led to widespread protests for well over a month, with Galle Face as the epi-centre. But the attack on the protestors triggered the outbreak of violence on 9 May and it spread country wide. While some of the genuine protestors, especially the angry youth turned violent, the anti-democratic political forces brought up in the past JVP terrorist tradition burned and destroyed houses and property and attacked individuals. The attacks were focused on MPs of the SLPP, though they were not involved in the attack on 9 May. For instance, the LSSP Chairman of the Balapitiya Pradeshiya Sabha had his house destroyed, though he only responded to the Prime Minister’s call, and as a LSSP member was a supporter of the protestors, and did no harm to them, and took no part in the attack on the protestors. I only hope, the JVP and its off-shoot the Peratugami Party will not return to the terrorism of 1971 and 1988/9. Some SJB supporters too have been implicated. 

Global economic crisis

As everyone knows the global economic crisis is getting worse, and the rich ex-colonial powers like the US, UK, and France, that became rich by exploiting the Third World countries, are badly affected. The USA which was in the top position of the economic ladder has dropped to the 12th place and China is now at the top. In fact, while the Imperialist powers have come down. Asia has shown growth, led by China, Vietnam, South Korea, India and Indonesia. But we must ask why is Sri Lanka near the bottom of the ladder, just above Afghanistan. The ruling class here tries to get away from any blame by putting it on our being a social welfare state. We must have economic development from both the private and Government sectors, not poverty.

But successive capitalist Governments, mainly led by the UNP in Sri Lanka, have not developed our economy, but followed neoliberal policies which have encouraged imports, including luxury goods, and spendthrift policies, leading to an adverse foreign trade balance. This is the basic cause of us having to go begging for dollar aid from foreign countries. In the absence of a clear national development plan we remain a basically agricultural economy barely achieving self-sufficiency in food at the best of times. Little attention has been paid to become an industrial nation by developing a value added economy, using our agricultural and natural resources.

The local capitalist class is content to export tea, rubber, spices etc. in the raw form, as was the case when under British rule. For instance we continue to import tires from Britain where the value addition is done, and they make a huge profit by selling the tires in the world market.  The same applies to our extensive natural resources like graphite and ilmenite, which could be the basis of our own large scale industries. For example, by the conversion of  graphite into graphene abroad a whole range of industrial products are produced at a great profit, but this is something that we can do in Sri Lanka.The sea around Sri Lanka is a rich source of fish and minerals to develop export industries. With a little effort our tourist industry can easily outstrip the Maldives, as we not only have the attraction of the sea, but also beautiful mountain scenery, well preserved ancient ruins and a rich culture. 

In view of the above facts, it is sad to see how our people are suffering. The wrong neoliberal policies of the Ranil Wickremesinghe  Yahapalanaya Government  that aggravated the economic crisis has continued with the SLPP Government and will be strengthened now that Ranil is back as Prime Minister. The resignation of the former PM, Mahinda Rajapaksa, after the 9 May events paves the way for the US once again to proceed with the objectives of the MCCC and SOFA Agreements.

The fact is that President Gotabaya renegaded on his promise to our Group of 41 MPs that broke away from the SLPP in Parliament and formed an Independent Group, which stated that an Interim All Party Government should be formed to restore economic, social and political stability in about 6 to 8 months, and then go for a General Election. Instead he made the main enemy of the progressive forces, Ranil, the PM. This is a clear indication that he does not wish to serve our people, but follows the oath he swore when becoming an American citizen to serve the USA and even sacrifice his life for it.

Diego Garcia

Our country is in grave danger. Our economy and society are on the verge of collapse, and it is questionable whether it is through the implementation of wrong policies by ignorance or by design. At the helm are Gotabaya as the Executive President, Ranil Wickremesinghe as PM, and Basil Rajapaksa as the leader of the main party forming the Government, the SLPP.

They are all committed to serve the US. Ranil may very well help the US to achieve the objectives of the MCCC and SOFA Agreements, which he had agreed to sign when PM in the earlier YG. In brief these agreements would allow the US to exploit our economy as the British rulers did, and to make Sri Lanka as a whole an American military base. The latter has become necessary after the International Criminal Court ruled the US should quit its main base, Diego Garcia, in the Indian Ocean rim, which is on an island that belongs to the country of Mauritius.

If these are done Sri Lanka will lose its independence, sovereignty and territorial integrity. At the end of the Second World War, Japan was forced to allow the USA to establish its military base in Okinawa island. When the women are raped by American soldiers, they cannot be charged in the Japanese Courts of law, but in the Courts of the USA. The final outcome is no or trivial punishment. When this happens to a powerful country like Japan, what will Sri Lanka’s fate be? It is the duty of all who love Sri Lanka to become aware of these dangers and resist all moves that are detrimental to the interest of the nation and all our people.       

By Prof. Tissa Vitarana