By Lalith Dhammika Mendis –

Lalith Dhammika Mendis

The word “Sri Lanka” (SL) denotes resplendent island. SL from time immemorial is renowned as “Pearl” of the Indian ocean. The island nation boasts inter-alia of a proud history, rich cultural heritage, age old traditions, iconic historical monuments, an abundance of natural resources, lush greenery, scenic beauty, unique weather patterns, sandy beaches, a whole gamut of industrial minerals, and a wide variety of precious stones. SL was under colonial rule for 443 years and gained independence from British in February 1948.

The collective report card of political groups that constituted successive regimes over SL’s checkered post-independence history of nearly 76 years reveals a dismal picture. Despite grandiose pronouncements made by politicos time and again to usher in socio economic prosperity, prosperity per se has largely remained elusive. Conversely, pompous rhetoric trotted out has proven that it was intended for the consumption of gullible public. Sadly, whilst circumstances of politicians may have gone from rags to riches, lot of the man on the street has remained as depressing as ever.

The World Justice Project (WJP), an independent non-profit organization founded in 2006, works to create knowledge, build awareness and stimulate action to advance the Rule of Law worldwide.

WJP defines Rule of Law (ROL) as “Durable system of laws, institutions, norms and community commitment that delivers four universal principles: Accountability, Just Law, Open Government and Accessible and Impartial Justice. ROL is an embracing concept not exclusively confined to the domain of laws. Besides the body of laws, it encompasses norms, standards, benchmarks, best practices, conventions and the like expected to be complied with by members of human society from every social layer.

Conformance to ROL aims to achieve certain cardinal objectives which include eradicating corruption. Moreover, ROL serves as an effective mechanism to protect people from injustice. It underpins development, nurtures accountable government and promotes respect for fundamental rights. Furthermore, it lays the foundation for equal opportunity and peace.

WJP annually publishes a “Rule of Law Index” (ROLI) whereby 142 countries have been measured and ranked based on specific set of criteria/factors that demonstrate extent to which ROL is prevalent in the countries across the world. Whilst countries are assigned overall rankings based on overall scores, they are also ranked in line with performances relating to each individual factor/criterion. WJP measures scores and assigns country rankings based on eight factors.

These factors feature inter-alia the following vital elements that are of paramount importance in determining the extent to which ROL prevails.

Factor 1

Constraints on Government Powers – which measures extent to which those who govern are bound by law and are held accountable for their actions

Factor 2

Absence of Corruption in Government – which considers bribery, improper influence by private or public interests and misappropriation of public funds and resources

Factor 3

Open Government – which measures transparency and openness and extent to which a government shares information with public and provide public the necessary space to hold a government accountable and participate in policy making

Factor 4

Fundamental Rights – which measures if the rule of law being adhered to is sufficiently effective to accord and guarantee due respect for fundamental human rights established under the United Nations Universal Declaration of Human Rights

In 2023 SL was ranked 77 with an overall score of 0.5 across 142 countries. ROLI is headed by Nordick countries with Denmark at number one position followed by Norway, Finland and Sweden consecutively.

ROL and Good Governance (GOG) go hand in hand. They are inextricably intertwined and complement each other. As declared by the United Nations (UN), GOG is associated with attainment of economic, political and social goals needed to underpin development. GOG thus is the whole process designed to ensure that public institutions conduct public affairs and manage public resources in a manner that promotes Rule of Law and realization of human rights and goals. These encompass civil, economic, political, social, and cultural rights and goals. Thus, Accountability and Transparency form the cornerstone of GOG. The IMF in 1996 declared that promoting GOG in all its aspects, ensuring conformance to ROL, improving accountability and efficiency in public sector and eradicating corruption is the framework within which any country could attain prosperity.

The post-independent SL has witnessed mammoth cases of corruption involving public funds/resources under successive regimes. None other than the elected representatives from both sides of the political divide have accused one another of reeking corruption and fraud. They deplorably engage in mudslinging over and over in the glare of the public eye. The public has many a time witnessed how those voted by them into exalted public offices opportunistically descend to shameful depths of moral decadence to achieve selfish political ends. It is disgusting to note that some of the shocking cases of corruption, malpractice and fraud reported to have taken place in the public sphere implicate law makers who are responsible for the management of public finance and affairs. It is ironic that those who are elected by the public to legislate for public wellbeing, welfare and common good end up being accused of violating the very laws they themselves enact in the name of public wellbeing.

The good governance regime (GGR) came to power with a bang on the plank of eradicating corruption and restoring GOG in public affairs. It was riding on the mounting outcry and groundswell of mass sentiments against rampant corruption, wasteful extravagance and misuse of public resources widely accused of having taken place under the erstwhile regime (ER). GGR gave a solemn undertaking and entered into a social contract to bring those elements of ER who were publicly accused of being culpable for huge economic sins to book no sooner assuming office. Alas, what unfolded after GGR assumed office was a far cry from what was widely anticipated and led to loss of hopes as GGR miserably failed to walk the talk on its main political undertaking. Its slogans proved empty rhetoric. It was a case of all hats and no cattle. Moreover, its tenure was marred by gigantic scandals like infamous Central Bank bond scam, wheeler dealer politicking and Easter Sunday catastrophe which claimed and maimed many innocent lives in which political elites and top brass have been implicated for complicity in one of the most brutal, savage and heinous crimes ever witnessed in Sri Lanka. Ironically, ROL and GOG had flown out of the window of a regime that was bragging so much about establishing lofty ideals.

The culture of impunity, moral depravation coupled with dismal lack of accountability & financial discipline, absence of GOG, ROL, integrity and prudence coupled with rampant corruption in the management of public affairs and utilization of public resources are some of the main catalysts that brought about unprecedented socio-economic catastrophe making Millions of Sri Lankans impoverished. Crafty politicians who have amply demonstrated conscious disregard to decisively deal with large scale corruption and malpractices have oft-times produced copious empty rhetoric promising to punish those culpable for corruption merely to hoodwink gullible masses. In many instances, it appears that real culprits remain unpunished, with precious little being tangibly done and achieved to date in terms of eliminating malpractices and making those culpable pay the price.

As reported in PublicFinance.lk the infamous sugar scam involving reduction in the special commodity levy caused a colossal loss to the Government to the tune of Rs 16 billion. According to Verite Research insight, the loss caused by the Central Bank Bond Scam cost the coffers Rs 896 million. Furthermore, as it is well known that Ceylon Petroleum Corporation incurred a whopping financial loss in a hedging deal worked out based on Zero Cost Collar mechanism pursuant to the recommendation given by the Central Bank. It was not so long ago that the public healthcare sector came in for very strong strictures and widespread condemnation with its hierarchy including the political head being arranged on charges of highly criminal nature for corruption, mismanagement and abuse of power etc. It is strongly alleged that the procurement mechanism in the public health sector has been corrupt to the core paving the way for the purchase of sub-substandard and low-quality medications causing peril to the lives of scores of poor who are unable to afford the luxury of costly private medical care. It saw some hapless ones paying the supreme price of facing untimely demise. The construction of Mattala MRIA, Mattala Highway, Hambantota Port and Lotus Tower are some of the monstrous scams that dealt debilitating blows to Sri Lankan economy costing Millions of US Dollars. These corrupt deals have caused immense public detriment and imposed a huge debt burden on the already stretched coffers of bankrupt SL. They point to the stark reality of the absence of ROL and GOG in the conduct of public affairs.

What is produced here is only a minuscule fraction of the cases of corruption and malpractice alleged to have taken place in the public sector at monstrous scale, mercilessly devouring taxpayers’ money. Besides, many cases of corruption and fraud extensively discussed and reported and continue to be divulged could well be just the tip of the iceberg with many more remaining concealed. Misconduct and malpractices implicating high echelons of power in the conduct of public affairs demonstrate deplorable absence of ROL and huge loopholes, glitches, flaws and shortcomings prevalent in the system of governance decayed over the years.

SL has been experiencing negative trade balances and budget deficits over the years and hence has been compelled to resort to borrowings. Except for a few instances of recording growth in export earnings, export revenues have been hardly sufficient to make up for the yawning gap between cumulative imports and exports that get translated into BOP deficits and finally the public debt. Further, decisive, concrete and focused measures have not been taken to date to sustainably grow export revenues to generate forex receipts to absorb imports and pay off ballooning foreign debt whilst building foreign reserves. The inability to meet debt service commitments on time necessitated SL to raise further borrowings to pay off the money that has already been borrowed, creating a vicious cycle of a crippling debt burden. Had proper economic sense and financial prudence prevailed as part of the principles of GOG in this very crucial and sensitive aspect of economic management, the outcome would have been totally different from what is seen today. Thriving corruption and heartless extravagance on the part of ruling elites through the absence of ROL and GOG have added insult to injury and exacerbated the economic woes to a bankrupt nation that boasted of the second highest GDP per capita in early 1950s.

SL declared bankruptcy in April 2022, when it announced a sovereign default, recording monumental fiasco in statecraft. SL’s inextricable debt trap has been ascribed to mammoth scale corruption, misuse, extravagance, waste & embezzlement of public funds by political apparatus aided by complicit officialdom under successive dispensations. Besides, the myopic strategy adopted by the GOSL in raising debt finance, and composition of debt itself too have been adversely impactful on the worsening debt situation. SL became a victim of an inescapable debt trap due to her misguided appetite for International Sovereign Bonds (ISB’s) and increasing reliance on China for financial assistance, disregarding the considerations of financial wisdom and judiciousness.

These intelligibly demonstrate absence of GOG and noncompliance with the principles of ROL in the management of statecraft.

Political parties vying for power customarily unveil manifestos spelling out policies, strategies and action plans. These contain ambitious timebound actions, targets and policy measures elegantly crafted to win mass support. In hindsight, had successive regimes taken focused and concrete measures to realize bombastic pronouncements made or at least a reasonable part thereof, Sri Lanka by now would probably have been a country on par with those in the developed world. If we are to realistically take stock of where SL stands today in terms of realizing its development goals 76 years after independence, the colossal debt burden weighing down on it will reveal how the successive regimes have failed to fulfil the promises repeatedly made and adhere to ROL and GOG in the conduct of economic management to usher in socio economic prosperity and resultant mass aspirations.

Come election time, it is quite typical to witness grinning mugs of political Santas cris-crossing the country carrying heavy loads of gifts and freebies. These promises are akin to piecrusts meant only to be easily broken. Campaigns of contenders vying for the highest office appear quite hectic unveiling huge gift packs full of largesse that come in the form of pay hikes, hand-outs, tax cuts and whatnot to please the electorate characterized by lack of political literacy. Mass poverty has served as an expedient platform for politicos to sweet talk poverty-stricken masses into believing blatant falsehoods trotted out to garner votes. Ample crocodile tears are shed to woo the masses to achieve political ends rather than serving the public good. Election boils down to a farcical competition of giving away freebies, rather than a contest based on intellectual debate on alternative policies.

The persistence of poverty in fact is a serious indictment on those who have held political office for decades, ruled the roost and promised masses stars, moon, sun and the world only to grab power craftily and enjoy the plums of political office. People have repeatedly fallen for grandiose promises crafted by politicos assuring socio-economic wellbeing, little realizing that reality has so far remained a far cry from their expectations, and they have been led down the garden path over and over. Regrettably, people too have shown they have short memories and suffer from dim-wittedness and lack of political acumen and literacy which undoubtedly have been manipulated by unscrupulous political masters to grab and perpetuate power within a coterie of elites.

Those vying for political office show no compunction in lavishly offering largesse costing billions of rupees to the coffers disregarding the harsh reality that SL has still not extricated itself from the hell hole of crippling public debt which continues to keep ballooning. They do not seem to care where the money could be found to pay for those generous giveaways. What SL has to date been achieved is to enjoy a brief honeymoon of not having to repay debts for a few years, although there is so much bragging about a newfound state of promising economic prospects. Elections times usually produce miracles. They make things that are practically impossible during normal times quite easy come election time. Many things that people fought tooth and nail facing the juggernaut of suppressing political power the other can be unbelievably on offer on a plate. Do people realise, that they are being shown a life in a fool’s paradise.

If IMF’s recipe is the panacea for all ills and the sole means of accomplishing socio-economic prosperity, let’s refer to IMF’s declaration made in 1996 to know what entails the achievement of economic development.

IMF in 1996 declared, “Promoting GOG in all its aspects, ensuring conformance to ROL, improving accountability and efficiency in public sector and eradicating corruption is the framework within which any country could attain prosperity”.

Very soon people in SL will have to very carefully make a discerning judgement on the political outfit that promises to truly tread the IMF’s path of economic recovery.

People’s decision should result in a genuine game changer to rescue the country from the hellhole of crippling economic crisis, if SL is to prosper, otherwise, no doubt, SL will fall from frying fan into the fire.