My paternal grandfather was the Editor of The Saturday Post in Singapore. A successful journalist in three-piece suit, coat, shirt and starched collar, he and The Saturday Post were hit hard by the depression. His penury was somewhat described by the Chinese saying “Coat, shirt and starched collar, pocket no dollar.” After the collapse of his newspaper, he rearranged his career and finances, sold much of his holdings in Nallur, and sent my father and his nephew Dick Hensman to Jaffna. He went into rubber estates in Malaya where he was successful until the Japanese came. They thought him an Englishman because of his height and clothing, and tied him up to a tree in the jungles of Malaya only to survive after being released by a Tamil rubber-estate worker after three days.
The above preamble is to draw similarities to us and our government. Our rulers live with coat, shirt and starched collar. Although “pocket no dollar” our ministers live well. Most of them have become very fat after joining politics. Our government lies to us and cheats us. Many of us were promised import permits as a benefit of service. I joined Peradeniya in 1999 as Professor of Electrical Engineering. At one stage we staff were asked to accommodate 2 batches together and promised that that year would be counted as 2 years towards the permit. I had earned a motor car import permit by 2006 when I was made Vice Chancellor of Jaffna. Using my displacement by the LTTE, I was denied my permit because I had blown the whistle on the extensive corruption in finances and promotions at the university. One VC who was tainted had Rs. 500,000 taken off his provident fund but made VC of another university. The system is absolutely corrupt and this corruption is a drop in the bucket compared to the visible corruption under this government. If you are a supporter of the government, you get everything except punishment.
After three years on the Election Commission, I had earned a second motor car import permit and given this in my fifth year (after a year’s delay saying there are no funds). I ordered a car. I gave my permit to the bank. The government stopped my Letter of Credit. No money they said. I offered to buy with foreign currency I had in a fixed deposit which I was asked to invest for 5 years as a condition for my dual citizenship, and it has been free from 2015. That was not permitted although I had been promised that I could take the money out after 5 years. They say there are no foreign reserves but our government imports cars for MPs, ignoring those of us who had already earned that benefit.
To take back an earned benefit is pure thievery. Now they have money for MPs to import cars, overriding commitments already made in writing for our earned benefits. Although MPs claim they did not ask for permits, most of them, I believe, will definitely will take the permits. And these are for huge cars unlike ours, so the permits can be sold to businessmen instead of used.
Just 2 months ago the Central Bank introduced a scheme for fixed dollar deposits coming from abroad, offering up to 6.5% per annum. It could be taken out or renewed at the end of a year. It was a good deal and some people moved in money from abroad where it was earning only 4.5% as bank deposits.
My daughters who are planning to return after being stuck with us in Jaffna because of COVID. They have been told they will not be given the customary foreign currency in exchange for rupees. No money is what the Central Bank told our bank. We cannot even use our dollar fixed deposits made under the promise that they can be taken out any time. After much pleading from our bank the Central Bank agreed they may take out fixed dollar deposits but only by telegraphic transfer as there are no dollar notes anywhere to carry by hand.
The Sri Lanka rupee is now a useless currency in my opinion. Those who have free currency perhaps should buy land if they can. They should not hold on to their rupees. People with dollar deposits I thought were safe. Even they are not with restrictions on sending them out, contrary to the government’s word when we brought the money in. Now we can change it to rupees (which we do not want) or simply sit back and wait, unable to spend it abroad. So even our dollar savings are useless.
Even foreign currency dealers have no money. Two weeks ago when I inquired, the rate for a dollar was from 180 to 200 rupees from currency dealers. Dollar notes were going at Rs. 180, new 100 dollar notes at Rs. 202/Dollar and old notes at Rs. 190/Dollar. The lower rate for dollar notes is that they cannot be smuggled out so easily. I do not know the cause of the difference between new notes and old notes. Embassies at the time were accepting at their own old black-market rates like Rs. 250 for a dollar that were far costlier than money-changer rates.
Money changers operate openly – God bless them because without them we would be forced to go abroad with zero foreign currency when we travel like the 1970-77 years under Srimavo Banadaranaike. I therefor assume that they operate legally or at least under the protection of our crooked politicians.
Today (1 July) I asked around money-changers in Jaffna for my daughters to take at least money for tea while on transit. No one had dollars. One said he could arrange for dollars from a trader in Colombo. There was one passenger who had arrived with some US$2000 and was asking for Rs. 233 per dollar in $100 notes. The main money changers said they could offer a few dollars at Rs. 230 per dollar and even for that they would need time to get it together from those like a Roman Catholic priest who had arrived with a little money from abroad and a few others. Otherwise, there was no US dollar currency. For some strange reason, pounds-sterling was easier to get on the streets.
We have been had
We have a government that cheats us. Our rulers are in coat, shirt and starched collar. But the part about “Pocket no dollar” does not apply to them. In their pockets is our stolen money as they drive about in BMWs imported with our fixed deposits and effectively confiscated imported permits, our earned benefits. Those like the president have office cars, fleets of them. We cannot even buy small cars using import permits we have earned.
In the meantime, our fixed dollar deposits are not safe. If you have rupees you do not need immediately, find a way to convert it to dollars or land. If there is anything imported whose purchase you were putting off, this is the time to buy it before the rupee collapses and its cost goes up. Over the last few days the rupee went down Rs. 2 per dollar per day on the money changers’ market, making the government not publish exchange days. It means your rupee went down 1% a day making import prices go up at the rate.
Do not listen to the government’s entreaties to bring in dollars, however high the interest rate the government offers. It is likely to be locked out of your use. The only good thing is that bankers say the government will not touch those deposits because that would mean the system has collapsed. But importing cars for MP could lead to that. If you have dollars, do not bring them in. As rupees, the money will lose any value it has.
leelagemalli / July 5, 2021
Dear Dr Hoole,
Thanks for your article.
But We got to know that GR had no renunciation certificate of his US citizenship by the time, he came to you for giving nominations. for the PE. GR’s duality was not cancelled to that point in time. Renunciation of his US citizenship was confirmed as given below.
If anyone else would have reacted so, that person was nt surely not allowed, however, GR’s was just overlooked. How come ?
Not us, but you as one of the powerful members in that EC, could do the job properly. Instead, yours was blocked by some reasons .. I had no clue what went through the head of the other member… If you did the job properly, things would have worked differently.
All in all the country is now governed by a DEFACTO- president. The entire bunch was alleged to have committed high crimes incl. multiple murders. All these were public secret. If law and order would have worked properly, GR,MR, BR and NR and all should have convicted for their high crimes.
Sinhala_Man / July 5, 2021
Dear professor Hoole,
Thanks for the clear warnings. When corruption and inefficiency get as rife as they now are, it is good for some who see clearly to speak out and not compromise.
SarathP / July 5, 2021
The government is broke and printing money at a tremendous pace. Still, it has managed to hold down the $ at around Rs. 200/.
Can someone explain this mystery to me?
Ajay / July 5, 2021
“They [Japanese] thought him an Englishman because of his height and clothing, and tied him up to a tree in the jungles of Malaya.” Are you kidding? The Japanese (if you can ignore their penchant for Hara-Kiri), and your readers are not that stupid. The fact of the matter is, the Japanese had never seen anything like your paternal grandfather before in their 3000-year-old history. They thought they were finally seeing right before their eyes the mythological Chimera whose terror they were subjected to as children by their fascist parents and wicked school teachers. It took quite a while – only in the 1950s – for them to realise that Charles Richard Kandappu was a rare phantom hybrid – a product of Jaffna-Tamil-Saiva and English-Jesus-Freak cultures. By the way I must admit you have a great talent for fusing family history with world history.
Agnos / July 5, 2021
“Charles Richard Kandappu”
The original article doesn’t include that Kandappu name. Is it something you intended as satire, or do you know the real full name?
Ajay / July 8, 2021
Yes, it was meant to be satirical. Given Dr. Hoole’s famous intelligence, I’d like to give the benefit of the doubt and believe most of what he’s writing is satire – most likely unintended. Otherwise the self-promotion and self-righteousness would be too jarring, diminishing his lone heroic struggles against all kinds of injustices out there that seem to be targeting him all the time. So I like to believe he is a satirist and respond in kind. Obviously these colonial Hooles, Hoovers, Hallocks, Ashburys, Bartletts, Lymans, and Wadsworths, and so on and so forth are the proselytized mutants of precolonial Arumugam, Appukutty, Cuttipillai, Iyampillai, Murugesu, Sivakolunthu, Veeravahu, Veerakathi … and of course the ever present Kandappu. As you know, these were the cool names in Jaffna before the advent of the materialistic and promiscuous white man with his self-glorifying, fairy-tale, desert religion. So to answer your question – ‘Kandappu’ is the result of my satirical conjecture. By the way, SJV Chelvanayagam married the daughter of the British appointed Maniagar for Valikamam, R.R. Barr-Kumarakulasinghe. This Barr-Kumarakulasinghe family in Tellippalai which had become very powerful by their loyal service to the Dutch and the British originates from one Subramaniam Appukutty who had converted to Christianity and was baptised as Joseph W Barr. [see, ceylontamils.com]
old codger / July 5, 2021
It is quite clear that the Viyathmaga pundits are incapable of running the country. It seems that those at the top have realized that going head-to-head with our biggest markets is counter-productive. So they have started negotiating meekly with the EU. But why is the regime continuing with the idiotic ban on chemical fertilizers? A famine will kill many more people than inorganic fertilizers.
With the USD hitting 225, the government can swallow its pride and accept IMF conditions or borrow even more at high interest and inevitably default. Even the Chinese have limits to their generosity. They are too smart to throw money down black holes.
As Sri Lankans, we have to learn to live within our means. If we can’t afford fancy highways or airports, for God’s sake don’t build them! It is far better to be underdeveloped but stable like Bangladesh (or as some “patriots” claim, without toilets as in Tamil Nadu) than wear clean suits like us with empty pockets.
old codger / July 5, 2021
Is it time for Sinhalayo to board the boats to Tamil Nadu?
chiv / July 5, 2021
Hoole I question anyone who deposits $ in Lanka right now . It is obvious you are fortunate to get the money back in any currency other than in $. Just the fluctuation it self is an indication of thriving black market for greenback. This will further worsen the crisis, encourage illegal market/transfers and all other unwanted activities. I have witnessed this first hand in China and India years ago, may be not anymore. In Venezuela this has been the case as long I remember. My friends and their families migrated to Canada few years ago and they had plenty stories to tell about how they smuggled $ out of Venezuela. Bolivar Soberano/Sovereign (new currency) replaced the old Bolivar Fuerte since 2018. Primary reason for replacement at a rate of 1 BS to 100,000 BF was hyperinflation. Currencies are printed in 10 000 to 1, 000 000 denominations. Why ?? When Chavez was ruling he tried artificially keeping the, then Venezuelan currency in par to U.S Dollar.
chiv / July 5, 2021
Just to add to my above comment
Last week I wire tranfered $ 1000 to my mom for an emergency paying almost 6000 LKR in fees., hoping she would get 200,000 . She received only 192500 from Commercial bank. If not for the emergency I would never cash $ in Lanka.
Agnos / July 6, 2021
Look into Wise.com for such transfers. Looking at the fees, exchange rates, and the transfer speed, they are probably the best for bank transfers from the U.S. to SL.
You can cancel the transfer with no fees if they for some reason delay it.
chiv / July 7, 2021
Agnos thank you so so much. Good to know .
Fred / July 7, 2021
Would it not be great if some the SL politicians, who are earnestly appealing to their compatriots to bring in their foreign currency holdings from abroad and invest them locally, set a good, patriotic example, and bring in some of their grand holdings of foreign currency deposits and other assets back to SL? Given how much they will have squirrelled away overseas, one imagines, it should make a significant difference to the national foreign currency holdings