18 October, 2019

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“Don’t Cry Over Lost Jaggery, Preserve What Is Left”

By Somapala Gunadheera

Somapala Gunadheera

Somapala Gunadheera

President Rajapaksa’s defeat has invigorated the hue and cry against the Southern Mega Projects (SMP). Their misplacement, magnitude, wastefulness and irrelevance are being highlighted in addition to the corruptions alleged to be associated with them. Not a word is heard in their praise.

Before it is too late, I consider it my duty to leave this record behind me on my memory of these Projects, from my official association with them from their inception. Southern development was a hot topic of discussion in the eighties with Japanese assistance and Marga participation. I remember participating in these discussions around the late seventies when I was with Marga, having lost my job as Secretary after the 1977 election. There was widespread dissatisfaction then about the comparative under-development in the South. The consensus was that more and more special projects should be introduced to the South, if that area was to be developed speedily.

A failed attempt

The SMPs were a logical offshoot of that thinking. When CBK came to power as President in the mid-nineties, she created the Southern Development Authority to accelerate the development of the South and appointed an enthusiastic architect as its Chairman. The SDA functioned from its office in Colombo with a coterie of hand-picked assistants. They concentrated on establishing mega projects in the South to the exclusion of small village development initiatives, with the result that there was no visible progress on the ground. Angered by this state of affairs, Ministers in the South protested against the SDA and its Chairman offered to resign from his post.

I was suddenly called from the North where I was functioning as Chairman of the RRAN and asked to take over the SDA. On second thoughts, the former Chairman wanted to retain the mega projects under him although he had no legal status under the Authority and the President asked me to look after the rest of the SDA. This arrangement caused me embarrassment when I had to face the COPE’s inquisitions about the special projects. All that I knew about the projects was that they were being studied by the former Chairman with a few others until the Colombo office was closed down at the end of the tenancy.

In the meantime, I opened my office in Matara and tried to make the best of a bad bargain. I concentrated on income generation through agricultural extension, small industries, dairy farming and mini enterprises. As far as I am aware, the SDA never got to the brass tacks of their assignment and had no concrete plans on the ground. So much so that the operatives were not aware of the depth of the Hambantota Harbour, when I made a casual inquiry. Theirs was only a concept for which no money was locally available. They were hopeful of getting private funds from Canada through a personal contact and the project wound up when that source dried up.

Basil 1The Mega Project idea resurfaced after MR became President. With his parochial interest in Hambantota, he wanted to develop that area on an accelerated basis. SMPs was a highlight of that drive. Presumably he was inspired by the grandiose proposals of the SDA, though he failed to have them implemented by the previous regime. It was only the idea he borrowed but MR went hammer and tongs to make it a reality. All the planning, implementation and financing that went into the projects was exclusively handled under his dispensation. So much so that even the locations at which the Projects came up had to be selected de novo. The sites where the former enthusiasts had selected for the projects wishfully had to be altered. The original harbour was to come up in the Hambantota town itself.

Post facto criticism

Be that as it may, how did the clamour for the SMPs change to a spate of criticism against them only after they were accomplished? If they were so unacceptable, why was no visible effort made to block them before they took off? Essentially, three main charges are levelled against the SMPs.

1. Bribery and corruption associated with them.

2. Distorted priority.

3. Inappropriateness of the locations.

Charge one does not affect the tenability of the SMPs. It is a common allegation made against the accelerated projects undertaken by the MR regime that has to be dealt separately as promised in the 100 Day Programme. If the allegations are established with acceptable evidence, there is no question that the culprits responsible for them should be penalized unsparingly. Culpability is personal to those found guilty but it does not detract from the validity of the project implemented.
There appears to be no serious objection to the addition of a new harbour and a new airport, except that the undertakings have reversed priorities of development. The other dispute pertains to the location of the airport at Mattala with tears for the peacocks killed by the movement of aircraft. From a national point of view, it would have been more beneficial if the alternative airport was located around the middle of the island. There is also a grouse about the paucity of traffic at Mattala and the inconveniences suffered by passengers compelled to land there to increase its traffic artificially.

It is too late in the day now to raise these objections. Mattala is now a fait accompli. It has been built under heavy costs and there is no going back on what has come to be. No one in his senses would want Mattala demolished. One is reminded of a popular proverb in this context. “giya hakurata naadanne, – thiyena hakura rekaganne”, (“Don’t cry over lost jaggery, preserve what is left”).

Rome was not built in a day

Besides, all new projects have their teething problems but they are solved with changing circumstances. I am not sure whether there was a similar objection when Katunayaka was selected as the location of our national airport but I remember going there as a Customs executive for baggage checks in the early sixties. Then it had only a temporary shed as a passenger terminal. It did not occur to me then that the desolate place where an aircraft landed occasionally, would one day become the busy international airport that is there today. Mattala itself would have its day, if all responsible parties put their heads together to make it work, without crying over it as spilt milk. The other day the Minister in charge of aviation was talking about using the facility for refuelling and aircraft repairs. Let him show his colours by pursuing these ideas efficiently without losing time on broadcasting the ‘white elephant image’ of Mattala.

It may be recalled that the media was full of similar depressing tales of the Hambantota harbour soon after it was built. But already it is becoming a noteworthy transhipment centre in the region. Bulk shiploads of cars arrive there for transfer to western ports, earning substantial income for a venture which was at the butt end of ridicule not many moons ago. More carriers may be attracted if the tardy administration of the Hambantota port could be streamlined. Industrial ventures planned for the port city should soon make it a hive of shipping activity.

In sum, the duty of those charged with the management of the Southern Mega Projects is not to compose elegies on them but to maximize their output through confidence, hard work and innovation. The new Government can win more Brownie points from them by placing these Projects under efficient management than by using them as a cudgel with which to beat their political opponents.

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Latest comments

  • 1
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    Kamal,

    Can you please make your comments? It is all yours.

    • 1
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      Maintaining white elephants is a costly business for the Sri Lanka tax payer and the Mattala airport should be shut down.

      Throwing good money after bad would be a costly mistake for Lanka and the new Cabinet need to see the light and cut our losses.

      All Chinese projects need to be investigated because they bring little benefit to the people of Lanka and lots of environmental pollution as well as social and economic de-development. The port city will cause an environmental disaster which should be stopped in its tracks.

      Somapala’s comparison of Colombo and Mattala airports is a silly argument because the Colombo airport was located in the capital city and would grow over the years, but Hambantota is an agricultural village and will never grow to sustain the airport as it lacks water and basic human resources and the population to be sustainable..

  • 1
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    The Hambantota airport is to be closed down as it costs Rs.240 Mn per month to maintain. Instalments of loans obtained to build it are to commence shortly.

    http://www.thesundayleader.lk/2015/03/07/mria-to-be-grounded/

    How many more ‘white elephants’ established to glorify Mahinda Rajapakse will suffer same fate.
    There are a sports stadium, a conference hall, and a botanic gardens at hambantota which may suffer the same fate.
    Funds which could benefit health care and education, will be wasted in similar manner.
    Will Mr. Gunadheera comment.

    • 1
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      RE: justice comment and Mr. Gunadheera

      “Will Mr. Gunadheera comment.”

      Not all mega projects are bad, It is a question of the overall value proposition that is quantified as economic value, social value and developmental value, and subtracting the environmental damage.

      For Medamulana Mahinda Rajapaksa, only one value matters, the Mahinda Rajapaksa Egoi Value and Dynastic Value. All the maRa shills and cronies went along with it.

      The Southern Expressway, seem to be different story. There is daily economic value realized by the people who are going beyond Horana to the South at a minimal cost to the environment, with an overall net positive gain. This happened during CBK Regime, though completed during MaRa’s regime.

      So, will Mr. Gunadheera quantify the various value propositions of each of the mahinda Rajapaksa Ego project, with Cost., running costs, Depreciation, Loan payments etc.?

      Mr. Gunadheera, you can use the Capital asset pricing model to estimate the return.

      http://en.wikipedia.org/wiki/Capital_asset_pricing_model

      In finance, the capital asset pricing model (CAPM) is used to determine a theoretically appropriate required rate of return of an asset, if that asset is to be added to an already well-diversified portfolio, given that asset’s non-diversifiable risk. The model takes into account the asset’s sensitivity to non-diversifiable risk (also known as systematic risk or market risk), often represented by the quantity beta (β) in the financial industry, as well as the expected return of the market and the expected return of a theoretical risk-free asset. CAPM “suggests that an investor’s cost of equity capital is determined by beta.”[1]:2

      The CAPM was introduced by Jack Treynor (1961, 1962),[2] William Sharpe (1964), John Lintner (1965a,b) and Jan Mossin (1966) independently, building on the earlier work of Harry Markowitz on diversification and modern portfolio theory. Sharpe, Markowitz and Merton Miller jointly received the 1990 Nobel Memorial Prize in Economics for this contribution to the field of financial economics. Fischer Black (1972) developed another version of CAPM, called Black CAPM or zero-beta CAPM, that does not assume the existence of a riskless asset. This version was more robust against empirical testing and was influential in the widespread adoption of the CAPM.

      Despite its empirical flaws[3] and the existence of more modern approaches to asset pricing and portfolio selection (such as arbitrage pricing theory and Merton’s portfolio problem), the CAPM still remains popular due to its simplicity and utility in a variety of situations.

    • 0
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      Regret that I forgot to mention the Hambantota Port which has very few ships visiting.
      This is another major wastage of funds for maintenance and now, importers of vehicles, have been compelled to ship them to this empty harbour where many vehicles have been damaged by ‘drivers’ crashing them after unloading – are these licensed drivers?
      A large sprawling building in the north has Mahinda Rajapakse saying that it is another ‘conference centre’!!!

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