21 September, 2020

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SLPP Has Creatively Disrupted Politics; Now It Has To Do The Same To The Economy

By W A Wijewardena

Dr. W.A Wijewardena

For good results, disrupt the existing systems

It was a cakewalk for Sri Lanka Podujana Peramuna or SLPP, headed by President Gotabaya Rajapaksa, to seize power in Parliament. Within a matter of a few months of its formation as a political force, it has kept a record by rising to the pinnacle of the country’s power cathedral. In the process, it has disrupted the two oldest political powers in Sri Lanka, namely, the United National Party or UNP and the Sri Lanka Freedom Party or SLFP. The emergence of a disruptor, though the name sounds something frightening, is a welcome development in any society. This is because it is disruptors, and not conventionalists, who have created a new world for the betterment of humankind. Relating to economics, this was first presented by the 19th century French economist and statesman, Frédéric Bastiat when he said that breaking of windows even in acts of vandalism was to be welcome. That was because it enabled the world to go for new generation windows sustaining the window industry, on one side, and creating a new output for society, on the other.

In the early part of the 20th century, Bastiat’s views were more formally and cogently presented in a positive way by two economists. One was the Russian economist Nikolai Kondratieff. The other was the Austrian-American economist, Joseph Schumpeter. I have covered their views in a previous article in this series.

Kondratieff: Inventions should be commercially produced

Kondratieff had discovered through empirical research that capitalist societies had repeatedly undergone ups and downs in their economies – known as business cycles – but had managed to recover to a new position every time they had suffered from an economic downturn. Such business cycles had typically been experienced by Western economies for long periods of about 50 to 60 years which he designated ‘long-waves’ of business cycles.

The reason for the recovery of a dying economy was the commercial adoption of scientific and engineering inventions by businessmen thereby taking an economy to a higher wave. Schumpeter, quite independently of Kondratieff, said that any new technology that was to replace the old ones, though feared by people, was a creative destruction.

Joseph Schumpeter: Generate creative destructions

Countering the Marxian view of the self-destruction of capitalist societies from internal conflicts, Schumpeter presented the contrarian view that capitalist societies continued to sustain and prosper through the introduction of a series of new technologies to replace the worn-out old ones. Expanding his conception of creative destruction, he identified four basic developments that should take place in an economic system enabling it to rise to a new height in development. His concept agrees with the Kondratieff long-wave formation in an economic system through scientific and engineering inventions that are commercially adopted by businessmen. But this commercial adoption was called ‘innovation’ by Schumpeter. Taking it forward, he identified two further developments that should be followed for an economy to sustain its prosperity. One was the diffusion of knowledge among as many businessmen as possible. The other was the imitation of new technologies by prospective entrepreneurs.

Inheriting a sick economy by SLPP

Why should SLPP be a creative disruptor of Sri Lanka’s economy? That is because it has inherited an economy sick with a multitude of ailments. Sri Lanka’s economy had infected itself with some of these ailments right from the independence of the country. Some are later infections by governments that had introduced disastrous viruses to its body from time to time. However, with no proper medication administered at the appropriate time, these ailments have grown within the body of the economy like a silent cancer that grows without demonstrating any symptoms.

As I have indicated in a previous article, political leaders have been playing a blame game accusing each other for the maladies from which the economy has been suffering. That was an exhibition of complacence on the part of politicians coupled with the desire to evade responsibility.

The behaviour so demonstrated by them was similar to the man falling from the 20th floor of a building shouting at a man at the window of the 10th floor that he was alright so far and there was nothing to be worried. It was simply acting on self-delusion quite oblivious of the empty space below him through which he was falling to a fatal end. In Sri Lanka, this has been repeated ad infinitum at every general election. The one that was concluded last week is not an exception.

Sri Lanka’s manifesting sickness from all sides

Sri Lanka’s economy began to demonstrate signs of serious sickness from around 2013 when the growth rate began to decelerate. Immediately after the end of the war in 2009, the economy showed all signs of recovery to a high growth path recording growth rates of above 8% in the three succeeding years. These growth rates were attained basically by investing in capital infrastructure which could sustain the growth rate only for a limited number of years. That was because in the absence of the needed reforms in the capital markets, labour markets and the public sector, the rigidity of the economy could not be softened. Such growth has been designated by Nobel Laureate Paul Krugman as ones that are attained through ‘perspiration and not inspiration’. Hence, as expected, growth rate began to fizzle out as from 2013. Along with the falling growth rates, the symptoms of other ailments from which the economy was suffering also became manifest.

Such ailments had taken the form of rising budget deficits, unmanageable public debt, rising inflation, deficits in the trade, services and the current accounts of the balance of payments or BOP. Since adequate capital flows could not be harnessed to meet the deficit in the current account, there were deficits in the overall balance of BOP too. It led to the peculiar situation in which foreign reserves had to be built only by making further borrowings. It led to two other basic ailments. One was the pressure for the exchange rate to depreciate in the market in the absence of adequate foreign exchange flows to the country. The other, arising from the inadequate foreign reserves, was the accumulation of debt by the government beyond manageable levels. As a result, repaying the maturing public debt has become a serious challenge for the new government.

No rosy picture about the economy in the next few years

Certainly, the new government has to worry about the frightening economic conditions in 2020 and in the next few years. It is facing an economy that has been virtually incapacitated by the disastrous economic fallout of COVID-19 pandemic towards the end of the first quarter of 2020. As a result, the first quarter of 2020, the size of the real economy, pulled down by a negative growth in agriculture and industry and a slow growth in services, became smaller by 1.6% in rupee terms. Its contraction was sharper in dollar terms at 5% because of the fall in the value of the rupee against the dollar from Rs. 176 to Rs. 190 per dollar in the period.

In the next three quarters, the decline in the economy would be sharper due to a completely underperforming services sector. Unless an effective vaccine against the coronavirus is found soon, this negative economic performance is to linger into the next few years too. Such an adverse development would make Sri Lankans poorer and poorer year after year. This is what the new government should avoid and for that purpose, it has to creatively disrupt the economy too.

Don’t fear disruptions

A disruption is simply a forced change of how people think, act, produce, distribute and consume. Taken together, they can be called the behavioural pattern of human beings. These behavioural patterns are represented by culture and culture is subject to a natural evolution over the time. Such cultural evolutions take their own pace to complete a full cycle but when they are shocked by an external agent – an opinion maker, new technology or new product – the evolutionary process is quickened.

A good example is the smart mobile phone. Five years ago, except those in young age categories, no one knew how to use the data processing power of a smart mobile phone. But today, hit by the social and economic restrictions of COVID-19 pandemic, everyone has trained himself to using smart phones and their versatile applications. As a result, practically everyone today is conversant with using popular Apps like WhatsApp or Zoom to communicate with others or disseminate information. This they do on a real time basis building networks of people and assembling them together. Thus, the smart mobile phone was a shock-agent and that agent has disrupted the traditional communicating agents like newspapers, radios, TVs or even land-based telephones. This was evident when people used smart mobile phones to learn of results, quick and fast, of the general election held last week.

An aggravated fiscal crisis by a generous tax offer

Sri Lanka’s present economic crisis has been aggravated by a fiscal crisis, debt crisis and a foreign exchange crisis. In the case of the fiscal sector, the crisis took the form of an unwieldy budget. The government revenue in relation to GDP was falling, consumption expenditure rising, savings of the government becoming negative, having to borrow to finance both the consumption and capital expenditures on one side and pay interest and repay the maturing debt on the other. This resulted in an unwarranted rise in the public debt stock and by the time the new government came to power at end-2019, it was as high as 87% of GDP, up from 72% five years ago.

This frightening fiscal scenario was worsened by a generous tax cut offered by the new government to income tax and VAT payers. It resulted an estimated revenue loss of some Rs. 600 billion per annum. This was an unaffordable and unwarranted comfort which the new government had given to some section of the people in the country. The consequential rise in the gap in the government budget had to be financed by the government by borrowing from both the central bank and commercial banks. During the first six months of 2020, the government had borrowed, on a net basis, a staggering Rs. 1.22 trillion from this source.

This is money printing which people in the street often talk about. Its inflationary pressure will have to be borne especially the low-income people. Hence, it is an iniquitous public policy since it favours the middle class and the high-income people, while passing the burden – called incidence of tax-financing versus inflation-financing – on to low-income groups. Hence, it is of utmost importance that the government revert to the tax system that prevailed prior to 2020 and save its budget. But it will be a shock-agent disrupting the comfortable life which the country’s taxpayers have been enjoying ever since the new President was voted to power. But that disruption is a sine qua non today.

To resolve the debt crisis, resolve the fiscal crisis first

Sri Lanka’s debt crisis is an off-shoot of its fiscal crisis. Hence, the way to resolve that crisis is to resolve the fiscal crisis first. Sri Lanka’s government has to borrow and raise the debt levels because its revenue is inadequate relative to expenditure programs. One reform it can do in this context is to generate savings in the budget by placing the government’s consumption expenditure – those expenses involving the day to day running of the government – below its revenue levels. To attain this target, another shock-agent of disruption has to be employed by the new government. While going back to the old tax regime, the government should economise its expenses from top to the bottom.

The curtailment of the benefits which many are enjoying today is a real disruption. This applies at the top to the Cabinet ministers who enjoy an array of benefits not counted in the budget as direct payments to them. Like in Singapore, the number of ministerial posts should be restricted, while paying them a decent salary and getting them to meet all their requirements out of those emoluments. In today’s context, the direct salary of a Cabinet Minister is less than Rs. 100,000, a salary lower than the total pay package of a minor employee of a state bank. But cost to the taxpayers by way of providing houses and their maintenance, vehicles and all associated costs, security officers, etc. which are recorded in different heads in the budget is enormous.

Taking into account the current economic crisis in the country, they should go for a voluntary disruption. All other unnecessary expenses of the government should be cut, savings in the revenue account generated and those savings used for vital capital programs. In selecting those programs, those that would help the government to get more taxes in the future should receive priority. In this way, borrowings are directly linked to extension of welfare to people and gaining capacity to repay them on time.

External sector crisis needs reforms in all sectors

The crisis in Sri Lanka’s external sector has been manifested by a need for borrowing for repaying the external debt and meeting the stubbornly high deficit in the current account of the balance of payments. The cause of the current account deficit has been the inadequate foreign exchange earnings by way of export of goods and services and remittances by Sri Lankans working abroad relative to the high import bill of goods and services and interest payments.

The government has recently clamped import controls on what it has termed inessential imports but the savings it could make through this measure is insignificant since the total such expenses are also a small fraction of the total bill. Sri Lanka spends massive amounts import crude oil, raw materials for industries, medicines and capital equipment. Any growing economy cannot curtail these items without compromising growth rates.

Hence, the way forward for the new government is to earn more foreign exchange in the medium to long run by increasing exports and attracting non-debt sources of foreign exchange such as foreign direct investments. To boost both these sources of earning, an essential requirement will be to introduce reforms to enable exporters to export more and attract more foreign direct investments into priority areas. Already, some of the reforms have been introduced to the goods market. But the labour, capital and land markets still remain untouched. It is necessary to shock these three markets through disruptive changes. Sri Lanka’s archaic labour laws dating back to the colonial times need be revised protecting both the workers and producers.

Singapore’s experience in reforming the labour sector

This was what Singapore did as a priority in 1960s because the growing trade union militancy supported by Chinese communists kept the foreign investors away from the country. As S R Nathan, an Ex-President of Singapore, has narrated in his autobiography, An Unexpected Journey, a special Labour Research Unit or LRU was set up at the instance of Singapore’s first Finance Minister, Goh Keng Swee, with the responsibility for ensuring a fair deal for workers through training, empowerment and recognition of workers’ rights.

Nathan who joined LRU as a researcher initially became its head later. His reading of the behaviour of trade union leaders in 1960s perfectly matches those in Sri Lanka today. Nathan has observed that those trade union leaders were full of hate, delusion and bias and poor of facts and understanding. LRU therefore initiated programs to help them overcome those deficiencies. Sri Lanka’s trade union leaders who shout at the microphones posed to them by media display that they still live in the world in which Singapore’s trade unionists lived in 1960s. The new government should as a priority engage trade union leaders in productive negotiations and for that purpose, as a herald, should serve them with a shock-agent of disruption first.

Hence, ‘disrupt the economy creatively or perish’ should be the slogan to be followed by the new government.

*The writer, a former Deputy Governor of the Central Bank of Sri Lanka, can be reached at waw1949@gmail.com

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Latest comments

  • 14
    9

    The petty-minded racist SLPP capitalised on the stupidity of the poverty-stricken stupid modaya yaks who swallowed his doings on the corvid-19 and voted with their pants down to give the much sought after 2/3rd majority which now will be craftily used to enhance the power hold of the crooked master swindlers the notorious Rajapuk gang.
    \
    They are the masters in criminal matters like robbing, sexual abuses fraud and murdering of the innocents and maiming of the innocents.
    \
    Being adept in all these they are nincompoops [ fools ] in the fields of economics and management of the treasury.
    \
    I can safely predict that very soon there will be a famine where the innocents who have no jobs to buy the basics of requirements to even have a basic meagre single meal for the day.
    \
    The presidents top men are themselves very well criminals and they were seen rubbing their hands in glee at the banana that has come their way to keep on depriving the struggling masses of everything.
    The world’s best bull shitter who’s now the prime minister is now in a dream world trying to outdo the present world’s richest man the founder of Amazon.com.
    He has forecasted that within the next four years he will become the wealthiest dude on this wonderful planet where I and you are living.

    • 2
      0

      Ranil did the needful to help the Rajapaksa’s win. It is because of Ranil’s incompetence, stubbornness, and disloyalty to the party, that enabled the present terror gang to come into power. We have to wonder what is in it for him….maybe a lucrative post overseas, or even financial gain.
      Ranil destroyed the UNP and delivered a weak opposition to run against to his good buddies, the Rajapaksa’s. Ranil should be treated like a pariah for the rest of his pathetic life.

    • 1
      1

      TNA does the same thing to poverty stricken uneducated Tamil modayas. Now there is a rival TNA (or SNA).

  • 6
    3

    “SLPP Has Creatively Disrupted Politics; Now It Has To Do The Same To The Economy”

    Creatively?

    I agree this time around the vote rigging is very creative and imaginative….in the management consulting industry we call it “reimagine”!

    • 1
      1

      Rajash

      “I agree this time around the vote rigging is very creative and imaginative….in the management consulting industry we call it “reimagine”!”

      Lets forget the rigging for a moment.

      Registered number of electors eligible to vote ——- 16,263,885 100.00%

      SLPP share of votes ————————————- 6,853,690 42.14%
      – ————
      Number electors refused to vote for SLPP ————- 9,410,195 57.86%
      ————

      Majority of the majority didn’t bother to vote for SLPP.

      • 0
        0

        During the final day’s war, LTTE exaggerated deaths of Tamils, no needs bogus figures, see 145 MPS elected to parliament from SLPP out of 225 MPS. Diaspoda always bogus figures are given to the Human Rights Organization and they bribed the HRO and HRO finally said they accepted huge money from HRO.In this parliament election, it’s very clear Sri Lanka belongs to Sinhalese Aryans. PEELAM barkers still barking for nothing.

  • 13
    4

    With two-thirds majority you can manipulate politics, passing authoritarian laws, taking dissidents into custody and controlling freedom, but can that help the government to uplift the economy to reduce cost of living, eradicate unemployment and develop the country. This is where Rajapakse gang is going to meet the Waterloo. With leaning towards China, USA and its allies are not going to give financial support leading to poverty as what happened in 1970 to 1977 period where country was leaning towards USSR. In addition, India is concerned about presence of China in Hambantota and Colombo despite assurances given, and likely to threaten the sovereignty of the country. In order to distract the people of impending economic doom and security disaster, government is likely to whip up Sinhala Buddhist nationalism. Will history repeat itself with people searching dust bin for food and country embroiled in hatred and violence.

    • 2
      0

      Dr Gnana,

      Wel said.

      But after 1970-77, it was followed by right- wing authoritarian JR, But this time it may be a social revolution.

  • 16
    2

    No hope at all. They returned to office in order to get rid of numeros investigations, however being close to local media, they misled the majority of stupid people through blant lies leading to fake perception. It was like myths controlled the medieval Europe then. Peoples have evidently no clue about the danger before them, they are so naive if ask to eat crowding for cure they would lone up to do so in masses we know how they worshiped fake relics at Kelaniya temple and how they went after Hakgediya being that naive and donkey like. The lead of the parade are so called Rajapakshe bandits, wearing pirith nuule they are seen in their crime acts, this is very often seen in that country, they cheat themselves on and on. Better to focus on mercy cow rather than even think of abusive people that elect high criminals into parliament for permanent loot. 😉😉😉😉😉😉😉😉😎😎😎😎😎

    • 9
      2

      The questions that would not be known to the public (punnakku eaters).@
      .
      Despite an over 10% and over 20% drop in global oil prices since early January, the Government has opted to maintain the current fuel prices until and unless the world prices reduce further in the weeks ahead.

      Global oil prices have been on a declining trend amidst the coronavirus pandemic and the Singapore Platts price of a barrel of petrol and a barrel of diesel recorded a drop of over 10% and 20%, respectively as of Wednesday (12) from their prices early this year.

      In Germany, we enjoy it as no times in the past. Mr Samaraweera introduced the oil formular but it was treated with all laughing stock, because that was not a match to Medamulana musala et al. However, the very same people, today, stay as if they have been fed with kirimati about the oil prices. As we know almost anything and everything can become cheapler, if oil prices go down, but what ballige puthas did was, made use of the concessions to boom their election campaign.
      How many billions they wasted on the costs of people s tax funds – is beyond estimates. This is how they waste state funds on their own.

  • 8
    2

    @@@No hope at all. They returned to office in order to get rid of numeros investigations, however being close to local media, they misled the majority of stupid people through blant lies leading to fake perception. It was like myths controlled the medieval Europe then. Peoples have evidently no clue about the danger before them, they are so naive if ask to eat crowding for cure they would lone up to do so in masses we know how they worshiped fake relics at Kelaniya temple and how they went after Hakgediya being that naive and donkey like. The lead of the parade are so called Rajapakshe bandits, wearing pirith nuule they are seen in their crime acts, this is very often seen in that country, they cheat themselves on and on. Better to focus on mercy cow rather than even think of abusive people that elect high criminals into parliament for permanent loot. 😉😉😉😉😉😉😉😉😎😎😎😎😎

    • 1
      0

      Leegalamalli

      “Despite an over 10% and over 20% drop in global oil prices since early January……”

      The Average price of Oil in 2019 was USD 57/- per Barrel while so far in 2020 it is USD 38′- which means a drop of 33%. See:

      https://www.google.com/search?q=crude+oil+price+chart+2020&oq=cRUDE+oIL+&aqs=chrome.5.69i57j0l7.14652j0j7&sourceid=chrome&ie=UTF-8

      • 1
        0

        Thank you Mhandiram. But why the people as consumers stay as if they are fed with clay ?
        If the situation would have been as such under GOOD GOVERNANCE, SLPP criminals would have gone weeks long strikes rabblerousing the very same people. They were so violent all along during the good governance term. I think the failure lies on the stupidity levels of the people. They would never be better. So long people would dance to the tune of the criminals, nothing tangible would be the case in this country.

  • 11
    1

    Let us look at what W A Wijewardena, a former Deputy Governor of the Central Bank has to say.
    1) Within a matter of a few months of SLPP’s formation as a political force … .
    Is this factually correct. No. SLPP is a clone of SLFP.
    2) SLPP should be a creative disruptor because it has inherited a sick economy.
    Is this a credible statement. No. The architect of the ills of our economy was SLFP itself, before it morphed as SLPP.
    COVID-19 pandemic has come in as a blessing to SLPP, to shift the blame elsewhere.

  • 8
    0

    Thanks, ever-helpful Dr Wijewardena,
    .
    I’ve read the article;
    it deals with the Economy of the country as a whole.
    .
    Now that I’ve got over the shock of the extent of the landslide victory, I’m wondering how to drag out the rest of my life on this planet. The government pension on which I manage will remain, but what will be its capacity be in the future? While those will be my main concerns, I realise that economic planning can no longer be centred upon my requirements. These articles of yours are very useful, but not many comment because Economics is hardly a subject that we understand enough.
    .
    So end of talk about the economy by me, and on to two other subjects which are easier for a vague and lazy guy like me. First the politics. It is now confirmed that this landslide was cleverly engineered by persuading a lot of floating voters to spoil their votes. Seven hundred thousand is huge:
    .
    http://www.dailymirror.lk/breaking_news/Rejected-votes-higher-than-the-UNP-JJB/108-193474
    .
    This is off-topic here, but must be taken up for discussion on Page 2 of this article, where that link has been provided by Rajash.
    .
    https://www.colombotelegraph.com/index.php/sri-lanka-rides-a-gotabaya-surge-blends-to-a-sinhala-buddhist-ethos-election-sends-a-chilling-message/
    .
    tbc

    • 5
      0

      Continuing PART TWO

      .
      Who persuaded these young people to commit hara-kiri? This guy with his videos:
      .
      https://www.youtube.com/watch?v=zIMTYWVdqJE
      .
      However, please don’t start analysing the politics here – do it there! Dr Wijewardena appends his email address to every article he writes. I used email him to inform him of those developments; this is to inform other readers that there is another place to discuss this political subject.
      .
      Let this place be kept uncluttered for other readers who are experts on Economics. I will return to learn, not to say clever things. Active Economists, please discuss here so that we may learn:
      .
      Let me tell you once more where that specific political debate is raging. It’s /b>here:
      .
      https://www.colombotelegraph.com/index.php/sri-lanka-rides-a-gotabaya-surge-blends-to-a-sinhala-buddhist-ethos-election-sends-a-chilling-message/
      .
      I don’t believe that the future has already been determined. It may be that we should cultivate optimism. Dr Wijewardena always looks to the future always with disciplined optimism. It’s a healthy habit.

      • 2
        0

        Dear Sinhala Man,

        I think you may be right with Sepala A, but today s video is totally different that of his previous ones. And again, I respect the guy below, he has been telling the truth.


        https://www.youtube.com/watch?v=LvCQvmFueJI

  • 4
    3

    ” SLPP Has Creatively Disrupted Politics “ Well said. Only three Tamil Churches and three tourist hotels needed to be destroyed to be creative disruptive in election; But was high ROI as return; 152 MPs. They just ordered justices at SC not to allow Yahapalanaya to re-camp until November in TTH & Diyawanna Lake Palace. Another breaking of Central Bank and a pogrom on minority properties & lives and their shameless life will bring a marvelous economic disruption. That will be a very profitable looting disruption for the economic growth for the Royals & Sinhala Intellectual consultants. They come up with a creative idea that British management had favored Tamils. Don creatively disrupted in 1948, deporting Estate workers & destroying Estate export income. SWRD’s Sinhala Only disruption remove all experienced Tamils from government departments.
    I don’t know what the author is talking about. If he has an iota of common sense, he would not have spent his precious time on this rubbish. Does the author understand anything further than windows breaking, the magnificent culture of the Sinhala Buddhists and Sinhala Intellectuals, what those Economists were trying to explain by creative disruption? The economists are talking about forcing current inventions out dated by new invention & force them to be replaced with new products even if they have good useful-life. That is something like Old King younger Son Prince invented SuperSat or the Kalkissa boy’s ICBM.

    • 1
      1

      Mallaiyuran,
      Don should have deported all Dravidians brought by colonial parasites. If he did that Sri Lanka could have saved lot of money.
      Tamil terrorists destroyed public property. Cost of those destructions was enormous. Sri Lanka had to spend enormous amount of money for the military operation to eliminate LTTE Tamil terrorist barbarians. No need to waste money to rehabilitate LTTE carders. No need to look after the displaced Demalu. No need to pay compensation to Demalu who got affected by the military operation.
      The loss of human lives cannot be quantified in monetary terms.

      “Don creatively disrupted in 1948, deporting Estate workers & destroying Estate export income.”

  • 1
    0

    This comment was removed by a moderator because it didn’t abide by our Comment policy.

    For more detail see our Comment policy https://www.colombotelegraph.com/index.php/comments-p

  • 5
    1

    Why is the Sri Lankan economy gradually deteriorated after 1948? One-time SLR is equivalent to twice the IR. It is now one third the value of IR. What caused the deterioration? There are several resources that are available for building the economy. The natural environment and its geographical location were an asset o the island. The multi-ethnic set up was the main reason for the economy to worsen the economy because the Majority community introduced laws that prevented the minority communities in the development of the economy. Repeated ethnic riots between the Major community and minority communities are the root cause of brain drain by talented people. Now the government wants the expatriate population to invest in Sri Lanka. How can the expatriate population trust the government? The attitude towards the Muslim community wu soon affect the MR labor Market economic conversion by China by ging on, and earring projects will add more peris to the economy. After-effects of these will be seen in a year or two. The current policies will kill the economy and the reputation of the country internationally? You can only lie once but can not continue to lie continuously

  • 4
    3

    Being disrupters of the highest class they the SLPP will have their hands and mouths full to revive a dead horse of an economy.
    \
    Having been responsible ever since 1956 for economically racially and immoral maestros in destroying the in the black rice exporter Ceylon which was till then a pristine land to live in.
    \
    I applaud China for gifting to the world the much sought far coronavirus-19 which helped the SLPP to win on a handsome 2/3rd majority which when implemented will drive the final nails into the already sunk coffin.
    \
    All you Yakko’s who are and were hero-worshipping the crooked Rajapuka’s now feed yourselves and you due to the gift do not even have the old white uncles calling at your homesteads to corrupt and soil your young ones especially the young boys.
    \
    in conclusion, even the easy monies for the men to behave like sultans and lead an expansive life with wine women/men and song has already come to a glorious end.
    Keep on attacking the Muslims after all you yaks are Lord Buddha’s gift to the world.
    They roam around on the false premises that the sun is always shining on their sordid backsides.
    Thankfully all yaks cannot be put into this rowing boat which will sink and there are exceptions to the rule especially some of the ladies whose comfort I enjoy.

  • 3
    0

    WAW, knowing well the trend, there is no one who can walk the talk. Deception has reached a higher level only.

  • 16
    0

    I’m no economic guru, just a hotel worker however, can the new government or will they have the courage to take a chainsaw and cut down on the following. Just to name a few,

    # We have a massive armed force that eats into our budget and with no war to speak of it’s time to cut back on defence and trim our forces. Won’t be popular but huge savings to be had.
    # Another is the white elephant Prdeshiya Sabhas, just a rubber stamp in my view, a budget killer and a treasury nightmare if I may say so.
    # Then we have a bloated public service, try walking into any public department for service , you’ll find hundreds of workers sitting or standing idle but not a cat to help you, I say trim trim and trim .
    There you are , please correct me if I’m wrong.

    • 0
      0

      Cyclops ,

      Let us be real for a moment ! Gota got elected mainly on the
      guarantee of protection from Islamist extremists which
      needs enough armed men ! Your first worry has to travel
      out of the window ! Pradeshiya Sabhas and Palath Sabhas
      are only meant to forecast the results of general or president
      elections whichever comes first and as self employment
      opportunity for the boot lickers of Diyawannawa ! Your
      third one can never be bailed out because of its ties from
      Kindergarten to the Strikegarten meaning the universities !
      Sorry my friend , no way out !

  • 2
    0

    Dr Wijewardena’s recommendation is ” that the government revert to the tax system that prevailed prior to 2020 and save its budget”. The simplified income tax system is better than the complicated system that prevailed earlier. However, reintroducing the top slab of 24% may become a necessity. The simplification of indirect taxes is another desirable feature of the reforms. Consolidating all indirect taxes (excluding import taxes) to a single VAT of 15% and reducing the VAT exemption limit to Rs 3 million per month may become a necessity to balance the budget.

    The focus needs to be attracting foreign direct investments and not allowing the foreign debt to GDP ratio to rise any further. It will improve the country ratings leading to lower cost borrowings. Here are some projects in the pipeline which needs immediate approval.
    1. The 980 MW Korean LNG plant and abandon the coal power plant and one 300 MW LNG plant in Kerawalapitiya.

    2. The US$ 500 million Chinese Tyre Plant.

    3.The Australian garbage to power plant.

    4. Call tenders to buy more solar and wind power. We need to tap the enormous wind power potential of our location. Unlike solar power, it supplies power during the peak demand period.

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      Truth28

      “The focus needs to be attracting foreign direct investments and not allowing the foreign debt to GDP ratio to rise any further.”

      This island is caught in a debt trap hence a repayment strategy is urgently needed before it spiral out of control. Those who got the country into this precarious economic situation is back in absolute power, heavily backed/trapped by unelected unproductive Saffron and Olive brigades.

      As for your points 1,2 & 3 the actual construction should benefit local people in terms of employment, income, skill endowment, suppliers, … through multiplier and accelerator. Previous projects only benefited the foreign contractors who brought everything necessary to construct and commission relatively large scale projects.

      In all these projects how far the local people are involved? Are they more of Top Down projects shoved into the throats of local people with little or no benefits accruing to them.

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    Breaking News!

    Ranil W agreed to step down as UNP Leader.

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      correction
      Ranil W agrees to step down as UNP Leader.

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    There is no such science as Economics.
    If there were all countries would be the same.
    No two Economists agree.
    The top most Economist of any country is the head of state.
    Talk to a couple of Economists at the Central bank and then talk to the security guard on your way out to return to your senses.
    Our Economists don’t understand what OUR politicians want. They want to know the percentage to THEIR accounts.
    Astrology is a more honourable job.

    Soma
    (How I envy their salaries!)

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    The author has introduced the word “disruption” in to our parlance as understood by high level economists. They advocate the disruption of the economy periodically as it would change the way how things are done and rejuvenate the system. If the author can name a few amongst the newly elected parliamentarians who would understand the word in this manner I would be happy. My guess is that the number would be less than five.

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    Wishful thinking by the writer.

    SL is over-governed. Too many layers and corruption at every layer. The only way to balance the fiscal deficit – get rid of provincial council system and LGs. Billions can be saved.

    Otherwise SL is doomed for good.

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