21 July, 2019

Blog

Sri Lanka’s Looming Economic Crisis

By W.A Wijewardena

Dr. W.A Wijewardena

Dr. W.A Wijewardena

Looming economic crisis: policy approaches are too short and too late while some are unproductive 

Open admission of the looming economic crisis

Three moves made by the Central Bank in the recent past have been tantamount to an open admission that Sri Lanka is in a deep economic crisis. Of course, the crisis, as this writer had pointed out on numerous occasions, was not the creation of this Government, but something which it had inherited from the previous administration.

Yet, this Government is at fault for making several mishaps by itself: Not making a proper assessment of the economy despite the warning by independent analysts; signing off the inflated growth numbers produced by the previous administration in the reports it has put out; not disclosing the crisis to prepare people for hard choices and failure to take immediate corrective action to come out of the crisis. Now the crisis is looming large over the country calling for firm action. But the authorities appear to be taking palliative measures to fix it.

The ‘resilient’ external sector forcing the Central Bank to allow the rupee to ‘depreciate’

The first move was to allow the rupee to depreciate in the foreign exchange market after many unsuccessful attempts at defending the rupee by losing the foreign reserves belonging to the nation.

Although the external sector had continued to deteriorate as from around 2009, the Central Bank Annual Report 2014, published in April 2015, had reported to Parliament that “Sri Lanka’s external sector improved its resilience in 2014 with a narrowing of the external sector imbalance and a surplus in the overall BOP”. The word ‘resilience’ is a misnomer here because its meaning connotes something else: Resilience, as related to an economy, means that once the economy has fallen due to an external pressure or an internal implosion, it would rise up again on its own without outside support. But six months after giving the good certificate to the economy, the Central Bank had to abandon the use of the country’s foreign reserves in the defence of the rupee in the exchange market.

Accordingly, the rupee fell from Rs. 131 per US dollar at the beginning of 2015 to Rs. 145 per US dollar by the fourth week of December 2015. This is a depreciation of 10% over the year.

The use of an abandoned monetary policy weapon by the Central Bank

The second move was to commence tightening monetary policy as from 2016. In the latest monetary policy announcement, the Bank said that it would increase the Statutory Reserve Ratio or SRR by 1.5 percentage points to 7.5% to be effective from 16 January 2016. The reason? There is a high excess liquidity in the money market and it should not be allowed to continue to prevail because it would increase future inflation by increasing money and credit.

This excess liquidity is not a new phenomenon and the market had been flooded with excess liquidity for many months. All the time, the Central Bank took the opposite view and encouraged commercial banks to increase their credit levels by even reducing interest rates.

Placing responsibility for requesting IMF support on PM

The third move, first announced by Prime Minister Ranil Wickremesinghe in Parliament earlier in December, is to seek the support of the IMF to get out of the current foreign exchange crisis through a new financing arrangement.

So far, the Government has not approached the IMF for such an arrangement and it says that it would do so in February 2016, when the next IMF mission is fielded to Sri Lanka. Announcing this intention in a recent media briefing, Central Bank Governor Arjuna Mahendran implied that it is a move coming from the Prime Minister and not from the Central Bank or the Ministry of Finance, the two institutions that should make this request together to IMF.

Market-based monetary policy weapons

In the latest monetary policy tightening, the Central Bank has used SRR which was a weapon that had been abandoned by the Bank many years ago as unsuitable. The Bank had chosen to implement its monetary policy through market-based weapons because they did not bring about irreversible market distortions.

Accordingly, the Bank had gone for changing its policy interest rates directly, first used as REPO and Reverse REPO rates and later changed to standing deposit facility rate and standing lending facility rate, respectively.

The former is a measure to take away the excess liquidity in the market by accepting it as a deposit with the Central Bank by paying interest at the rate of 6% per annum. Hence, it is a cost to the Central Bank and such interest payments, amounting to Rs. 18 billion in 2014, happened to be the largest single expenditure item of the Central Bank in that year. Hence, if the excess liquidity is higher, the Central Bank’s interest expenditure will also be higher. But under the new SRR, a minimum of additional Rs. 50 billion has to be kept by commercial banks in the Central Bank without earning any interest income. Thus, the new monetary policy tightening will pass the cost from the Central Bank to commercial banks.

SRR is a dead duck

SRR has been abandoned by central banks as an unsuitable monetary policy weapon with the exception of a few central banks like the US’s Federal Reserve System and China’s central bank which still rely on it. There are many reasons by other central banks, including the Central Bank of Sri Lanka, for considering it as an unsuitable monetary policy weapon.

Imposing an unintended tax on banks

First, it is a tax imposed on commercial banks because banks are forced to keep their hard-mobilised deposits in idle form at the Central Bank. In the present situation in Sri Lanka, banks pay on average about 6% on their deposits and spend another 2% in mobilising and maintaining those deposits. If they add a profit margin of 2% to that cost, their opportunity cost amounts to about 10% per annum.

Hence, when these moneys are kept in idle form in the Central Bank, banks lose about Rs. 5 billion per annum which is a tax on them. It is a ‘deadweight tax’ since it is a loss to banks but no one else in the economy earns it as revenue.

Forcing banks to increase interest margins

Second, SRR brings in an unintended consequence in the form of widening the gap between banks’ deposit rates and lending rates, known as the interest margin. Since banks have been forced to keep their deposits, mobilised at a cost, in idle form with the Central Bank, they have all the incentive to recover it from their customers.

The strategy they adopt to attain that goal has been to punish both depositors and borrowers. They would accordingly reduce deposit rates or increase lending rates or do both. Whatever the strategy to be adopted, it widens the interest margin, an index of inefficiency of the banking system of the country and an ailment which the Central Bank has been fighting very hard to eradicate.

Long time lag in yielding results

Third, SRR becomes effective in delivering the objective of taming money and credit growth after a long time lag. Hence, it defeats the Central Bank’s announced goal of fighting inflation in the next 6-12 month period.

The increase in SRR is an external shock delivered on banks and not on markets. Hence, banks are required to make a series of adjustments to change the size of their loan books and it takes time for that process to run its full course.

From the middle of January, banks will have to park an additional Rs. 50 billion with the Central Bank. Those banks with excess liquidity can do so without any labour because they have excess funds to do so.

However, banks with deficit liquidity will have to borrow immediately in the call money market to meet the new obligation and it will dry up the moneys in the call money market. If funds are not available in the call money market, banks would be forced to sell some of the Government securities they are holding by pushing down the price and increasing the yield rates. It will affect the government securities market in the form of increasing all yield rates across the board. Banks would be forced to cut their lending only after that and experience shows that it takes about 12 to 18 months for the full cycle to run its course.

Forcing banks to abandon core banking business

Fourth, it is not a market oriented policy weapon since it is in effect a tax on banks and brings about a series of market distortions which the Central Bank would not love to have in the system. A few of such distortions would be, as shown earlier, widening of the interest margin, incentive for banks to move from interest based core-banking to fee-based service banking, unintended increase in the yield rates of government securities.

Of them, the shrinking of the core banking portfolio in banks will act counter to the wish which the Minister of Finance announced in the Budget 2016 to increase their core banking portfolio by restricting leasing activities.

Markets eventually increase interest rates

The Central Bank Governor in an interview with Reuters has said that the Central Bank used SRR to tighten monetary policy, since an increase in the Bank’s policy interest rates leading to an increase in the whole interest rate structure would impede economic growth.

It is true that SRR will not increase interest rates immediately and the Governor will be happy for a brief period. But, as pointed out above, it will lead to an increase in the whole interest rate structure over the time plus bring in many more unwanted consequences to the economy.

Hence, officially interest rates are not increased but the market will take action to do so defeating the Governor’s objective. In this sense, it appears that the Governor and the Monetary Board have been misinformed by their advisors.

A too short and too late policy move

The Central Bank cannot continue to increase SRR in order to further tighten monetary policy when the emerging situation demands it to do so. It is widely speculated that the US Federal Reserve Bank will implement a second round of interest rate increase in February. With the low interest rate regime prevailing in Sri Lanka, the rupee is already under pressure to depreciate because low interest rates encourage imports, give incentives for exporters to keep money out and reduce the potential capital flows.

The country is so far fortunate because it still has in its short term funding base about $ 2 billion invested by foreigners in Treasury bills and Treasury bonds down from $ 4.5 billion a year ago.

These investments have come to Sri Lanka due to the near zero interest rates prevailing in USA as against high rates offered by Sri Lanka to them. If the Federal Reserve increases its interest rates further in February, to prevent these dollars flying out of the country, the Central Bank will be forced to make a matching interest rate adjustment upward. Hence, the euphoria enjoyed by the Central Bank’s management that it has tightened monetary policy without impeding economic growth appears to be very short-lived. Thus, the policy measures taken by the Central Bank to avert the crisis are too short and too late. A policy like increasing SRR is unproductive too.

The ‘resilient’ economy has recorded a decline in growth rate in 2015

It is, therefore, advisable that the Central Bank should take a realistic view of the present state of the economy. The Bank’s Annual Report for 2014 has expressed satisfaction about the present state of the economy in its opening sentence as follows: “In 2014, the Sri Lankan economy showed the resilience in the face of domestic as well as external challenges. Real GDP grew by 7.4% in 2014, in comparison to the growth of 7.2% in 2013”.

Once again, the use of the popular word ‘resilience’ is a misnomer since it implies that the economy would rise again without external support. Strangely, the resilient economy has grown only by 5% in 2015 as revealed by Governor Mahendran at a media briefing on 31 December 2015 and according to him, it was also a “testimony to the resilience of the Sri Lankan economy”.

Take a lesson from independent critical analysts

While the Central Bank has been jubilant over economic growth and other macroeconomic numbers, The Institute of Policy Studies or IPS, another organ of the Government, looked at them from a different perspective.

In its State of the Economy 2015 Report, IPS has said that the headline growth numbers and impressive infrastructure facilities have masked the real situation in the country. Says IPS: “These (headline growth numbers and impressive infrastructure) masked some inherent structural weaknesses in Sri Lanka’s public investment led and external debt financed growth. As noted in Sri Lanka State of the Economy 2014 report ‘beyond the immediate headline macroeconomic numbers, the Sri Lankan economy continues to show skewed growth, high level of external indebtedness, modest export earnings growth and limited private sector appetite to expand the capacity’. Stacked against headline statistics, structural weaknesses in the economy, however, are not as readily explainable on election platforms”.

Not only at election platforms, such structural weaknesses in growth cannot be even explained to people in power who always desire to listen to only good news praising their policies. It is unfortunate that the Central Bank, created by the nation to give impartial and apolitical analysis to the public and make its policies independent of politics, acts like an organ pleasing the ruling political powers.

Dr. N.M. Perera’s advice to Central Bank: “Be impartial and objective”

The Central Bank management should keep itself constantly reminded of a piece of wisdom which Dr N.M. Perera, the left-wing Minister of Finance during 1970-75, left with its senior management in 1971.

At a function bidding farewell to Mr. J. Thyagaraja, retiring Monetary Board Member, N.M. Perera had advised the senior officers of the Bank that the Bank ‘should make independent reports on economic subjects to the government and not report merely to suit the political complexion of the government in power’ and that ‘he would value reports (of the Bank) made dispassionately and objectively’.

Create an ‘independence culture’ within the bank

In his economic policy statement, Prime Minister Ranil Wickremesinghe has said that the Government would take action to restructure the Central Bank so that its officers can work independently.

This is a laudable goal. But, legal independence in the Central Bank is necessary but not sufficient. What is necessary and sufficient for the Bank to carry out its mission successfully is legal independence supported by an ‘independence culture’ within the Central Bank.

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

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  • 3
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    Dr. W.A Wijewardena

    RE: Sri Lanka’s Looming Economic Crisis

    “Accordingly, the rupee fell from Rs. 131 per US dollar at the beginning of 2015 to Rs. 145 per US dollar by the fourth week of December 2015. This is a depreciation of 10% over the year.”

    “Three moves made by the Central Bank in the recent past have been tantamount to an open admission that Sri Lanka is in a deep economic crisis. Of course, the crisis, as this writer had pointed out on numerous occasions, was not the creation of this Government, but something which it had inherited from the previous administration.”

    Yes. This is real. Will it be as bad as Greece?

    1. The Foreign remittances, mostly from the Middle East has only gene up by 0.9%, partly due to the ISIS Terrorism and War. Other exports have not gone up that much die to a slowdown in the global economy.

    2. However, the good news is that the Energy prices have gone down. This may only be a temporary relief.

    3. There may not be much growth in the Middle East Labor market. Given that need to focus on exports and value added exports and of course Tourism.

    Do you think Sri Lankahave the Intellect to handle this impending Economic Crisis? Or, will it be Politics and Economics as usual?

    Currently, the Gamarala President is busy handling the “Thana Pata” Brassier throwers and the organizers of the brassier throwers.

    • 2
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      Amarasiri,

      I agree with you. We have to identify areas of potential development. One such is area is falling back to our ancient agricultural system. New findings have emerged that presently adopted chemical fertilizer and pesticide based agriculture has gone nowhere except destroying the natural balance of ecosystem and also debilitating the living. Research has identified and continue to discover ecofriendly methods of agriculture devoid of chemical fertilizers, pesticides using reduced amounts of carbon manure, microorganisms, seasons, timing, rain and lightening, ecologically evolved robust crop varieties, scientific agricultural methods, new and efficient methods of nursery, seed planting, weed controlling and crop harvesting. These methods can improve efficiency and decrease production costs. There are large acreages of unutilized agricultural lands in the areas outside the dry zone agricultural areas and if we could establish a mechanism to mobilize unemployed youths under a properly setup mechanism to cultivate these lands we could instantly go back to our ancient day agricultural methods, seed varieties, poison free food consumption and a disease free population capable of increased output. We cold also find foreign markets for such really healthy and delicious food varieties. Our country had an abundance of tasteful and nutritious rice and vegetable varieties which we have to rediscover and propagate among farmer families and households in the country. Yes, a new and reoriented agricultural revolution, in tandem with industrial revolution, is due now.

    • 7
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      Amarasiri,

      “Currently, the Gamarala President is busy handling the “Thana Pata” Brassier throwers and the organizers of the brassier throwers.”

      Gamarala president is outputting what he is made of! Of course all SLFPers are like this! Beginning from Banda this is what they did to themselves, digging, nurturing, socially establishing, invoking and personifying in themselves all trivial, racist, extremist, tribal and primitive emotions of primitive animal living in psychological and biological man. Sira like Mara will continue to feed on bras, hypes, asbestos and the like which are aimed at the SLFP gallery which they have built over several decades under them. The concepts and methods of UNP are anathema to them!

      • 0
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        What about Premadasa senior ?

  • 2
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    This is a critique sans an alternative policy prescription. I do not mean an alternative to just increasing the SRR but a total alternative policy prescription for the economy. This proves that Central Bankers and ex Central Bankers are not planners and builders; for that we need to get together a team of development economists, engineers and thinkers. It is a vision that issues from such a source that can give birth to concepts like Made in India.

    • 2
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      EW Golding,

      Exactly! Then what is the alternative is the million dollar question! Sri Lanka must build a think tank to consult on these matters.

  • 4
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    PRIORITY should be given to trace and recover the looted billions that the corrupt Jarapassa family and associated politicians of Lanka have in overseas bank accounts.
    These stolen funds would be more than enough to pay of the gigantic National DEBT and prevent an IMF bail out and make Sri Lankan economy would be solvent..

    The so-called National Debt is really the COST of POLITICAL CORRUPTION and Chinese White Elephants like port and sea port in Hambantota,
    The people must demand that all the stolen Rajapaksa and cronies millions in Suiss, UK, Singapore, Dubai, China and Sechelles etc be traced.

    But getting aid from UK to which benefits from the looted funds of third world dictators and politicians, who keep the corrupt British Banks going is useless, because UK is part of the financial crime circuit@ UK and all the western banks and economies benefit from corrupt politicians in third world having their accounts in western banks! IMF would be irrelevant if there was no third world debt- so they keep the corrupt global financial circus which ensures “TRICKLE UP” and growing inequality which give rise to movements like ISIL or Daish..

    Look what happened in Greece where the corrupt politicians caused the economy to default and come under the yoke of the IMF with the people suffering. The IMF and Transparency international never said anything about the CORRUPTION and LOOTING by corrupt Greek Politicians even though they knew what was going on.

    The world financial system is a corrupt cesspool the king of which is the IMF and World Bank. Transparency International is an NGO which tows their party line, so Sri Lanka should ignore them and chart its economic course..

  • 4
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    Thanks Dr. Wije.

    There is a need for qualified Sri Lankan experts from the Institute of Policy Studies to lead the discussion on what is to be done re. the economic crisis. The IMF will lead Lanka into a Greece-like tragedy, which will result in renewed conflict and violence in Lanka.

    Ranil’s Royal College buddy Arjuna Mahendran is a corrupt insider trader and financial criminal who is not qualified to run the Central Bank. Mahendran is a bond and derivatives dealer and not an Economist and should not be in charge of the CB. He has been following the footsteps of the previous corrupt clown Nivard Cabraal who also made a huge fortune on insider trading and currency manipulation.

    The debt, the looming economic crisis and tanking rupee is as you say a result of the corrupt policies of the previous Mahinda Jarapassa regime and this should be clearly explained to the masses who should be educated that BI-PARTISAN POLITICAL CORRUPTION IS THE ROOT CAUSE OF THE CURRENT ECONOMIC CRISIS, that the people have to pay for while inequality gap widens and the rich get richer.

    Hope the opposition stops Ranil from succumbing to IMF demands.

  • 0
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    “It is widely speculated that the US Federal Reserve Bank will implement a second round of interest rate increase in February”

    Despite expectations, it is more likely that the FED will reduce interest rates back to zero and start a new round of QE.

  • 1
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    What crisis ?…

    US now is the biggest Investor in Yahapalana Srialnka, according to Ceylon Today.

    In fact, Uncle Sam thumped Confucious by a whopping 1 Billion. Green Backs of course.

    The new Oil Refinery which Uncle Sam is going to build to give Yahapalana suckers American gas, is going to cost USD 2,500 Million.

    And not even a cent from Yahapalana Tax payers is needed..

    Aloysious and Uncle wouldn’t be too impressed.

    All the money is from Foreign Banks and a few ex CPC heavies.

    But the good news is, it is going to be in Hamabantota , because the Yahapalana Minister couldn’t find 500 Acres to donate to the consortium from anywhere else.

    But no mention of the Harbour .

    May be Uncle Sam is going to Airlift Crude Oil or just pump it from Saudi direct to Hambantota.

    How cool will that be….

  • 4
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    Very good analysis showing off the knowledge of the writer revealing the dire state of affairs of the country but with zero contribution and sense of responsibility from the writer’s part in making use of the knowledge he gained from the very land he lives on. What this country needs is not a lecture on social media but a tangible contribution from those who have extracted the essence from this land. Despite his showing off of his erudition the country would enter the “looming economic crisis” and on hind side everyone is intelligent! What would validate writer’s credentials as an economic specialist is not mere whistle blowing but contributing concretely, materially and measurably and tangibly to change the course of the country towards better economic policies and management. If I may propose please avail of your expertise with people that matter like PM, CB Governor, policy makers of government etc. You could also partake in TV discussions and debates involving Harsha, Ravi, RW etc. and create an awareness in the country as to the ground realities, correct economic policies and directions the country should adopt. Do transmogrify from abstraction to substance.

    • 2
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      Show off nature is read in their genetics.

      Most coming from CMBO I have met in Europe are showing off. I really dont know why. They refer their schools and what their parents did etc again and again. Most of all Royalists and St bridget school behave as if they are royals. This mentality is written in their genetic codes. Even if you have not obtained a basic degree, but to have gone to Royal college or St Briget school make them exageratingly proud. How come ? Women are more like than the old men. This is very typical to srilankens oldies.

    • 0
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      Silva, Rarityminds,

      I think it is at least too hasty, and possibly myopic, a conclusion that Dr. Wijewardena’s presentation is merely show-offish and to criticize it as lacking in objectivity, since he provides no prescription.

      Contrarily, the author has very precisely identified the “side-effects”, if you will, resulting from not-well-thought-out policy decision, seemingly made at a whim.

      It is absolutely right for the author to summarize the issues and the likely consequences in quite a generalized, logical framework and state them in lay-man’s term, to the extent possible. That should help begin a worthy, detailed and productive discussion among the professionals and politicians (hence resorting to lay-man term explanations) about alternate policy options and consequences so as to fashion a tailor made policy mix suitable for the country at this particular time and environment.

      It would truly have been show-offish, if Dr. W had instead spelled out a prescription in an all-knowing arrogance and patronizing attitude, over-and-above the heads of all the professionals and institutions that actually have the responsibility and the capacity to converge towards a reasonable action plan, with appropriate evaluation of the pluses and minuses inevitable in making that choice!

      Your criticism may have resulted from your discomfort in having now realized the apparent faux-pas of the Central Bank (in not analyzing the policy directive adequately and independently, independent of Political expediency needs) and your anxiety to promptly drill-down to a “cure-all” policy decision, that you feel the author irresponsibly avoided revealing.

      I bet the author has no such quick-fix mantra, but he is just earnest in his belief that broader and independent discussions should begin to evaluate such critical policies, away from political interference or perhaps dictation! And, I believe, Dr. Wijewardena accomplished that in the most non-show-offish and restrained manner, inviting broader participation in required, professional discussions on alternate policy implications without offending those tasked to provide that best-possible prescription.

      • 0
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        Kumar R.

        You have got what I said from the wrong end. There is no anxiety, discomfort or anything on our part about what the writer has said. On the contrary the point I raised was why didn’t the writer approach those in the government that matter and raised these seemingly valid points with them so that they would have considered his arguments, observations, forecasts and economic realities and modalities etc. when and before they take economic and policy decisions to take this country out of the ‘looming economic crisis’.

        You would not undertake bypass surgery on the dead body, rather it is before the patient dies that you must act and operate upon. The writer is an experienced veteran on CB methodologies hence this is not what we really expect from him rather he should have taken some meaningful actions to guide the decision makers in correct economic path.

  • 2
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    It was understood by many that recovery of black money would help our economy. It was understood that we would reschedule our foreign loans. We expected Foreign direct investment would increase. With a looming crisis we cannot expect this either. We are paying to much attention on human rights and national unity. We are not reaping a peace dividend. Consent-ration on to much legislature is the main reason for the crisis.
    Let us concentrate on making the economy move. Let us increase the software of development and decrease the hardware. Let us declare an amnesty on black money. Let there be truly a national government. Let us reschedule our loans.Let the diaspora bring in funds to our country by giving them incentives.It is time for the central bank governor to resign.His negative reports is creating a panic. Is the measuring of GDP changed. He was involved in a change in bonds without planning ahead.He indicated that there would be changes in measurements. Is there a cover up.

  • 2
    0

    From tyhe frying pan in to the fire.
    Go back to China… Apologise to for humiliating them. bring them on board and re-negotiate the loan payments.
    I am sure there will be waivers too.

    Soros is going to be in town…….. There will be more sorrows.
    Quicker we get to China the better.

    • 1
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      thondamanny,

      And then import oxygen from India as they do from Canada!

  • 0
    0

    US back that Indian influence by RAW led economies policies drafted by UNP-Neo-liberal road map will destroy the future of Sri Lanka; it will be lost cause since 2015 January 9th that led by MS being to President of SL.

    WE HAVE MISS THE NEW OPPORTUNITY TO USHER DEMOCRACTIC REVOLUATION IN ECONOMIC AND POLITICAL TERMS OF SUSTANABULITY OF CAPITALIST DEVELOPMANT.ITS NOT OFFER US CHANCE TO PUT ECONOMIC REVOLUTION AND DEVELOPEMENT ON A LOOKING-FORWARD AND SUSTANABILITY FOOTING AND IN THAT WAY TO SECURE ITS NEW COMPETITIVENESS IN THE LONG-TERM POLITICAL PACKAGE OF DEVELOPMENT.

    The face with new UNP government deficits ,high taxes millions of disgruntled voters are rightfully concerning about mortgaging their future in heap of unpayable debt and saddling their children with bankrupt society.
    The welfare of the millions of human being will lost life supporting due to the UNP neo-Liberal policies. The Free Education and Free Medical facilities have been enjoy by millions of people of that had been operated since British Colonial system is near to collapse by UNP-Ranil.w… proposals.

    This is critical movement of in Sri Lankan history, when our very survival and future of our people are at stake ,we can no longer afford to dwell in mystical land of Sri lanka of UNP -Ranil magical thinking.

    Under UNP-Ranil W…rightwing orthodox policies that economics revolution do not just emerge from either .

    • 2
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      N.Wimaladasa,

      What you have written indicates you are a low-budgeted, penniless, begging for living asshole bent of rations. What the hell do you know about UNP? It is UNP that began rations system during WWII under the British rule. During war food became scarce and the British took measures to address the hunger of its protectorate. What happened thereafter was that buggers like N. Wimaladasa demanded that every government that followed give away free food, free education, free medicine, free uniforms ….. These beggars do not realize no creature on this planet can be fed free of charge by another creature or group of creatures. This clown makes a farcical demand that his hunger, education, health etc. needs be fulfilled by the working masses’ tax money! [Edited out]

      • 0
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        Silva – you are exactly correct – whether it is Ranil or MR running this country we will have no future unless and until we brain wash these beggars to think differently – these [Edited out] expect everything on a plate and never wants to work for it – Salary increments / car permits / free health /free schooling — everything free free — work less earn more – we tax payers spent more than half of country’s income to maintain these brick bats – unfortunately even Ranil shows no back bone to tackle these dead weights – that is why he amend his budget proposal when few hundred of loin cloth wearing farmers stage a protest in Colombo – mockery of democracy –

    • 1
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      What do you want to say Wimaladasa ?, I cant understand anything you have added here. Can you please write in a comphrehesive langague. THanks. Leelawathie

  • 1
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    Rabok,

    Another limp that was built into N.Wimaladasa’s verbal diarrhea was his broken English so typical of these SLFP buffaloes! I don’t know how the hell this pakis booruwa calls on his better half when the bugger feels inclined to discharge his secretions!

    “unfortunately even Ranil shows no back bone to tackle these dead weights – that is why he amend his budget proposal when few hundred of loin cloth wearing farmers stage a protest in Colombo – mockery of democracy – “

    On the contrary, RW has defeated the subtle intensions of these protesting bastards. Behind all these lies is the cat’s paw of MARA who daydreams of grabbing the power of the country by creating a wave of strikes, protests, commotions, racial riots and pogroms. They want to prevent investors coming to SL seeing the wave of strikes going round the country. They hope to keep the country under perpetual turmoil and conflict. It is this sinister coup that RW rightly dissolved and nipped in the bud.

  • 0
    1

    Silva’s your political-economy has no base in developing economics country like Sri lanka. How we are going address inequality of social class in vast gap between have and have not’s of that uneven growth of ours national economy?

    Instead of insulting other ,you should have your own solution of mode of economic growth of Sri Lankan GDP? You are seems to be similar to that identical version of UNP-Ranil.W… orthodox that one partially stuck in the old top-down approach to Sri lanakn political and economic development.

    UNP-Ranil W….the other hitching his political fortunes by US and Indian that distributed -network approach each defying of orthodox conservatives party labels of NEO-Liberalism.

    Well UNP-Ranil .W…policies that NOT going towards would need to be integrated into new capitalist road map for Sri lanka.
    Indeed including removed barriers to enter into market ,sale-up and commercial penetration by US and Indian MSNs.

    Weather the UNP-Ranil W…regime collaboration with MS+CBK will in fact follow through on its assurances rather than Sri lanakn’s national economic development that they slip back into the kind of US and Indian moribund approach be bleak future that is typical puppet and depend Economy of ongoing proposals is still an open question to Sri Lankan!

  • 1
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    N.Wimaladasa,

    Yet again, what the hell are you vomiting by your incorrect gibberish which you seem to think convey sense? First attend an English class before you spew out nonsense here!

    • 1
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      I think Wimaladasa may be using – google for his translations.

      Let me help WImaladasa (while sitting on a train heading Dortmund- I thought to help him ) at least to some extent

      Para 1

      Silva@, your suggestions have no basis for a developing country like ours
      (Sri lanka). xxxxxx – rest no meaning

      Para 2

      you need to come up with alternatives, attacking anyone cant bring us further. Yours is more or less like that of UNP-RW.xxxxxxxx

      Para 3

      UNP-Ranil and his plans are to work the neo leberals…. rest not clear

      Para 4

      Well UNP-Ranil .according to him will be so capitalistic…
      rest not clear.. may be CT will have to help Wimaladasa with special dictionaries

      Para 5
      As I got it – WImaladasa is fully against RW-MY3-CBK..rest has no meaning.

      • 1
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        Sam Fernando,

        “I think Wimaladasa may be using – google for his translations. “

        That Dimwit Wimalaya who cannot coin a grammatically correct and sensible sentence in English ostensibly using Google translator for translating nationalistic racist extremist diatribe ostensibly emanating from Gunda Amaradasa typed only know Sinhala and we hate English camp is trying to lecture us on global economic systems, social class, equality and income gaps, (uneven?) national economic growth, GDP growth solutions, (US, Indian,distributed -network approach, orthodox conservatives party, labels of NEO-Liberalism ??????!!!), ……….., …………., #$^&*…….!!!! is pure, unadulterated, hysterical, jaundiced nonsense!

        These are the types of people who provide online jokes for a change!

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    The man called HE Sam Fernando and other commenters to be noted

    Political-Economy is more complex an issues in Globe as well as in Sri Lankan developing of sustainability of Capitalism.

    I am sorry to say the commenters are poor reading of US led Global economy and the other side of Island mode of economy.

    US or even George Soras is that unable to bail out Sri Lankan economy in deep crisis since 2015 January 9th after MS-President back by UNP-Ranil.w…. orthodox party came into being by Conseversity economics proposals and packages.

    We can see that brief & glance of US economy outlook since 2008 August. Even more ominous the ratio of household debt to GDP of US which was 65% in mid-1990,reached 100% preset 2010,was sure sing that US consumer would no longer be propping up Globalization with their power of purchasing.

    We have realized that US in 2008 which credit bubble and financial crisis did not occur in a vacuum. They grew out of the monopolization of capital after second world war.

    The economy slow down began in the late 1980s,when the suburban construction boom–brought on by laying down of interest highways system to peak, signaling the high water mark of the auto-age and oil era.

    The discovered of abundant natural resources of developing countries, cheap oil that automobile which drove US into top of the world economy by 1980s.To create it in an extraordinary buying binge designed to keep the economic engine artificially revved up while the REAL ECONOMY was winding down.
    US citizens saving dried up they barrow US $ Trillions dollars more, living off the myth of our still unrivaled economic prowess and uninterruptedly spending money they did not have at all of fueled the Globalization in process by US political and Military hegemony.

    The upshot of 18 years of living off extended credit is that USA is now a failed economy.
    The gross liabilities of US financial sector which 21% of GDP in 1980 have risen steadily over past 27 years to an incredible 116% by 2007 ,now US debt equal the GDP 2015 $ 18 Trillion that throwing in reasonable doubt the future prospect of USA which can bail out SRI Lankan Economy? Is not yet US economy has recover since 2008 August by in Global terms of development .

    Indeed we have discovered that fact UNP-led Ranil.W.. has map out new myth of economic boom back by US is nothing illusion of “good governance and rule of Law” in that promised People of Sri lanka By
    UNP -Ranil W…package of nothing and empty promised.

    His political vision & system of economic thoughts will misled majority people of our country in relatively and temporary.

    This type of politics of economy will fail soon.

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      Please Wimaladasa – go and see the nearest Neurologist, psychologist and return to further writing. It seems nobody would understand what you are going to say. Even if you seem to be not happy with current govt, please try to add your thoughts in a comphrehensive manner. Else, blocking webspace this way cant bring us nowhere. Good luck.

      My problem right at the moment is not you, but the guys that make every efforts to create new forms of devisions in the country today.
      I am speechless being unable to tick what these tatooed men have to say about the peace and reconcliation of the island nation ?

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      Wimaladasa@,

      why cant you give lectures on the topic ? You insist people have no idea on the topic – dont you think it is high time to inform them adequately ?
      I have no doubt if Wimal Buruwanse could go to various European destinations for his kind of awareness programs, why cant you ? Even those who are reported to have no GCE Ol can move the nation (valid SRILANKEN nation only – even 2nd being an stupid as no others)

      Even former Kelaniya Mervin- one of the right hands of former SRILANKEN idiamin (MR) could do the job even better. Dont you think so ?

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    N.Wimaladasa,

    !!//…….==++#@#@$%$^& ?/>>>>>>>>>>
    <<<<<<<<<<
    ?????????????????!!!!!!!!!!!!!!

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    I have nothing to do with MR or MS or UNP or SLFP line of politics.

    I talk of truth out of Global economy.

    I am sorry to say my poor English .

    I am not Oxford Educated person or not that belongs Colombo 7 class is like Ranil W….of UNP-TNA -JVP and CBK of SLFP neo-Liberalist !

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