23 October, 2020

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Towards A World-Class Colombo: Development Without Democracy

By Collective for Economic Democratisation

Colombo’s urban development is driven by the idea of transforming it into a “world-class city” and a “preferred destination for international business and tourism”, according to the Secretary, Defence and Urban Development. Therefore, many of the Urban Development Authority’s (UDA) initiatives, apart from those related to flood control or road improvements, have focused on enhancing the image of Colombo by building urban landscapes and spaces for consumption that are ‘world-class’, such as the Dutch Hospital and the Race Course, and providing sweeping incentives to real estate corporations and investors to build luxury apartments and hotels.

A key question that arises is what is the place of the poor in a world-class metropolis? Currently, the Western Province, the most urbanised in Sri Lanka, is not only the most prosperous but is also home to the highest proportion of Sri Lanka’s poor. The spiraling costs of living and lop-sided and non-inclusive growth will provide Colombo with more cheap labour to serve the elite. This is already evident from the number of the city’s poor and elderly who now work long hours under adverse terms for private contractors keeping the streets clean.

Over the next few years around 70,000 families, largely from poor low-income communities from the inner city areas, are to be displaced and relocated, freeing up prime land for commercial exploitation.  There has been little public discussion and scrutiny, let alone the active participation of these communities, in deciding on the need for, or the goals and terms of relocation, which will have profound implications for their rights and well-being.

Bringing the UDA under the Ministry of Defence was indication enough that the urban development agenda did not include democratic and accountable local governance. Rather than address shortcomings on the accountability and effectiveness of the Colombo Municipal Corporation by deepening democratic participation, the UDA, backed by the enormous human and technical resources of the military, has effectively sidelined it, and with it, local democracy itself. When the military does the work of the municipality, it is not just the physical but also the political landscape that is altered.

While hundreds of millions of dollars of loans are being contracted with multilateral and bilateral donors, including for projects that are merely of symbolic value, like the Lotus Tower project, there has been little investment in substantially enhancing public transport, upgrading low income settlements and quality low-cost social housing. The latter more often than not comes with forced relocation and is driven not by a vision of safeguarding rights and entitlements but of freeing up lands for commercial exploitation and investment.

Current development plans such as Mahinda Chintana propose to create a market for “pro poor” loans. The attempts to resettle communities are to be matched by offering collateral and housing loans to displaced residents. These loans tie into the broader attempt to incorporate the poor into official banking institutions, while a seemingly benign goal of development, such transformation of housing finance is also connected to removing land market restrictions for commercial developers. The state tenancy and land development laws are being revoked or reshaped in order to promote the private market. In a context of pre-existing inequalities, the market differentially benefits those with access to power and privilege. Thus in a certain sense the poor are being asked to participate in the very mechanisms of their dispossession.

The spate of high profile land deals involving global investors and capital is being touted as a sign of development and a promise of prosperity to come. However, it is well known that urban real estate is but a temporary parking place for speculative capital, which in the long run creates instability and potential for crisis. Successive financial crises, including the most recent one of global proportions, have been connected to the bursting of real estate bubbles. Moreover, even market insiders are expressing skepticism over possible oversupply of high-end real estate with a number of overpriced projects coming on the market at the same time. However, even if demand is borne out, the crucial question is whether this is a sustainable path to inclusive urban development?

The current trajectory of urban development in Sri Lanka cannot be disconnected from the military-market nexus, which is narrowing the space for rights while expanding the footprint of market and financial interests. In such a context, claiming the right to the city is central to the struggle to reclaiming social and economic democracy in Sri Lanka.

None of this, of course, in a certain sense is “new.” Historically, from colonial times to the recent neoliberal decades, problematic political and economic transformations have had a major impact on the development of Colombo. In 1978, the Greater Colombo Economic Commission (GCEC) was created along with the National Housing Development Authority and the Urban Development Authority. Under the GCEC, Sri Lanka became one of the first countries in South Asia to establish Export Promotion Zones, which promoted tax incentives for foreign companies in the interest of capital and to the detriment of labour rights. The EPZs emerged against the background of the Jayawardena regime’s attack on trade unions in 1980, what some economists innocuously refer to as “labour market flexibility.” To return to the present, what we are arguing is that urban development in Colombo is not a neutral exercise to reorganise space and beautify the city. It reflects definite political interests and is implicated with powerful mechanisms of accumulation and exploitation.

Needless to say, the influence of powerful global actors, such as the World Bank or UN Habitat, cannot be ignored. Relying on narrow functionalist claims and driven by ahistorical ideas about the spatial dimensions of economic changes in different regions of the island, along with static “poverty” indicators, they obscure the political economy behind urban development. Thus, while the World Bank does propose mechanisms for consultation or supporting displaced residents, it fails to address the vested financial interests and the undemocratic nature of state policies that cause dispossession and help reconfigure the economic geography of urban spaces to suit metropolitan elite and finance capital.While these issues will be further explored in the next article, it is important, in conclusion, to reemphasise the importance of vigilant critique and struggles in advancing the right to the city and guarding against undemocratic urbanisation driven by real estate and speculative finance.

*The Collective for Economic Democratisation contributes to this column hosted by the Centre for Poverty Analysis as a guest contributor.  The Centre for Poverty Analysis (CEPA) is an independent, Sri Lankan think-tank promoting a better understanding of poverty related development issues.

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Latest comments

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    Great article, and perspective. Thank you.

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      Time to restore democracy.

      It is not an easy task to fool the public for ever, corruption and crimes need to be controlled, Judge Warawewa is going to contest Central province.

      If the Opposition could bring constitutional changes to restore all rights of citizens, voters would defeat UPFA in all three provinces. UNP has to prepare a manifesto with a written documented time frame to fulfill the pledges to win the next election.

      This is going to be the beginning of the end of criminals.

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    Excellent piece, pleasure to read, keep it coming!
    This represents an important and higherto silenced critique of mainstream economists and World Bank, ADB’s neo-liberal model that benefits military dictatorships like the current regeme!
    The FACADE of DEVELOPMENT goes with the Rajapassa project of creating a DEEP STATE. Rajapassa is working towards a Turkey or Pakistan style DEEP STATE with the military running businesses and playing large role in the economy. This model of “development” is bad for the Military because it erodes discipline, encourages corruption, land grabbing and rent seeking among the rank and file, and amounts to mission and mandate creep. It is also bad for the economy since the state subsidizes military business and squeezes out competition.
    The deep state that Gotabaya is creating, is similar to that of a “state within the state” and evident in many military dictatorships with FACADES of DEMOCRACY as in Turkey, the Mid East and Pakistan’s ISI which Gota works with. The political agenda of the deep state involves an allegiance to nationalism, corporatism, and state interests. Violence and other means of pressure have historically been employed in a largely covert manner to manipulate political and economic elites and ensure specific interests are met within the seemingly democratic framework of the political landscape.
    The deep state is a group of influential anti-democratic coalitions within the Sri Lanka political system, composed of high-level elements within the intelligence services, military, politico-religious parties, security, judiciary, and administrative officers and crony capitalist of the regime. Finally, it will enable a COUP D’ETAT for Gota to take over as Lanka’s first MILITARY DICTATOR – in the name of “protecting Buddhism” from the minorities. Never mind that Sinhala Buddhism has been has distorted, perverted, MILITARIZED and destroyed by Gotabaya.
    The outlook and behavior of the Rajapakse family and associated predominantly military and political elites who constitute the deep state, and work to uphold national interests, are shaped by an entrenched belief that the country is always “on the brink” of being DIVIDED. This is the bogey that Rajapassa promotes in the form of Balu Sena etc. Sri Lanka liberals will need to be vigilant given the levels of militarization as the ECONOMIC CRISIS bites and people mobilize against the Rajapakse regime on the streets. Big question is will China play the role of supporter of the Gotabaya dictatorship as the US does with the Egyptian military? And what will India-America do?!

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    Development of the city is lacking in the main ingredient which is the people. What use of developing the city whilst the inhabitants are bedraggled and starved. To them development means the further looting of their properties and them being cast into some hell hole to rot unseen and unheard. The politicians and big tycoons with high contacts will make all the money.

    Lotus Tower is not just a project of symbolic value. It will be a means of security surveilance of all incoming and outgoing communications including the internet. No doubt it will be under the defence ministry. So citizens of this country must prepare for more and more inroads ito their personal freedom.

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    our future is very clear..sir, there is no one to handle this country except you..we sure about that.now we are passing the our developing season..if you stay with in future oneday our country will come among the developed countries in the world. no doubt of that good luck sir

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    “A key question that arises is what is the place of the poor in a world-class metropolis? Currently, the Western Province, the most urbanised in Sri Lanka, is not only the most prosperous but is also home to the highest proportion of Sri Lanka’s poor. The spiraling costs of living and lop-sided and non-inclusive growth will provide Colombo with more cheap labour to serve the elite. This is already evident from the number of the city’s poor and elderly who now work long hours under adverse terms for private contractors keeping the streets clean.” (Collective for Economic Democratization)

    In regard to addressing poverty the only difference between Colombo and other capital cities in the developed countries is the poor in the rich world are covered by social security. In Colombo it is Samurdhi (formerly food stamps), which is not comparable with Colombo Price Index.

    “Over the next few years around 70,000 families, largely from poor low-income communities from the inner city areas, are to be displaced and relocated, freeing up prime land for commercial exploitation. There has been little public discussion and scrutiny, let alone the active participation of these communities, in deciding on the need for, or the goals and terms of relocation, which will have profound implications for their rights and well-being.”(Collective for Economic Democratization)

    Housing is now market driven. No more free grants. The value of the space occupied by the urban “poor” is considered as the price they pay for getting a permanent good house. The land liberated will be used to meet the cost of construction of houses. Sahaspura was the first project to be implemented but “democratically elected” local councilors and parliamentarians prevented the communities from moving into the new houses. There had been surveys and consultations with communities. They were given the option of moving out of Colombo with land and capital to start self-employment in agriculture, fisheries and industry. The urban “poor” never paid “taxes” and provision of infrastructure services to urban “poor” are at subsidized rates. The Collective for Economic Democratization does not appear to have read about how housing programmes for urban “poor” are implemented in capital cities of both “socialist” and “capitalist” countries.

    The new house has a clear title and the “displaced poor” can either sell or mortgage it. Minister WW was said to be unhappy due to Ministry of Defense & Urban Development launching this programme, which is within his purview. I think GR carefully weighed the options and decided to implement it through the UDA, which is under the purview of Ministry of Defense. Upon scrutiny, I found that the UDA has statutory powers to engage in housing.

    “The spate of high profile land deals involving global investors and capital is being touted as a sign of development and a promise of prosperity to come. However, it is well known that urban real estate is but a temporary parking place for speculative capital, which in the long run creates instability and potential for crisis. Successive financial crises, including the most recent one of global proportions, have been connected to the bursting of real estate bubbles.” (The Collective for Economic Democratization)

    Very poor analysis of the burst of urban real estate bubble. What happened in USA in 2008 was due to big banks in USA borrowing from China through special purpose vehicles of US banks at cheap interest rates and disbursing the same in USA without collateral to any US citizen over the counter. Non-performing loans were increasing rapidly and when China asked for repayment the big banks had no funds to bail out their special purpose vehicles which disbursed the money borrowed from China. Barak Obama offered a bail out package but with stringent conditions.

    What happened in USA in 2008 affected the housing market in Sri Lanka. Our property developers were dependent on the investment capacity of Sri Lankans living abroad, who had access to credit without collateral. They paid the initial payments and our property developers went on building houses suitable for them at prices determined on the basis of local interest rates. When the carnival ended in USA and Europe in 2008, flow of capital converted from “capital provided by China and borrowed in USA”, came to a halt. If this Forum wants to know more about the collapse of real estate market in Sri Lanka, then study the housing laws enacted during 1970-1977. Those laws sent the urban “lower middle class” people who made a living out of renting houses, out of business. Now we cannot blame those investors who come here with money irrespective of its colour (“black or white”).

    “Needless to say, the influence of powerful global actors, such as the World Bank or UN Habitat, cannot be ignored. Relying on narrow functionalist claims and driven by ahistorical ideas about the spatial dimensions of economic changes in different regions of the island, along with static “poverty” indicators, they obscure the political economy behind urban development. Thus, while the World Bank does propose mechanisms for consultation or supporting displaced residents, it fails to address the vested financial interests and the undemocratic nature of state policies that cause dispossession and help reconfigure the economic geography of urban spaces to suit metropolitan elite and finance capital.While these issues will be further explored in the next article, it is important, in conclusion, to reemphasize the importance of vigilant critique and struggles in advancing the right to the city and guarding against undemocratic urbanization driven by real estate and speculative finance.”(Collective for Economic Democratization)

    An architect-friend told me that a world famous architect had coined the architectural idiom (or otherwise) that “form follows function”. Historical facts indicate that Colombo was never intended to be a mere residential city. Though Colombo is not a natural harbour the British made it safe for anchoring ships by constructing a breakwater. “Thotalanga” was the trading area and the Dutch Fort was meant to be stationing the soldiers required for preventing attacks from the hinterlands. The residential area outside the Fort was Pettah and with the moving of shipping activities from Galle to Colombo in 1900, the houses in Pettah became “shop-houses” first and then “shops” later. These happened with the infrastructure laid for housing. Earlier the form of Pettah followed the function but after 1900 the function changed while form remained same. Lorries and vans replaced bullock carts. Sewer lines are now bursting from it’s seams and on rainy days sewage and storm water bubbles out of manholes. May be it is the result of form not following function. Narrow functionalist claims????

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    The Rajapassas, coming from the backwoods of Hambantota, are driven by the concept of ‘Boru Shoke’. This is why, when they travel Overseas they see only the materialistic developments in the Capital Cities, and consider it worthwhile attaining for Colombo. They now live in Colombo and have forgotten their roots and the People who voted them in, at the last Election. The LTTE Victory is not the priority today, and those voters are now beginning to see the Rajapassas ‘Feet of Clay’!!!!

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