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.