27 January, 2023

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World Bank Assistance Too Is Subject To Conditions!

By Rusiripala Tennakoon –

Rusiripala Tennakoon

Today much of the ongoing discussions about the country’s economy are centered around the international financial institutions. In particular their response to our requests for assistance. The IMF and the World Bank are in the forefront. Both these institutions are serving the same member countries because a country has to first join the IMF to be eligible o join the World Bank Group. The World Bank Group has five different institutions under its umbrella sharing among them the responsibility of serving a common objective of reducing poverty, increasing shared prosperity, and promoting sustainable development. The IDA and the IBRD of the WB are the two agencies addressing these with the former(IDA) with a special focus on the world’s poorest countries, and the(latter) IBRD assisting middle-income and creditworthy poorer countries, respectively.

International Monetary Fund’s main focus is to stabilize the international monetary system and to act as a monitor of the world’s currencies, keeping a track of the global economy and  the member countries. It lends to countries with balance of payments difficulties, and provides practical help to members.

In the current context of the present crisis, are we correctly focusing attention to these areas of available assistance and the programs, targeting exactly what we want to achieve?

Is the World Bank moving ahead of us?

In line with its common objective of reducing poverty, the principal focus of the World bank would be to address ways and means of alleviating the hardships of the poorest segments of the society. Our policy directions too should be so oriented with emphasis on this aspect. Let us therefore examine the role plays of both the WB and our own dedicated agencies towards this aim. 

To make it more authentic and in order to ascertain the true position I thought it would be more appropriate to quote from the official announcements of the WB on the Sri Lanka situation;

World Bank Statement- JULY 28, 2022 on Sri Lanka

“The World Bank Group is deeply concerned about the dire economic situation and its impact on the people of Sri Lanka.

To help alleviate severe shortages of essential items such as medicines, cooking gas, fertilizer, meals for school children and cash transfers for poor and vulnerable households, we are repurposing resources under existing loans in our portfolio. To date, about US$160 million of these funds has been disbursed to meet urgent needs. In addition, other ongoing projects continue to support basic services, the delivery of medicine and medical supplies, school meals and tuition waivers.

We are working closely with implementing agencies to establish robust controls and fiduciary oversight to ensure these resources reach the poorest and most vulnerable. We will continue to monitor this closely. We are also coordinating closely with other development partners to maximize the impact of our support for the people of Sri Lanka.

Until an adequate macroeconomic policy framework is in place, the World Bank does not plan to offer new financing to Sri Lanka. This requires deep structural reforms that focus on economic stabilization, and also on addressing the root structural causes that created this crisis to ensure that Sri Lanka’s future recovery and development is resilient and inclusive.”

It is Sri Lanka that is in need of such assistance, hence the lead role for ensuring the required inflows to achieve this objective rests on our side. But where do we stand?

We only hear about harangues highlighting issues which always end up as accusations and allegations levelled against each other during parliamentary sessions. They include the following; 

Acute shortages in medical supplies;

Deteriorating standards of malnutrition affecting children;

Shortages and unbearable cost of school amenities;

Every so often supply shortages of cooking gas;

Heartbreaking news items about starvations and resulting loss of human lives;

Aggravating day to day livelihood issues;

Ships waiting to unload supplies of essential commodities including fuel for want of   foreign exchange;

Patients in Government hospitals asked to bear the cost of their lab tests from private sources; 

Gross inadequacy of free social assistance to sustain family expenses among the poorest sectors;

Inflation (especially that of the Food Sector) increasing unprecedently;

Ironically these verbal battles have become ‘mere aerosol transmissions’ for casual conversations finally vaporizing into thin air without reaching any meaningful conclusions.

We neither see nor hear any agreement or understanding about any contemplated actions or at least a frank admission of the existence of such situations. Is this our role play in this calamitous critical situation?

Isn’t it the responsibility of our authorities at all levels to address these in a much more serious manner going beyond the concerns of the International Agencies? Country expects the participation and involvement of our authorities instead of this ‘talk shop’ audacity.

Food for Thought   

If we look at the country overview by the Word Bank we need no further expertise to understand our failures, lapses and the areas where we should concentrate on with a special focus. Let us list those for easy reference;

The WB admits that they  accept  we are facing a dire economic situation with serious  impact on the people; They also endorse there  is an urgent necessity To help alleviate severe shortages of essential items such as medicines, cooking gas, fertilizer, meals for school children and cash transfers for poor and vulnerable households;

WB is ready to repurpose resources under existing loans in our portfolio. To date, about US$160 million of these funds has been disbursed to meet urgent needs.

* WB is also coordinating closely with other development partners to maximize the impact of their support for the people of Sri Lanka

* WB has agreed to work closely with implementing agencies to establish robust controls and fiduciary oversight to ensure their resources reach the poorest and most vulnerable. 

* WB wants an adequate macroeconomic policy framework to be in place; they will not offer new financing to Sri Lanka until this is done. They expect deep structural reforms that focus on economic stabilization.

* They want us to address the root structural causes that created this crisis

These concerns open the avenue for addressing the need to fall inline with the World Bank objectives and support their action programs with a firm commitment. It is evident that the WB is working in close collaboration with other international agencies to ensure their support to reach the people of Sri Lanka in this hour of need. 

We have to reorganize our internal mechanisms and the administrative machinery to help ensure the reaching of the resources to the vulnerable sectors of the society. They want us to establish a macroeconomic policy framework to be in place as a precondition to the World bank to provide any new financing to Sri Lanka. They insist on deep structural reforms with the objective of economic stabilization. The Government of Sri Lanka is also expected to PROBE into the causes that led to this crisis.

All these point towards a need for a serious commitment on the part of the Government to put the house in order to become eligible to obtain assistance. Paying lip service without any acceptable policy plan and framework will not pave the way to qualify for obtaining help and assistance in this highly crucial hour of need even from the few available resource bases.

It will be a prudent step to authentically ascertain how the 160 million USD grant already released has been utilized.  

More importantly, it is compulsory for us to ascertain the true picture of the already committed project funds to divert them to more needy areas, under the present circumstances, with the agreement to repurpose such funds as a special humanitarian assistance program announced by the World Bank. If we can successfully conclude this task it would help us to have access to significant amounts to mitigate the serious economic hardships we are now facing until the IMF and other fund sourcing arrangements materialize. 

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Latest comments

  • 3
    0

    Is there anything new, (not already known to us) in this article. No. Nothing.
    Now, I have spent some time reading it. Is it a waste of time? I won’t call it thus.
    .Here is something, I could make use of:
    “addressing the root structural causes that created this crisis”.
    Why no writer opens this subject for discussion?
    There lies the propensity to lie!

    • 1
      0

      Nathan, All know the root causes that created this crisis was robbery to the last dollar as confirmed by auditing. Solution is to jail the robbers and recover the dollars robbed.

      • 0
        0

        davidthegood,
        I thought of giving you a pass. That is not fair by you. Hence, I come in.
        There are root causes and structural causes. These are interconnected but distinct.
        Would you care to write about them. I have a ton to add.
        Robbery is a bi-product of those causes.
        Even murderers are released in our country. And, you are speaking of jailing the robbers. I don’t buy it.

    • 0
      0

      N
      Why do you seek things that cannot be expected?
      Whatever will be new will be some inconsistency.

  • 6
    0

    Rusiri, “is the WB moving ahead of us “? not sure but Silly Lanka is moving backwards, hence the illusion. WB helps the poor , but not the corrupt. It’s Lanka’s responsibility to take control of their own S- – -. The doctor doesn’t take the medicine prescribed for patient, so that patient gets better. Your name sake at BOC (chairman) says “funds allocated for development are missing” ???? . Was CORRUPTION mentioned in your article / ever????? sorry I didn’t see it.

  • 3
    0

    World Bank wisdom experience is that our robber family draining the last dollar of the nation should not be allowed to come near our finances. The rope gift should be their consolation for their shameless legacy, still salivating for more of mammon with never ending greed and craving.

    • 4
      0

      dtg
      The process started with the opening up of 1978. There has been no turning back.
      We borrowed mostly to feed wasteful consumption far more than for development.
      Was not Gamini D a robber?
      I can name others too.
      Why do we forget the long line of thieves of whom the R family is notorious, but by no means accounting for most of the theft..

  • 4
    3

    There is an assumption among the largely uneducated, grossly unrefined, cunning parasitic political scum that make national policy, that international lending institutions and countries are as stupid as the local cattle which always vote for these vermin at election time. The lending bodies are not naive like the ordinary foreign tourist visiting the beaches or cultural centres in SL. They are astute financiers with a lot of discipline, morals (maybe) and learning. However, they have learnt not to trust the grand criminals that run national policy in SL. Therefore, with rampant corruption as the main religion, there is no escape. The tragedy is that the most vulnerable poor suffer most. The solution is a massive people’s uprising demanding their country back and a restitution of their human dignity, wiping away the framework that exists, giving power to the dedicated, sincere and educated youth who have demonstrated their commitment to developing their country for future generations.

    • 3
      3

      LP, you are absolutely right. Immoral Lankans tend to blame those who genuinely try to help them (countries, financial institutes, people – – – -). Will any bank loan to corrupt or criminal ??? This failed nation is corrupt to the core.

      • 1
        1

        Today, Trump organization ( business entities ) were found guilty of all financial/ tax fraud charges. No one is above Law.

        • 1
          1

          By the way, for those who are interested, Warnock won Georgia run off, handing Democrats a comfortable 51 seat majority in senate. So called centrist like Mnuchin and Cinema will not be able to hold party for ransom, anymore.

    • 4
      1

      LP
      Colllins Dictionary defines polity thus:
      A polity is an organized society, such as a nation, city, or church, together with its government and administration.
      *
      The phrases
      “the largely uneducated, grossly unrefined, cunning parasitic political scum that make national policy”
      “as stupid as the local cattle which always vote for these vermin at election time”.
      Such outbursts will delight some who will be delighted by any insult of this country and its people. I am sure that you are more serious than that.
      *
      The first equates a despicable group with the whole people.
      You and I will by the second be part of the cattle and so will be the creatures that migrated to greener pastures. So will be the much celebrated ‘Aragalaya’ protesters.
      Kindly consider if it is any different in any of the bourgeois democracies that effectively limit choice to two parties, and are led by their noses by a corrupt media feeding them with falsehood.
      *
      I appeal you to be more cautious in your choice if words.

      • 0
        0

        Collins Dictionary

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