{"id":228755,"date":"2022-08-20T11:49:48","date_gmt":"2022-08-20T06:19:48","guid":{"rendered":"https:\/\/www.colombotelegraph.com\/?p=228755"},"modified":"2022-08-31T16:08:51","modified_gmt":"2022-08-31T10:38:51","slug":"ranils-post-imf-challenge","status":"publish","type":"post","link":"https:\/\/www.colombotelegraph.com\/index.php\/ranils-post-imf-challenge\/","title":{"rendered":"Ranil\u2019s Post-IMF Challenge\u00a0"},"content":{"rendered":"

By Ameer Ali<\/a> –<\/b><\/span><\/p>\n

\"\"<\/a>

Dr. Ameer Ali<\/p><\/div>\n

China\u2019s Yuan Wang-5 vessel finally reached and docked in Hambantota Harbour \u2013 China\u2019s leased property, on Tuesday 16th<\/sup>, five days later than originally scheduled. This delay could be seen as a gesture of goodwill and to satisfy Colombo\u2019s request to delay that visit after India raised security concerns, which ultimately proved baseless. A day before that, India gifted Sri Lanka a Dornier Maritime Reconnaissance aircraft to coincide with India\u2019s National Day celebrations. Ranil Wickremesinghe<\/a><\/span> (RW) in acknowledging that gift reassured close relations with India and described the two countries as \u201ctwo sides of one coin\u201d. Sometime back in 2020, Prime Minister Narendra Modi<\/a><\/span> in a bid to strengthen Indo-Lanka ties recalled India\u2019s glorious Buddhist past, celebrated it with the inauguration of a digital Buddhist library, emphasized the civilizational bond with Sri Lanka and reported to have said, that helping Sri Lanka was a \u201ccivilizational duty\u201d. On the whole, the Yuan Wang-5 episode ended without any diplomatic complication and to the satisfaction of all three parties.\u00a0 \u00a0 \u00a0<\/span><\/p>\n

In the meantime, while public attention was kept focused on developments surrounding the Chinese ship at Hambantota, India\u2019s Adani Green Energy quietly won approval for two wind projects, one of 286MW in Mannar and the other of 234MW in Pooneryn, adding to an ongoing economic and commercial penetration of India into impoverished Sri Lanka.\u00a0<\/span>Given the economic plight of this island and President RW\u2019s desperation to demonstrate evidence of quick economic progress to win the hearts of the people, the two regional giants would be aggressively competing to exploit the country\u2019s weakness to enhance their own respective long-term interests through rivalling gestures of benevolence. It is a well-known fact in international relations that no country aids another purely with altruistic motives. What Adam Smith said about the benevolence of butcher and baker applies to countries also. Ultimately, Sri Lanka would be forced to pay a heavy price for the strategically motivated Indo-Chinese generosity. There is also no guarantee that there would be no more Chinese or Indian military vessels entering Sri Lankan waters causing diplomatic nightmares in the future. At the end, when the country finally manages to come out of its insolvency and state of dependency it would discover with disappointment that its sovereignty had been compromised on multiple fronts. That would be the permanent legacy of a foolish civil war fought with borrowed money and bungled foreign policy. One should not disconnect the economic ruin from ethno-nationalist politics. \u00a0 \u00a0<\/span><\/p>\n

Be that as it may, RW, his Foreign Minister, CBSL Chief and other hired experts are busy finalizing with IMF<\/a><\/span> the reparation program for economic revival.\u00a0 <\/span>In these talks, one should commend the CBSL Governor for his stand not to concede to any request from IMF for restructuring domestic debt, which would seriously imperil the local banking industry and may even become problematic in restructuring foreign debt.\u00a0<\/span>Even without domestic debt restructuring foreign debt restructure would pose enough difficulties given the unwillingness of China to co-operate with IMF. With this background, CBSL Chief\u2019s prediction of an 8 percent contraction of the economy and 70 percent inflation rate this year is going to make life extremely difficult to a vast majority of Sri Lankans. That the IMF prescriptions, which would include implementation of stringent fiscal and monetary reforms with radical restructuring of lossmaking SOEs, and that those prescriptions are going to be too bitter to swallow is public knowledge.\u00a0<\/span>RW has already warned the nation about its unavoidability on more than one occasion. That is why he is keen to constitute in a hurry an all-party government with a jumbo cabinet so that all of them would rally behind him in accepting unanimously the entire reform package of IMF and selling it to the public with patriotic zeal.\u00a0<\/span><\/p>\n

But what was missing in his warnings was the need for and willingness to undertake structural changes of a different magnitude and which lie outside those recommended by IMF.\u00a0<\/span>Such a structural change involves a total repudiation of the rotten political and administrative culture and ideology that produced the present calamity in the first place. That culture could be destroyed and its ideology thrown out only by a government mandated by the people.\u00a0<\/span>RW, being a prisoner of that culture and ideology, is incapable of undertaking this monumental challenge.\u00a0<\/span>Needless to repeat, that the overarching demand of the aragalaya youth is to make that change a reality. Neither RW nor his ministers and none of the present political parties, except JVP\/NPP, seem to understand let alone support this nation building demand of aragalaya.\u00a0<\/span><\/p>\n

Economic reforms should not be considered in isolation and separate from socio-political reforms. Both are intertwined and it is a cardinal sin often committed by professional economists to relegate socio-political matters to the periphery in their analysis and continue to concentrate only on what is purely economic. IMF is not free of this prejudice. When IMF insisted that political stability was paramount to achieve economic stability and that it would not start the dialogue until that stability was achieved, it did not mean structural and ideological changes in Sri Lankan politics, but some sort of a working compromise among competing power groups to allow peaceful governance. RW\u2019s ascendancy to executive presidency by way of constitutional procedures was satisfactory enough for IMF to work with. This is why the president is not concerned about aragalaya demand and is prepared to ignore its mission and confront the agitators with force if necessary. What an ungrateful leader who climbed to power on the back of those agitators and now trying to destroy them!\u00a0 \u00a0<\/span><\/p>\n

The greatest and unavoidable post-IMF challenge facing RW and his proposed All-Party Government and ministers therefore is to get peoples\u2019 endorsement to the finalized program.\u00a0<\/span>This is not to argue that IMF recommendations should be rejected altogether as some leftists of vintage era would prefer. Instead, what is implied is that that program alone would be insufficient to achieve long-term stability and prosperity. To achieve that requires additional projects and specifically worked out plans to capitalise on IMF recommendations. RW has no such plan except to talk in general terms about an innovative export economy to transform Sri Lanka into a First World economy by 2048.<\/p>\n

That is why a general election, if unaffordable locally, could be made affordable through international funding agencies and the UN, is imperative.\u00a0 <\/span>Aragalaya should emphasize this necessity in its future campaigns. The call for an election should be heard as far as Geneva where UNHRC is scheduled to meet this September. A fresh mandate from the people for a manifesto that focuses on structural change is the only way to maximize the benefits accrued from IMF exercise. Otherwise, the implementation of its recommendations would be compromised in the interest of parties that join RW\u2019s achcharu government with an unwieldly cabinet. The aragalaya youth, Inter-university Student Federation, trade unions and JVP\/NNP should coalesce work out such a manifesto and go before the people for endorsement.\u00a0<\/span><\/p>\n

Thanks to aragalaya Sri Lanka has entered a historic moment and that moment should not be allowed to go waste.<\/p>\n

*Dr. Ameer Ali, Murdoch Business School, Murdoch University, Western Australia<\/i><\/b><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

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