Financial Times

Discipline the key to economic growth
By Chandima Padmaperuma (Banker and Attorney-at-Law)
Every nation strives to be rich for the benefit of its people. With the paradigm shift in the world order, economic power has become the measure of strength of nations in global context.

While developed and rich nations are competing with each other to grab a larger slice of the global wealth, poor nations like ours struggle to achieve a sustainable economic growth in order to provide the basic needs to the citizens amidst increasing internal and external challenges exacerbated, inter alia, by the growth rate of the population.

The best way to increase the standard of living is through increasing national incomes preferably with an equitable distribution of wealth while bridging the gap between the rich and poor. This cannot be increased overnight. The increase in national income is measured by the GDP growth.

A 3 % economic growth ensures the increase in national income by 10% in three years. If we achieve a 1% GDP growth it will take at least 70 years to double the potential national income. Therefore achieving a higher GDP growth is the only way to become a rich nation. As per our aspirations are we on track? Or are we a nation of megalomaniacs who just dream of but do practically little to achieve our goals?

When we analyse why Sri Lankans couldn't achieve an impressive or desirable economic growth in comparison to the countries that achieved such success like Singapore, South Korea, Taiwan etc., there is one aspect that all the developed countries and the countries which followed them in Asia possessed or inculcated in common which we don't have ---------- discipline with a capital D.
Discipline is a wonderful habit, which breeds wonderful results.

It is the spark that needs to ignite the engine of growth. Discipline nurtures and harnesses the most important other factor for success, that is commitment. Discipline is simply the ability and the stamina to concentrate and focus on what you do which is the fundamental quality required to achieve success. We are all aware as a nation that we lack both discipline and commitment.

In terms of the economic development and growth what matters mostly is the financial discipline which is a by-product of the social discipline. Singapore became an economic powerhouse in Asia due to its social paradigm shift in the context of discipline.

One of the most respected visionary leaders Lee Quan Yew, then prime minister of Singapore, once recalled how he was mesmerised by seeing the disciplined social behaviour in Britain when he saw how newspapers were sold there - kept in machines near underground stations in London, unattended, through which people obtained a copy by placing the exact amount of cash inside. This was one of the experiences that helped him build Singapore into one of the most coveted economies in Asia.

Financial discipline could be cited as the need of the hour when the economy is doing well. Our economy was in rock bottom in the recent past not only owing to the fundamental weaknesses and shocks in the economy but also due to undisciplined financial management of private or public corporations. Bankers would very well vouch for this since some business failures which ended up in properties being auctioned were directly due to lack of financial discipline. It is imperative to be disciplined in bad times since it is the decisive factor for survival.

Discipline should come from childhood and practiced to make it a habit through a system of education which ultimately produces good citizens. In the same manner corporate citizens should practice discipline in order to become good corporate citizens in addition to their own survival and progression.

Disciplined corporate entities with focus and invariably sound strategies and positioning could compete in global playing fields since productivity at such organisations is always on the high side. World-renowned leadership guru, Stephen Covey says that effective leaders choose vision, passion and discipline in order to achieve excellence.

As a nation it is time we understand the importance of discipline in order to achieve economic growth like South Korea, Malaysia, Singapore and Taiwan to name a few winners who achieved immense success through discipline. The foundation for a vibrant, robust and competitive economy comes from countries with disciplined citizens including politicians.

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