The poll, economic uncertainty and consequences
On the eve of another election there is considerable uncertainty as to what economic policies would be followed after the elections. This uncertainty springs from several factors.

The most significant of which is the uncertainty of what the actual policies would be if the UPFA were to come to office. The need for two political parties with divergent economic policies to compromise and come up with a quick fix economic programme has resulted in their joint economic policies inevitably having a degree of vagueness and internal inconsistencies.

Besides this, the same factors account for a lack of credibility in their economic stance. In addition to this, there is an uncertainty as to whether the peace process will continue and what conditions are likely to prevail in the North and East as well as elsewhere in the country. A return to war in the North and East and terrorism elsewhere would be a serious setback to the economy. The disintegration of the LTTE has added to this fear.

Increased expenditure on the war, dislocation of economic activities throughout the country, reductions in foreign investments, lack of confidence in the local business community, setback to tourism and withholding of foreign aid for reconstruction and infrastructure development, are among the serious consequences of a resumption of war.

However this scenario is unlikely. A more likely scenario is one where there is an uneasy peace and lack of progress towards a durable and sustainable peace; a more uncertain situation than the "negotiated non-settlement" we have had in the last two years. Such a situation too could have some of the disadvantages mentioned before.

The other anxiety arises from the possibility of political victimisation and revenge on economic interests and the fear of capricious economic policies. The response of the international community will be of utmost importance in moving the country into a higher trajectory of growth. The multinational agencies in particular have their agendas and positions and unless their conditions are fulfilled they are not likely to extend their full support to an economic programme. All these factors make it an eve of economic uncertainty for the economy.

The country's economic history is one of reversals in economic policies with each election in the post-independent period. Economists have attributed these swings in the pendulum of economic policies to be a root cause for the relatively lower economic growth and performance of the country, especially in comparison with that of East and South East Asian countries.

This disadvantage was removed in 1994 when the People's Alliance government adopted policies that were largely a continuation of the previous regime's liberal economic policy framework. This continuity inspired confidence in the country and avoided the disruptions that had characterised previous changes in government. It was also a realistic and pragmatic approach in the changed global economic and political context.

This stance prompted confidence that the economic policies of the future would be that of continuity with limited change. The significant question that is being asked now is whether the alliance of the PA with the JVP would ensure such continuity?

The manifesto attempts to assure that there would be no drastic change in policies. Yet the policies on privatisation, trade and a regulatory tone in the manifesto have added uncertainty and scepticism to this prospect.

Divergences in the interpretation of the UPFA economic policies by spokesmen of the two main constituent parties have added to unpredictability in their final policy outcomes. It is hoped that there would be a rethinking of some aspects of their announced policies to ensure a pragmatic approach in economic polices.

The re-election of the UNF would not necessarily ensure economic stability and confidence, as once again the country could be embroiled in a continuation of the constitutional crisis. The focus of the government may well be distracted away from economic programmes to political games.

The UNF has the advantage, if returned to office, to adjust its policies in the light of the mistakes it may have made, without erosion of confidence. Its bias toward the business community, foreign investments, aid, high-tech development projects and relative neglect of agriculture and the rural community, the breakdown in the public health services, improvement in the quality of education in the provinces, reduction of graft and corruption are among the issues that must be addressed.

Some of the deficiencies in the implementation of economic policies of the UNF and inadequate benefits to the poor are issues that must be addressed.

The perception that the UNF has accepted the World Bank prescriptions for a market-driven economy uncritically and that its policy package is pro-rich must be examined and the policies readjusted to be more appropriate to the people's expectations and benefit. It is uncertain whether there would be much of a change with a reelection of the UNF.

The two most significant uncertainties for the economy are whether the peace process would continue and whether there would be political stability. Without these two preconditions economic progress is unlikely. There is considerable uncertainty that the elections would produce these conditions.

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