Poll on CFA impact on the economy

The Sunday Times FT this week asked various sections of society – mainly business leaders, corporate executives, (some) government officials – as to whether or not the economy benefited during the ceasefire accord which ended last week.
More than 88 percent of the respondents said the economy had benefited while 9 percent said no. Little over 2 percent of the respondents were undecided.

Many of our respondents however pointed out that the CFA was virtually dead after the first few years, and it would not be accurate to look at the economic benefit for the entire 6-year period. Others said even though politically and in terms of violence it had collapsed, the benefits for economic progress and business continued.

Here are some ‘voices’ from the email poll:

-- Apart from economics benefits to the country, thousands of lives were saved.

-- There was definite economic benefit to those who made that sacred term "peace" a business especially by reaching uncleared areas to do their opportunistic businesses - both legal and illegal. The whole expressed purpose of CFA was to make the society a peaceful one in which the economy could eventually be built up on that platform. But, we never had a platform to begin with - before CFA, during CFA or even after the CFA.

- Peace meant Stability. Stability meant Economic Activity. Economic Activity meant Prosperity.

- There was no economic benefit at all by ending the CFA. This is evident from the drop in the share market and the issuance of travel advisories by several countries for its citizens to avoid certain areas in Sri Lanka that will have an adverse effect on the tourist industry.

- Yes, there was indeed a benefit of the ceasefire and the peace talks for a while and we saw the investments coming in.

But the question always remained if the LTTE was serious about its intentions to follow through on the agreements made. I believe that the issue is not whether we have a ceasefire with the LTTE or not. It is about why the Southern polity cannot and does not agree on a common position to offer the Tamil people as a common position from the South. Key political leaders in the South first, need to support each other (for a peace with dignity for all) to arrive at this national position on what we give and how. Our top leaders should stop looking at what's in it for me and ask 'what's in it for Sri Lanka'.

- All positive economic developments since the ceasefire had a close nexus to the ceasefire directly or indirectly.

- Yes, at the beginning. The ending of the inoperative CFA appears to have been unnecessary from an economic point of view.

- What our leaders cannot understand is that a CFA DOES NOT mean complete cessation of arms. It has never happened in any of the warring countries that went in for similar pacts. However the fact that an agreement is in place gives investor confidence and a possibility of restraint from either side. It helps the business community to plod on until a complete cessation of arms is agreed upon by both sides. Now with its abrogation other countries will think twice about doing business with us and consider Sri Lanka as highly volatile and hence not suitable.

- There were immense benefits to the economy and corporates when the truce was in full force but ever since the violation of the agreement began by both sides the economic benefits dwindled and were virtually non-existent at the time of abrogation.

- Attention should be drawn to the initial period of the agreement during which economic activity reached great heights. Foreign investments started to flow at a hectic pace increasing employment opportunities. However, subsequent changes in the approach towards the war effort that violated the agreement made a negative impact on economic activities. The situation has aggravated further with the cancellation and it is moving from bad to worse.

- During the initial period, there was some economic benefit although admittedly enough was not made of the window of opportunity. Possibly, if the process had been allowed to continue through 2003/04 a fuller benefit may have been realised. However, in the latter part of the CFA with the CFA being undermined the economy was also being mismanaged and any benefit was lost.