The trio had gathered near Kussi Amma Sera’s gate on this sunny Thursday morning, in a V-shape formation, keeping a safe distance of more than one metre between each other in line with physical distancing recommendations. It was the first time in many days they were meeting and over mugs of tea, they were engaged [...]

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Jobs and lay-offs

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The trio had gathered near Kussi Amma Sera’s gate on this sunny Thursday morning, in a V-shape formation, keeping a safe distance of more than one metre between each other in line with physical distancing recommendations.

It was the first time in many days they were meeting and over mugs of tea, they were engaged in deep conversation. “Apey lamai-ge rassawata monowa weida (What will happen to our children’s jobs)?” asked Mabel Rasthiyadu.

“Mage gamei angalum karmantha wala weda karana godakata rassawal nethi wei wage (I think that many people in my village who are working in garment factories may lose their jobs),” noted a worried Serapina. “Eka hari, mage putha kiyanawa eya weda karana kamhalata kisima orderayak avith ne kiyala (That’s right, my son says that at the garment factory where he works, they don’t have any orders),” added Kussi Amma Sera.

As I listened to their conversation, I recalled a recent notice where the head of a large company had announced to his workers that the directors would be taking a 100 per cent pay-cut for several months, while senior management staff would find their pay cut at various levels up to 50 per cent. The company has seen export orders drying up to zero in the past month.

The same example is seen across many companies in Sri Lanka where the business community is facing perhaps its worst ever crisis, even more serious than the 28-year-old conflict which ended in 2009 and other conflicts that Sri Lanka has faced since independence.

Across the world, millions of people will lose their jobs as COVID-19 hits where it hurts most – thousands of factories, production centres, restaurants, hotels, delivery services etc – with orders and work drying up.

Amidst the gloom came a very reassuring, responsible and positive message to its customers from a clothing store named Memosa. The store urged its customers to save money for essentials, saying clothing is not an essential item at this point of time. Even at the risk of losing business, Memosa said it was its duty to be transparent, authentic and honest at this time.

As I watched the trio conversing – still keeping a safe distance among each other – the phone rang. It was my jolly-mood economist friend, Sammiya (short for Samson) on the line, with whom I hadn’t spoken for several weeks now.

“Hello Sammiya, how are you,” I said delighted to talk to him. “Good, good… I was calling you after hearing a friend singing Sunil Perera’s irresistible Koththamalli song as this herbal concoction is useful to build up your immunity levels,” he said.

“Which song …. can you sing a few verses?” I asked. He then responded with a verse: “Bonna nangi malli sawoma koththamalli//Oya ledata dukata obata pihita wenne koththamalli//Ape punchi kale podi unak haduna wele//Mata mathak wenawa amma koththamalli pewuwa kale//Apita haduna hama ledatama amma dunna ekama behetha koththamalli// (Have the time? Then, you can access the song at https://www.youtube.com/watch?v=yxnW5GjKCW0)

Loosely translated it means … “Drink, brothers and sisters, drink koththamalli//It’s good for any ailment//When we were young, if we fell ill, our mother gave us koththamalli//For every ailment, koththamalli was the cure//.

On a more serious note, Sammiya said that food security was becoming a serious topic these days. “The question asked by analysts and policymakers is whether we can create a situation where we can live with the food we produce, without resorting to imports,” he said.

Two weeks ago, the Central Bank directed banks against opening LCs for non-essential imports like motor vehicles and said that only essential imports would be allowed.

Having food on the table has become so important these days with vegetable, fish and other vendors going down many lanes in Colombo selling their products during curfew hours. A country’s food security and delivering food at a price that people can afford, has become important today more than ever before. In a few home gardens in congested Colombo city and the immediate outskirts, its delighted owners are happily posting pictures on Facebook of their vegetable and fruit produce! Some even ventured to offer an abundance of jak-fruit to friends if they were willing to collect it.

Sri Lanka is still dependent on food imports like dhal, sugar, milk powder and other essentials. The new crisis would send policymakers scurrying to the drawing board to examine whether the country can produce some of these important foods – for example milk and other lentils – to reduce this import dependency and in the process save foreign exchange. The US dollar by the way has rocketed over Rs. 190 per one dollar.

However, what is important is also to see how such food could be produced at the cheapest possible cost. Local food production is costly owing to the dependence on imported fertilizer and other inputs, on rice production for example. The same applies to chicken production where the costly feed is imported. Some decades back, when Kingsley Wickremaratne was the trade minister, there was a shortage of eggs in the market during the Christmas period. Local eggs had shot up in price.

The minister then ordered the import of eggs from India at 1/5th the price of local eggs. The market was flooded, consumers were happy but local egg producers protested vehemently and the imports had to be stopped. There has to be a balance in looking after both, the producers’ and consumers’ interest.

Sammiya and I discussed many issues particularly several measures offered by the Central Bank to stimulate the economy and delay repayments owed to banks and finance companies, until customers are able to recover from the crisis.

It was pointed out by Sammiya that the recovery would be long and protracted and depended on when the COVID-19 pandemic would end. At this point, in the Sri Lankan context, no one is sure. Some say it would take a total of two months or more, others are uncertain. The longer it takes, the bigger the financial stimulus necessary for a full recovery. We are looking at billions of rupees in the Sri Lankan case and billions of dollars in the international case. The IMF is proposing the full US$1 trillion that it has for emergency measures to uplift ravaged economies.

While lending agencies (and in Sri Lanka’s case the Central Bank) are offering financial relief, the problem is not over yet, across the world. With every passing day the crisis gets worse which means more money is required to save the economy, than what was originally pledged.

As I wind up my conversation with Sammiya, Kussi Amma Sera – this time wearing a face mask – walks into the room with a second mug of tea for me.

“Mage puthata vena rakiyawak laba ganna puluwan-wewi kiyala mama balaporoththu wenawa (I hope my son is able to get another job),” she muttered and walked away. Kussi Amma Sera’s plea is one that would echo across millions of others in the world struggling to keep their jobs or find a replacement so that they are able to put food on the table for their family.

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