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An annual average economic growth of four percent in the seven decades (1950-2020) after independence was far below the country’s potential, especially as the country began with favourable initial conditions.

These advantageous initial conditions consisted of a thriving plantation agriculture, a good network of roads and railway, a good administrative system and a functioning democracy. Last Sunday’s column discussed this post-independence underperformance of the Sri Lankan economy as well as some key achievements especially in human development.

Other views

The 73rd anniversary of independence ten days ago was an occasion for many writers and commentators to reflect on the country’s post-independent years. However, much of those reflections were on the golden days of our ancient civilisations in Anuradhapura and Polonnaruwa that were golden eras we could be proud of.

Past glory

Most recollections of the country’s past did not recognise that the country had consisted of several kingdoms and was underdeveloped at the time we succumbed to foreign rule. The portrayal of the years before foreign occupation as an era of prosperity, whose foundations were destroyed by the three invaders, especially the British, who conquered the Kandyan Kingdom in 1815, is factually  incorrect as several historians and sociologists have documented.

Fruitless exercise

In any event, an excessive focus on our ancient glory is a fruitless exercise. It will not enable the country’s economic development today. What is salient today is the future development of the country.

Furthermore, such forays into the distant past, fails to recognise the inability of the country to develop in the 73 years after independence. Facing the current economic realities is what is critically important.

Blame foreigners

Perhaps any nation celebrating its independence has a right and inclination to blame its foreign rulers and ignore whatever good they did for the country. Recognising the mistakes and weaknesses of the country to develop in the post independent seven decades is of much greater relevance and a starting point for ensuring the development of the country that is currently in multiple crises.

Other voices

More significant were other voices, somewhat muted, that voiced unequivocally the dissatisfaction with the country’s economic development after independence. There was a consensus among them that the island’s economic performance was far below her potential.

Political bias

As to be expected the discussion of the post independent seven decades was in many instances politically biased, economically erroneous and very much coloured by irrelevant and outdated economic ideologies and poisonous ultra-communalism. Ironically it is these modes of thinking that will sink the country further in the future. This poverty of thinking is precisely what would ensure continued economic underdevelopment and persistence of poverty.

Economy in dire straits

Despite these modes of thinking, there was a hidden consciousness that the economy was in dire straits and is dependent on foreign benefactors to save it from insolvency. From whence such help would be forthcoming remains uncertain at present, but options are few.

In fact last week’s focus was on the government’s moves to obtain foreign assistance to resolve the country’s external financial vulnerability that reached an unbearable level with the expected withdrawal of the US$ 450 million swap arrangement with the Reserve Bank of India.

Other assistance

The government and the Central Bank of Sri Lanka has repeatedly reassured the public that a larger amount of US$ 1.5 billion of assistance is forthcoming from China. If all goes well, this would be confirmed by the time this column is published.

Economic and social development

Let us return to the theme of post independent economic growth. In fact the foundation for the Island’s economic development was laid in the post 1931 years after the Donoughmore constitution was introduced, with universal adult franchise. The achievements in food crop agriculture, especially rice production, improvements in health and education commenced prior to independence and continued  since independence. Free education and free health were pro-independence policy thrusts that has improved the country’s human development.

Economic growth

However, the economy never took off to robust and rapid growth as expected. The country failed to ensure the conditions required for economic development. These are both economic and non-economic conditions.

Non-economic factors

The reasons for this economic underdevelopment are many. They are mainly non-economic factors: cultural, political and ideological. They include the ethnic violence and civil war, distraction from economic concerns to political and ethnic issues, the frequent changes of government and the consequent changes and uncertainty in economic policies, preoccupation with politics and religion rather than a serious concern in economic development.

Non pragmatic economic policies

Ideological rather than pragmatic policies, inability to seize the opportunities to export in a liberalised international economy and neglect of and underdevelopment of technical skills are among the many reasons for the country’s economic underperformance. The current pursuance of impractical monetary and fiscal policies are illustrative of this.

Economic shocks

Admittedly unfavourable international economic factors have had their toll on the island’s trade dependent economy. Adverse terms of trade, external shocks, such as fuel price hikes,  adverse global financial developments and unfavourable geopolitical developments have also affected the economy adversely during the last 73 years.

Concluding reflection

As we move on after the country’s 73rd anniversary of independence, there appears to be little prospects of rapid economic growth. The management of several crises facing the country are the immediate challenges. The containment of the spreading corona virus and at the same time keeping the economy moving is indeed a Herculean task. But beyond the critical current challenges, are  fundamental preconditions that we have failed to achieve in the 73 years that must be accomplished to ensure economic growth.

Among them is social cohesion. The 73 years since independence has seen a continuous erosion of ethnic and religious solidarity. Sustained robust economic development is not possible without a firm commitment to mould a united nation. The future lies not in our stars but in ourselves.