66 years since independence…
On February 4, the media carried messages issued by several dignitaries from the President downwards in commemoration of the 66th Independence Day. They were all promising, patriotic, and optimistic filled with hopes and wishes. Ironically a news item apeared along with these messages caught my attention. A Yatiyantota Pradeshiya Sabha (local authority) member had borrowed beyond his means to construct a house for his family (for the future); he was unable to repay; the lender has seized his assets (trishaw); the borrower has committed suicide.
The message contained in the news item is a well meaning reminder and a forewarning to a country which is indebted to the tune of US$33,674 (Total Outstanding External Debt and Liabilities as at end 2012). The bulk of these liabilities has been invested on construction of infrastructure (for the future) of which the returns are low or/and has a long gestation period. Can there be a better message a country can receive on its Independence Day?
The year 2013 for Sri Lanka was a year of many notable achievements, even while global economic conditions continued to remain weak. (Source: Road Map for 2014)
- Economic growth rebounded (7.2 per cent expected in 2013)
- Level of investment maintained at over 30 per cent of GDP
- Headline inflation declined to 4.7 per cent
- Unemployment remained at low levels (4.5 per cent in H1-2013)
- Exports expected to grow by 6.9 per cent
- Trade Deficit estimated to contract by 8.7 per cent
- Tourist arrivals at record levels
- Remittances estimated to reach $6.7 billion
- FDI surpassed $1 billion for the third consecutive year
- BOP recorded a surplus of $700 million
- Foreign reserves at healthy levels of $$7.1 billion (4.5 months of imports)
- The Rupee remained stable amidst global market volatility
- Budget deficit declined to 5.8 per cent of GDP in 2013 from 6.4 per cent in 2012
- Debt to GDP Ratio declined to 78 per cent in 2013 from 79.1 per cent in 2012
- Policy rates reduced by 100 bps; •Market interest rates declined by 61-452 bps
- Private sector credit picked up; credit to public corporations moderated sharply
- Stability of the banking sector preserved throughout the year.
However, statistics (whether massaged or not) alone will not speak of the complete story. In spite of the achievements the economy is still not out of woods. Sri Lanka was at par or ahead of our neighbors in 1948 but has been faltering and falling behind many of them. We have failed to meet the aspirations of a newly liberated nation; we have failed to take the full advantage of potential, talent and opportunities; we live on hopes; we let status quo to lead us and we don’t lead; we believe in karma leaving no room for science and technology; we live in the past; we live on wishful thinking and expectations; we have more and enough excuses in store to cite for our failures; we do not plan, follow up, monitor; we conduct post-mortems and record achievements.
The Sri Lankan economy faces issues and challenges at all levels. At macro level, it is the widening fiscal and trade deficit, public debt and low level of investment coupled with limited inflow of FDIs. At regional level, it is the failure to develop a single sustainable region after the Western region. There are several regions with potential for development based upon opportunities and challenges rather than repeating and replicating the western region model. The Mahaveli region opened up a new area with the full complement of infrastructure; diverted Mahaveli water flows through the region enriching its fertility, soil, ecology and bio-diversity balance; it has the full potential to become a prosperous dynamic agro based region. But it remains as yet another arid dormant zone.
At sector level it is the no or little planning and coordination; agriculture is neglected; socially condemned; economically backward; yield is low; resorting to conventional methods; failed to modernize, intensify and commercialize and to introduce technology, new varieties, high yielding planting materials and water conservation; exports are replaced by low quality sub-standard imports i.e. palm oil in place of coconut oil. According to the Minister of Agriculture, we cannot export surplus paddy as the variety (red rice) we produce is not in demand. Vietnam was liberalised from American clutches 25 years after we gained independence; Israel is not a country which is naturally conducive to agriculture; more than half of the land area is desert; only 20 per cent of the land area is naturally arable. Yet, we send Sri Lankans (more officials and hardly farmers) for agriculture training in Vietnam and Israel.
A Minister had unearthed a yam weighing 15 kg and stated that he planted the seed at the time he was Minister of Agriculture. He had taken 10 years to reap the product. He is now holding a different portfolio. He might take a generation to reap results of his action (wag says inaction) in current portfolio. Minister’s display of the yam reminded me of my Seeya, not because of the yam but of what he said once. He said “Lajja nethikama mahamudalikamatath vediya lokuyi (shamelessness is greater than the mudliarship).
Sri Lanka claims to be on the top of Asian countries when it comes to social welfare indicators. It is the first Asian country to introduce “Free Education”. The education sector faces problems from A (Admission) to Z (Z-score). We have failed to introduce new systems, subjects, teaching methods, etc to suit emerging needs, global changes and income levels. We put out graduates who are not demanded by the economy. A few weeks ago, I served on a selection panel. There were 48 applicants (all graduated in Agriculture with first or second upper class) for one vacant position. They were all unemployed. Agriculture graduates are those who studied hard to enter the medical field but ended up in the paddy field.
Once I suggested to an Executive President that we must scrap the primary section of leading (so called ‘popular’) schools. That would minimise corruption, irregularities, inconvenience and traffic congestion. Students should be admitted to these schools at grade VI after a strict admission test. The immediate response was “very bright idea but cannot be implemented with old boys/girls Associations (OBA)”. So decisions are made in the education sector not by the Ministry but by OBAs.
The Health sector is plagued with all sorts of diseases (viral, infectious, non-communicable). “PREVENTION” has lost its place to “CURE”. Both public and private sectors invest in curative health because the money is in it. Once I suggested to a Minister of Health to allow the private sector to train nurses. He said “excellent but cannot be implemented with Hamuduruwo (Reverend Monk) and GMOA”. We can be happy that doctors being public servants have been allowed to enjoy autonomy. This autonomy should be extended to other public servants as well including the Election Commissioner. But it cannot be implemented; lives of politicians are in the hands of doctors while the lives and limbs of other public servants are in the hands of the politician.
At micro level it is the inadequate access to funds, technology, market, raw material and quality seeds and planting materials.
Sri Lanka being a small island and thanks to the road network left by British Colonials any destination can be reached within five hours. A visitor can have her/his breakfast on the beach enjoying the rising sun and could reach Nuwara Eliya by road to enjoy the lunch witnessing the sun hidden among clouds; s/he can be in Anuradhapura well in time for dinner while watching the sun setting among ruins. This is the potential. A foreign visitor comes here to enjoy the beach and warm temperature; to mix with local culture and habits; to taste local food. In brief s/he wants to experience a difference. Instead we keep the visitor imprisoned in a freezing air-conditioned room in a luxury hotel in Colombo and feed them with poorly cooked, tasteless western cuisines.
All the stakeholders have failed in their respective roles. The private sector is more a risk averter than a risk taker; it has sustained neither under the “Protection” policy nor under “Open” policy; it has been reduced to (with a few exceptions) being import traders for making a “quick buck”; it has failed in its role as “Engine of Growth”. The public sector is more “authoritative” than “facilitative”; it has lost its autonomy, dignity and direction; it is not in the driving seat of the economy. The banks and financial institutions have become mere lenders; they are more after “recovery” than “financing”; they do not chase after the projects funded by them but the borrower.
NGOs work according to their own agenda and priorities; they are neither aware nor sensitive to the Government agenda. All the sectors have failed as partners of development. Sri Lanka has tried out almost all the models and strategies found in development jargon. We implemented food drives, poverty alleviation, rural development, regional development, inequality mitigation, import substitution, protection, investment promotion, export promotion, infrastructure development, livelihood development, participation, consultation, partnering and so on. But, at no time, had we an overall holistic integrated economic policy or a strategy or a plan drawn out considering the challenges, priorities and potential of stakeholders, sectors, regions and at all levels with a long term vision. Such a plan should have measurable achievable goals; it must be followed up; progress should be reviewed and monitored.
It is already late but better being late than never to make a determination 66 years after independence before the 67th independence commemoration and my 70th birthday!
(The writer can be
reached on
chandra.maliyadde@gmail.com)