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Economy and the country

Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 25 September 2018 00:00


By Oscar E.V. Fernando

Sri Lanka, then known as Ceylon, was under British Colonial Rule, prior to1948. It was colonised due to obvious economic reasons – with Ceylon being called the Granary of the East for its lush cultivation, export of rice and other economic potential.

At the end of a lucrative period of business entrepreneurship and ruler-ship, the British gave so-called “Independence” to a people who were enjoying independence and prosperity, even before these invasions – to an extent that was then feasible – with possible economic fruition eventually, without any external interference.

How prudent is it to free a caged monkey without getting it used to the wilds? So it is – the predicament of this country from the forties and fifties to the present day!

This is not to dwell on the justification or otherwise of colonisation – as it is best left for the dead past to bury its dead, but to say that, at the point of this independence in the forties and for a period thereafter up to the fifties, the country was emulated for its economic advancement by other Asian countries, that were far behind us in many ways. 

What indeed was the reason for this country to have got literally stuck in the mud from fifties onwards?

We have to admit the stark fact that the economy, so prevailing at the time of gaining independence, was manned by the British and the so-called “cohorts” of the British – dubbed with much victorious and triumphalist relish as “Kalu Suddas”! 

This is a historical but stark and stubborn fact involving language, race and religious factors – with multiple facets of disputes that seems to be festering over and over again to the detriment of the country – ending with the recent brutal bloodshed.  

Disputing and battling over historical events, which often happen to be probable opinions of historians, will not bring bread to the table, but sadness, misery and economic decline! 

We clearly see the youth of the country emerging from the debris of close fistedness and narrow, or frog in the well mentality. They want jobs with bread on the table!

Let politicians of all hues – blue, green, red or maroon – see this fact written large and clear on our walls and act before it becomes too late for that mighty unleashing of repressed anger – this time with intellectual vengeance: seventy years of waiting tries one’s patience!

The economy that prevailed before we were colonised, first by Portuguese, was not a communist or military dictatorship – it was an economy with an iron fist of Royal dictatorship of a sort. It was certainly not a State-owned, communist or a mixed economy – in the style of corporations and statutory boards!

With colonisation we transformed into a privately-owned mercantile economy. This was no mean feat, although it left a disgruntled trail of animosity towards the then rulers and their so-called cohorts!

These frustrated feelings erupted in the fifties after the euphoria of independence in the throes of patriotic feelings and new freedom – not in the least wrong by itself – but in retrospect we see to be hurried and wrongly directed.  

The dismaying outcome was that the so-far luscious economy, that brought in good foreign exchange, and that was manned predominantly by the so-called cohorts of the British, were replaced with corporations and statutory boards. The British and some of the cohorts too, gradually left our shores – for greener pastures!

Hooray to that some might say – but what of the present crisis, frustration and the future?

Up to independence, the mercantile sector managed businesses that ran the economy – such as plantations, insurance, shipping, public bus transport, petroleum, fisheries and a host of other businesses.

With the scrapping of the mercantile sector, sprouted corporations/statutory boards such as plantation, shipping, fisheries, insurance, mineral sands and several corporations which were called with much hope as State ventures: we now see these were never venturesome except in areas of tenders and commissions – contributing much to the present financial crisis.

These corporations established hastily and with vengeance – in the euphoria fifties – like switch to ‘Sinhala Only’ in 24 hours, have over the years become a white elephant and a drag to the country – with the language issue leading to dismay and bloodshed – and those ‘public ventures’ owing to the Treasury billions, whereas the private sector would have earned much-needed foreign exchange. 

This switch over could have been done with less haste and vengeance by inviting the more-accepted indigenous entrepreneurial ‘mudalalis’ available at that time – such as bus magnates who did lucrative business.

Continuing to dispute over these historical happenings will not fill our larder – it will only bring further battles and bloodshed!

How we can put our economy back on track should be the gripping issue – not wallowing and debating on our pre-colonial glorious past and the repercussions of the euphoria fifties.

We have to find solutions fast to the simmering language issue linked in a fastidious way to the declining economic issue, festering from as far off as the fifties – nay thirties!

It is well to find out who among those uneasy with the country did mischief recently with the Japanese financial holding company Nomura Holdings with intentions to influence the IMF – a rumour affecting flow of FDIs to the country!

There are three broad categories through which an economy can be controlled and developed; these are:

1. Capitalism or free enterprise

Much has been in circulation to hate this economic system saying that it makes the rich richer and the poor poorer! This is a perfect conclusion in the context of unbridled capitalism that becomes very harsh to the poor – even with the mantra of eventual ‘trickling down benefits’ to the poor. It has been proved over the years that this mantra preached by world financiers never came true – due to human greed. 

Whilst rejuvenating the economy with private enterprise, the poor and marginalised have to be sincerely given dividends and benefits with private sector profits and production – this the world financiers, bankers and politicians of all hues must take note of for their own survival!

It would be a good exercise to consider Chinese private enterprise with State control or private public enterprises – with central control, as now envisaged in Sri Lanka – with State laying down policies: this however is a tricky issue presently for us with FDIs, as beggars cannot be choosers – so we say – hold on to the loud drum beats against private enterprise – until our nose is above waters! 

2. Communist or socialist enterprise

Suffice to say that both China and Russia, the leaders of communism and socialism, have crashed – although some senior adherents are still beating that distant drum – as in a trance – and some misguided youth yelling loud – but can do much by directing their energies in the right way – towards State-driven private enterprise – let this be a loud call for the youthful JVPers!

3. Enterprises managed by statutory boards

The writer has spelled out the outcome of these ventures and will not write on this any further – other than to say these are neither fish, fowl nor beef in the context that these do not provide the military fear of communist ventures nor do they have a profit-oriented basis to enthuse the workers and managers.

Sri Lanka has paid the price flirting with all the above-mentioned economic systems and is on the brink of collapse unless it is fast-tracked with one suitable system that will rejuvenate its economy – preferably with all hues of politicians getting together for the sake of the country!

There will be no perfect justiciable system to satisfy all and, of course no good system will prevail and be successful with corruption rampant in a country! 

(The writer is a senior citizen, former Director Finance/Board Member – Sri Lanka Foundation, Member – Human Rights Task Force.)

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