JO MP Tharaka condemns AG for refusal to qualify accounts to the Finance Ministry

In a hard hitting speech in Parliament, emerging JO Economic hitman MP Tharaka Balasuriya hit out at former Finance Minister Ravi Karunanayake, and gave a stern warning to the new Finance Minister on the state of the Finance Ministry and the economy. The 42-year-old Kegalle district Member of Parliament politely, but in no uncertain terms, criticised and warned the Government on the dire state of the economy.

Highlighting the political heights to which the new Finance Minister has arisen, he noted that he is only the second person in Sri Lanka (tied with his colleague Ravi Karunanayake) to have held both the Finance and Foreign Affairs Ministry after Felix Dias Bandaranaike.  He did highlight that although among the most experienced Ministers in government, that Samaraweera had no background in finance, economics, or accounting like his predecessor.  However, despite this lack of background that he was confident that his performance would be superior to the former Finance Minister, and wished him the best of luck in the tough tasks ahead.

Floundering Economy

After cordially congratulating Samaraweera, on replacing Asia’s supposedly best Finance Minister, he went on to paint a picture of an economy in trouble.  Using comparisons with data for year-end 2014 (the last year of the Rajapakse regime) he cited a long laundry list which included: decrease in GDP growth rate, flat per capita income, increase in unemployment rate, increase in consumer price inflation, decrease in nominal wage rates, increase in the trade deficit and reduction of exports.

He warned of an impending debt crisis, citing reduction of foreign reserves, debt service as a % of GDP increasing, debt to GDP increasing, and increasing interest rates.

On the capital market side, he highlighted the poor performance of the Colombo Stock Exchange, with price indices going down, amid deteriorating trading volumes.

State of the Finance Ministry

After hitting the Government on the economy, the speech went on to condemn the state of the Finance Ministry - in particular, the refusal of the Attorney General (AG) to qualify the accounts of the Ministry.  He pointed out that this is the first time in the history of Sri Lanka that this had taken place, and warned that this would increase the cost of borrowing in the international marketplace.

Advice to the new Finance Minister

In closing his speech, Balasuriya offered some tongue in cheek advice to newly appointed Finance Minister Samaraweera.  He advised him not to automatically approve favorable proposals sent by his friends, to not accept rent money from certain people, not to lease bonded warehouses from close relatives, and not to appoint unsuitable relatives to state owned enterprises.

In a backhanded compliment, he stated that although the new Finance Minister did not have the intellect of N. M. Perera or Ronnie De Mel, he was still confident that he would do a much better job than former Finance Minister Karunanayake who, he said, had lead the country up the garden path.

Economic Voice

With the latest GDP growth figure of 3.8% for the 1st quarter of 2017, and with the flood impact possibly leading to an even lower reading in the 2nd quarter, Sri Lanka may be about to enter the worst economic period in the post war era.

Balasuriya has become increasingly active in the Joint Opposition by highlighting the economic shortcomings of the Yahapalana government.  Due to the present state of the economy, it is likely that he will have more ammunition to use in his criticisms. The MP has a Bachelor’s Degree from the University of Wisconsin in the United States, and a Masters from the University of Wales.  He was a senior executive at Sri Lanka Insurance Corporation before going into politics.  He hails from a political family and is the son for former Cabinet Minister Dr. Jagath Balasuriya.