Mr. Prime Minister, Please Be Serious About Economic Governance!

By Hema Senanayake –April 30, 2016

Hema Senanayake

Let me write freely. I knew that Prime Minister and his close political associates strongly believed that they know economics better. Therefore, they did not pay any attention to any serious government official or other economic analysts who performed their duty outside the government by airing their views through media. Politicians thought that they can instruct the government officials as to what they should do. This wishful thinking has almost ended by now. The economy is in a mess. It seems politicians have now surrendered to officials.

Officials of every kind might think that they can now dictate to the elected officials of the government as to what they should do now. There are chances that the political authorities would listen to them this time around because they come with IMF side by side. First, let me prove my point, so read the following quote carefully.

“It is politically difficult. We need to raise taxes. Policymakers need to convince the public that they should be able to pay more taxes. There’s no other choice as the government will have to collect more revenue.”

Who said this? It was the Deputy Governor of the Central Bank of Sri Lanka (CBSL). Please read it again. He insists that “…that there is no other choice.” I do not agree with him. These officials, I define as inexpedient, I mean in regard to the very job they are supposed to perform that is to take care of the country’s economy and economic governance. Do you need a proof? Let me give you just one example but this one is astounding.

CBSL is the official economic advisor to the government. Its Board of Directors known as Monetary Board met on February 23rd 2015 and made the following decision:

“… the Board instructed the Superintendent of Public Debt to conduct a 30 year Treasury bond auction during the week and arrange to list sovereign bonds in Euro Clear Exchange in future.” (Board Paper No: MB/ER/4/2/2015, date 23-02-2015).

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