Is this a ‘lost cause’?

I hope they have the strength to see it through to the end, I hope they succeed where my generation was unable to. With the youth leading the way, no cause is lost  – Pic by Ruwan Walpola

Wednesday, 11 May 2022

There are many reasons Sri Lanka is in this tragic situation and we all agree that it has been down to several decades of poor planning and mismanagement. However, the scatterbrain, adhoc manner in which the present administration managed the country’s economic and monetary policy is pathetic and must, on its own, necessitate an independent investigation. 

Having been centre stage in the financial sector for over 50 years, working under several Central Bank Governors; in my capacity I have liaised with virtually every Finance Minister and Treasury Secretary during that time. I can tell you, with confidence, that at no point during that period have I witnessed such an ignorant, unprincipled set of ministers, secretaries and officials whose lack of courage has led Sri Lanka down this path. 

Since all meetings at the highest level will maintain recorded minutes, I propose these minutes are studied to ascertain the thought process and deliberation that went into the myriad of decisions that led the country to the brink of total collapse. The CBSL’s monetary policy must be closely studied, what drove the decisions to print excessive money, to spend billions controlling an exchange rate at an unrealistic peg, to spend vital reserves on paying bond holders instead of keeping the economy running, to float the LKR instantly without any contingent plans. 

The budgetary collapse was clear from the outset, the CBSL Road Map: a complete sham. What was the logic behind not negotiating with the IMF until a disorderly default was at the door? The people must demand answers to these questions. After the economic fire-fighting is completed, if the next administration fails to adequately investigate these decisions and processes, including forensic audits into those that gains super-margins by investing in ISBs. 

There should have been a long list of resignations and an equally long line of officers and staff, from within the Finance Ministry and the CBSL ready to give evidence against the blatantly politicised decision-making at these institutions. Why did they not come forward when common sense was being ignored? It seems the degeneration and rot of the corrupt policies has permeated deep into the system. Decent, honest, professional people, failed. 

What was perhaps most disappointing and disheartening was the complete lack of integrity shown by many corporate leaders, some of whom I still regard as friends. We even saw recently some Titans of industry sitting before the COPE and stating that their internal expansion decisions were made in ignorance of the seriousness of the country’s economic crisis. Their reactions to questioning from an MP, a representative of the people, smacked of an arrogance that even they could ill-afford at this moment. 

As a corporate citizen during my career, whenever the government began to consider policies I felt would be detrimental to the country and the economy, I did not hesitate to voice those doubts and reservations whenever the opportunity presented itself. During my time, my Chairman, Directors and shareholders appealed to me to restrict my criticism of the government, but I simply said what I felt was right. I have clashed with many Finance Ministers and Treasury Officers. I have argued and debated with CBSL Governors. Those disagreements, although constructive, seem so small considering some of the policies we have witnessed over the past two years.

I was astonished to witness powerful industrialists and business leaders cheering on policy formulations that were clearly incoherent. Some of Sri Lanka’s business community jumped on numerous committees and boards without considering the overall picture, not checking whether they were engaged in making a positive contribution or whether their names, their personal brands or those of their organisations were being taken advantage of, for political mileage. Their acquiescence of and silence regarding many illogical decisions that were clearly not in the ‘national interest’ was very surprising. Perhaps it is to do with the term ‘National Interest’ and how one defines it. 

If businesses believe that their success guarantees the progress of their people and communities, then the focus will always be on business and success will be defined by this. I noted that many share prices were not only rising but were breaking records when inflation was ticking up and many were already in queues for essentials. The business community that I used to be a part of, must come forward and demand an urgent change in policy and political course. Our dependency on foreign capital flows and USD borrowings has been discussed to death, however solutions such as diversifying our tea exports, growing the rubber sector and encouraging entrepreneurs, is simply campaign jargon. These are not substantive ideas.

I am on record stating that the most recent Governor of the CBSL was not only the least-qualified person to hold that post but is also largely responsible for the politicisation of the Central Bank and of monetary policy. Officers such as Dr. P.B. Jayasundera, who was once banned by the Supreme Court from holding public office and numerous other individuals in high positions, had records that should have disqualified them from consideration for those posts. Yet, not only were they appointed, but many still survive. 

A Chartered Accountant cannot be a CBSL Governor. A person considered for an appointment at the CBSL must be highly qualified in that specific field and should have a mountain of experience with a long history of displaying expertise and crucially, integrity. I have to say, that many of the recent appointments to some of the highest positions in our land have been grossly under-qualified for those positions. Just take a look at the qualifications of the Ministers of Singapore. If we do not have public servants of that calibre, we will be left with policy outcomes that reflect this lack of quality. 

We want to be Singapore, without utilising that level of public servant and politician, they do exist, but more often than not, they are pushed to the margins. We want our people to be entrepreneurs and to innovate but we don’t want to pay teachers and improve schools to teach our children. 

Looking at the political sphere, I see that the Colombo electorate is divided. This is the result of the UNP’s disintegration, it was the main party that was supposed to represent Colombo. The UNP leadership’s role in the Easter disaster and their lethargic period of administration led to the Colombo vote splintering. Wimal Weerawansa and Udaya Gammanpila had over 400,000 votes between them! Considering the future administration, there are some talented politicians in opposition that will need to be called for duty. 

The Leader of the SJB has very obvious support around the country and his recent speeches have shown his connection with the people in the villages. While I sense his popularity in Colombo is nowhere near as strong, the SJB has some diligent and capable MPs, including Dr. Harsha De Silva, Eran Wickramaratne and Harin Fernando. The popularity of these politicians in urban areas in Colombo and beyond should allow the SJB to form a government with a few coalition partners. However, in order for the SJB to enhance its credibility, it must resist short-cuts to power and distance itself from the failed political establishment and its representatives. 

Some of those representatives who now sit as ‘independents’, are largely responsible for cheerleading the policies that led to the present disaster, they have no political capital now and this will soon become more obvious to them, they have let down their own electorates and now they are letting down the entire country just to ensure their own political survival. 

My generation’s greatest fear is fast materialising. I was born while Sri Lanka was still a colony and I remember perfectly well the potential our country had. To see leadership waste opportunities to make tangible improvements to our people’s lives, saddens many of us that made the sacrifices we felt were necessary for our country to prosper. Sri Lanka was meant to be the next success story from the Asian region. I and many from my generation face terrible sadness during the final phase of our lives, because we see that a few people with personal and narrow agendas, have shaped Sri Lanka into a shadow of what it once promised. To see so many intelligent and talented youth leave Sri Lanka is truly heartbreaking. Many of us stayed back to make honest contributions to our nation building project.

Our only hope seems to be this young generation that has come forward to demand a change, not just a change in the people, but in the “system”, in the way of doing things. 

I hope they have the strength to see it through to the end, I hope they succeed where my generation was unable to. With the youth leading the way, no cause is lost.

(The writer can be reached at rienzietwij@gmail.com.)