“Mahinda Chintana” should not be handed over to foreign vampires
Posted on October 3rd, 2010

Ajit Randeniya

 Recently in Colombo, this writer had the opportunity to gain a glimpse of a 249 page document put together by the Sri Lankan Ministry of Finance and Planning and Department of National Planning, titled ‘Mahinda Chintana’: Vision for a new Sri Lanka – A ten year horizon, Development Framework 2006-2116. The document provided details of a sectorally based ten year economic development plan to underpin the government economic policy.

 To give credit where it is due, the document had correctly observed that the past economic ‘growth’ (averaging five percent over the ‘war’ decades), had failed to deliver benefits to many segments of the population, or to stimulate domestic entrepreneurship; the new strategy is aimed at achieving ‘equitable’ development, building on the positive aspects of the past policies, within the broad policy framework of ‘Mahinda Chintana’.

 Astonishingly though, the main aim of the strategy is to achieve a higher growth rate of eight per cent, notwithstanding the failure of ‘growth’ to ‘trickle down’ previously. In addition, the document details that the ‘strategy’ is to be achieved through reliance on the same old, deceptive western capitalist traps (the so-called economic fundamentals) such as ‘up-scaling’ investments and productivity, increasing international competitiveness of industry and export earnings, expanding tourism, and alarmingly, full global integration!

 In short, the strategy document looked (and read) like it had been written by some American ‘adviser’ or a team from the World Bank, IMF, the ADB and other appendages of the American and western economic hegemony.

 Latest news following President Rajapakse’s successful visit to New York, emanating from his close advisers, seem to indicate that such uncritical reliance on the failed western development model (designed to exploit developing country populations and natural resources is deep-rooted within administrative circles.

 For example, Sri Lanka’s ambassador in the US Jaliya Wickremasuriya organised a luncheon meeting for US business leaders (from Coca Cola, Boeing, Google, Hilton Hotels etc) at the Helmsley Hotel. The manufacturer of Viagra, Pfizer has expressed interest in investing in Sri Lanka!

 Then, the Senior Presidential Advisor and Deputy Finance Minister, the Honorable (in the true sense of the word) Dr. Sarath Amunugama has declared that the release of another, US$ 213 million, tranche of the IMF loan facility is a clean bill of health issued by ‘the international community’ following a comprehensive evaluation of the government’s economic policies; he has quoted the upgrading of Sri Lanka by the global ‘rating’ organisations Standard and Poor and Fitch Ratings (to B plus!), sending a strong signal to those who are interested in investing in Sri Lanka.

 Probably the fact that Standard and Poor (S&P) is the very same ‘rater’ that gave all toxic debt products sold by the American rogue bank Lehman, causing the Global Financial Crisis an AAA rating escaped the good doctor’s attention!

 Apart from his faith in S&P, Dr Amunugama’s remarks are half right: it is certainly true that the function of the ‘rating’ agencies is to send signals to billionaires of the emerging new ‘opportunities’ to make their money ‘grow’ without significant risks of loosing the capital; in a shrinking world of cooperative and secure investment locations, some multinationals and filthy billionaires might turn up to open a few more garment factories at Katunayake, or to dig up a mine if they here of any mineral deposits. After all, Sri Lanka has experiences it through J.R. Jayawardena’s “Darmista Society’ that was based on the same model.

 The purpose of this dispatch is to express the view that placing Sri Lanka’s economic future and President Rajapakse’s good intentions on such a failed, dubious model poses risks of limiting Mahinda Chintana to a meaningless, wordy document only, putting future political aspirations of President Rajapakse (which he has revealed through section 18 amendments) in serious jeopardy.

 This view is backed by the experience of a number of developing country economies, and more particularly the demise of some of the strong, independent minded developing country leaders over the last thirty years who were brought down by feeding a diet of faulty economic theory as the principal means of destabilisation.

 Judging the credentials of the western formula of economic development, and those who are advocating it, needs to be done against the background of past experience: how can one forget the numerous monetary ‘crises’, starting from the Great Depression to the more recent the Argentinean, Mexican, Russian, East Asian crises and the recent Global Financial Crisis (GFC) itself to name a few: not a single western economist or a ratings agency predicted those crises and each crisis was made worse by the corrective measures (IMF shock treatment !) they recommended. The corrections inevitably came through the public purse, worsening the plight of the poor in each of the countries affected.

 Basically, the predictions based on the so-called neoclassical economic theory designed by the Chicago based Jewish economists has been proven disastrously wrong, time and time again. There is a significantly large school of thought among developing country economists in the international institutions such as the World Bank and the IMF that they were deliberately designed to not to work!

 This was certainly the case with the 1997 crisis in the Indonesian economy that was directly responsible for bringing down the regime of President Suharto, a leader with a remarkably similar background to President Rajapakse in terms solving the Marxist insurgency that was the root cause of their economic woes. Between 1965 and 1997 when the economic crisis precipitated, he made Indonesia remarkably strong, while the Americans (led by Paul Wolfowitz) were throwing the usual accusations of human rights violations, corruption and lack of transparency. Somehow they failed to ‘get him’ through these means.

 But in early October 1997, he was forced to call in the IMF for ‘program support’, for the first time since 1973. That was when the conspiracy against him finally bore fruit, through usual IMF ‘advice’ for the tightening of fiscal and monetary policy as a means of resolving weaknesses in the banking system. The World Bank ‘supported’ the government by helping formulate a draft budget (in January 1998), that was proven to be a ‘dead rope’.

 The then IMF President Michael Camdessus (of France) virtually ‘stood over’ Suharto when he signed a loan agreement that demanded abolishing cooking oil and fuel subsidies, a crucial issue with the poor. President Suharto announced a fuel price increase of 70 per cent and a bus fare increase of 67 per cent, triggering widespread protests across the country, especially in Jakarta. In an unprecedented move, the parliament called for Soeharto’s resignation, and he stepped down: what had started as a ‘financial’ crisis turned into a social and political crisis, leading to the fall of the leader, taking Indonesia in to chaos.

 There are important lessons here for Sri Lanka and for President Rajapakse in particular: the forces the Sri Lankan policy makers seem to be placing their faith on are the same people and companies that were determined to undermine Suharto; in that particular case, they found the possibility of Indonesia, with a population of 200 million at the time, making it the largest Muslim country in the world, becoming economically powerful totally ‘unacceptable’. The economic ‘advice’ provided the means of bringing Indonesia down, where the usual rights, corruption and transparency means had failed.

 Those close to President Rajapakse should not believe, based on the smiles and hand shakes he received during the US visit, that these forces have now forgotten the past. That will never happen; an important part of maintaining the hegemony is to ‘teach a lesson or two’ to other leaders who have ‘slighted’ them (in their eyes), by refusing to carry out their orders, such as ending the war prematurely, granting their ulterior wishes.

 The totally unjust and corrupt treatment of the now deceased former Serbian leader Slobodan Milosevic, including the poisoning of him while in custody was another example of the evil thinking that pervades the Zionist circles who determine American foreign policy. (It is significant that the Asia Society headed by Richard Holbrooke, the architect of the illegal Balkans bombing campaign and the murder of Milosevic invited G. L. Peiris to deliver a lecture!).

 It needs to be understood (by the policy makers) that economic development depends on a complex mix of factors than the level of capital. More capital is obviously helpful, but, remarkably, experience the world over has shown that transfer of funds through trade, aid and investments has not had a large effect on economic growth. If not, why are more than two third of the former colonies are still in abject poverty after half a century of capital transfer? Nor does the total withdrawal of government activity, handing over control to (foreign) companies produce economic development.

 It needs to be understood that industrial countries where such advice comes from, and developing countries, are on different production functions and are organised in fundamentally different ways. Development is not primarily a process of capital accumulation but rather a process of improving the functioning of such unique social and organisational structures.   President Rajapakse and Mahinda Chintana seems to recognise this fact. It seems however, the policy formula does not!

 The sooner the bureaucracy and politicians recognise the dangers of placing the country’s economic future at the mercy of foreign forces (offering bags of money) would be the better for the countless poor as well as the medium to long term future of the government.

 Strength of feeling on the issue prompts the writer to humbly issue an unprecedented warning: Mark my words!

13 Responses to ““Mahinda Chintana” should not be handed over to foreign vampires”

  1. jana Says:

    if this is true it is terrible and would amount to winning nthe war and selling the country.

  2. wasantha bandara ranagala Says:

    Dear Ajit
    Let me take this opportunity to admire your art of writing that put that shameless woman Sonali S in her rightful place which I read with great amusement.

    We also have taken a serious interest on quite a few contributions you have made to a range of post war issues SL is confronted with. If you are cautioning MR as to how he should go about rebuilding the nation to prosperity, we only are sympathetic to your tireless efforts. Look at the characters that are behind MR acting as his advisers. GL, Amunugama, PBS, Cabraal, and the coterie of politico/admin entourage escorted him to Waldorf Astoria that burnt down the lion share of IMF tranche amounted to $200m. We Sri Lankans, including you, are living in a banana republic. Aren’t we?

  3. Geeth Says:

    Dear Ajith,
    I am not going to say a lot; but I felt the same way like you did. It is pretty clear, the game plan is to kill the patient using a big pill although it looks like a vitamin. As you said, apparently their target is the regime and then Rajapaksas. This is an old horse proved success in many occasions delivering targeted results. But sad thing is that only party who do not understand these virtually naked facts is our colonial bureaucracy. They do not know what is really happening in South America. How they have realized they being exploited through ‘open veins’ through many centuries mainly due to this ‘Eurocentric Development fallacy’. But not anymore, the reason is because they have formulated their liberation philosophy now. We can learn from them, but if we want to.

    Before we jump into this maelstrom of global economy, we need to have a plan based on a philosophy that can liberate us economically. We need a ‘Sangayana’ like in ancient times to recollect, remember and enlighten about our past and future, to educate our people about very fundamental principles governing world economy and politics. Until that day downs, we will circle around same cycle over and over again. Let me bring four quotations, they will tell a lot.

    “Men fight and lose the battle, and the thing that they fought for comes about in spite of their defeat, and then it turns out to be not what they meant, and other men have to fight for what they meant under another name.”
    (William Morris)

    “When a man prays one day (I think it must be Sunday) and steals six, the Great Spirit thunders and the Evil One laughs”.
    (Oklahoma, Native American)

    “…Eurocentrism and the invisibility of “economics” that in turn prevent the development out of poverty of the greater part of humanity is a fundamental philosophical and ethical theme of our time…”
    (Enrique Dussel)

    “What is the appropriate action for a man or a woman in the midst of this world, where each person is clinging to his piece of debris? What’s the proper salutation between people as they pass each other in this flood…? “I do not believe in a fate that falls on men however they act; but I do believe in a fate that falls on them unless they act.”
    (Gautama Buddha)

  4. gdesilva Says:

    While I agree with Ajit’s observations one needs to appreciate the fact that the Sri Lankan administration is born and bred by the Western standards and as such it will not be a trivial task to make the paradigm shift needed as outlined in the above article. Unlike in many other Asian countries our bureaucracy has a strong commitment to Western values and to change that mindset, I believe, would require a much stronger leader than Mahinda Rajapaksa. It is hard to believe that such a person will arise through the current democratic system as such a person almost invariably will have to be benevolent autocratic leader. Without being too idealistic, if MR can lead the country out of current economic state and instill some level of national pride in people, I would think he would go down the history as a very successful and great leader.

  5. Ben_silva Says:

    AR has correctly identified the dangers of placing the country’s economic future at the mercy of foreign forces (offering bags of money). Foreigners would be only interested in ROI, which is fine. However, we need to raise the standard of living of the poor and develop our skills so that we become self reliant. The objectives of foreigners and our objectives may be different. So self reliance and developing our industry and skills should be our aim and should be given ptriority. Our engineers and the people need to make appropriate representations to decision makers in the country. The global economy may just swallow us, and the poor Sinhalese may not even have a chance. Global economy is there to stay, it is real and we need to realize the advantages and disadvantages and take steps to minimize the negative effects. Due to the small size of Lanka, foreigners should only be allowed to lease land on a short term basis. Otherwise it may be a case of winning the war and selling the country.
    When I see countries like Singapore and how much development they have achieved in a short time, I wonder what we have been doing all this time. Is it lack of self confidence bred by invaders or is it our passive belief system ?

  6. Kamal Says:

    We are supposed to be in an economic war, after the war against the terrorists.
    One of the principles of war is not to repeat a mistake.
    If one has failed ones it should not be tried again. (Eg. Mavil-aru closure by Prabhakaran for the second time which cost him dear)
    Are we trying to repeat history? Looks very much like that. We have been there before, we and the rest of the world has seen the results. Are we going to have another go at it the same way? The result is obvious isn’t it?
    Could some level headed person put this into the thick heads please?
    Mr Basil Rajapaksa, please take note.

  7. Fran Diaz Says:

    Lanka should go for lasting QUALITY OF LIFE INVESTMENTS instead of blind Economic Trickle Down measures, the latter a disastrous recipe tried, tested and failed !

    What gives us Quality of Life for ALL ? A sense of Peace & Harmony, Clean air, clean Water, Environment safety, Safety of human beings & animals, Nourishing & tasty Food, Shelter & Clothing, Ethical Leadership, good Education geared to the needs of Lanka & the region, Good Health & Recreation, taking care of the Aged, the Sick & the very young …. readers, please add to this list.

    Ask yourselves if Boeing, Coca Cola, Viagra, more Hotels etc can do any good for Lankans seeking Peace & Happiness. !

    If GoSL is forced to bring in western investors, at least, let us choose the investors wisely.

  8. Fran Diaz Says:

    Lankans should go for lasting QUALITY OF LIFE INVESTMENTS instead of short term Trickle Down Investments, the latter having failed miserably !

    What constitutes Quality of Life for All ?
    In my book, it is Safety & Security for all, Clean Air & Water, fair Homes, good Food, Clothing, Environmental Cleanliness, good Education geared to the needs of Lanka (jobs) & region, healthy Recreation, facilities for the Sick, the Aged …. readers, please add to this list.

    Query: Can Coca Cola, Boeing, Viagra, more Hotels etc. bring Lankans a sense of good Quality of LIfe ? It may be a fast track method of ruining Lanka.

    If GoSL is forced to follow IMF rules, then at least let us choose the investors carefully.

  9. Fran Diaz Says:

    Lankans should use the PHYSICAL QUALITY OF LIFE INDEX in development, not the Trickle Down Effect, which is a failed policy.

    What makes Quality of Life better for All ?

    In my book it is : Clean Air, Water, Food, Environment. Good Shelter, Clothing, Education geared for country’s needs. Kindness toward needs of Sick, Poor & Elderly. Readers, please add some more indices.

    Will Coca Cola, Boeing, Viagra etc. add to our Physical quality of Life Index ? Surely there are better industries.
    GoSL should be very careful as to who invests in Lanka, and make public the laws that govern these investors.

  10. Fran Diaz Says:

    Lankans should use the PHYSICAL QUALITY OF LIFE INDEX in development, not the Trickle Down Effect, which is a failed policy.

    What makes Quality of Life better for All ?

    In my book it is : Clean Air, Water, Food, Environment. Good Shelter, Clothing, Education geared for country’s needs. Kindness toward needs of Sick, Poor & Elderly. Readers, please add some more indices.

    Will Coca Cola, Boeing, Viagra etc. add to our Physical quality of Life Index ? Surely there are better industries !!
    GoSL should be very careful as to who invests in Lanka, and make public the laws that govern these investors.

  11. Fran Diaz Says:

    Lanka should be guided by the PHYSICAL QUALITY OF LIFE INDEX in her economic development, and not the Trickle Down Effect.

    In my book, the PQLI for all should include : Clean Air, Water, Environment. Good nourishing food, good shelter & Clothing.
    Education geared for the needs of the country & region. Kindness toward the Sick, Poor & Aged, etc. etc. Readers please add to this list.

    Can Coca Cola, Boeing & Viagra add to our PQLI ?!! Surely there are better industries.

    Lanka should be extremely careful as what industries take root in her soil. Laws governing these industries should be exposed to the Public.

  12. Fran Diaz Says:

    Lankans should use the PHYSICAL QUALITY OF LIFE INDEX in development, not the Trickle Down Effect, which is a failed policy.

    What makes Quality of Life better for All ?

    In my book it is : Clean Air, Water, Food, Environment. Good Shelter, Clothing, Education geared for country’s needs. Kindness toward needs of Sick, Poor & Elderly. Readers, please add some more indices.

    Will Coca Cola, Boeing, Viagra etc. add to our Physical quality of Life Index ???

    GoSL should be very careful as to who invests in Lanka, and make public the laws that govern these investors.

  13. Andare Says:

    Lankans should use the PHYSICAL QUALITY OF LIFE INDEX in development, not the Trickle Down Effect, which is a failed policy.

    What makes Quality of Life better for All ?

    In my book it is : Clean Air, Water, Food, Environment. Good Shelter, Clothing, Education geared for country’s needs. Kindness toward needs of Sick, Poor & Elderly. Readers, please add some more indices.

    Will Coca Cola, Boeing, Viagra etc. add to our Physical quality of Life Index ???

    GoSL should be very careful as to who invests in Lanka, and make public the laws that govern these investors.

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