Is Sri Lanka’s hard won sovereignty being surrendered to the IMF and other money lenders?
Posted on January 30th, 2012
A couple of recent reports from Sri Lanka give rise to concerns that the treasured national sovereignty gained in May 2009 by eliminating the menaces of terrorism and war is being squandered through the careless or incompetent actions of certain members of cabinet and top bureaucrats.
The first of such reports refers to the presence in the country of a delegation representing the International Monetary Fund (IMF), holding ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œdiscussionsÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ with the Central Bank (CB) on the issue of a sum of US$ 800 million yet to be drawn of the IMFÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢s US$ 2.6 billion Standby Arrangement (SBA) approved in July 2009.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â The second report relates to an admission by the Petroleum Resources Minister Susil Premajayantha that Sri Lanka is already looking at alternative sources of oil in view of the impending US sanctions on financial institutions that pay for Iranian crude oil, announced by Barack Obama on 31 December. Already, Minister G.L. Peiris has also approached the US Embassy in Colombo to determine how Sri Lanka could seek an exemption!
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â The reports of these sinister US-backed efforts, as well as the reaction elicited from our government in the case of Iranian oil imports, point to a disturbing apparent lack of comprehension in certain quarters of the guises under which the US efforts to compromise the independence of the country are being imposed and to how best to respond to them.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â On the issue of the $800 million of the so-called ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œfacilityÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢, it appears that, quite rightly, the Central Bank of Sri Lanka has reservations about drawing this amount since doing so will nearly triple the loan interest rate, from 1.1% at present to a 3.1%. This is because of the IMF ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œguidelinesÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ limit low interest facilities to 300% of its quota in the IMF.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â However, the IMF delegation appears to have been annoyed by the CBÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢s ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œrecalcitranceÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ on the matter. They have brought in another ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œstickÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ to the discussions, expressing ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œconcernÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ over the use of government funds to defend the rupee; the IMF officials are said to be ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œat a lossÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ to understand why the rupee was being defended (so vigorously) with foreign reserves! (Quite rightly again, the CB Governor Ajith Cabraal has dismissed the IMF ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œconcernsÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ on the grounds that only surplus reserves were used to defend the rupee).
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â This fraudulent effort by the IMF to lend more money to a country against its own wishes (so that it can extract higher interest rates) goes to prove the initial doubts about the so-called ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œfacilityÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢, that was ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â introduced to the world back in 2005. In a nutshell, there were fears among developing country economists that the ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œfacilityÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ mechanism was the new noose that replaced ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œdebtÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ in the face of the much trumpeted ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œdebt write-offÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ by the G7 countries back in 2005, requiring new mechanisms for maintaining their control over poorer countries.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â As has been pointed out by Soren Ambrose of the ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¦Ã¢â‚¬Å“50 Years Is EnoughÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€šÃ‚Â Network, Washington, DC USA, (www.50years.org), the objective of the ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œfacilityÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ was to limit the positive impact of any debt cancellation on developing countries and to retain the power to impose conditions on these countries, even if they were no longer officially indebted to the IMF.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â Frustrated by the CBÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢s proper and common sense position on the draw-down of another $800 million the IMF has, astonishingly, decided to meet with the UNP! So much for their recognition of the ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œgovernmentÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ of a sovereign country to control national affairs!
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â A UNP parliamentarian and economist named Harsha de Silva appears to have lent a sympathetic ear to the IMF by questioning the CB as to why it is reluctant to pay 3.1% interest when it has previously paid 6-7%? He has attempted to ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œrub it inÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ by declaring that the Governor, who is an accountant, should know better that 3% is cheaper than 6-7%!
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â Looks like Ranil Wickremesinghe has found an economic advisor that matches his level of intelligence and competence!
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â On the issue of the US ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œsanctionsÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ on Iranian oil purchases, the government ministers appear to have literally got their knickers in knots! This is despite the decision by countries like India, China and Russia to ignore these provocative sanctions!
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â Eighty per cent of Sri LankaÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢s crude oil requirements is said to be imported from Iran (balance is imported from Saudi Arabia) and Iranian oil is said to be the most suited for the refinery at Sapugaskande. Iran has already informed Sri Lanka that it could continue to meet the countryÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢s requirements and assured that payment arrangements could be worked out. This is probably in addition to the four month credit facility Sri Lanka currently enjoys. The Saudi government has said that it will not be able to meet additional requirements
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â Despite such compelling factors, Premajayantha has started discussions with Oman (though Omani crude does not contain bitumen when refined). In response to G.L.PeirisÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ pleadings for exemption from embargo, The US embassy has announced that the matter would be discussed when Luke Bronin, Deputy Assistant Secretary in the US Treasury (responsible for matters relating to Terrorist Financing and Financial Crimes!) arrives in Sri Lanka on February 2.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â In dealing with issues of this nature, the Sri Lankan government needs to spend as much time and resources as necessary to properly understand the background of, and issues associated with, the various traps the western cabal is imposing.
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â It is about time the UNP admitted that they are more interested in serving the interests of international money lenders, of extracting the economic blood of the poor of Sri Lanka and help further the primary function of debt in the global economy, of allowing filthily rich countries to maintain control of weaker countries by assisting the implementation of IMF and World Bank tools. (The decision by the government to enter into a contract for an IMF surveillance program as required under the SBA facility has already provided such means).
ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â What is happening in Sri Lanka is additional to the IMF fear campaign being launched in richer countries that ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œthe world will face a ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œ1930s momentÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢ (of the kind that brought on the Great Depression), unless money can quickly be found to support nations such as Italy and Spain; they are in the business of money lending and gaining control of national governments
And they know ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œfear sellsÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬ÃƒÂ¢Ã¢â‚¬Å¾Ã‚Â¢.