China has left the world behind in development.
Posted on June 21st, 2015

By Garvin Karunaratne., Ph.D. Michigan State University.

I travelled half the world on the Trans Siberian Railway and entered China through Mongolia. I was amazed at the development that was taking  place apace. The land was barren and desert, with a trace of water at the bottom low lands,   like the land we had passed through  in Mongolia north of China, but the Chinese were at development in all its aspects.  There were endless homes being built for the masses, the ordinary  people. Farmers and construction workers were all at work everywhere, tree planting had been done all over, the terrain had been graded to avoid denudation, peasants were at work seeding and  weeding the fields.  There were vast scale plant  nurseries,  the land was being prepared by tractors as well as by ponies dragging ploughs. Canals were taking water and being well maintained. There were also  major factories at work. China makes everything. Even automobiles  are being made locally. The models in use in China are not found elsewhere. Beijin is a clean city where there are workers employed all over to keep it clean. People are at work. The Cities are full of high rise flats-apartments for the people, The roads are a marvel to see. The only blot I saw was a few beggars, most of them suffering from incurable diseases. They should have been in hospital care.

I have seen very little of China. It was five days in Beijin and two days by train entering from Mongolia. It was a very short visit  but my handling development work of all types in Sri Lanka and Bangladesh, consultancy work in the Bahamas and Bangladesh and my academic studies in economic development at leading universities-Michigan State, Edinburgh ands Manchester,  equips me to state that China is breathing, it is developing fast, while the rest of the world, the UK where I live most, the US which I often visit, the countries of the Third World which are more home to me,  are all decaying fast and in a state of plunder, either the rich are becoming richer and the poor are being plundered or the systems of administration or politics that they follow  only make the people fight amongst  themselves rather than enable them to work together, muster their resources and cooperate to bring about development. In the meantime, sad to say the IMF has forced the countries to follow its Structural Adjustment Programs which has actually meant plundering the riches of the Third World to contribute to the Developed Countries. This the IMF did by making them indebted.(more later)

The British and other colonizers bequeathed a system of party politics to the colonies  that became sovereign countries.. Dons in leading world acclaimed universities extol the virtues of the party political system, the system which enabled President George W Bush to win the 2000 US Presidential Election by stopping the counting of ballots. In the 2004 US Presidential Election, the method was different. There the Voting Machines declared the winner and the outcome could not be questioned. (My Books; The  Administrative Bungling that Hijacked the 2000 US Presidential Election(The University Press of America) and The Electronic Stealing of the 2004 US Presidential Election(BookSurgew/Amazon)  tells it all. The Republicans veto any development work to be done by the Democrats and vice versa.  To get to the Third World suffice it to state that the two leaders  in Bangladesh, Zia Khaleda and Sheik Hassina are eternally  at each others throat.  Bangladesh, my home for two years, is the most fertile country I have ever seen, but its political system has robbed it of possible development.

Let me hark back to my own administrative experience. In 1955 when I  joined the service of the Government of Sri Lanka, the major thrust was on Rural Development. The newly formed Rural Development Department was in full swing, with a glorious vision  of community development, power to the people. A Rural Development Society was established in every village area and its remit included literacy work, small scale infrastructure projects useful to the people, tree planting etc to be done with popular participation and small industries, with  handlooms in the homes. The Government Agents at the District level and the Divisional Revenue Officers had their hands full. There was a Rural Development Officer in every division. Cutting roads bringing villages into civilization, opening up of schools, tree planting all went apace.

The emphasis was also on the restoration of Irrigation Works, opening up Colonisation Schemes. The Land Development Department was very active in Districts. Opening up land, building roads, building colonist cottages and providing the infrastructure for farmers. My colleagues Willie Perera and Graham Dissanayake  Land Development Officers worked day and night in malaria infested Padaviya. That was the time when we built the Gal Oya Project, a massive irrigation tank and a colonization scheme, all with funds belonging to us. Then we were not an indebted country.

Then came 1956, the Premier SWRD Bandaranayake, and Minister Philip Gunawardena with his emphasis on  agrarian reform. It was the Paddy Lands Act, power to the farmers, establishing Cultivation Committees all over and marshalling the power of farmers to use fertilizer and improved seeds. That was the Green Revolution in action. A new Department, the Agrarian Services was established overnight and I was one of its Assistant Commissioners. Though Minister Philip Gunawardena was removed we worked day and night for the cause of development on the  framework he had provided. Minor Irrigation was taken over by the Agrarian Services Department and the Vel Vidanes who were earlier appointed by the Government Agent went out of the scene and the work was handled by the Cultivation Committees. However Rural Development with its small industries  and the Colonisation Schemes  the doyen of the earlier decade was forgotten. The officers existed doing something;  they were not wanted.

It was thought that the village level administration should be made progressive. Out went the Village Headmen, the chiefs of the village appointed  by the Government Agent from amongst  the villagers. Their place was taken over by a Grama Sevaka, a O Level qualified officer on a transferable basis. He knew very little  of the village he worked in. That became a retrograde step that defied the achievement of development goals.

In 1965, the Bandaranayakes lost the election and in came the United National Party which had  ruled the country before 1956. The emphasis changed  back to Rural Development. Infrastructure development projects with peoples participation  became the order of the day. Rural Development Societies again flowered into action. The  agricultural development functions of the Agrarian Services Department were brought under the Government Agent, along with other Departments like Cooperatives and Agriculture.  Paddy cultivation was concentrated on and Sri lanka became self sufficient in rice, while implementing a rice ration scheme that gave rice almost free to the needy. That was a really great achievement.

Then came a change in the 1970 election where  Mrs Bandaranayake became the ruler.  The emphasis  changed again. Instead of increasing production in agriculture, the emphasis was on land reform, acquisition of large estates, and youth employment,  The Divisional Development Councils Programme was established and the entire administration was devoted to implement it.  Rural Development again went totally out of the window.  The emphasis was on establishing small cooperative industries, small agricultural farms. It was   a crash programme to bring about employment to the youth.  We worked day and night to establish small projects. I was myself involved in creating small industries. We went flat out even when national organizations like the Industrial Development Board were fast asleep and that was the time when we established a crayon  industry entirely on our own, with the process of manufacture being unearthed at the science laboratory of Rahula College Matara by the science teachers and the Matara Katcheri Officers working late in the nights for months. Then Member of Parliament Sumanapala Dahanayake took over in his capacity as the President of the Morawak Korale Multipurpose Cooperative Society Union to manufacture crayons. From 1973 to 1978 Coop Crayon was sold island wide. It was a major success.

Then came the United National Party into power again in 1977. Down went the flagship programme of the earlier Government- the Divisional Development Councils Programme.  Its show piece industry , Coop Crayon that had island wide sales was a thorn.  It  and its leader Sumanapala Dahanayake had to be brought to heed. A special mission headed by Deputy Director of Cooperatives N.T. Ariyaratne was sent to find fault with the Coop Crayon, for fraud or  misappropriation. The Deputy Director Ariyaratne  told me of what happened. When he told it to me he did not know that Coop Crayon was a project established by me.  They went through the books for days and ended up concluding that the Coop Crayon was well maintained and it was ably ,manned by Sumanapala Dahanayake. Anyhow with the onslaught of imports and the apathy of the new Government, Coop Crayon died a natural death. Though handmade, the crayons were of very  high quality and my blood boils even today four decades later,  when I see any Crayola Crayons on sale in Colombo.  It was a great loss to the nation.

The 1977 Government of President Jayawardena instead  of having a development programme of its own embraced  the Free Market  and Liberalization  Economic Model  advocated by the International Monetary Fund(IMF) which advised  Sri Lanka to do away with capital controls, import controls and to allow every citizen to use any amount of foreign exchange for any purpose  and to flood our country with imports and when the amount of foreign exchange that we had and could obtain through our exports and Mid Eastern maids was insufficient told us to get loans. To help us on this path the IMF and its sister organization the World Bank offered our country loans with long grace periods, where for years and years we need not pay either the interest or the repayments, but the interest got added to the capital and we had to ultimately pay up. Our  leaders finding that they did not have to bear the responsibility to pay up liked this scheme because they will not be in charge when it comes to pay up,  snatched the funds. The IMF dictated what to do- open up for imports, flood the place with luxury imports sending back the loaned money with profits to the Superpowers. In that process Sri Lanka became an indebted country where we had to get further loans to pay up the interest and the repayments. That was the Structural Adjustment Programme of the IMF in action and almost every Third World country is now indebted so that the country has to abide by the dictates of the IMF to keep its economy open for imports, allow the free use of foreign exchange, get more loans and when we cannot get loans raise Bonds to finance the spending spree. I can see more luxury cars in Colombo than in London, all imported on loans. . Today our effort is not to bring about development but to raise capital through raising Bonds and to lick behind foreigners to come in with some foreign exchange as Investors on tax holidays to invest, develop our resources and take away the profits. We forget that we are the net loser.  This is because in that process we have lost our assets, Noritake came in  and works on tax holidays working on our clay resources. Now it is reported that we are short of clay.

The only exception of an achievement in the post 1977 Period is the Mahaweli Development Project which is nothing other than a major colonization scheme.

Following the Structural Adjustment Programme of the IMF we ruined our economy with unfettered imports. Today we beg of Investors to come in. What we can do ourselves is forgotten.  In the Fifties, when we needed Rice Mills, our local entrepreneurs responded overnight and opened up rice mills. I worked with the Rice Millers advising and guiding them. The Jayawardena Government instead of getting our millers to mill wheat into flour invited Prima, a Singaporean multinational to open up a factory and gave Prima to take charge of imports of wheat. Then in rice milling the profits in milling stayed in Sri Lanka, while Prima takes the profits away to Singapore. This is not development. It is exploitation and that is the motto of the Structural Adjustment Programme which we have to follow even today.

Under the tutelage of the IMF the development infrastructure that the country had developed was either privatized or abolished. The Marketing Department that purchased vegetables and fruits in producer areas at higher prices than what was offered by traders and  sold the produce in the cities at lower prices than the private sector was abolished. This  Department had assured fair prices to the producer as well saw to it that traders had to offer produce at cheap rates if they were to be in business. We thereby effectively controlled prices. This Department also had a Canning Factory that offered a floor price for fruits like Red Pumpkin, Ash Pumpkin and Pineapples, which were turned into jam. It not only achieved self sufficiency in all Jam and Fruit Juice but also built up an export trade in pineapple. Today we import all our Jam and Fruit Juice.

The Cultivation Committees that attended to paddy cultivation were abolished and till today  agriculture has no village level participatory base.  In  the pre 1977 days Sri Lanka produced all its buses and rail carriages at Moratuwa, Ratmalana and Werahera, employing over a thousand men.. These units were abolished and privatized. Now we import buses and rail carriages.  Following the Structural Adjustment Programme has ruined the economy. Yet most economists fail to understand what has happened.

Our Third World Countries have to develop a new algorithm for development away from the clutches of the Structural Adjustment Programme. China does not follow the SAP.

Sri Lanka is now in this predicament. The demise of Sri lanka at the hands of the IMF is well documented in my book:How the IMF Ruined Sri Lanka and Alternate Programmes of Development (Godages)

Our foreign debt was caused by our following the IMF’s prescriptions and the IMF is therefore guilty of providing us with the wrong advice. They have therefore to bear the brunt of the foreign debt which they themselves made us create.

To get back to what I saw in China, what I saw was  everything we have done earlier, being done simultaneously. China’s is a vast programme of irrigation construction and colonization, agricultural development, rural development, small industry and large industry, everything all aspects done  all done together with a massive unstoppable force. We do have the expertise  in  administrators, who have excelled in opening up new employment creation projects and rural and land development. We also have  politicians like Sumanapala Dahanayake.. Politicians are now allegedley tainted with corruption. I can vouch that the politicians I worked with in Kegalla District in 1968 and 1969 and in Matara District in 1971 to 1973 were beyond corruption. Instances of corruption were reported like my own Divisional Revenue Officer at Mawanella  taking a large bribe from an estate owner, to stop our acquiring  her estate, telling her that the money had to be given to Deputy Minister Beligammana. It was found that Beligammana  had nothing to do with the bribe.

In my eternal visits to my mother country I have met Grama Niladharis, Divisional Officers and also politicians and can state that they have not lost their ethics and are patriotism bound. The Sumanapalas are there who can take charge.  It is only the political will that is today mired in internal warfare. This is also the ploy of the Superpowers. They do not want any Third World Nation to succeed.

The question also  arises as to from where can we find the funds to bring about development.

The answer  to this comes from my own work in Bangladesh, where I undertook to establish a Self Employment Programme without any funds. I was the Commonwealth Fund Advisor to the Ministry. It was denied funds because the ILO had tried to establish a self employment programme earlier and failed miserably.  It was the Youth Development Ministry  which ran a large programme of youth training- we trained 40.000 youths a year in skills. I argued the case for a self employment programme, with Treasury Officials who were against it, disproving all their premises. I battled alone for over two hours till the Minister for Labour and Manpower had enough of us and ended by approving my establishing a programme. The Ministry Secretary was authorized to use the funds already available for youth development  to establish a self employment programme side by side with skills development. This was done by my training youth workers  in economics to guide the trainees when they commenced income generation enterprises.  I with a core of officials addressed the youths in training and motivated them to commence  small employment ventures in their homes, with their parents and brothers and sisters. We guided the functioning of each enterprise however small. The design of the programme  was worked out by me and Bangladeshi Administrators continued the task after my two year stint was over. Today the Ministry of Youth Development   spends over 90% of its time on creating  employment. It has superceded the extension functions of the other line Ministries like agriculture, livestock and small industry.  . This Programme  has by February 2011, guided over two million youths to become self employed. (Report of the Government of Bangladesh to IFAD), Today this Programme guides 160,000 youths to become self employed annually. All this was achieved by redeploying and re training  existing officialdom.

In looking at the people working enmasse in China on development work,  I relived my memories of row seeding and weeding in Kegalla, of working with Cultivation Committees in Anuradhapura, marshalling and motivating people to use high yielding varieties and fertilizer, of Rural Development work in Kegalla where we worked with hundreds of volunteers on building roads and in opening up new small industries like the Coop.Boatyard at Matara and the Crayon factory at Deniyaya. In the Sixties when the cry was how to distribute fertilizer the Agrarian Services built large fertilizer stores overnight.  However, we have worked in fits and stars, never a coordinated effort due to the whims and fancies of political parties in power.

Party politics has caused our ruin. I worked on implementing the Paddy lands Act in Matara District and in Kegalla District and found the committees divided on party political lines. Most of my time was spent in settling disputes.  When I implemented the Paddy lands Act in Anuradhapura District, I issued instructions to all our Divisional Officers that no elections should be held. We aimed at a concensus election where everyone had to agree. If I remember right out of some 295 committees some ten defied my Divisional Officers attempts at concensus. I called election meetings again which I attended myself. I succeeded in prevailing on a concensus election in all cases, at times discussing with them for over five to six hours. We had great dividends in the working of the committees. The people worked together harmoniously and I never faced the internecine warfare I faced in Kegalla and Matara earlier.

China in its massive development effort and the achievement of the Self Employment Programme of Bangladesh, the largest employment Creation programme the world had known,  shows us the way ahead.

In the manner we are fighting amongst ourselves today, being the pawns of the Superpowers and their protégé the IMF, I am reminded of the words  I read today in the Forbidden City in Beijin(25/5/2015) from The Book of Rites, When we handle matters properly, harmonically, without leaning to either side, all things on earth will flourish”

Garvin Karunaratne

Former Government Agent, Matara District,

21 st June 2015.

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