Singapore FTA SL and other’s garbage
Posted on September 2nd, 2018

By Shivanthi Ranasinghe Courtesy Ceylon Today

Last week United National Party Matale district Parliamentarian Rohini Kaviratne, in an interview to this newspaper, makes couple of notable comments.  Her thinking is not unique and the views she holds are common to many who support party politics. This refusal to discuss the real issues with insightful analysis or knowledge and sincerity is the bane of our country. Defending one’s political party even in the face of wrong has done more damage to our country than terrorism or corruption has ever been able to.

Other countries like Singapore, Malaysia and Korea, that had also been under the colonial boot have been able to put that ugly historic black patch behind and are enjoying strong economies. Sri Lanka on the other hand that regained independence before any of these countries is not only struggling to survive, but actually moving backwards.

The main reason for this tragic phenomenon is because we allow a political career to those who fail to deliver. The incumbent Prime Minister Ranil Wickremesinghe is a case in point. When he was holding the same office from 2001 until 2004, he made a number of grave blunders like the Millennium City betrayal and the 2002 Cease Fire Agreement (2002 CFA).

As a direct result of the Millennium City betrayal, our entire Military Intelligence Unit fell victim to the Liberation Tigers of Tamil Eelam. The LTTE marksmen took some of their targets right in the heart of Colombo. Yet, the Wickremesinghe-led Government could do nothing.

The ceasefire signed in 2002 was another great betrayal. Wickremesinghe signed the Norway engineered agreement without the Cabinet’s or the then President Chandrika Bandaranaike Kumaratunga’s knowledge. By doing so, he not only elevated an illegal entity into the same status of the legitimate Government of Sri Lanka, but also officially marked out the territory as that falling under LTTE’s control.

Today, having allowed him back into office, we are facing a similar calamity. He along with his closest confidant the Minister of Development Strategies and International Trade Malik Samarawickrama signed the Free Trade Agreement with Singapore. While it is detrimental to our country in many fronts, perhaps the most contentious is the possibility that the FTA might turn our country into a waste dump.

As the Meethotamulla disaster amply demonstrated, we are unable to manage our own garbage. Over 30 people, including small children were buried alive by our own garbage.

Yet, we have allowed the FTA with Singapore to list garbage as an acceptable, duty-free commodity to be imported into the country. State Minister of National Policies and Economic Affairs, Dr Harsha de Silva, is of the opinion that garbage would not be allowed into the country. He cites Pakistan as an example that has a similar agreement that is yet to be implemented.

However, whether credibility can be attached to his opinion is questionable. He is also of the opinion that the fast depreciating Rupee is beneficial to our country despite not having an export sector to accrue benefits of such depreciation. Though most politicians do make such blunders regularly, he is more than a mere politician. He as a professional economist is UNP’s economic guru. He while in the Opposition denounced China as an economic hit man. He was very much instrumental in creating the fear psychosis among Sri Lankans that we will end up becoming a Chinese colony. Today, he has taken a 360 degree turn from that opinion.

Whether we will be able to escape from the garbage clause is highly debatable – especially with China, Malaysia, Vietnam, and Indonesia banning the import of waste into their countries. Singapore that has no landmass must find an alternative dumping ground and must find it fast.

The 2002 CFA severely strained and undermined our national security whilst giving many undue advantages to the LTTE. The damage was so extensive to the country that many believe Wickremesinghe had not even read it before signing it. Similar fears are being entertained regarding the FTA with Singapore for no one in Sri Lanka noticed for months that waste was in the list of duty free imports. The reason being the FTA was not debated even in Cabinet.

It is evident from Kaviratne’s terse statements that she has no faith in Wickremesinghe. When asked directly if she thinks whether Wickremesinghe is a suitable candidate for the upcoming Presidential Elections, she redirects the question to the interviewer.

Despite her apparent reservations, she expresses confidence that the UNP will be able to build a country without debt by 2025. Even Wickremesinghe does not entertain such hope. According to him, it will be in 2050 that we will be debt-free. Either way, this kind of blanket statements should not be acceptable by the voter anymore. There need to be a serious discourse on the plan to achieve this target – whether in seven years time or in 32 years.

This discourse is especially important when the national debt has galloped under the present government’s watch. It was so under the Rajapaksa administration as well. The national debt that was Rs. 2,222 billion in 2005 increased to Rs. 7,391 billion by 2014. However, when the national debt is taken as a ratio of the Gross Domestic Product (GDP) a very positive perspective emerges. The GDP is the measure of the country’s income. Thus, in 2005, the debt to GDP was 90.6 per cent, but by 2014, it had drastically dropped to 71 per cent. Since early ’80s until 2001, this was always over 80 per cent and often over 95 per cent. From 2001 to 2004, this ratio was always over 100 per cent.

Rajapaksa era loans

Though Kaviratne is of the opinion that loans were obtained arbitrarily during the Rajapaksa era that had failed to affect a return on investment. She boldly states that the incumbent Government had paid off a large number of instalments of that debt. However, the National Debt in 2015 was a massive jump of Rs. 1,112 billion from that in 2014. This amounts to one third of the net loans taken by the Rajapaksa administration during the post-war period of six years. The growth rate of 3.1 per cent recorded in 2017 is the lowest since 2001 and the second lowest in 28 years.

During the tenure of the Rajapaksa administration, the interest rates of Treasury Bonds and Bills that were in double digits fell into single digit numbers. This was reversed after the infamous Central Bank Bond scams.

It is indeed unfortunate that Kaviratne is of the opinion that “it was a transaction that took place from the time of the previous regime”. These scams that took place in 2015 and 2016 have shaken the financial situation of the country at its very foundation. Yet, even our Parliamentarians are still very ignorant of facts surrounding the matter.

Transactions over auctions do not take over two months to complete. Therefore, the predecessors cannot be held responsible. The previous Government did rely on the auction system to set the interest rates that was then used for direct buying and selling of bonds and bills. However, that is only a method and not the transaction itself.

Similarly, she is extremely ignorant of the facts surrounding the lease of the Magampura Port to a Chinese company for the next 99 years. She thinks it is a better option than “keeping it like that and paying off debt”.
The Magampura Port loans were being financed by the Sri Lanka Ports Authority. However, the monies from the lease did not go into the SLPA accounts. It was said that it will be utilized for other projects, which so far had remained unspecified. What really happened to the SLPA loans has still not come to light.

For so long we have been dogged by blind loyalty to party politics. This situation arises as we are determined not to find out what is really happening with our own country.

We make emotional judgements without pausing to verify its plausibility. The very real possibility of becoming the garbage dump of Singapore should be a wakeup call to all of us.

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