BY EDWARD THEOPHILUS

It seems that economic development and growth in Sri Lanka could be used with different approaches and many Sri Lankans mean that economic development is individual prosperity while growth is an aggregate status that could reflect the comparative position of individuals with the previous pattern of consumption and other matters. Many students who learn macroeconomics in Sri Lanka and other countries know that consumption function may reflect the points to assess the development and growth of a country. The demonstration effect is the best example of this idea and can this apply to determine the size and nature of economic development in Sri Lanka is a question. It is clear that the living standard of people in Sri Lanka has been improved since the independence in 1948, this could have further improved the population growth reduced to less than 1% and the depreciation of the currency unit controlled as the way country wanted.

I observed many UTUBE PROGRAMS” conducted by Sri Lankans attempt to show demonstration effect and could such situation explain as a better way of showing economic development and growth?  My answer is not and they are misleading people.  I started working in Sri Lanka in Mid-1975 and I observed in offices at that time people hadn’t positive attitudes among people many macroeconomic factors such as education and skills development, population control and productivity improvement, and many factors. When I was working in the offices, I had a feeling that people with outdated attitudes were considering education and skills development as a curse to the country. Some employees thought that English knowledge is the only way for development and growth, but not work skills and qualities. Later, when people were going overseas for working these people with outdated attitudes realized education and skills development key factors for the economic development and growth of the country.

 Now, it also seems that politicians and economic policymakers are stuck with inaccurate determination, and people in the country consider economic development and growth have associated with power playing politics. This is the notable difference meant in Sri Lanka regarding the development and growth compared to many countries. When I have been living outside Sri Lanka since 1990, I had a feeling that the economic status of the country being tremendously improved and the major criteria I was using the demonstration effect. During the COVID 19 season, my mind has pushed to the reality and now I feel that the demonstration effect in Sri Lanka is a witchery that hoodwinker of people outside the country. The true nature of development and growth is a mound raised by white ants of debts and it is not an economic improvement. Is that the meaning of economic development and growth in Sri Lanka? 

Sri Lanka has many limits to growth and development. The best example for this situation is looking at the economic achievements of China and Russia. while it could observe that China and Russia have been achieved rapid economic development and growth with rapid market-oriented policies Sri Lanka has failed to show economic development and growth to people like the way Chinese and Russian people achieved or demonstrated to the outside world. Policymakers in Sri Lanka conduct meeting every day and submit reports to political authority, but such actions have not impressed people to feel the economic development and growth. Why this situation is going on in Sri Lanka? Why politicians are too much talking about Singapore where the economic growth and development have strongly associated with macroeconomic factors such as population, skills development, investment, liberal approach for controls, regulating market than controlling.

Did the government and policymakers consider this situation and identify the reasons for not impressing people on the growth and development? The major reason is ignoring the concept of balanced growth, which is not a process like balancing accounts in an accounting process.  Balance growth is a broader concept that is going beyond the microeconomic process. Growth and development involve in the macroeconomic process that has links between sectors and the outcome of inter-industrial demonstrates that development is a mound raised by hard-working white ants or termites.

Economic development concerns two areas of policies, the restructuring of economic activities considering the cost and benefits of policies to supporting macroeconomic progress and directing investments for productive and possible developing future links to the economy. As I have seen in Sri Lanka that microeconomic reforms are needed for the improvement of productivity.  Politically based trade unions and other racist organizations have become a barrier to policy development and implementation. The best example is the policy development for the Colombo Port city project. Many critics of racist and trade unions have not made a positive approach and the best outcomes have been achieved and will be achieved from the project. The best outcome that could be observed is adding a piece of land to the country that has not been seen since the era of King Vijaya. I read many articles about the subject and nobody has mentioned this point.   

Economic growth is an aggregate position of the combination of various sectors’ outcomes compared to the quantitative status of the previous period. The quality of the progress may not ignore because if the quality of the progress is higher it would go to people, most probably the distribution of quality may have unequal apportionment.  The meaning of economic growth and development to Sri Lanka should consider as a successful outcome of both processes and the distribution of outcomes among the rural and urban population. China and Russia have demonstrated the successful outcome of development and growth, but Sri Lanka has collapsed coordination of the two processes and the main reason for this situation is the self-centered attitudes of policymakers and the authority of policy implementation.   

The direct impact of this dualistic process of economic development and growth seems that created by the instability of the economic policies of the country and the distribution of benefits of projects among people. The second problem with economic development and growth is policymakers have ignored the fundamental requirement of balanced growth and turning to politics of development for indulgence by media. The best example is the process of Port City Development in Colombo. The benefits of the project expand to a limited volume of population and media attempts to close eyes of people for political impression or influence.

The public needs to comprehend the issues social media out of the focus as many who use social media users have a lack of understanding of the subject matter and my feeling is the management of social media doesn’t bother about the development and growth.  I feel that social media also working like opium as the way Karl Marx talked about religions.