{"id":108582,"date":"2020-11-12T16:37:21","date_gmt":"2020-11-12T23:37:21","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=108582"},"modified":"2020-11-12T16:37:21","modified_gmt":"2020-11-12T23:37:21","slug":"the-pohottuwa-government-of-sri-lanka-part-2-c8a","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2020\/11\/12\/the-pohottuwa-government-of-sri-lanka-part-2-c8a\/","title":{"rendered":"THE POHOTTUWA GOVERNMENT OF SRI LANKA Part 2 C8a"},"content":{"rendered":"

KAMALIKA PIERIS<\/em><\/span><\/h2>\n\n\n

TheMillennium Challenge Corporation (MCC)\nis a  foreign aid<\/a> agency established by the U.S. Congress<\/a> in 2004. The MCC Board\nis chaired by the Secretary of State. The Board members consist of the Secretary\nof the Treasury, US trade representative, four private sector representatives\nand a representative of USAID. <\/p>\n\n\n\n

MCC is  therefore not the independent, altruistic  US foreign assistance agency it claims to be.\n It has government connections.   The governing  Board \nrepresents  the  political and trade interests of the USA.   Advocata \nInstitute   however, says,\nalthough heads of the U.S. State Department and U.S. Treasury sits on its\nboard, the MCC operates independently as a separate entity. <\/p>\n\n\n\n

The Millennium Challenge Compact is a US grant for development\nwork in foreign countries.  The  first project negotiations in Sri Lanka  for  such\na  grant commenced in 2004 during the\nKumaratunga-Wickremesinghe tenure and continued during the Rajapaksa government\nuntil the project was terminated for political reasons,  by MCC in 2008. <\/p>\n\n\n\n

After\nYahapalana government came to power, in December 2016, Sri Lanka was again\nselected for a Compact.  The country\nbecame eligible for assistance after passing 13 out of 20 indicators on MCC\u2019s\npolicy scorecard. <\/p>\n\n\n\n

Countries must qualify as low income or lower middle income\ncountries according to the World Bank\u2019s classification in order to be eligible\nfor MCC grants. On the 1st of July 2019, the World Bank classified Sri Lanka as\nan upper middle income country with a per capita income in excess of $ 3,895.\nHowever, by that time the MCC grant for Sri Lanka had already been passed and\nin any event according to MCC criteria, when a country\u2019s classification\nchanges, it will retain its former classification for a further two\nyears. <\/p>\n\n\n\n

On August 13, 2018, the MCC delivered to the U.S. Congress a\nCongressional Notification of its intent to negotiate a Millennium Challenge\nCorporation Compact with the Government of Sri Lanka.  Sri\nLanka completed negotiations with MCC in October 2018    and the Board of Directors of the Millennium\nChallenge Corporation of USA approved a five-year, $480 million Compact grant\nto the Government of Sri Lanka.  <\/p>\n\n\n\n

 The agreement was to be signed in December\n2018 but was delayed, due to  \nobjections. MCC\u2019s Board of Directors met in mid-September 2019 and re-approved\na five-year, $480 million Compact grant to the Government of Sri Lanka.   The\nUnited States said it hopes that Sri Lanka will eventually approve the $ 480\nmillion Millennium Challenge Corporation (MCC) grant. Measures will be taken to\ncreate awareness on the MCC programme among the people,  the embassy said. <\/p>\n\n\n\n

Analysts\nobserved that US does not historically give Sri Lanka direct aid, they do it\nthrough World Bank. But in this\ncase they   readily provided money\ndirect. The embassy confirmed in 2019 that the full sum of USD 480\nhas   already been approved. <\/p>\n\n\n\n

When a country is awarded a Millennium Challenge compact, it sets\nup its own local MCA accountable entity to manage and oversee all aspects of\nimplementation, the US explained. Sri Lanka has set up Compact Development Team\nin the Policy Development Office of the Office of the Prime Minister.    This will later be replaced by MCA-Sri\nLanka, which will deal with the work of the Compact. <\/p>\n\n\n\n

The   land and transport\nprojects of the Compact were first examined \nby Harvard University\u2019s Centre for International Development in a year\nlong study in 2016. This was followed  by\nstudies from World Bank, Asia Foundation, \nTrimble and Center for Policy\nAlternatives, Colombo. These are \norganizations which have a strong link with USA, said critics.<\/p>\n\n\n\n

The present\nCompact is based on a full-fledged proposal submitted by the government in\nNovember 2017, said Pathfinder Foundation. The\nlocal Compact team and MCC specialists had extensive discussions with the\ndepartments responsible for transport and land administration. They also had\ndiscussions with the private sector,  \nthink tanks, and civil society organizations. <\/p>\n\n\n\n

The\ngovernment team was led by the Secretary to the Ministry of Finance. The team\nincluded senior officials from the External Resources Department, Attorney\nGeneral\u2019s Department, Policy Development Office in the Prime Minister\u2019s Office,\nMinistry of Highways and Road Development, Ministry of Lands and Parliamentary\nAffairs, Ministry of Megapolis and Western Province Development, Ministry of\nTransport and Civil Aviation, and Sri Lanka Survey Department, said Pathfinder. <\/p>\n\n\n\n

The MCC\nCompact  led to considerable discussion.\nSeveral organizations  held seminars on\nthe subject and the US embassy has attended and contributed information. This\nis your project. We are not forcing it on Sri Lanka, said US. Implementation\nwill be supervised by a local body staffed by Sri Lankans. This body will be\naccountable to a Sri Lankan Board of Directors comprised of eight government\nofficials and three representatives from the private sector and civil society. <\/p>\n\n\n\n

Certain\nchanges have already been made. Attorney General\u2019s Department raised objections\nto the clause in the original draft which brought the Compact under\nInternational law. MCC was asked to\nremove any sentence which excluded domestic law and the MCC agreed,  USA said.<\/p>\n\n\n\n

MCC Compact has not been received\nwell in Sri Lanka. The MCC was developed in secrecy by a team located in the Sri\nLanka Prime Minister\u2019s office, charged critics. The government has been\ninexplicably secretive about the whole MCC project, they said. There has been\nno public discussion on it, said Lasanda Kurukulasuriya. <\/p>\n\n\n\n

The  US embassy replied. All\nMCC Compact   programmes,   all over the world are prepared by the\nlocals of that country, the embassy said. In Sri Lanka too, the Sri Lanka plan\nwas prepared by teams of Sri Lankans including  members of the civil society. The private\nthink tank Verite Research  said that\nthey had been involved in   planning the\ntransport programmes. At least 15 Sri Lankans were present at the negotiations,\nthe embassy said. The Compact\nprogram was proposed by Sri Lankans, developed by Sri Lankans and will be\nmanaged and supervised by Sri Lankans, said the US embassy. <\/p>\n\n\n\n

The MCC grant represents the largest grant Sri Lanka has ever\nreceived from a single source, said Advocata. The grant is a huge one, USD 480\nmillion. The failure to utilize the MCC\ngrant would be an economic loss to the country   said US\nadmirers.  USD 480 is not a big sum\ntoday, critics replied. The present government could borrow 480 million USD in\na single afternoon through the issue of Sri Lanka Development Bonds. <\/p>\n\n\n\n

Critics also observed that \nwhile the donor (USA) is keen on the compact, the recipient, (Sri\nLanka), is suspicious and reluctant. It is most unusual to have a donor running\nbehind a recipient like this. It is usually the other way round.  Sri Lanka is wondering why USA is so anxious\nto push this through. Is this simply a grant to   avoid traffic jams and prepare   maps or is it something more. What is behind\nit all. <\/p>\n\n\n\n

The stated\naim of the MCC  is to    reduce poverty and stimulate economic\ngrowth, said MCC.  In Sri Lanka we have\nidentified transport infrastructure and weak land administration   practices as the binding constraint on\neconomic growth in Sri Lanka.This\nis   nonsense,  said critics. Sri Lanka\u2019s \u2018constraints to\neconomic growth\u2019 cannot be   removed by\ntackling traffic jams and listing  land\nparcels. Sri Lanka economic problems\nlie elsewhere. <\/p>\n\n\n\n

One analyst,\n(name withheld) who it appears seem to have seen the document, said the MCC\nCompact is not a Compact at all. There are annexures and cross references and\nthe agreement is difficult to understand. It has \u2018shall\u2019 only twice and that is\nfor US, not Sri Lanka. <\/p>\n\n\n\n

The present\nCompact is a treaty not a compact, said Palitha \nKohona and it is not under Sri Lanka law.  It is a tool for furthering the objectives of\nthe USA . D.L.Mendis,  a specialist\nin  treaties and  international law , stated at an OPA\ndiscussion that MCC compact must be examined by \npersons who know to asses a treaty. Simply looking to see whether it is\ngood for the country  will not do. The\ntreaty implications must be examined.<\/p>\n\n\n\n

The MCC\u2019s\napproval of the $480 grant for Sri Lanka was announced by government just days\nafter the Easter Sunday attacks, when one would imagine that Sri Lanka\u2019s\ninvestment credentials were at an all-time low. The secrecy, the odd timing of\nthe announcement and other aspects would suggest that the MCC is being imposed\nby the US for its own purposes, rather than for the benefit of Sri Lankans,\nsaid Lasanda Kurukulasuriya. <\/p>\n\n\n\n

The Compact\nnow awaits approval by the Cabinet and signing of the agreement by the\ngovernment., But there is hesitation on\nthe part of the government and reluctance to sign., observed the media. <\/p>\n\n\n\n

The Agreement between the MCC and the Government of Sri Lanka is\nyet to be signed  the Prime Minister\noffice announced  in June 2019. .According to\nthe Standing Orders of Parliament, this compact will be reviewed by the\nOversight Committee and will be open to the interested parties. The agreement would also be presented to\nParliament after obtaining Cabinet approval. <\/p>\n\n\n\n

This Millennium Challenge Corporation grant has been seen as part\nof a threefold US package of MCC, ACSA and SOFA.  ACSA and SOFA are military agreements; MCC\ngrant is about economic interests,  said\nMCC supporters.  But they look like a\npackage, replied  critics. All three were\nto be signed in  2018, one after the\nother.  ( Continued)<\/p>\n","protected":false},"excerpt":{"rendered":"

KAMALIKA PIERIS TheMillennium Challenge Corporation (MCC) is a  foreign aid agency established by the U.S. Congress in 2004. The MCC Board is chaired by the Secretary of State. The Board members consist of the Secretary of the Treasury, US trade representative, four private sector representatives and a representative of USAID. MCC is  therefore not the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[104],"tags":[],"class_list":["post-108582","post","type-post","status-publish","format-standard","hentry","category-kamalika-pieris"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/108582","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=108582"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/108582\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=108582"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=108582"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=108582"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}