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| Sunday, 17 August 2003 |
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Why Sri Lanka has lagged far behind by V. Thirunavukkarasu The speech delivered recently by Minister of Human Resource Development, Education & Cultural Affairs, Dr. Karunasena Kodithuwakku, at the Sri Lanka Economic Association Annual Session, makes interesting reading. Even though he elected to speak as a professional and not as Minister of the Government, there is much food for thought for the entire State and Government. Firstly, Minister Kodithuwakku rightly lamented that the countries of particularly East Asia which were far behind Sri Lanka have over-taken us by leaps and bounds. As a matter of fact, former Prime Minister of Singapore, Lee Kuan Yu's intense yearning in the early 1950s was to catch up with Sri Lanka, (then Ceylon). Secondly, the Minister went on to identify inefficiency of the government machinery, corruption and waste as among the obstacles that have impeded development. Thirdly, the Tamil National Question which he referred to as the North East conflict. He identified this problem as the "most critical of the exogenous factors" the early resolution of which and a non-reversal to warring, could determine the level of success of what the Ranil government has designated as "Regaining Sri Lanka." Now, there has been great jubilation, particularly in government circles that the June 9/10 Tokyo donor parley has brought forth a thumping US$4.5 billions as aid/grant. It is as well to remember that the financial cost of the 2 decade-old war is not less than Rs. 500 billions which is higher than the rupee equivalent of the Tokyo "bonanza". And that clearly demonstrates that the abject failure of successive Sri Lankan governments to find a reasonable and productive political solution to the Tamil national question in good season, coupled with the foolhardy military squandermania that governments of either hue embarked upon, have reduced this country to subservient dependence on foreign aid. Minister Kodithuwakku then dwelt on the question of the strategically vital role that the government has to play in regulating and monitoring the development process, while also identifying the private sector as the engine of growth. Asserts he, "It is the government and no other, that could engage, from an overall perspective, in continuous surveillance of emerging trends in the economic environment, geopolitical posture conducive to the country, identify the country's lead sectors for growth, formulate competitive strategies consonant with its resources, and manage the implementation of such strategies to move the country on a selected path of development to achieve its vision. It is only the government that can effectively negotiate on Government to Government basis for the benefit of their own private sector." Of course the Minister went on to pinpoint the classic evidence of the role played in this respect by the government of the East Asian countries. Globalisation The most significant dimension of the Minister's speech was his studied reference to "Globalisation and its discontents" authored by Jozeph Stiglitz, former Chief Economist of the World Bank and former Chairman of President Clinton's Council of Advisors. Capitalist Globalization is no mean evil, to put it modestly, an that is really what Stiglitz portrays when he says, "Globalization today is not working. It is not working for many of the world's poor. It is not working for the stability of the global economy," to repeat what Minister Kodithuwakku has quoted in his speech. Let us look at what Stiglitz has further stated, interalia: "I have written this book, because while I was at the Bank, I saw first-hand the devastating effect that globalization can have on developing countries and especially the poor within those countries... The IMF's policies in part, based on outworn assumptions that markets by themselves lead to efficient outcomes, failed to allow for desirable Government interventions in the market... part of the problem lies with the international economic institutions, the IMF, the World Bank and the WTO which help set the rules of the game. They have done so in ways that, all too often, have served the interests of the more advance, industrialized capitalist countries rather than those of the developing world." And of course, not only Stiglitz, but there are also other former WB/IMF economists who have decried the reprehensible role played by the Brettenwoods twins,vis-a-vis the developing countries even before the advent of the WTO in 1994. To quote just 2 of them: (1) Davison Buddho, a Granadan, who said in the course of a speech he delivered in Chennai nearly 10 years ago, that he left the service of the IMF after 12 years, absolutely outraged by what he called the genocidal policies pursue by the IMF against the poor of the world. (2) Herman Daly, from the West, who referred jocularly to the World Bank as being blind and deaf to the woes of the world's poor that it badly reeded thick pair of spectacles and hearing aids. Most significantly even the present Chief Economist of the World Bank, Nicholas Stern, has strongly accused the US and the European Union of hypocrisy in preaching free trade while erecting tariff barriers to farm produce from the developing countries. He also denounced as a great sin the system of subsidies paid by the rich countries to their farmers, running into US$300 billions per year not to work their farms. In this regard, Stern characterized the EU as the greater sinner than the US and Japan as the greatest sinner. On the other hand, the WB/IMF, under the sway of the G8 countries that include the US, Japan and the EU countries such as Britain, France, Germany and Italy, prescribe sharp cut-backs in much needed subsidies to farmers in developing countries to boost production. In fact, the controversy that has been raging of late in Sri Lanka between the Ministry of Agriculture and the Treasury is a case in point. Thus, it is up to the G77 countries (with some 137 countries in its fold now) to stand up against the double standards practised by the WB/IMF/WTO troika at the behest of the rich countries in question. It need hardly be said that it is most urgent to follow up the Havana Declaration made 2 years ago grimly warning that especially with the advent of the WTO, the poor countries have becomes poorer. (The author is a senior member of the Nava Sama Samaja Party and a former Municipal Councillor in Colombo). |
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