Rice prices and cost-of-living

By Sarath Wijesinghe

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The cost-of-living is high in Sri Lanka. It is true that it is difficult to make ends meet with a limited income, if you are an average wage earner. But the government servants enjoy many facilities over others. They are free from income tax, and enjoy other benefits.

Living has become difficult with modern developments, high life expectations, and demands for modern way of life. Salaries in the private sector are comparatively satisfactory.

In the old days there was only one breadwinner in a family, Now it is not so, There are more than one breadwinner and additional sources of income for the extended family. The television, mobile phone, computer games have become essential items in life even if you are in a remote village where village values are being gradually eroded.

Still 80% of the population is living in close to villages. They do not feel the cost of living as much as their urban counterparts. Still Jak, Bread fruit, Kohila, Ala, Batala Kankung and village products are freely available or cheap in village surroundings. They do not need Gas for cooking.

They only need electricity for the Radio, TV, Mobile phone and the Computer which is becoming an essential commodity. Life has become complicated.

Simplicity, living within means and self-sufficiency in a village environment is history. Living on debts has invaded our culture as in the west where the average citizen is living on credit cards and mortgages.

In the west you can have all comforts in life with borrowed money. Purchasing a house, a car, and house utensils is only a matter of a telephone call. Credit card culture is invading us fast. Urban Sri Lankan is getting used to supermarkets and credit cards.

Recession

The United States which is the richest country is also facing recession and fighting for the stability of the dollar. The decline in house prices, and problems in the banking systems threaten to purge the economy into self reimposing debts.

This has created a discord between US and EU and put upward pressure of the EURO. Downfall of US economy has had a direct ripple effect on the economy of the United Kingdom and Europe.

Gorden Brown insisted on 15th of April, that he was doing everything in his power to maintain economic stability as the public shows that Britons do not trust their government would manage their economy as much as the citizens of the other western countries.

In the United Kingdom a pint of milk in a super market for 31 pence has risen to 81 pence! Bread which was 18 pence at supermarket in the United Kingdom is 98 pence in a corner shop!! Litre of petrol is over one pound!!!

Price of milk and bread in the west is the barometer of consumer resistance as the governments always are careful to provide the citizens essential consumer food items at an affordable price.

Prime Minster of Britain today has rated the worst in the last 20 years. IMF - the Godfather of world economy says that we are facing the gravest economic crisis of this century.

World Bank President, Robert Zoellick said that doubling of food prices over the last three years could potentially put 100 million people in lower income groups into further poverty.

World Bank says that Asia is slowing down as 25% of the global growth is declining to 3% equivalent to a global recession. Cereal production has come down to the lowest in 30 years and it is being used as an alternative energy by developed countries causing shortages to the poor countries.

But in Sri Lanka people still trust Mahinda, despite high prices of some consumer goods. Prices of Rice, Oil, and Gas are high due to world recession.

They strongly believe his solution on the North and East is effective and management of economy and developments continue hand in hand with the war on terror. Some consumer items are still cheap and stable in price despite unfavourable external influences.

Media do not talk of sugar today as the prices have come down from 63 per kilo last year to 54 per kilo. 15% of our children are potentially diabetic and it is time for us to reduce our sugar consumption.

In the west they consume little sugar with tee and coffee. In Sri Lanka tea offered in a household or a restaurant so sweet. It is time for us to change our eating habits in order to economise and bring the cost of living down as well which we will discuss later at a separate discussion.

The world has 6.67 billion people and 50% depends on rice as their staple food. 90% of global production of rice comes from Asia, yet USA is one of the main handlers of rice industry.

World’s richest country went to war in Iraq because of oil and nobody knows whether there will be wars for food as the price of oil may go up from 100 pounds to 200 pounds. UN Chief Ban Ki Moon said that food shortages have negated the two year war on poverty. The problems are spreading all over. Prime Minister of Haiti was ousted on this issue.

Thailand is short of rice, Malaysia is short of Palm Oil, Australia is short of wheat and rice production has halved. In Afghanistan people cultivate wheat because poppy farming is risky and wheat too gives a good income due to shortages.

Isolated Island

We are living in an isolated Island depending on imported food for our existence. 60% of our food is imported, though most could be grown here. Though surrounded by sea we import canned fish at exorbitant prices which are sold through air-conditioned supermarkets.

Undoubtedly the world recession will have a direct impact on us as we depend outside on food and financial assistance as well.

We are about to win the war on terror and North and East will be liberated. They are beginning to enjoy their democratic rights through strengthening individual and collective human rights. The only way out for our liberation is to strengthen rupee and food production and industrial development.

We have the best climatic conditions, soil, and educated and experienced technical know-how. What is lacking is the will and determination of the nation disturbed with modern and hollow artificial trends of following western e-com culture which we should have used for our benefit and not for destruction.

Pardon us for giving warning signals and a piece of advice to our energetic Minister of Trade, Consumer Affairs and Cooperatives. He has been given one of the most powerful ministries by His Excellency with lots of expectations.

People expect a lot from these powerful Ministries. We believe it is time for him to go back to the drawing table as forthcoming few months will be crucial to us and world over.

Food war will be equally or more crucial in time to come as the war on terror because people tolerate hardships trusting Mahinda who was appointed by the people as the trustee of the nation for a specified period.

People are well informed and educated. They do not need lectures and explanations. They know what is happening here and around. They need a strategy and results with available resources- we are full of resources and a resourceful nation.

We need an Energy Policy, Food Policy, Policy on Eating Habits, Consumer Policy as proper consumerism is one of the ways to check the cost of living, boost, encourage and initiate consumer organizations, make use of the cooperative movement to combat the war on food.

Warning signals have already reached us on food war as bad as other wars. We are warned that food shortages are inevitable and world shortages may give rise to famine and mass-scale poverty worldwide.

People must be warned and advised on time and measures should be taken by educating and convincing the masses. Change of Governments will not be a solution. It will aggravate the situation.

Fortunately Mahinda Rajapaksa government has identified the danger on time and measures are being taken to accelerate the FOOD WAR.

If George Bush and Gorden Brown whose countries are so rich and powerful are struggling and waiting to face a major disaster, how could Mahinda Rajapaksa alone bring down the cost of living with the war on terror which he has successfully brought to control, while bringing about major and micro developments islandwide?

But there should be and in deed there is a solution to meet the challenge. The only way to be successful against the world economic and political trends is to improve our production and lead a simple and well-managed life at least until the stormy period is over.

In western countries only 10% to 20% of the income is utilized for food while in Sri Lanka and many other poor countries around 60% to 80% of the income is consumed for food. This is an unfortunate reality. But the good news is that we are wonderful survivors. If we are determined we could withstand any resistance.

We bravely enjoyed New Year despite high prices of some consumer items. We are innovative and will survive any situation. We managed during many wars. Our coconut plucker charges 60 rupees for a tree. He moves round with a mobile phone. When I questioned him during the new year about his income he said his average income is in the range of around 1000 rupees a day.

He is not bothered about Gas prices. He used to spend 300 per day for Kassippu. Good luck to his children he has now given up the bad habit. Children are happy about their father who is reformed. This is only one isolated incident. During New Year I paid my carpenter, mason and electrician 900 to 1000 rupees a day for their services.

The driver allocated to me when I was the head of an institution was drawing about 14000 rupees per m prices in supermarkets when there is alternate energy sources introduced by the government. He should know what to buy and where to buy cheaper. This is a matter to be discussed under a different topic on a later day.

People grumble for the price increase of an item by few rupees- but not a hum on the mobile telephone bill. Every member of the family and almost all the waiters in a small restaurant carry mobile phones.

They carry mobiles and busy everyday doing something important and fruitful; Those who are resourceful succeed in the world of survival of the fittest. I was in my village in Hamantota during the New Year and the sound of crackers echoed for a considerable period was indication and barometer of happiness of the people during the New Year.

They adopted and contended with available resources without being greedy.. They are used to lead a contented life and satisfied with what you are and what you have got. Excessive greed breeds hatred and sorrow.

Food riots

Senegal and Haiti experienced food riots. Food prices have risen dramatically in almost all the countries. In Bangladesh where rice is available in bulk and other industries are booming, the prices of food have risen by 60%.

In a number of developing countries prices of bread, rice, maize products, milk, oil, soy, beans and a variety of other basic food items had recorded considerable increases despite policy measures like restructure on exports, subsidies, tariff reductions and price control.

Most rice producing countries have banned export of rice and other food items. Due to the mismanagement of fiscal policy and mismanagement of economy and destruction of National wealth we are not in a position to meet the challenges and the world trends.

Paddy Marketing Board which was running beautifully was destroyed and Paddy stores valued billions were sold to political stooges for exorbitantly low prices.

Mahinda in 2005 has agreed to reintroduce the Paddy Board and bring lost glory and pride to the farmer which is spelt in the Mahinda Chintana as follows- I will re-establish the Paddy Marketing Board in order to intervene in the process of paddy purchasing and rice markets.

With effect from the next Maha season, the guaranteed price for Nadu rice will be fixed at Rs. 16/50 and for Red Rice and Samba Rice at Rs 17/50 per kg. Unfortunately our family silver including most valuable mega paddy stores have been given to political stooges of the past governments for low prices.

We are skeptical about the measures taken to bring rice under S18 of the CAA making it an essential item in terms of the act. But the good news is that the wheat consumption has been reduced by 60% and it is time to popularize rice-based products over wheat.

We are pleased that even private sector purchases paddy at Rs 40 to 50 per kilo from the farmer direct and the Consumer Affairs Authority has declared rice as an essential consumer item under section 18 of the Consumer Affairs Authority Act by fixing the price of Samba at Rs 70/=, Nadu Rs 65/=, Red Kakulu Rs 65/=, and white Kakulu at Rs 55/= .

It is a good move in theory as there should be some State intervention in regulating quality, price and standards of the staple food of the nation. It is doubtful how it is going to be implemented countrywide with a handful of staff and resources of the CAA.

This is the time the Civil Society, NGOs and Consumer Organizations should be active in order to defend and protect the consumer and help whoever in power to meet the changes faced during the world recession.

There is a word of caution to the Opposition and the politicians. If you need political power please be patient. When the nation is in danger do not make things worse by tarnishing the good image of the country. It will not help you in the long term. Please learn from others.

In the United Kingdom Labour, Conservatives and Liberals work together and spoke with one word until IRA laid down arms completely and entered democratic process.

Today Labour is in difficulty and all indications are that Conservatives are coming to power. During the world war all parties gave support and mandate to Churchill who won the war but lost the next general election. If the Opposition tarnishes our image, we sink together and their will not be a country for you to manage.

The nation will curse and will not pardon if you continue the destructive ways of damaging the country by carrying tales to the world. Therefore, it is time for us to work together for our own survival and our future.

Do not think of changing governments at this juncture. Help the nation and come out with your programme and strategy to serve your period in due course, if people are willing to believe and trust you and your abilities.