Towards economic prosperity

The International Community has kept faith again in the Government and endorsed the economic and development policies of the Mahinda Chinthana.

The International Monetary Fund (IMF's) decision to finally grant the much talked about loan was a clear mandate to President Mahinda Rajapaksa's determined effort to win the 'economic war' as well.

Having steered Sri Lanka's relentless battle against terrorism, the President is now eager to win the economic war as well and drive the country towards prosperity through development.

The invisible links of the LTTE and certain opportunist Opposition politicians in the South worked overtime to lobby against the IMF loan.

They resorted to anything and everything to block the IMF loan, hoping that it would cripple the Government's development activities and cripple Sri Lanka's economy.

The UNP acted as an irresponsible opposition and its leader Ranil Wickremesinghe made an unexpected tour of Europe when the entire country was liberated from the clutches of LTTE terror two months ago.

As a responsible Government, President Rajapaksa's inspiring leadership to the Security Forces liberated over half a million innocent civilians in the North and the East - our fellow citizens who had been undergoing untold hardships due to LTTE terror.

The Government needs huge funds for infrastructure development and resettlement of displaced persons. It is indeed a gigantic task to develop the North and East and bring those provinces on par with the Western Province. .

Hence, we welcome the IMF's decision to grant the US$ 2.5 billion loan for Sri Lanka, of which US $ 313 million will be made available immediately.

There are many positive aspects of the IMF loan which would strengthen Sri Lanka's economy. It would stabilise our economy at an important juncture like this when the Government has to channel other resources for infrastructure development.

The IMF loan was requested at a time when Sri Lanka needed to strengthen its foreign reserves. Despite the delay in finalising the loan due to various logistical reasons, Sri Lanka stood on its own as the country's foreign reserves situation improved. The delay in the IMF loan approval did not have any impact on our national economy, much to the disappointment of opportunists who had dreamt of an economic collapse.

Though Sri Lanka looked forward to only US $ 1.9 billion, the IMF decided to grant US $ 2.6 billion, which portrays the level of confidence the IMF and the International Community have in Sri Lanka.

The IMF facility, even exceeding Sri Lanka's original request, will have immediate and medium to long-term benefits.

It will overcome undue pressure, especially speculative, on the exchange rate. enhance Sri Lanka's reserves and the immediate outlook of the economy, enhance Sri Lanka's credit rating for loans from financial markets and enhance the credit availability for investment and financing of economic activity. It would also enable the Government to strengthen its development activities, particularly in the North and the East.

The IMF loan would also have a positive impact on the country's investments, especially Foreign Direct Investment (FDI) which will have a considerable boost, as is usually the case in many countries.

The UNP-led Opposition politicians, having failed in their efforts with their malicious campaign to block the IMF loan, are now singing a different tune. The shameless politicians and certain INGO agents with vested interests said the IMF will not reply positively to Sri Lanka's request. But when they failed miserably and the IMF reiterated its confidence on Sri Lanka and the Government's policies, they now allege that there are negative conditions applied to the loan.

The masses are acutely aware how President Rajapaksa and his Government beat unprecedented odds to win the battle against terrorism. Some countries and INGOs did their best to hamper the humanitarian operation through various means. Nevertheless, the President stood firm and did not bow down to any pressure. The Government, having secured the IMF loan, will by no means agree to anything which would hamper the policies of the Mahinda Chinthana.

Following the positive response from the IMF, the Asian Development Bank (ADB) has also indicated that it would increase its lending to Sri Lanka by 50 percent to help rebuild the country. The ADB would step up its annual allocation to Sri Lanka to US $ 300 million next year, an increase of over 33 percent. The ADB will fund road, power and water and sanitation projects in the North and the East.

The ADB's South Asia lead economist Narhari Rao said Sri Lanka is enjoying "an extremely favourable situation" and added that the overall confidence of the international community is "much higher". Rao added that the ADB is trying to push ahead on various fronts since the Manila-based body feels that it is the "right time to give resources to Sri Lanka".

This augurs well for Sri Lanka. What is important is to utilise those funds in the most productive way to take Sri Lanka towards economic prosperity.

President Rajapaksa and his Government have a clear vision to win the 'economic war' as well and take Sri Lanka to greater heights. The contribution of the people in the North and the East will be a decisive factor. If the farmers in the two provinces could make a greater contribution to the national economy, the Government could undoubtedly win the economic war as well.