Business community demands:

'Go for polls without delay'

by Rohana Jayalal

The business community has expressed serious concern over the political stalemate in the country which is not conducive for investments and launch of new projects.

The Chambers and industry stakeholders have underscored the importance of going for General Elections soon and breaking the stalemate to ensure stability and the confidence needed to attract foreign direct investments, which is vital for the country at this crucial juncture.

The Ceylon Chamber of Commerce in a recent communique reiterated the need to conduct parliamentary elections without delay.

The contradictions emerging from the diverse political forces in the coalition Government is leading to instability.

The business community is concerned and so are potential overseas investors. "The mandate for the present government was to implement a 100-day program and more than 30 days have elapsed since the date Parliament was meant to be dissolved (April 23). National policies including those relating to the economy are on the back burner pending a General Election and the formation of a Government with an appropriate mandate," the statement said.

It is imperative that such a government is elected to office at the earliest so that policies can be formulated and implemented to kick-start the economy and exploit its true potential.

However, in the event there is consensus among political parties that other constitutional amendments - including electoral reforms - are vital before parliamentary elections, such enactments should be expedited considering the serious impact that any delay and the associated uncertainty has on the national economy, the Chamber communique said.

Elections at national and Local Government level are in the offing and the Chamber reiterates that the onus is on the leadership of all political parties to demonstrate their true commitment by nominating candidates with an unblemished record, strictly abiding by the criteria outlined in the March 12 Declaration.

Bank and financial institution sources said that the loan portfolio has dropped due to the uncertainty in the country and the wait and see approach followed by many borrowers. “The housing and commercial sector loan applications have dropped sharply as borrowers are worried over the instability. The situation will stabilise after an end to the political stalemate,” a senior private sector banker said.

Secretary, Vehicle Importers Association of Lanka, Keerthi Gunawardena said the reduction in the duty of vehicles below 1000 cc and increasing the duty on hybrid vehicles does not augur well for the automotive industry which faces a tough time due to its concerns being ignored.

“Sales have dropped drastically. Today, the trend is for electric vehicles which is not available in Japan due to high demand. The price of an electric vehicle is one million Yen,” Gunawardena said.

He said that the Association is concerned over the sudden resignation of Customs Director General Jagath Wijeweera who was down to earth and always sought the views of all parties and arrived at a solution without delay.

“We appreciate the service rendered by an honest and committed official who stood by his staff,” he said.

Vehicle Importers Association of Sri Lanka, President Mahinda Sarathchandra said, “Political stability was the utmost need for steady economic growth. Sri Lanka never had this situation over the past 60 years. Purely in economic terms, during British rule of over a 100 years continuously, the country recorded steady growth though one could argue whether it was justifiable. Yet the fact is, under stable rule, the economy would flourish.”

“People were hoping that the economy would turn towards development after the civil war ended in 2009. But their hopes were shattered when the rulers were more interested in achieving their personal goals rather directing the country towards steady economic growth. The situation has worsened since the change of government in January,” Sarathchandra said. “Without concentrating on strengthening the economy the emphasis today is on stabilising the political power of people and or groups,” he said.

“As a solution to the prevailing situation,we propose that the rulers of the country must get together and work towards developing a stable, long-term economic policy that would not be affected by change of Governments or their administrators and implement such policies immediately,” he said.

Director, Dreamron Global (Pvt) Ltd, Deepal Nelson said many people are of the view that Sri Lanka is going through an era of political instability which is affecting the business community adversely.

“This is an exaggerated opinion. Sri Lanka is a country that has gone through a 30-year era where tourism dropped to a bare minimum, there was no confidence with regard to the security situation in the country, leave alone the business community and every one was living in fear,” he said. “In this backdrop, the business community suffered adversely. However, the present situation is a mere storm in a tea cup which will subside with time. Other than those unfairly trading through Government connections, the common businessman, has not seen any difference in their trading patterns. Trade goes on as usual for him,” Nelson said.

“In the previous Government, top positions were filled by powerful henchmen. Sadly, good governance has been unable to change this. Many top positions are still held by close allies of the Government. This upsets many,” he said. “There has been a slight drop in the banking sector, in terms of the demand for borrowings. Banks must focus on technology driven start-ups as opposed to mere traditional trading deals.,” Nelson said.