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There seems to be no real direction as a country: Dr. Harsha de Silva

10 months ago

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  • Don’t see a structured move towards forming interim unity government
  • Crackdown on protesters is not a positive move, concerns raised from all sides
  • Govt. must clearly tell public the need for economic reforms and be convincing
  • Delays in debt restructuring talks with China is negligent, must expedite talks
  • China is crucial for debt restructuring since it holds 10% of external debt
  • Rajapaksas, Cabraals, Lakshmans and Jayasunderas et al are criminally liable
  • Elections must be held soon; a new mandate by the people needed
  • Unprecedented situation where Govt. mandate is completely distorted
By Asiri Fernando Sri Lanka needs to act decisively to introduce economic reforms and bring about a comprehensive restructure to come out of the economic crisis and avoid another one down the road, asserts Samagi Jana Balawegaya (SJB) MP Dr. Harsha de Silva. According to the Opposition MP, the Government needs to form an all-party interim government quickly and communicate to the people and the international community a genuine desire to bring economic reforms. He noted that the public needed to be educated and convinced that the austerity measures and reforms that needed to be introduced were in their best interests. However, he expressed doubt about the ability of members of the current Government, who have for long championed an inward-looking, protectionist economic policy, of being able to convince the public, especially trade unions and the poor, that reforms and restructuring are in their best interest.  According to Dr. de Silva, while law and order are necessary, a continued maintenance of a State of Emergency and heavy-handed tactics of applying the rule of law selectively to protesters and activists, do little to build trust in Sri Lanka in the eyes of the world that are now fixed on us. He added that the Gotabaya-Mahinda Government and its senior officials were criminally irresponsible for fooling themselves and the public that there was no need to seek International Monetary Fund (IMF) or international assistance on debt sustainability early on. In an interview with The Sunday Morning, the economist-turned-politician called for a General Election as soon as the Constitution would allow it, so that the new public mandate could be reflected in Parliament while also calling for the reinstatement of the 19th Amendment to the Constitution.  Following are excerpts from the interview: What is your view of the current political and economic situation in the country? It is very fluid. There seems to be no real direction where we are heading as a country. Yesterday (27), we had assumed that Parliament would be prorogued and recommenced and that the President would make a policy statement. We had hoped that after the prorogation the President would have given an indication about the plan on political reforms and economic reforms and also perhaps make a serious invitation to all political parties to form an all-party interim government, but that did not happen. The Government’s policy statement has not been delivered.  There seem to be multiple views on forming a multi-party government. In the interim, there is a crackdown on protesters, which is not a positive move, although I understand concerns about infiltrators into the peaceful protests and of disruptors. I understand that law and order should be established and that no one should be given a free hand to destabilise the country. There is concern locally and internationally about whether the tactics and force being used on the protesters are appropriate. It is being asked around the world. So on the one hand we see a crackdown happening, on the other hand we don’t see a structured move towards forming an interim unity government, which can govern until an election can be held as soon as possible. Do you think the continued use of the State of Emergency (SOE) is warranted? If so, why? No, I don’t think it is warranted. I don’t think there is a need for an Emergency and many of us in the Opposition voted against it. If we want to quickly get back to normalcy, law and order are essential. However, if we are trying to woo tourists and investors, what do you think having an islandwide SOE will tell them? What kind of message are we sending? I don’t think it is necessary to have Emergency laws in place. You can use the normal laws of the country. If this is a law enforcement issue, get a warrant and do it the proper way. That would give legitimacy to what is being done. The Government has been quick to enforce the law on protesters and those who occupied State facilities. However, action against those who were involved in the 9 May assault of peaceful protesters and incidents like the Rambukkana Police shooting has been slow. How do you view this discrepancy? It is evident that the Government is using two sets of laws. One set of laws is being applied to the protesters and another is being applied to the people who created all these issues. What about all the big name politicians who instigated these assaults? Why are there no arrests except for a few who were ‘in your face’ leading the assault? Even they have been set free. That is one reason why there is such criticism about the use of force and the law. The law must be applied equally to everyone. Are you of the view that Sri Lanka should hold a General Election as soon as possible? Yes I am, because of a critical reason. This is an unprecedented situation where the mandate of the Government has been completely distorted. A person who came to office with a two-thirds majority has had to flee. The Cabinet has had to resign in shame, multiple times. The sentiments of the people are most certainly different compared to the time of the 2019 Presidential Elections. Therefore, it is a complete misnomer that the present Parliament reflects the views of the people. The Parliament today, does not, I repeat, does not, represent the views of the people. Constitutionally, you can’t do anything about it and we should not go extra-constitutional. In March next year elections can be called and the President has to call for elections at that time. What we have heard is that for Wickremesinghe to get the votes from the Sri Lanka Podujana Peramuna (SLPP) to win the election within Parliament, a promise had been made that no elections would be called. That is not acceptable. When it is constitutionally possible, we want an election. It is then that the views of the people will be reflected in the Parliament. The ultimate objective of the Aragalaya will only be completed if a new president is elected by the people. The ‘new beginning’ will come only when there is a new ‘225’. A new president will need to be elected unless this President sticks to his original position of abolishing the Executive Presidency. Legitimacy comes in two ways. One is from the supreme law of the nation, which is the Constitution. One can argue that he has been elected by Parliament and within the constitutional framework and provisions which are available to be used in a situation like what we had. While it is true that it is a distorted Parliament, it is yet constitutional. The other way is by the will of the people. He is de jure President, but we know that the election within the Parliament does not reflect the will of the people. How confident are you that the Wickremesinghe-Gunawardena Government will bring the constitutional changes which were discussed earlier? Will they move to bring back the 19th Amendment or abolish the Executive Presidency? It is a possibility. Wickremesinghe is someone who voted for the 17th and the 19th Amendments to the Constitution. He voted against the 18th and he was not an MP when the 20th was voted on, so Wickremesinghe has maintained a certain position.  However, Prime Minister Dinesh Gunawardena has, if I am not mistaken, voted for the 17th, 18th, 19th, and 20th Amendments. I think several others in the current Government have also done so. Therefore, I don’t see any deep-rooted belief in the need for reducing the powers of the Executive Presidency and strengthening the Parliament and the Cabinet. Now, whether political opportunism will trump the political ideology of Dinesh and his group, we will get to see in the future, because it is Dinesh and his group that will benefit from abolishing the Executive Presidency. Given that Gunawardena voted for the 17th, 18th and 19th Amendments, it is likely that he may vote for this as well. What we hear is that the SLPP-led Government was planning to bring the 22nd Amendment as per the revisions made by former President Gotabaya Rajapaksa. We heard that what they took to him was closer to the 19th Amendment and that he had made some changes. After his input, the amendment had lost some of its 19A characteristics, because the Executive had a lot of power, including to sack the prime minister and ministers as well. The proposed 22A was going to be presented in Parliament, but it did not happen. What we heard last evening (27) was that they were going to take it back to the Cabinet and that President Wickremesinghe was keen on moving it back towards the 19th Amendment, which is a good sign. However, the 19th Amendment that was implemented was not the 19th Amendment we wanted. The Court made multiple changes, which restricted the transfer of power to the prime minister and the cabinet, and that is one reason why the conflict between the Executive and the Legislature (Maithripala Sirisena and Ranil Wickremesinghe) happened. Ideally, we should go for the original 19th Amendment that we proposed and not the 19th Amendment we got.  Do you think the new Government has the legitimacy to help restore the international confidence needed for debt restructuring and seeking bridging finance? No, I don’t, for more than one reason. The primary reason is that except for Wickremesinghe and the two SJB members in the Cabinet, there is no one in his Government who has previously supported reforms. The main issue is that we need to carry out unprecedented economic reforms for debt negotiations. I don’t know how people who have been completely opposed to reforms will suddenly ditch their philosophy and say ‘we are ready to do this’.  I say this because I was one of the first in the Legislature to have pointed out that this country is going to go bankrupt. It was in September 2020. The SLPP had no regard for the forewarnings that others and I made. They claimed to have ‘home-grown’ solutions, which clearly didn’t work. More than that, it is in their DNA to be inward-looking, protectionist, and opposed to integrating with the world. Their economic view is one of being shackled and controlled, being under permits. Further, throughout the periods they have been in government, crony capitalism has reigned, so how can they change? If they are going to change, they will have to accept the political ideology of our camp and say, ‘You guys were right all along and we were wrong’. Are they prepared for such a change? Or are they going to say, ‘We don’t necessarily agree with your philosophy, but we need to get out of this crisis, therefore, we agree to a little change, a light restructure.’ If that is the case, it will not work. Light restructure will only lead to Sri Lanka facing a similar crisis three years down the road. At this stage, a deep comprehensive restructure is mandatory. I don’t know how this Government can do it. A plaster restructure will not do. If there is one reason this country should listen to what I say and genuinely establish an all-party government, it is for nothing but the comprehensive economic restructuring that has to happen. The Government has to be genuine about doing what it takes to pull this country out of the hole it has fallen into. If not, we will be trying to fool the people again. The need for comprehensive economic reforms must be effectively communicated to the people. They need to be told why these reforms are necessary and how people will benefit from them. The public must be told why economic reforms are pro-poor and not anti-poor. Why we should open the country and integrate with the rest of the world needs to be explained to the public. To do this, the Government, its leaders, and lawmakers must first believe in it themselves. I can’t picture Gunawardena or someone else from the SLPP going to Maharagama or Avissawella and arguing for deep economic reforms. You need believers for that; people that the public and the world will believe when we say we are serious about reforms. Hence the need for a multi-party government that will be able to tell the people and the trade unions of the need and benefit of change. If we don’t convince the trade unions, they will be on the streets protesting against reforms. We need to convince the people about the need for market reflective prices; explain the real need for privatisation. Do you think anyone from this current Government can open their mouths and say anything about privatisation? They can’t. So where is the ability to say it and sound convincing to the public? The IMF has indicated that Sri Lanka should begin debt restructuring discussions with China. How can Sri Lanka do this? What challenges will it face in doing so? Everything about debt restructuring depends on China. China holds 10% of our external debt and if China is not willing to play ball, then the restructuring of debt will get delayed. I am shocked that Sri Lanka has not started the necessary discussions with China. Everything is delayed. Multiple governments over the last few months have failed to start this. Why haven’t they done it? This is irresponsible. Doesn’t the Government have competent people to do this? If they don’t have people, they must get them or hire them. I think one reason Lazard (legal and financial advisory firm) was picked is that Lazard had spoken to China and Ecuador and was successful in getting an agreement. So why hasn’t anything happened up to now? It is irresponsible of the Government not to get this process moving. I think now things are far gone from where they could have been fixed with small changes and a little bit of pain. If Sri Lanka had gone to the IMF in 2020, we could have done this with only the IMF. If we went in early to mid-2021, perhaps we would have been able to carry out light debt restructuring, perhaps with no haircuts for the creditors, along with the possibility of debt reprofiling. If we went towards the end of 2021, we may have been able to do this with only the restructuring of foreign debt. However, because the SLPP-led Government has been criminally irresponsible, in my view now even that is not enough. I think it has come to the stage where there is no getting away from restructuring domestic debt and doing so is going to have a very big impact on the entire domestic economy. I think even that will be possible only if the foreign creditors are agreeable to a big haircut and a long period of time before they see any money coming back to them. The Rajapaksas, Cabraals, Lakshmans and Jayasunderas and cohorts that advised that Government and took their message to the people and fooled everyone are criminally liable for this absolute destruction of the wealth of 22 million people of this country and for having destroyed their futures and demolished the dreams of every young person in this country. They have made this a country of paupers. What are your views on the expected budget and what do you think should be included in it? This is an uphill task we have before us. For Wickremesinghe, it will be a vertical climb with baggage on his back. No one with him really believes in the need for the kind of serious reforms that are needed in this budget. This budget needs to be reform-heavy and equally important, it must address pain that will be inflicted upon the less fortunate in this society. Both will have to have equal prominence. This means addressing the entirety of the subsidy programme. The interest rate will probably move towards 40%. What happens if we don’t do that? If you do it, the economy may shrink, people will lose jobs, and some businesses will have to shut down. So if you think of political survival and say ‘no, we won’t do that,’ then what? We have to print money. What will that do? It will cause inflation to skyrocket again; it may hit 100%. That is the worst crime you can inflict on the people, because inflation is evil, it kills everything, it destroys the very existence, the future, and all that you have saved in the past. So which do you choose? Are Gunawardena et al ready for this? We are in the midst of a storm and we need a crew that can handle a ship in that weather and knows which direction to take to reach a safe harbour. If not, if we go for half measures and light restructure, the short-term relief may be a light at the end of the tunnel, but that light may be from the headlights of an oncoming train.  

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