The Central Bank governor has expressed confidence that Sri Lanka will receive the second tranche of the IMF loan before the end of the year. He has made this prediction despite the failure of the government to meet the basic IMF conditions, which include reducing the gap between revenues and expenditures. The ability to access IMF funds despite not conforming with its conditions is indicative of favoured status. The budget prepared by the government shows a widening of the chasm that are mitigated by optimistic predictions of increased tax revenues. The government has signally failed to deliver on the IMF’s “governance diagnostic” which highlighted the need for much greater efforts to tackle corruption and to be transparent in the signing of new contracts.
If social media reports and personal anecdotes are to be believed, corruption is thriving at all levels. Agreements with international companies continue to be entered into with little being known of the terms and conditions, and even the debt restructuring agreement with China continues to be a secret.
But there continues to be a belief amongst sections of the Sri Lankan population and international community alike that the present unsatisfactory governance needs to be tolerated until the country makes the transition to self-sustaining economic growth. There is concern that any change of government at the present time would jeopardise the economic and political stability that the country has achieved despite the unconvincing evidence to the contrary. The general population is expressing its lack of confidence in the future by fleeing abroad and giving votes of no-confidence in every public opinion poll they can.
Despite the government’s continued hold on undisputed power, and skillful use of its parliamentary majority and security forces to enforce governmental rule, it is not able to show that it has the backing of the majority of the general population. The government’s policies seem to have the support of the business and upper social classes whose position is that there is no better alternative at present, a view that is echoed in diplomatic circles. But this sentiment is not reflected in public opinion polls that equally consistently reveal that the government and its leadership get less than 20 percent of the support and even much less. This accounts for why the government has resolutely defied calls for the holding of local government and provincial council elections, the latter which are long overdue.
The president’s announcement that presidential and parliamentary elections will be held next year may be a recognition that the government has come to the realization that it cannot continue to justify holding on to power without obtaining a fresh people’s mandate. The proposed budget is an indication of the government’s preparation for those elections. There are efforts in it to provide benefits for different sections of the people, though whether these promises will materialize is another question due to paucity of resources. President Wickremesinghe has pledged to provide tens of thousands of farmer families with free hold title to the land they currently cultivate under state leases. The motivation to obtain the vote of people by providing them with economic benefits is one of the key features of the democratic process not only in Sri Lanka but worldwide.
However, the skillful use of state power to provide economic benefits, utilizing the parliamentary majority to come up with news laws and use of the security forces to enforce those laws are not the only ingredients for success in governance. The general population needs to trust those who are in power. This trust comes from consistency in word and deed. One of the features of the present government is that deeds do not follow words. The exemplary anti-corruption legislation is being used to catch those at the lower levels of the hierarchy but those at the higher levels continue to escape. The recent Supreme Court decision that apportions blame for the economic crisis that plunged vast numbers of people into poverty has not been acted upon and there is no indication at the present time that it will be acted upon.
There are two other areas where the government needs to rebuild the trust of the people. First is to convince them that the burden of economic recovery will be apportioned justly and equitably. The restructuring of the EPF and ETF pension funds which affected the poorer sections of the people adversely while the sparing of the banking (and corporate) sector may have been motivated by the fear that the collapse of the banking sector was a real possibility. However, the evidence that is now coming out, as demonstrated in parliament by the opposition, that huge amounts of loans taken by companies have been absorbed by the banks is unconscionable. The government needs to promise that it will rectify this and other such inequities as soon as possible including the tax holidays to favoured companies. The recent parliamentary debates have provided the opportunity for the opposition to make presentations that highlight the need for consistency.
The second area that needs to be addressed is the ethnic conflict in the country. This is a problem that has receded into the background of the national discourse, due to the overwhelming nature of the economic crisis. The wrong that was done to the Tamils of recent Indian origin at Independence has still not been rectified. They continue to be the poorest and most neglected community in the country. An issue that is scarring the Tamil and Muslim people at the present time is the takeover of grazing lands in the east by people from outside the area. One of the root causes of the country’s economic crisis is that huge amounts of resources were devoted to fighting a war that need not have taken place if there had been policies that promoted inter-ethnic justice and equity. The security forces continue to extract a large part of the budget.
There is a need to convince the ethnic and religious minorities that they are a part and parcel of the polity and treated as equal citizens. The provincial council elections cannot be postponed for another two years. There was no democratic basis for the president stating that local government and provincial council elections will be held in 2025, the year following the presidential and parliamentary elections. In fact, this would be a violation of the election laws as both these elections are long overdue. Sri Lanka is not a unique country when it comes to having different ethnic and religious communities. Other countries have them too, but most of those countries, especially those that are economically successful, have found ways to resolve their differences through dialogue and power sharing that benefits the entire society. Provincial council elections have not been held for over five years. The residents of those areas have no government to protect them. This is not the way to build trust that will unify the people with the government to uplift the economy.