The Govt. is trapped in a huge mess and muddle: Harsha

The Daily Mirror sat with former Economic Affairs State Minister and SJB MP, Dr. Harsha De Silva to discuss the Economy, Politics, Current Affairs and a few other burning issues faced by the people.

The following are excerpts from the interview:

   Q      The country is in dire straits economically, socially and in respect of inter-communal harmony. The unprecedented onslaught by the COVID-19 pandemic has made the situation worse. How can Sri Lanka get out of this mess?

Yes, we are in a huge mess. The economy is in deep trouble. Trust and respect among communities is falling apart. Be it the Muslim burial issue or the broader Tamil reconciliation issue the current dispensation based on lop-sided political decisions has dealt a brutal assault on social harmony. Yes, then the mismanagement of the coronavirus pandemic has brought the situation to a critical point. The way out is to unite as a nation and take the right decisions based on a Sri Lankan identity. We have to tell our people the truth and increase their confidence in the government. But for that we need a sincere and genuine leadership.

"Yes, we are in a huge mess. The economy is in deep trouble. Trust and respect among communities is falling apart. Be it the Muslim burial issue or the broader Tamil reconciliation issue the current dispensation based on lop-sided political decisions has dealt a brutal assault on social harmony"

   Q      Economy wise, the biggest challenge Sri Lanka faces is to meet her foreign debt commitments in 2021 and beyond. By the end of August 2020, the government’s total outstanding external debt was US$35.3 billion. Our annual debt servicing stands at a massive US$4.5 billion up to 2025. Sri Lanka has never defaulted on its debt servicing obligations in the past. With foreign reserves falling to a precarious US$5.5 billion and fast dwindling FDIs, foreign remittances and export earnings, do you think Sri Lanka could meet her debt commitments this year and the years to come?

Yes, you are right. The big issue is the external debt sustainability. The government announced that Sri Lanka has to meet obligations amounting to nearly US$7 billion this year. They are trying to paint a pretty picture and say all is well. They are saying no problem and they will receive FDIs and will conduct some SWAPs. They say they may even go to the market. My view is different. I do not believe we can carry on as usual. We won’t be able to rollover our debt the way we used to. In fact, this week the Central Bank failed to sell almost 80 per cent of the advertised US$200 million development bonds. I think beyond mid-2021, with the post-repayment of the US$1 billion International Sovereign Bonds from our reserves, the problem will become even more complex. Already our reserves are falling to alarming levels. Current account is running a large deficit while oil prices are rising. We can’t go to the international markets when our ISBs are trading at 50 to 60 cents to the dollar. We are barely a notch above default as per all three global rating agencies. So, unless a benefactor bails us out with a commitment over the medium term to keep us afloat, I don’t see any other option other than the IMF. But CB Governor Lakshman categorically said no to IMF this week. So, let us wait and see how we could motivate a benefactor?

   Q      The price of almost all the essential commodities has increased sharply in the domestic market. People are trying hard to make ends meet. Widespread redundancy in the private sector, in the field of self-employment and among daily wage earners has made their life extremely miserable. Is there a remedy for this sorry state of affairs?

Take the price of rice. A kilo of Samba is around Rs.130 while the maximum gazette price is Rs 98. What is the issue there? We had a bumper harvest during the past two seasons estimated to be in the region of five million MT of paddy which is much more than we need annually. We saw the President intervene not only at meetings he presided at the Secretariat but also sitting at the manager’s desk at the Narahenpita Market. We saw ministers talk tough to the paddy miller oligopoly. We recall the undertaking given by a Brigadier who said they have a database of all stored paddy which could be force-released into the market pronto. But people are suffering, unable to buy rice at a reasonable price. Take sugar. They reduced the tax from Rs.50 a kilo to 25 cents a kilo and by gazette fixed the price at Rs.80 a kilo. The price was supposed to fall by Rs.47.75. But, by how much did the sugar price fall? Hardly anything! The government made major announcements on the price of canned fish; the first gazette fixed the price at Rs.100 and for a tin of canned fish then at Rs.200. They did the same to dhal. But, these prices prevailed for maybe two weeks. So their plan to control prices by gazette has failed and prices of essential commodities are soaring.

"Job losses, salary reductions and cutting allowances and overtime have happened across the board and livelihoods have been lost in several sectors of the economy. Life has become miserable for millions of lower-middle and low-income people. The government’s handout of Rs.5,000 to a household was nowhere near adequate"

And yes, job losses, salary reductions and cutting allowances and overtime have happened across the board and livelihoods have been lost in several sectors of the economy. Life has become miserable for millions of lower-middle and low-income people. The government’s handout of Rs.5,000 to a household was nowhere near adequate. It is the responsibility of the government to look after the vulnerable in society. But that is not happening.

   Q      You launched the “Suwaseriya’ pre-hospital mobile healthcare service in 2016 with financial assistance from India amid heavy opposition and criticism from your detractors. In a short period of time, the ‘Suwaseriya 1990’ pre-hospital healthcare delivery service has become a blessing to the country, in particular to the less privileged sections of society. How do you feel when you witness the relief brought to the people by the ‘Suwaseriya 1990’ programme?

The feeling I get every time I hear the siren of a 1990 Suwa Seriya ambulance or see it rushing by is something difficult to explain in words. This has been my biggest achievement thus far. Every day we take more than 1,050 patients to emergency and critical care. Even if we save 10 per cent of them, that’s a 100 lives every day. Is it not amazing? From just an idea in my head to perhaps the most efficient public service in the country in just a few years against massive opposition, I am justly proud by its absolute success.

"I do not believe we can carry on as usual. We won’t be able to rollover our debt the way we used to. In fact, this week the Central Bank failed to sell almost 80 per cent of the advertised US$200 million development bonds. I think beyond mid-2021, with the post-repayment of the US$1 billion International Sovereign Bonds from our reserves, the problem will become even more complex"

Many projects are launched with donor funds but most die a natural death soon after the funding is over. But this is different. We established the service as an autonomous institution by Act No:18 of 2018 -- the1990 Suwa Seriya Foundation. The Foundation is 100 per cent government-owned but run as a super-efficient institution under the rules and regulations specifically developed for the emergency service. After the pure grant of US$23.2 million ran out, the funds are provided through the annual budget. It was gazetted under my non-cabinet ministry but in the new government under Dr. Ms. Sudarshini Fernandopulle’s state ministry. I must appreciate the genuine support of the President and the new government for the ‘1990’ and I am certain they will improve it even further. Also, there is a lot to learn for others on how not to politicize everything in life.

I can only take partial credit for the success of ‘1990’. It’s Dumindra Ratnayake as Chairman, the other members of the Board, the CEO and the 1,400 staff including doctors, emergency medical technicians, pilots, emergency response officers and all others who dedicate themselves every day and night to help save Sri Lankan lives. I must add the Board is entirely voluntary with no remuneration whatsoever. Such people do exist!

   Q      Your critics charged that ‘Suwaseriya’ posed the danger of bringing agents of Research and Analyzes Wing (RAW), India’s secret service to Sri Lanka and that the entire staff of ‘Suwaseriya’ would comprise Indians. Their negative advise to the people was not to board ‘Suwaseriya’ ambulances as they would get electrocuted. Do these apologists hide their face in shame when they see you?

In politics sometimes this kind of thing happens. But as a Buddhist I have forgiven all those who threw mud at me then. Looking back, I am happy that we were able to overcome those tough challenges. If not, we won’t have a 1990 Suwa Seriya 
service today!

"The UNP needs a new dynamic leader. Mr Wickremesinghe has now led the party for 26 years. He has had his ups and downs. I have nothing personal against him. But the fact is that he and the others must realize that the people have politically rejected them"

   Q     The government’s continued refusal to allow the bodies of Muslims, who died of COVID-19 to be buried despite approval from medical scientists, community physicians, virologists, dermatologists, global agencies like WHO and the domestic expert panel has created a major controversy and communal mistrust in the country. Don’t you think that this is an unnecessary burden on an already oppressed nation?

Yes. This is totally unnecessary and we are being called an intolerant nation by the global community. Rightfully so! Given that scientific experts here and abroad have explicitly stated that burial is an option; we could even now allow burials. Almost every other country in this world allows burials. Why not us? The reality is that the decision not to allow burials is not based on science but ugly communal politics. It’s a shame.

   Q      Sri Lanka’s grand old party, the UNP which brought independence to the country and led by statesmen like DS, Dudley, JR and Premadasa has become a minority party today with no parliamentary representation. Not only the UNPers but other party supporters and politicians point accusing fingers at party leader Ranil Wickremesinghe for the unpardonable and ignominious debacle of the party. Do you agree as a politician who cut your political teeth in the UNP?

I feel terrible about the fate that has befallen the UNP. In fact, I was until the very end, hopeful we could save the party from splitting. As an option, several of us worked hard to find an amicable solution such as that of having Sajith Premadasa lead the Samagi Jana Balawegaya at the last election with the UNP as a constituent party of the alliance. We almost reached an agreement but it fell through at the last moment. If not, we could have had much more seats in the legislature and prevented the two-thirds majority and there would have been many UNP MPs within the SJB.

"The misdeeds of the bond market really hurt the UNP. The yahapalana government could never recover from it"

   Q      Not only the Rajapaksas, not even any politician, a political party or a single voter in Sri Lanka would have imagined in their wildest dreams the fate that befell Ranil and the UNP at the last general election. Your comments?

No, I never expected Mr. Ranil Wickremesinghe to lose. But his loss shows how disappointed the Colombo electorate was with the UNP and him. Even though much was delivered during the five years, be it the increase in salaries, reduction in the price of essential commodities, student insurance schemes, extension of the Southern expressway and the railway, a middle section of the central expressway, investments in schools and the massive ‘Gam Peraliya’ programme besides the steps taken to strengthen democracy, be it the 19th Ammendment, the right to information or reconciliation, people didn’t acknowledge the good things of that government. But, let me add, the UNP has to change. It can’t continue with the same old leadership. They need new blood to lead the UNP. Ruwan Wijewardene is the ideal choice. I am sure they realize this. But further procrastination will not help them at all.

   Q      The Central Bank bond scam was the main contributor to the downfall of the Yahapalana government and Ranil. Do you agree?

Well yes, the misdeeds of the bond market really hurt the UNP. The government could never recover from it. The SLFP apportioned the entire blame on the UNP. But I think it was the Easter bomb attack that put paid to that government’s chances of returning to office.

" Economy wise, the biggest challenge Sri Lanka faces is to meet its foreign debt commitments in 2021 and beyond. By the end of August 2020, the government’s total outstanding external debt of the Government was US$ 35.3billion"

   Q      The brand name describing Ranil as Mr. Clean, a high profile statesman, expert in foreign relations, a great democrat and one of the top economic pundits in the country were proved to be myths. There was no significant progress in the economy (GDP), neither was there any increase in FDIs nor in the living standards of the people during the Yahapalana regime under his command from 2015 to 2019. He is clinging onto the party leadership for nearly three decades despite the total collapse of the UNP. His critics charge that he destroyed the economy, investor confidence on Sri Lanka and the respect commanded by the UNP among voters. Your comments?

I think that is too harsh a criticism. The reason why the Yahapalanaya government could not get the economy moving aggressively was because there was no consensus among the two groups in government on critical economic reforms that we needed to structurally shift our growth path upwards. Even though I was never in the Cabinet, I know that almost always the SLFP members would undermine the proposals submitted by the UNP. It was as if we were in the opposition even though we were in government.

"The reason why the Yahapalana government could not get the economy moving aggressively was because there was no consensus among the two groups in government on critical economic reforms needed to structurally shift our growth path upwards"

   Q      It seems that the same old and failed clique round Ranil is trying hard to nominate him for the only national list slot secured by the party in Parliament for their own survival. Do you think the party or the country will benefit from Ranil entering Parliament? 

That is their prerogative.

   Q      Don’t you think that if the UNPers were to have any hopes for the future, Ranil must not only must relinquish party leadership and give the opportunity to an educated, young and upcoming party stalwart with a clean record in politics but must also retire from politics as he is a dud coin now?

As I said before, yes, the UNP needs a new dynamic leader. Mr. Wickremesinghe has now led the party for 26 years. He has had his ups and downs. I have nothing against him personally. But the fact is he and the others must realize that the people have rejected them politically. They need to ask the question why? Why did this happen? Unless the UNP is able to find the right answer to this question the grand old party will be doomed.

"We are in a huge mess. The economy is in deep trouble. Trust and respect among communities is falling apart. Be it the Muslim burial issue or the broader Tamil reconciliation issue, the current dispensation based on lop-sided political decisions has dealt a brutal blow on social harmony"

   Q     Don’t you think that unity between the UNP under a new leadership and the SJB would create an extremely powerful and robust political force in the country?

While, by and large the people who supported the UNP have come over to the SJB, it would be good to have an alliance under the proposed Samagi Jana Sandanaya. This is what I said we worked very hard to achieve before the general election. SJB is now progressing rapidly to establish its branch network. In fact, we are out most weekends doing this across the country. I have personally been active in Galle, Polonnaruwa, Kurunegala, Kandy and will be in several other districts as well. Many groups and individuals are now joining Sajith Premadasa to further strengthen the SJB both directly and indirectly. We have a plan and a solid team of young professionals to take over this country at the next democratic opportunity. We will build bridges among our communities and with the world. We will correct the course of this nation and we will put it on a path to progress. That revolution is coming.