Sri Lanka: Economic and political prospects
Friday, 24 July 2009
There is good news for Sri Lanka. On July 17, the World Bank made an upbeat forecast about the prospects of Sri Lanka. Naoko Ishi, the World Bank Sri Lanka Director, observed that the end of the armed conflict in Sri Lanka has created an opportunity for the country to "graduate from a low-income country to a fully fledged middle-income country". And on July 20, the IMF and Sri Lanka agreed on a $2.5 billion loan to help the efforts of the Sri Lankan government to reconstruct the country. Possibilities are strong that the IMF board will extend even higher loans to Sri Lanka. The IMF chief, Dominque Strauss-Kahn, has already said that the IMF supports Sri Lanka's "ambitious programme aimed at restoring fiscal and external viability and addressing the significant needs of the conflict-affected areas.'' Meanwhile, the Central Bank of Sri Lanka raised earlier this month its 2009 growth forecast almost by double, from 2.5 per cent to 4.5 per cent.
President Mahinda Rajapaksa of Sri Lanka has been courting foreign investment and his government has launched a campaign aimed at encouraging the Sri Lankan expatriates, particularly the Tamils of Sri Lankan origin, to invest in their home country. The outlook for foreign investment seems to be bright. China has stolen a march over others and a special economic zone exclusively for investment by Chinese companies will be established near Colombo. This development is said to have triggered a keen competition between China and India to see who can eventually make a bigger contribution towards economic reconstruction and development in Sri Lanka. As for encouraging the Sri Lankan diaspora to invest in their home country, Sri Lanka's ambassador to Belgium formally appealed to the member countries of the European Union (EU) on July 20 to use "all their influence" on the immigrants of Sri Lanka of Tamil origin to help Colombo's efforts at rehabilitation and reconstruction. It will, however, be naive to think that the Tamils will positively respond to this appeal any time soon. This apparently is a political campaign to promote racial reconciliation at home and win sympathy abroad for the Sri Lankan government's policies towards the Tamils.
Thus, in two months' time after the 25-year civil war in Sri Lanka ended with the military defeat of the Liberation Tigers of Tamil Eelam (LTTE) on May 19, the Sri Lankan government has made impressive economic progress. The Rajapaksa government is now called upon to redeem its pledge of establishing national reconciliation. It carried out its all-out war efforts against the LTTE, ignoring all suggestions for dialogues from home and abroad, with the argument that a political solution to the ethnic conflict in Sri Lanka would be possible if the LTTE could be defeated militarily. With the war with the LTTE being over, the Rajapaksa government has taken up a policy of 'Three Rs' -- rehabilitation, reconstruction and reconciliation. The government can get -- and is getting -- bilateral and international help in accomplishing the first two of these tasks. But the most crucial task of 'reconciliation' is a political matter and it has to be brought about by the Sri Lankans themselves. In an interview with the New York Times on July 19, Rajapaksa said that when he became president for six years in 2005, the mandate he got was to defeat terrorism and now he would seek a mandate to settle the ethnic problem of his country permanently through a political solution. He has, however, yet to unveil a comprehensive plan of such a political solution. Time is running out.
President Mahinda Rajapaksa of Sri Lanka has been courting foreign investment and his government has launched a campaign aimed at encouraging the Sri Lankan expatriates, particularly the Tamils of Sri Lankan origin, to invest in their home country. The outlook for foreign investment seems to be bright. China has stolen a march over others and a special economic zone exclusively for investment by Chinese companies will be established near Colombo. This development is said to have triggered a keen competition between China and India to see who can eventually make a bigger contribution towards economic reconstruction and development in Sri Lanka. As for encouraging the Sri Lankan diaspora to invest in their home country, Sri Lanka's ambassador to Belgium formally appealed to the member countries of the European Union (EU) on July 20 to use "all their influence" on the immigrants of Sri Lanka of Tamil origin to help Colombo's efforts at rehabilitation and reconstruction. It will, however, be naive to think that the Tamils will positively respond to this appeal any time soon. This apparently is a political campaign to promote racial reconciliation at home and win sympathy abroad for the Sri Lankan government's policies towards the Tamils.
Thus, in two months' time after the 25-year civil war in Sri Lanka ended with the military defeat of the Liberation Tigers of Tamil Eelam (LTTE) on May 19, the Sri Lankan government has made impressive economic progress. The Rajapaksa government is now called upon to redeem its pledge of establishing national reconciliation. It carried out its all-out war efforts against the LTTE, ignoring all suggestions for dialogues from home and abroad, with the argument that a political solution to the ethnic conflict in Sri Lanka would be possible if the LTTE could be defeated militarily. With the war with the LTTE being over, the Rajapaksa government has taken up a policy of 'Three Rs' -- rehabilitation, reconstruction and reconciliation. The government can get -- and is getting -- bilateral and international help in accomplishing the first two of these tasks. But the most crucial task of 'reconciliation' is a political matter and it has to be brought about by the Sri Lankans themselves. In an interview with the New York Times on July 19, Rajapaksa said that when he became president for six years in 2005, the mandate he got was to defeat terrorism and now he would seek a mandate to settle the ethnic problem of his country permanently through a political solution. He has, however, yet to unveil a comprehensive plan of such a political solution. Time is running out.