The Government could no longer keep it under wraps. Last week it was forced to make public that it was going in for a huge IMF loan. The IMF, known as the Siamese-twin of the World Bank, has been berated by generations of left-wing politicians in this country, if not worldwide, but even the country's only Socialist Finance Minister, Dr. N.M. Perera was a frequent traveller to its headquarters in Washington.

Today these voices are mute as the Government capitulates to the pressures of the world economic meltdown and our own internal mishandling. The fact that the Government which resisted this move as a matter of politics and pride, is finally resorting to an IMF loan of such magnitude, only shows that the weight of sheer economics took over. For a few months after the Great Wall Street crash which sent world economies reeling, the Government tried to insulate the people of this country by going into foreign commercial borrowings at very high interest rates. But it was an artificial prop for the Rupee, something that could not last long. It was just a case of postponing the inevitable.

The first hint of trouble came when President Mahinda Rajapaksa spoke of the world meltdown impacting on countries of the South Asian region at the SAARC Foreign Ministers meeting in Colombo last month. Even then, the Central Bank remained intransigent. Either it lived in a fool's paradise, or it just wanted to conceal the truth from the people, or both. It insisted that the economy was sound, all our foreign reserves were ship-shape, and there was nothing to worry about.
Last week's announcement of this massive IMF loan has shaken whatever credibility the Bank had left. Some institutions must be above politics - and the Government. The CB is one, the Monetary Board the other. Today, the CB has become the fiscal spokesperson for the Government - not the Finance Ministry. And, it's not doing a good job. As they say, you can't fool all the people all the time.

Now, the latest statement is a cute one. The CB says that it is not that the Government wanted this loan, but that the IMF offered it. That this money is for the reconstruction of the North and East after the defeat of the LTTE. And will there be conditions attached? The CB says a firm "No", which reminds one of the pithy Sinhala saying, which loosely translated means "never mind if you fall down, you mustn't get sand into your mustache". The Economist writing this week in our newspaper (page 12 ) says that going for IMF loans is better than going for commercial loans, but succinctly tells us what has happened, and the conditions that will inevitably be attached to such loans. It has oft been proven that IMF recipes don't work in developing countries. Sometimes they make such politically unpalatable suggestions that Governments would rather ask them and their loan to go to hell than lose an election. In the final reckoning, it is not the Government or the IMF that suffers, but the ordinary people. But some Governments, like that in Sri Lanka, have unfortunately shown that they are incapable of exercising good governance and financial discipline, without external pressures.

For some inexplicable reason, the Rajapaksa Administration has not acted on repeated media exposures of corruption and mismanagement in the public sector with public money. Two parliamentary reports viz., the COPE (public enterprises) and PAC (public accounts) reports, the Auditor General's report, the report on failed finance companies of the past commissioned by the President himself -- are gathering dust in his office. Meanwhile more public funds are pumped into on-going failed companies, the multi-billion VAT fraud is isolated to a commission of inquiry, while the wastage of public funds on Mihin Lanka borders on the criminal.

It is something like what we see in the investigations into some failed credit card companies. If you take monies from public depositors and mishandle their funds, despite warnings, it becomes a criminal offence. The same enthusiasm, and drive in prosecuting the 'war' has not been shown in battling corruption, wastage, mismanagement and financial indiscipline. The Doctrine of Public Trust has yet to seep into those who are the keepers of the Public purse.

Tibet - 50 year struggle

The Chinese Government is fond of comparing the Tibetan struggle for autonomy with the LTTE's demand for a separate state in Sri Lanka, and arguing, therefore, that it should be crushed.

Such similarities, are debatable, to say the least. While China remains one of Sri Lanka's staunchest allies in its battle against the LTTE and successive Sri Lankan Governments cannot afford to antagonize China, there is one aspect that requires, in the least, a change of heart from the hard-nosed decision-makers in Beijing.

That is to permit the Dalai Lama of Tibet, whose people marked the 50th anniversary of his exile in the face of the Chinese annexure of his spiritual state, to visit Sri Lanka. It was indeed an irony that while President Mahinda Rajapaksa declared open to the public a special exposition of the Sacred Tooth Relic of the Buddha in Kandy this week, there is one Buddhist in this world, who is not allowed to pay his respects there.