Columns

• Why the Cabinet discussion did not take place last Monday
• President may approve a fresh term for CB Governor despite no recommendation from Finance Minister
• GL turns up in Geneva to make fresh overtures to UNHRC to preventadverse fallout on President and Government
• Core group rules out his moves just a day after his address at 50th sessions

By Our Political Editor

There is growing disapproval within the majority partner of the ruling disposition, the Sri Lanka Podujana Peramuna (SLPP). A sizeable number argue that the overriding need now is to alleviate the worsening hardships faced by the people due to shortages of essentials. When 21A reaches Parliament for approval, after a month, they fear, the situation would have aggravated to more disturbing levels. Already emergency measures are being introduced to cope with a disastrous situation, including work-from-home systems for state sector employees and study from home for school children.

The non-availability of sufficient fuel stocks to serve the entire country is the reason. Queues outside fuel stations are extending to as long as two and three kilometres in Colombo and other areas. In most, stocks have not even arrived. As a result, food prices are skyrocketing, and shortages are mounting. Cooking gas (LPG) is not available. Thefts are on the rise and the Police, burdened with many a task, are unable to cope with it. An exacerbation of the situation, security experts warn, could lead to uncontrollable law and order issues. Other than select politicians and possibly a smaller group including those promoting public interest issues, constitutional changes have not been the subject of close attention. More so with the crisis over the much-needed essentials superseding the logical rationale for the move, the focus on it has largely evaporated. Come what may, President Nandasena Gotabaya Rajapaksa, as publicly declared by him, will continue in office with most of his powers intact.

Much to the surprise of both the Government and the opposition, the final draft of 21A was not taken up for discussion at the weekly meeting of the Cabinet of Ministers last Monday. In fact, it was not listed on the agenda. This is despite the wish expressed by President Gotabaya Rajapaksa that it could be taken up last Monday (June 13), as exclusively revealed in these columns last week. This came, as reported, when President Rajapaksa had a one-on-one meeting with his brother and former Finance Minister, Basil Rajapaksa, on the evening of Saturday (June 4). He interrupted his conversation to telephone Justice and Constitutional Affairs Minister Wijeyadasa Rajapakshe and urged him not to take up for discussion the final draft on Monday (June 5). He said copies could be distributed at the end of the meeting.

At last Monday’s ministerial meeting, items on the agenda were taken up one. The last subject was “Any other business.” Minister and House Leader Dinesh Gunawardena were to raise an issue related to the proposed new Constitution. A draft has already been formulated by a committee headed by President’s Counsel Romesh de Silva. Gunawardena said President Rajapaksa had named a Cabinet Sub-Committee to examine the provisions. Their report is ready but all other ministers, who were members of the subcommittee, were no longer in the Cabinet. He was the only exception and wanted to know what to do with the report.

An unidentified voice interrupted at this point. He was heard asking “what happened to the 21st Amendment?” The dialogue thereafter went on something like this:

President Gotabaya Rajapaksa (presiding): Haven’t we approved it already? Prime Minister Ranil Wickremesinghe: No, not yet. The Cabinet of Ministers wanted me to consult all parties represented in Parliament. I had two meetings with them. I then asked the Minister of Justice and Constitutional Reforms to incorporate the amendments recommended by them. Thereafter I sent it to the Cabinet Secretary.

Cabinet Secretary Donald Fernando: I did not receive it.

(Note: That explains why the 37-page final draft of 21A, highlights of which were revealed last week, was not distributed by the Cabinet Secretariat nor the discussion on it listed on the agenda for that ministerial meeting. It had been distributed on Monday – June 6 – by Justice and Constitutional Reforms Minister Wijayadasa Rajapakshe in keeping with President Rajapaksa’s directive)

Then President Rajapaksa asked that the final draft of 21A be submitted to the Cabinet Secretariat. This is how a discussion on 21A came to be slotted for the ministerial meeting tomorrow (June 20). After approval, the Government proposes to table it in Parliament on Tuesday (June 21), the same day when it would be published in the Gazette. The Speaker will also forward a copy to the Supreme Court for its determination whether the contents are consistent with the existing Constitution. That will allow a two-week time frame for those who want to challenge the provisions before the Supreme Court. With a further two weeks for the SC to make its determination, it would take a month before the amendments are taken up in Parliament for the second reading. The first is deemed to have taken place with the tabling of 21A. The date will have to be determined by the Business Committee of the House. Any amendments would have to be made during the Committee Stage. This of course is a phase where greater vigilance is necessary. The passage of 19A generated some controversy when allegations were made that provisions over issues raised by the SC were passed through amendments under different wordings.

21A passage an uphill task

There are several reasons why the passage of 21A is becoming an uphill task. Opposition is growing within the SLPP with questions being raised on why such an exercise was given utmost priority. If it was, as claimed, to prevent Basil Rajapaksa from becoming President, the issue is no longer valid. He has resigned from Parliament. Also being contested is the claim that it would reduce the powers of the President and was only a “watered down version.” Here again, incumbent President Gotabaya Rajapaksa has publicly declared he would continue in office for the next two years. Thus, it is argued, that there would not be any substantial change in the status quo.

The SLPP stance was articulated by its General Secretary, Sagara Kariyawasam. He told the Sunday Times, “Our position is that the executive presidency should be abolished. There should be a strong prime ministerial system vested with executive powers.” He said the existing electoral system should also change.

The passage of 21A in Parliament would require a two thirds majority. The SLPP has around 103 within its fold. An exact count is difficult in view of the periodic shift of loyalties by MPs. An example of how they performed can be judged from the vote on the election of a Deputy Speaker of Parliament on May 17. Ahead of that, Premier Wickremesinghe recommended that SJB parliamentarian Rohini Kaviratne be elected uncontested as Deputy Speaker. A woman being named for the first time would have been an honour for both Parliament and the country. President Rajapaksa recommended that this be carried out and told Minister and House Leader Dinesh Gunawardena to follow through. He declared this at a meeting of the government parliamentary group and sought the support of MPs. He said it was also the President’s wish that she be picked.

Yet, SLPP parliamentarians voted for their candidate Ajith Rajapaksa who received 109 votes. Ahead of that event, Basil Rajapaksa loyalists had lobbied pointing out that the party’s independence should be protected and there should be no compromise on such matters. Even if the 103 or so MPs do not oppose 21A en masse, there is a sizeable faction of at least more than 50 who will vote against. The main opposition Samagi Jana Balavegaya (SJB) which has around 46 MPs is seeking support for its own amendment. It has come in the form of a private member’s motion and the Supreme Court determination on it is due to be sent to Speaker Mahinda Yapa Abeywardena. The Tamil National Alliance (TNA), with ten members, is also in favour of the SJB proposal and is opposed to 21A.

However, protagonists of 21A, which is spearheaded by Premier Wickremesinghe, are confident of seeing it through in Parliament. One of the key promoters, a one-time top player in the SLPP administration, said, “Their parliamentarians are disillusioned with their leaders after the homes of many of them were destroyed or damaged. This was in retaliatory attacks after the onslaught on protestors by the SLPP gang of thugs on May 9 outside Temple Trees and the Galle Face Green. They also said that most parliamentarians complained they could not go to their electorates in view of public agitations since issues facing the people had not been addressed.

A source close to President Rajapaksa said, “He (the President) has also explained to Premier Wickremesinghe during a conversation his own thinking. He has explained politely that he has a mandate from 6.9 million voters whilst Wickremesinghe had none. This was why he opined that provisions in 21A either removing powers of the President or empowering a Prime Minister, if at all carried out, should take effect only from the next (tenth) Parliament and not immediately. He has also publicly made clear he was not in favour of piecemeal amendments but stood for the abolition of the executive presidency.”

Friction between President and PM

As is well known, there are still a few areas of friction between President Rajapaksa and Premier Wickremesinghe. Asked to identify what they were, the source said, that was largely two-fold. He said, “One is the President’s belief that a ‘deal-making group’ (deal daanna kalliya) has entered the Prime Minister’s office. They were engaging themselves in corrupt activity. In fact, he asked ‘Chief of Staff’ Sagala Ratnayake to convey to Wickremesinghe his (the President’s) concern over this. He even named one of them. The other is the extension of Central Bank Governor Nandalal Weerasinghe’s term, which is set to expire in early July. The Premier wants him replaced and has his own nominee. An official of the Presidential Secretariat did seek a letter of recommendation from the finance minister (Wickremesinghe) as is required by law. However, it has been refused on the grounds that there was no vacancy at present. Nevertheless, the President may go ahead and grant this extension of service.” Such a move, there is no gainsaying, could spark a confrontation.

In the past few days, both President Rajapaksa and Premier Wickremesinghe have had their own conferences on agricultural development and tourism promotion. That made it apparent that the two were working separately. This prompted former President and Sri Lanka Freedom Party (SLPP) leader Maithripala Sirisena, to declare at a news conference on Thursday that the country’s number one and two were at loggerheads. He called for a broader interim government since the current one had failed.

These issues notwithstanding, President Rajapaksa has entrusted Premier Wickremesinghe to do most of his (the President’s) troubleshooting over the deepening economic crisis. Unfortunately for him, many of the ministers are making his task difficult by resorting to contradictory remarks or taking unilateral action. They apparently want to be headline makers and emerge as the great saviours of the nation. “We will acquire 100,000 hectares of unused farmland for five years and cultivate,” declared Agriculture Minister Mahinda Amaraweera, last week. The remarks came after he had earlier asked people to revert to the use of bicycles for transport.

This was his own decision and not one made by the Cabinet of Ministers. How will he provide fuel for tractors to till this unused farmland? Where is the foreign exchange to buy fertiliser, pesticides, and weedicides? Does he not realise that someone blundered in not making them available to farmers and the current crisis is the result of that? Minister Amaraweera also places the Government in a difficult situation when accusations arise those lands of political rivals have been taken over and given to their supporters, that too without a proper feasibility study of the project.

The young and inexperienced Energy Minister, Kanchana Wijesekera, declared publicly days earlier that there were sufficient stocks of fuel and there was no cause for panic. The same day the media reported it, there was another account from Premier Wickremesinghe warning that fuel shortages could worsen as more difficult times are ahead. Casting protocol aside, he walked into the Russian Embassy in Colombo for a meeting with Ambassador Yuri Materiy, a seasoned diplomat. He ended up, by his own admission, receiving a list of four companies that he should get in touch with to seek oil supplies. Could not have the Foreign Ministry in Colombo or for that matter the Sri Lanka Embassy in Moscow played that role? Does this not clearly demonstrate further that the conduct of the country’s foreign policy is in shambles? President Rajapaksa’s appointment of most cronies and personal loyalists as heads of missions has made Sri Lanka a laughingstock. There has been little or no monitoring from the Foreign Ministry in Colombo either.

President’s plans regarding UNHRC

The ’great relief’ President Rajapaksa has gained from entrusting responsibilities to Premier Wickremesinghe is being used to ensure a “trouble free” period ahead when he plans to retire in two years. An area of much concern for him has remained the resolutions at the Geneva-based UN Human Rights Council. The shoddy handling of issues there both by the Foreign Ministry in Colombo and the Sri Lanka Permanent Mission to the UN in Geneva has aggravated the situation with the last resolution calling upon member countries to resort to universal jurisdiction to deal with instances of human rights violations. Most damagingly external evidence gathering project has been initiated.

Incidentally, a few errors crept into references to the resolutions in last week’s reportage. The resolution 46/1 (Promoting reconciliation, accountability, and human rights in Sri Lanka) was passed in March 2021 and not in March 2020 as reported. Also, the reference of the resolution concerned was 46/1 and not 41/6 as reported.

President Rajapaksa’s plans vis-à-vis the UNHRC surfaced when Foreign Minister, G.L. Peiris, appeared in Geneva early this week. It was for the Council’s 50th sessions where there was no discussion on Sri Lanka. On such occasions, the usual practice has been for Sri Lanka’s Permanent Representative in Geneva to make a statement and the need for a Foreign Minister to be present does not arise. Even other countries follow the same practice. However, Peiris flew to Singapore for the Shangri La Asian Security conference and from there to Geneva.

He took the opportunity of making a speech last Monday at the 50th regular sessions. He was oblivious to the fact that it was the SLPP government, under President Gotabaya Rajapaksa, (where he had been a cabinet minister), which removed independent institutions functioning under Parliament and vested more powers in the President. He also had a big hand in drafting the 20th Amendment that brought about the change. He now claimed: “We are actively engaged in evolving an all-party consensus regarding the need for the 21st Amendment to the Constitution, to consolidate seminal democratic values enshrined in Parliament, independent institutions and salutary checks and balances on the powers of the Executive.”

He added, “On the important aspect of the economy, to stabilize the situation and provide essentials for our people, we are formulating concrete measures which are expected to lead to an IMF supported programme. In moving forward, we are in dialogue with all stakeholders including domestic and international partners. We are putting together a coherent structure to place our economy back on a sustainable growth path and to provide for necessities such as food, fertiliser, energy, and medicines. The current situation and future reform measures have a potentially adverse impact on the lives and livelihoods of the poor and the vulnerable. In agreement, therefore, with the emphatic remarks by the distinguished High Commissioner, Michelle Bachelet, earlier this morning, Sri Lanka is firmly committed to targeted social protection measures to mitigate these consequences. We certainly recognize, as a core belief, that human rights are indivisible, interconnected, and interdependent.

“Over the past years, including at the 49th Session in March this year, we have interacted with the Council in addressing a series of issues raised in relation to Sri Lanka. Today, as we seek to redress grievances and issues in a broader social context, it is both compelling and challenging to demonstrate further tangible progress on post-conflict consolidation through domestic processes. We will continue to do so by active engagement with this Council.”

A Geneva-based diplomat who is familiar with details of meetings FM Peiris held including selective bilaterals over three days summed up the visit. “The whole reason the minister seems to have made the effort of travelling to Geneva, when Sri Lanka was not even on the agenda, was to indicate formally to the core-group of countries, the Office of the High Commissioner for Human Rights (OHCHR) and other relevant member states, that Sri Lanka may be willing to negotiate the text of any future resolutions. This is particularly in September when the 51st sessions will be held. It is now known that a tough resolution will be placed before that session and will cover several new developments. That would include attacks on protestors, intimidation of journalists, declaration of emergency, intimidation of peaceful protestors by military personnel, as well as the counter attacks on the properties of parliamentarians. Further it could refer to the breakdown of rule of law, weakening of democracy and the selective nature of the police actions that followed the violence of May 9 and the lack of will from the Government to proceed with the investigation with vigour and conviction.”

The call for resort to universal jurisdiction has also been a cause for concern. That proviso makes violators liable for arrest in the countries which exercise universal jurisdiction to face charges under their laws. For example, it could apply, if there are accusations and if Gotabaya Rajapaksa chooses to return to the United States where he has a home in Los Angeles. An attempt to negotiate provisions in a future resolution, however, has not been successful.

The next day (Tuesday) after FM Peiris’s speech, the core group Canada, Germany, Malawi, Montenegro, North Macedonia, the United Kingdom, and the United States issued a statement in Geneva. They said: “We recognise the significant challenges that Sri Lanka has been facing over recent months, causing great hardship for the Sri Lankan people.

“We note that protesters, have exercised their rights to freedom of peaceful assembly and association, and freedom of expression in recent months. We are deeply concerned by violent attacks on peaceful protestors and subsequent violence against government-aligned politicians and supporters. Those responsible for this violence must be held to account. We stress the crucial importance of upholding democracy, human rights, and the rule of law, and maintaining independent institutions. We also urge the Sri Lankan authorities to address long-standing impunity and corruption and underline the need for good governance and sound economic policies. Our concerns over surveillance and intimidation of civil society persist and we stress the importance of protecting civil society space.

“The Core Group calls on Sri Lanka to cooperate with the High Commissioner and her Office and is ready to support Sri Lanka on the implementation of HRC resolution 46/1.” The reference and the call to implement HRC resolution 46/1, it can be seen, rules out FM Peiris’ moves to negotiate the upcoming resolution. He also said in his speech that “The list of designated individuals, groups, and entities under the United Nations Regulation No. 1 of 2012 is being reviewed. As of now 318 individuals and four entitles are proposed to be delisted. This is a continuing exercise.”

The Sunday Times learnt that the four organizations to be delisted are the Australian Tamil Congress (ATC), British Tamils Forum (BTF), Canadian Tamil Congress (CTC) and the Global Tamil Forum (GTF). The spokesperson for the most effective of these organisations, Suren Surendiran of the Global Tamil Forum (GTF) took to the twitter to demand “why and on what basis these four organisations and 318 persons were proscribed in the first place.” He demanded an apology for the proscription “for this baseless proscription as you delist” tagging President Rajapaksa, Defence Secretary Kamal Gunaratne and other relevant bodies.

Special Rapporteur’s report

The UNHRC’s 50th session also saw the release of the report of the Special Rapporteur on “the rights to freedom of peaceful assembly and of association by Clement Nyaletsossi.” Among other matters, it said it “is seriously concerned with the steps taken from the end of March 2022 on, in response to large-scale protests, including the declaration of a state of emergency and the publication of emergency regulations. The Special Rapporteur has received reports of the use of tear gas, water cannons and live ammunition in response to protests, leading to serious injuries and deaths. The Special Rapporteur and other mandate holders have previously expressed their concern with the approach adopted.

“The Special Rapporteur has also received reports that an order was issued for armed forces to open fire in response to the looting of public property—a serious violation of international standards on the use of force and the right to life. The Special Rapporteur has also received reports of arbitrary arrests of protesters taking place. In the context of these reports, the Special Rapporteur reiterates his previous statements, including his calls on the authorities to ensure compliance with international standards on the use of force, to ensure that arbitrary detentions do not take place, and to ensure that communities’ serious grievances, including grievances impacting rights enjoyment, are addressed.”

IMF assistance

Now to the fast-deteriorating economy. This is the second month that inflation has grown by near 10% month on month. Until the rupee is stabilised, and supplies are regularised to meet the demand, inflation will be on the same trajectory for the foreseeable future. Financial experts familiar with Sri Lanka’s case forecast that the rate of inflation will be nearing 50% by the end of June. A team of advisors from Clifford Chance (Legal) and Lazard Freres (Finance – Debt Restructuring) are already in Sri Lanka. A team from the IMF is due in Sri Lanka on Monday to discuss policy details and technical support mechanisms. This team needs to be convinced that any proposed economic spending, fiscal policy changes and economic reforms suggested by the Government are realistic and sustainable before they could recommend staff-level agreement.

IMF spokesperson Gerry Rice said in Washington last week that the magnitude of the financing cannot be shared yet. He further said that it is “too early” for the agency to discuss the magnitude of financing or potential financing or the date for either the staff-level agreement or when it might go to the Executive Board. Rice also said that a date could not be given either as to when the staff-level agreement with Sri Lanka would end.

Achieving staff-level agreement could enable the IMF board to approve an Extended Credit Facility Arrangement (ECF) for a fixed term of three or five years, these experts say. Going by past experiences of the Republic of Congo and Zambia – for Sri Lanka, the earliest will be sometime in August but most likely at some point after. For an Extended Fund Facility Arrangement (EFF), however, debt needs to be sustainable. Sri Lanka’s debt is formally declared as unsustainable debt, hence the need for debt restructuring, they point out.

According to the IMF website, “IMF financial support can only be provided for countries with sustainable debt. In some cases, debt sustainability can be restored through sufficient access to concessional financing, while in others, a restructuring of the debt is needed to reduce debt or extend debt service over a longer period. For countries with unsustainable debt, IMF financing may proceed before a debt restructuring is completed if:

(i) Official bilateral creditors provide the IMF with adequate assurances that they will take steps to help restore debt sustainability; and

(ii) In cases where a restructuring of debt to private creditors is needed, if the member has taken credible steps towards completing the debt restructuring process in a way that will achieve debt sustainability.”

With China so far being non-commital to restructuring and bond-holders indicating they would play hardball, the same experts warn that, EFF Arrangement could potentially take till year-end and is likely to be during the first quarter of 2023. During this uncertain period, the only way forward is to generate as much foreign currency as possible through tourism, traditional exports, remittances, and bilateral bridge finance, they point out.

Unfortunately, except for India so far, no other country or institution has come forward to help in any material way. One may wonder why and whether these are directly due to foreign policy failings of the past and present. When the United States Federal Reserve raises interest rates, as it did on Wednesday, the impact does not stop with the U.S., but the fallout can be felt beyond America’s borders, hitting shopkeepers and consumers in Sri Lanka also. The raise of 0.75% is the largest single most increase since 1994. The immediate impact is borrowing costs going up and the US dollar appreciating making imports of goods and services for Sri Lanka more expensive. Almost immediately, the UK’s Bank of England also raised the base rate to 1.25%. The European Central Bank (ECB) has indicated that if inflation keeps rising, a fifty-basis point interest rate increase cannot be ruled out.

As things are, the ongoing Russia-Ukraine war has created food shortages, particularly grain/flour/cooking oil/fertiliser. Prices are shooting up due to supply shortages to match demand. Sri Lanka will not be considered priority for supply and cannot afford to import at higher prices. The same war is causing uncertainties in gas and oil supplies. Oil producing UK, for example, has put up prices by nearly 40% already and expects increases of 75% more by Christmas than what it was in late 2021.

What all these will mean to the already suffering Sri Lankans is that the worst is yet to come.  The pain will not be for just three months but several months if not years to come. Apart from giving President Gotabaya Rajapaksa the breathing space he was desperately looking back on May 10, Premier Wickremesinghe is yet to show any significant progress on the social, economic, or political spheres. It is not his fault entirely. He has been bestowed with some unenviable tasks and the ministers in the cabinet are pulling in different directions to be counted as heroes. And a hapless President Rajapaksa, though in office, is losing his hold in managing a government.  With the rapid depletion of essentials, Sri Lankans are no doubt facing a bleak future.