Financial Times

Drama over chamber document
A confidential document, which leaked out of the Ceylon Chamber of Commerce (CCC) spelling ways how the powerful CCC could impose its will over smaller chambers and marginalize the powerful J-Biz forum, triggered a furore at a J-Biz meeting last week.

Representatives of chambers like the Federation of Chambers of Commerce and Industry (FCCISL), National Chamber of Exporters (NCE) and the International Chamber of Commerce (ICC) pitched into the CCC represented by Tilak de Zoysa and Deva Rodrigo over the bitter attack on other chambers.

The three-page document, titled 'Two issues facing the Ceylon Chamber of Commerce' lists out ways and means of tackling two issues seen as a threat to the chamber - Commerce Ministry proposals to make chamber membership compulsory and the J-Biz being manipulated by various parties.

"The situation is aggravated by organizations competing with us riding on the back of the CCC and using the prestige attached to the name 'Chamber of Commerce' to catapult themselves as leader organizations of the private sector," noted the document, copies of which were mysteriously faxed to several chambers including those represented in J-Biz.

According to informed sources, CCC's De Zoysa and Rodrigo said the document was an internal discussion paper, not meant for circulation, and reflected the views of some CCC members only. This did not convince chamber personalities like Mahendra Amarasuriya, Nihal Abeysekera and Patrick Amarasinghe who strongly contested statements like weak and poor quality leadership among smaller chambers.

J-Biz - a grouping of Sri Lankan chambers that decides on joint action on issues of national importance - called the meeting at the FCCISL headquarters to discuss the creation of more jobs as requested by Prime Minister Ranil Wickremesinghe.
However, soon after some members made comments on this issue, the discussion turned to the controversial document and after a stormy session, the employment issue was forgotten. J-Biz also rejected a proposal by the CCC to form a confederation of chambers - run by the CCC - which brings all other chambers including the FCCISL under it.

Members of J-Biz, currently chaired by FCCISL chairman Abeysekera under a rotation system, were angry over attempts by the CCC to undermine other chambers and couldn't be calmed down, even though CCC representatives pleaded that the document was an internal discussion paper and not for implementation.

One suggested strategy in the document is for the CCC to "pull out (of J-Biz) and let it collapse under competing interest, poor quality and confusion and governance or stay with J-Biz and give it leadership".

The document said J-Biz was being manipulated by leaders of small chambers "with no base, clout or quality, persons who had aspired for chamber leadership but failed, using J-Biz to get on top of the CCC, and former leaders of the National Chamber of Commerce and Industry propelling themselves ahead of the CCC." It said the CCC, out of generosity had allowed J-Biz to exist and (in some way) flourish and for it to be exploited by its competitors.

The CCC paper noted that the proposal to make chamber membership compulsory was detrimental to the CCC, the private sector as well as the country. "This paper does not attempt to recommend a particular course of action. Its purpose is to surface the two issues, provide some thought, discuss possible solutions and develop a strategic plan," the document noted.

Morale booster for garment unions
Garment industry unions won a small but morale-boosting victory last week when workers at the Polytex garments factory at the Koggala zone voted unanimously for the formation of a trade union, industry sources said.

This came about two weeks after a similar but disastrous referendum at the Jaqalanka factory at the Katunayake EPZ in which only 17 of the 390-strong workforce turned up amidst allegations of intimidation of workers by the management. Under pressure from local and international garment unions, the European Commission (EU) postponed a decision on providing concessions to Sri Lanka's garment industry.

The referendum by voting, monitored by government agencies, is a legally accepted mechanism to allow workers in FTZ's to decide whether they want to be unionized or not. At the Polytex referendum, 754 workers wanted a union, 115 opposed while eight ballots were rejected. The factory has a workforce of 925.

It's not cricket!
Programmes broadcast by television and radio broadcasting organisations will now receive exclusivity with the introduction of the new Intellectual Property bill.
Copyright laws will now make it illegal for an organisation to telecast or broadcast programmes that have already been broadcast by a rival organisation.

The law, which is yet to be interpreted by the courts, is likely to prevent live telecasts of cricket matches or any other events from being recorded by rival organisations, and aired, even during a news bulletin.

Radio broadcasters, who provide commentaries through live television broadcasts, would not be able to do so under the new law. However, information pertaining to the news of the day will not be protected under the law.

Prices up on Jaffna flights
By Suren Gnanaraj
Religious ceremonies and festivals have created a sudden rush for air tickets to Jaffna, leaving domestic flights booked several weeks in advance. Ticket fares have also increased, with a return air ticket from Colombo to Jaffna costing Rs. 7,500.
Asoka Perera, managing director of Lionair, said that July and August was usually considered the peak season, due to the numerous ceremonies and kovil festivals in the North, which traditionally attracted several devotees, both local and expatriate.

Shanthi Wickram, Chief Executive Officer of Serendib Travels, said that the Colombo-Jaffna route was generally seasonal, with passenger levels expected to drop once again in September. He said that with railways and roads re-opening in the north, the profit margins of the domestic airline industry would begin to decline.
He said the company had realised that it could not afford to focus solely on the Colombo-Jaffna route.

“If we concentrate on Jaffna, our losses could be heavy," he said. As a result, Serendib Travels is expected to commence operations to China Bay and Ampara from next month, having acquired another aircraft with a total of 19 seats, which could land on any domestic airstrip in the country.

“The idea is to promote tourism, so we need to diversify our destinations,” he said.
Serendib has also obtained a licence to fly an eight-seater charter plane, which could be used by VIPs and government delegates at any given time. Heavy operational costs have been attributed as the reason for the latest price revision by all three operators.

“The Russian Antonovs that we had came with a maintenance crew. But since we switched to Western aircraft we have been forced to carry out our own maintenance,” Wickram said. The three operators had reached a consensus on a common pricing structure earlier this year.

Previously, industry experts had said there was no room for three operators on the Jaffna run and all three airlines suffered owing to low passenger loads after the road to the peninsula was re-opened. The three airlines had also engaged in a price war in order to fill up their aircraft.

British visa rule annoys Lankan biz
Private sector businessmen are annoyed over the new British visa rule where the fingerprints of the applicant are compulsory. “No doubt Britain has had problems with illegal immigrants as much as other developed countries. But finger printing is not the answer to stop illegal immigration,” argued Patrick Amarasinghe, President Emeritus of the National Chamber of Exporters of Sri Lanka.

He said if businessmen are to stand in queues from the early hours in the morning "to be finger printed as if they are convicts, this is something that cannot be accepted, while only politicians and officials are exempted, with no exemptions made for professionals.”

Some chambers with the exception of the Ceylon Chamber of Commerce expressed their opposition to the British rule, which came into effect last week. Industrialists like Amarasinghe say there are many people who have obtained visas and travelled to Britain many times over without being illegal immigrants. “There should be more decent methods of evaluating persons wanting to visit Britain without being humiliated,” he said.

He said it was regrettable the government agreed to this new British rule when the private sector is being pressed to increase trade and exports. The fast track system of getting visas has been discontinued by the British embassy after the new rule came into place, travel agents said. Earlier a businessperson could apply for a visa through an accredited travel agent without going to the mission, which is a must now as the chairman of a top chamber found out last week. Preparing for a business trip to the UK, he stayed in the queue like anyone else at 5.30 in the morning at the British embassy.

Asked to come to the embassy for a visa to Britain on route to the US on a USAID trip, Amarasinghe refused, saying, “Why should I? I have been travelling since the 1970s to many countries including Britain many times over and I have returned."

Nawaz Rajabdeen, senior vice president, Federation of Chambers of Commerce and Industry of Sri Lanka, said the new rule would slow down trade and investment between the two countries. “No other country in the world does this. If Britain wants it then there should be reciprocity.” Tilak de Zoysa, chairman of the Ceylon Chamber of Commerce said none of its members has raised or complained about this issue.

PR blitz to sell economic reforms
The government plans to launch a big public relations campaign to overcome opposition to and muster support for its economic reforms programme making use of funds from a $15 million World Bank loan.

The campaign will be spearheaded by the Ministry of Economic Reforms, Science and Technology, which has set up a special section called Strategic Communication Unit Economic Reforms (SCUER) to handle the project.

Opposition groups and non-governmental organizations have heavily criticised the government's economic reforms agenda and the 'Regaining Sri Lanka' programme.
The criticism has been mainly on the grounds that these programmes are likely to increase poverty and hardship for the very poor and widen existing income disparities, contrary to their stated aim of reducing poverty.

The ministry has called for expressions of interest from advertising and public relations agencies interested in undertaking the work for the advertising and media campaign.

The media campaign will be funded by using part of the $15 million loan received from the International Development Association of the World Bank for the government's Economic Reforms Technical Assistance Project, which is run by the ministry.

"The technical assistance project is meant to strengthen the government's capacity to implement its economic reforms programme," said Cresenta Fernando, the World Bank's team leader for the project.

"One component of the project is strategic communications. We think that many people have limited access to accurate information or an understanding of the need for economic reforms. Distorted reports breeds fear and suspicion. There is a need to inform and build a positive perception of economic reforms where eventually the public will see that reforms are for the people and the country.

"The SCUER was set up at the request of the government to address this need to communicate in a constructive and an effective manner with all sections of the population," Fernando said.

Companies hired under the project would have to prepare an advertising campaign for the print and electronic media as well as articles and news stories covering the 'Regaining Sri Lanka' and the economic reforms programme. The PR agencies selected will be responsible for placement of articles in suitable media and must be willing to get up to 20 commissioned briefs a month and undertake work at short notice.

Fernando also said: "We feel that good communication is an essential factor for successful implementation of economic reforms. It encourages transparency and public debate on issues that affect people's lives." The technical assistance project was approved in January and the media campaign is expected to start shortly.

"There's a massive gap in the quality of the English reading material vis-à-vis the Sinhala reading material when it comes to economic issues," Fernando said.
"English will not be the only language of communication. SCUER understands the need to direct communication in Sinhala and Tamil as well as English to reach all communities."

The critics have said the reform programmes have been influenced by international lending agencies such as the IMF and World Bank, and foreign donors keen to open up Third World markets to foreign capital. The government's reforms agenda and de-regulation effort has also been criticized for jeopardizing social safety nets for the poor and unemployed.

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