Sound economic management may facilitate the implementation of solutions to the ethnic conflict but Norway's ambassador Tore Hattrem said that in the end, any solution must be supported by all ethnic groups. He said Sri Lanka's overriding problem is not economic but political. Addressing the Business for Peace Forum organized by the Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL) this week, Mr Hattrem said Norway supports economic development and will continue to assist peace building efforts in the country but outsiders and external powers cannot solve Sri Lanka's ethnic conflict.

Mr. Hattrem said the public sector must move out of sectors better handled by the private sector but should be supported with good governance and delivering public goods such as infrastructure development, investment in education and other services. He cited a World Bank study which highlighted obstacles for economic growth in Sri Lanka such as the high cost of energy, the need to strengthen government institutions and curtail corruption, the need for high quality services and the need to transition to a knowledge based economy which so far, has been inefficient.

Mr. Hattrem said Sri Lanka should adopt technology widely available in the developing world today and focus on creating a conducive business environment. Information and communication technology (ICT) plays a central role in economic growth and increasing cell phone penetration and Internet use would stimulate growth. Interconnectivity is the essence of modern economies and Mr. Hattrem noted that Sri Lanka has made progress but still has high prices and low penetration rates. He added that a culture that stimulates innovation should be adopted, noting that the World Bank study shows that Sri Lanka has fallen far behind in science and technology.

He also spoke on the need to improve the quality and standards of education as well as focusing on greater access to higher education. Sri Lanka currently spends about 2.5 percent of its GDP on education which Mr. Hattrem said is low in the Asian and international context.

Chairman of the Legal Aid Commission of Sri Lanka S.S. Wijeratne, a panelist at the discussion who has worked extensively with the United Nations High Commissioner for Refugees in Geneva, said it is impossible to have peace without creating a culture of justice where equal opportunities are given to all ethnic groups. From a humanitarian perspective, he said Sri Lanka has a long way to go in achieving peace.

Mr. Wijeratne said an alternative dispute resolution culture has to be created from the grassroot level although so far, no work has been done in this regard. He said people today are focused on winning wars and winning cases, creating not only winners and losers but a set of enemies in the process. He said in war, one may win a battle but the psychological impact of those who have been defeated will persist.
He advocated a peaceful resolution of dispute without winning or losing but noted that it is not a common way of thinking in the business world. He said the message of mediation and negotiation has not yet reached the grassroot level and urged business leaders to focus their corporate social responsibility (CSR) initiatives to getting the message across.