Columns

Indications of the policy thrusts and mode of governance in the first few days of Anura Kumara Dissanayake’s presidency have evoked great expectations and impatience with the pace of policy implementation.

No magic

It is worth recalling the President’s words in his inaugural address that he is not a magician. The undoing of years of poor governance cannot be achieved in a few days, nor can it be completely transformed. It is well to remember that “Rome was not built in a day.” Nevertheless, the foundation and first steps towards an economic transformation must be taken now.

Indications

There are strong indications of a resolve to transform the polity and economy. However, it is only after the parliamentary elections on November 14 that reforms can be implemented. Nevertheless, the President has taken the first steps towards good governance, which is the foundational prerequisite for a social and economic transformation. Punishing the corrupt by due process of the law has been one of these actions.

Corruption

As pointed out in last Sunday’s column, corruption is a severe setback to economic development, and eradicating it is a Herculean task. Bringing to book the corrupt is more likely than the near-impossible task of obtaining their loot from safe havens.

Crime and punishment

New laws may be needed, and strong evidence has to be found to uncover the crimes and punish the wrongdoers expeditiously. Furthermore, the legal processes are time-consuming.

Loot

The expectations of recovering the loot being unrealistic, a first step would be to investigate the undeclared incomes of all politicians and important officials. What are the sources of income of those who have built palatial houses, hotels, businesses, and bought lands?

Even the punishment of these wrongdoers is uncertain. There are many ways of hiding the wealth of the rich and mighty.

Past and future

People are looking back in anger and urging the government to uncover the ill-gotten wealth and punish the corrupt. However, the legal processes for punishment of the crimes are long drawn out and dilatory.

Economic policies

What are the early indications of the government’s economic policies and economic performance? What are the early economic indicators? What are the indications of the government’s economic policy thrust?

Early indicators

There are several indications that the JVP/NPP economic policies have shifted from a leftist-Marxist stance to a left-of-centre policy. For instance, they have indicated quite clearly that they will assist the private sector. Several private sector professionals are their advisors.

IMF agreement

The President’s position on continuing the IMF agreement is indicative of a pragmatic rather than an ideological position on economic issues. Indications are that the government would be able to modify the conditions as well as agree to work out policies that ensure the macroeconomic targets in an acceptable manner to the IMF.

Cordial

The IMF has extended a warm welcome to the new president and said it will work with the new ad-ministration. The IMF sending the mission chief on a courtesy call promptly and the greetings from the IMF’s Managing Director are signs of cooperation and understanding.

International response

The election of a new president in a democratic and peaceful manner has been hailed by the international community. They have agreed to assist in the country’s economic development. Japan, the US, India, China, and several other countries have pledged support.

Japan

Japan has agreed to resume several of its halted projects. The World Bank and the ADB have also indi-cated their willingness to assist. The International Finance Corporation (IFC), an affiliate of the World Bank, has agreed to finance projects in the private sector. The utilisation of this aid effectively without corruption is vital for the nation’s economic development.

Investment

The confidence generated by the change has been impressive. The Colombo Stock Exchange (CSE) has seen a surge in its indices. The share market’s rise is a clear indication of business confidence.

International trade

Economists expressed concern over whether the JVP/NPP realised the importance of international trade for the economy. There were fears of the country returning to a 1970–77 closed economy. But indications are that the government is mindful of the importance of international trade and foreign investment. It has stressed that the country’s future lies in being competitive to boost international trade. However, the government would adopt selective import controls for effecting import substitution, as witnessed in the increased tariff on potatoes, onions, and eggs, as well as the continuation of vehicle import restrictions.

Privatisation

Another issue facing the government is the privatisation of state-owned enterprises. The JVP opposed the privatisation of national assets. There appears to be a shift in policies to one of selective privatisation. For instance, the government is amenable to the privatisation of some enterprises but opposed to privatising utilities and the state transport service. Its position on SriLankan Airlines has veered to-wards state ownership and management.

In any event, the final decision will be taken by the new parliament.

Concluding reflection

Although the punishment of the corrupt is important, the more significant need is to ensure good governance in the future. The new administration must ensure that bribery, corruption, and inefficiency are eliminated. The President and the cabinet of 25 must lead by example. The new appointees must be persons who are capable and of proven integrity. This is no easy task in a society that has been corrupt. Yet it is imperative. Those who are proven to be of questionable integrity must be relieved of their office. Meritocracy and honesty are vitally important to ensure an economic and social transformation. The first steps towards an economic and social transformation have to be taken immediately by those at the helm of affairs.

Early indications of good governance and pragmatic economic policies are encouraging, but sustaining this thrust will not be easy. Let us hope that we have come to a turning point in the country’s economic and social development.