Editorial

President A.K. Dissanayake travels to the United Arab Emirates (UAE) for the annual World Governments Summit 2025, where he will meet some of the big guns in the world of governance and commerce, and on the sidelines have talks with the UAE on investing in energy cooperation in Sri Lanka. There have already been advanced discussions during the Ranil Wickremesinghe presidency on the possibility of Sri Lanka tapping into the India-GCC (Gulf Cooperation Council) initiative to have a multi-product pipeline connecting the subcontinent with gas- and oil-producing Gulf nations.

It is rare for a Sri Lankan leader to visit the region, though there is a lot of interest and benefit accruing, not least from the remittances by the huge workforce there. Remittances from Sri Lankans overseas amounted to USD 6.5 billion last year, exceeding earnings from tourism and garments. The largest portion of the foreign exchange was from women domestic helpers in West Asia, most of whom are in the 40-44 age group.

Kuwait, Saudi Arabia and Qatar make up the top three sources of Sri Lanka’s remittances, and a presidential visit to the UAE extended to other countries in the region would not be out of place.

In his Independence Day message, the Minister of Foreign Affairs and Foreign Employment referred to the “invaluable contribution” of the Sri Lankan workforce around the world. “Ensuring their welfare, security and dignity remains a top priority,” he went on.

There is much to be done on this front, not least on the social repercussions of sending labour to those countries. Increasingly, there are reports of orphanages filling up, both in the region and in Sri Lanka—a by-product of foreign employment.

There is a wide range of activity between the UAE and Sri Lanka.  The UAE’s world-famous airline, Emirates, and budget airline Flydubai bring in the tourists; the Abu Dhabi Fund for Development disburses grants and loans in the millions of dollars.  The UAE has been a steadfast supporter of Sri Lanka in difficult fora like the UN Human Rights Council. Sri Lanka exports tea, gems, and even fresh coconuts to the UAE.

The blind spot is that the UAE is a paradise for the banking and investing of undeclared foreign exchange spirited away by corrupt politicians and businessmen and a safe haven for those in the narcotics trade from Sri Lanka. President Maithripala Sirisena, ill-advised as he was, made a hash of trying to locate the loot stashed in Dubai accounts.

To say that successive governments have not given due attention to the Gulf and West Asian region and its socio-economic importance, merely seeing it as a source of foreign exchange to the detriment of the welfare, security and dignity of Sri Lanka’s workforce, is an understatement. A government that prides itself as a labour-friendly one ought to do a better job of it.

 Trumpism: The rhetoric and the reality

‘When America sneezes, the world catches a cold’ it used to be said, in acknowledgement of the USA’s global power and influence. Under the re-anointed US President Donald Trump, however, America is retreating into isolationist quarantine while launching a blitzkrieg of Executive Orders to protect its well-being or perceived national interest.

A global trade war has been initiated through tariffs, a withdrawal from multilateral obligations announced, and the Agency for International Development (US-AID) shuttered with crippling impacts on many global projects helping the vulnerable. US President Donald Trump has called those at the agency “radical lunatics”.

On the trade front, the US is Sri Lanka’s largest export market, and with its retreat into protectionism and a transactional approach, dependence on it makes any country vulnerable. Directions of global trade and supply chains are likely to diversify as countries seek to reduce uncertainty and vulnerability. However, this may also create new opportunities—our Business section pages report the likelihood of better demand for Sri Lankan garments in the US due to tariffs impositions on competitor countries. Sri Lanka may need to fast-forward Free Trade Agreements (FTAs) that are favourable bilaterally and explore ways and means of riding unexpected economic storms.

President Trump believes America is carrying the world on its shoulders. He is following the policies of a 19th-century US President, William McKinley, who used tariffs on foreign imports as a form of income tax. Sri Lanka seems to be adopting the exact same policies when it imposes a duty of 200-300 percent on car imports, which is a virtual income tax. The European Union, for instance, has only an 8-10 percent tax on imported cars. McKinley was credited for enriching the US economy with his protectionist policies but was assassinated six months into his second term.

Foreign affairs analysts believe this cowboy approach against its neighbours, allies and the poor countries relying on USAID will be to America’s rival China’s advantage. Some argue it is purely the Trump coterie of billionaires showing off their machismo—until reality hits them and they have to buckle down to reality.  China is pondering taking the US to the WTO (World Trade Organisation) to challenge the unilateral imposition of tariffs.

The local NGO sector will have to stomach the bitter pill of the blanket ban on USAID that has hit them like a thunderbolt. The US head honchos of the day are themselves saying USAID work was linked to the US spy agency CIA and was not only wasting American taxpayer money abroad, such as in promoting LGBT activity worldwide, but also involved in many covert activities around the world. That is a damning admission.

Many Sri Lankans, including legislators, have fallen for this Trump-Elon Musk narrative and begun questioning USAID activity in Sri Lanka, ‘missing the woods for the trees’ in that the US Government is shutting the tap to all aid—even the good from the entire world.

Many in the developing world have been cynical of the idealism of the so-called liberal international order as well as its structures—that they are in reality a camouflage over the power and interests of wealthy countries. The ‘America First’ foreign policy seems to drop this idealistic cover, exposing hard reality.