February 6, 2012 
by Jehan Perera
Addressing the nation and the international community on Independence Day President Mahinda Rajapaksa made many inspirational statements. These could be regarded as statements of government policy that will charter the future course of the country. The President’s speech was also finely tuned to appeal to the nationalism of the masses of people and their sense of patriotism. Making reference to the economic crisis that the country was experiencing and which is eroding their standards of living he said that "We would be able to exist as an independent, sovereign state only if we strengthen our economy. We have to get together and work just as we got together and worked with dedication to defeat terrorism."
The President’s promise with regard to economic prosperity was important in the context of the pessimism that has set in on account of balance of payments difficulties. For months, in the face of governmental denials, independent economists have been warning that the country’s economy is imbalanced with imports far exceeding exports. The economic success has led to huge imports and the country’s trade deficit touched a record USD 9 billion in the first 11 months of last year, shrinking its foreign currency reserves to USD 6 billion by January 2012. Foreign reserves stood at USD 8 billion in July 2011. Now the Central Bank has announced a devaluation of the rupee which will have adverse consequences on the cost of living of the masses of people Read more...
