How Sweden Is Pursuing Its ‘Feminist Foreign Policy’ in the Age of Erdogan, Putin, and Trump

BY REID STANDISH-JULY 29, 2016

The last two years have upended the international order. The Islamic State’s push into Iraq in 2014 blurred the Middle East’s borders, Russia’s annexation of Crimea and war in eastern Ukraine brought back realpolitik back to Europe’s doorstep, and a failed military coup in Turkey earlier this month triggered widespread purges — shaking the stability of a vital Western ally. And that’s not even mentioning Europe’s migration crisis and an unpredictable U.S. election this year that has left much of the world feeling uneasy.

For Sweden — a country of nearly 10 million people and self-described “humanitarian superpower” — the global shake-up has proven itself to be a test. The Scandinavian country has traditionally relied on a mix of diplomatic and economic power in its foreign policy — electing to use multilateral organizations like the United Nations and generous financial aid programs to achieve its goals around the world. But in a new era of hard power, Stockholm is aiming to blend its unique brand of Nordic idealism with coldhearted practicality, a duality expressed in Sweden through its role not only as one of Europe’s largest per capita donors of foreign aid, but also one of the continent’s largest per capita exporters of military hardware.

In interviews with Foreign Policy last week in Washington, Swedish Foreign Minister Margot Wallström and Defense Minister Peter Hultqvist focused on the levers of influence that a smaller country like Sweden has its disposal, and how to the country now must find a way to deter military might without abandoning its values.

They also pointed to a need to strengthen international law.

“For small nations to be respected, international law is crucial,” said Hultqvist. “We can’t see anything positive if big powers try to create their own laws and their own principles to imprint that on the international community.”

Since assuming the role of defense minister in October 2014, Hultqvist has faced a growing portfolio in hot spots around the world. As a member of the U.S.-led anti-Islamic State coalition, Stockholm has sent military advisors to Iraqi Kurdistan and announced in July that it planned to double their number, from 35 to 70. But despite a series of challenges in the Middle East, the defense minister’s biggest test has been back home in Europe: responding to an increasingly assertive Russia.

Following the annexation of Crimea and the outbreak of war in eastern Ukraine in 2014, relations between Russia and Sweden have soured. Russian jets have repeatedly prodded Swedish airspace, and Swedish authorities launched a massive hunt for a foreign submarine in 2014, suspected to be Russian. Adding to the tensions, the Swedish Security Service described Russia in its annual report released in March as the country’s biggest security threat.

“We cannot accept the Russian perspective that they want to have a sphere of influence,” Hultqvist said.“We don’t accept the thought that big nations need a backyard. We don’t want to be in a backyard, we are a sovereign nation.”

Neither Sweden, nor its neighbor Finland, are currently members of NATO — a legacy of both countries’ histories of military neutrality and complex relations with the Kremlin. But Crimea has forced Stockholm to respond. Sweden joined Western sanctions against Russia and has provided humanitarian aid to Ukraine following the outbreak of war. In February, the Swedish military returned to the island of Gotland in the Baltic Sea for the first time since the end of the Cold War as part of a billion-dollar increase in defense spending announced in 2015. In May, Stockholm inched closer to NATO, signing a host-nation support agreement that will allow the alliance to more easily operate in the country.

Hultqvist, however, insists that the current government has no plans to join NATO, a sentiment echoed by his colleague Wallström, the foreign minister, citing low public support for joining the bloc in Sweden.

“There was a shift after Crimea and Ukraine, but now we are back,” said Wallström, referring to a 2015 poll that showed for the first time more Swedes in favor of membership than against it and a subsequent poll released in July showing a reversion back to a majority of Swedes against joining NATO. “Because what happens if Donald Trump wins? What happens with Turkey? It’s the second largest army in NATO. So, you know, that means something.”

Despite the realpolitik calculations of dealing with Russia, Wallström has championed a foreign policy seeped in idealism since assuming her role in the fall of 2014. As foreign minister, she has said that under her leadership Sweden will become the only country in the world to conduct a “feminist foreign policy,” a perspective that emphasizes the role that women must play in ensuring peace and security.

“I don’t think a feminist foreign policy is idealistic. It is the smartest policy you can have at the moment,” said Wallström. “Every peace agreement has a better chance to succeed if you involve women.”

By some measures, the doctrine has been a success for Sweden on the world stage, earning it both notoriety and accolades. In its annual scorecard, the European Council on Foreign
Relations rated Sweden, along with the United Kingdom, as having the second largest influence on shaping European Union foreign policy in 2015, with only Germany listed as more influential.

ButWallström has also encountered her share of detractors. In Sweden’s parliament, her critics in the opposition — and even some in her own diplomatic corps — have decried her feminist foreign policy as naive.

But her biggest row has been abroad. After criticizing the treatment of women in Saudi Arabia, as well as the public flogging of Saudi blogger Raif Badawi, Wallström found herself in a diplomatic standoff with Riyadh that culminated in the country withdrawing its ambassador from Sweden and Stockholm canceling an arms deal with the kingdom. The outcome infuriated Swedish business leaders who feared trade losses, but the foreign ministerremained unrepentant over the row.

On Turkey, Wallström has also found herself walking a fine line between values and needs. A deal struck between Brussels and Ankara in March to limit the flow of refugees into Europe has given the continent, especially Sweden, which accepted 160,000 asylum-seekers in 2015, some much needed relief. However, a worsening atmosphere for human rights in Turkey — which has only deteriorated further following the failed coup against Turkish President Recep Tayyip Erdogan — has also meant dealing with an increasingly authoritarian government in Ankara. Like other Western nations, Sweden voiced support for Erdogan following the failed coup, butWallström remains critical of developments inside the country and warns that if some proposed measures are adopted, such as reinstating the death penalty, Turkey will be barred from one day joining the EU.

“I don’t think anyone feels happy about this. We have seen the developments in Turkey going in the wrong direction with a more polarized and repressive regime under Erdogan,” said Wallström. “But one has to see that Turkey has taken on a huge responsibility in hosting refugees and that they are doing their best to help and get them established.”

In the face of these crises, both Wallström and Hultqvist remain resolute that Sweden is on firm footing and that they are pursuing the best decisions for the country’s interests without abandoning its values.

“[Russia] isn’t going away. Same with Turkey. We cannot move them,” saidWallström. “There is no military solution to all these things, we have to continue to insist on diplomacy to solve concrete problems.”

Photo credit: SVEN NACKSTRAND/AFP/Getty Images

Facebook could owe $5 billion in back taxes

By Renae Merle July 29

Facebook is digging in over its fight with the Internal Revenue Service. The social network said this week that it faces a potential $5 billion tax bill after moving some of its assets to Ireland.

The company’s tussle with tax authorities dates back to its decision in 2010 to transfer many of its global “intangible” assets — those not in the United States or Canada — to its Irish holding company. The transfer allowed the company to pay a lower tax rate on the profits made from those assets, tax experts say. (The corporate tax rate in Ireland is 12.5 percent, compared with 35 percent in the United States.)

The IRS said in court documents the way the assets were valued was “problematic” and that the “transferred intangibles” may have been undervalued by “billions of dollars."

On Thursday, Facebook, which reported more than $2 billion in profits during its second quarter, said it received a "deficiency" notice from the IRS and could end up with a tax bill of $3 billion to $5 billion, plus interest and penalties. "We do not agree with the position of the IRS" and will challenge the decision, the social network said in an Securities and Exchange Commission filing. If the IRS prevails it "could have a material adverse impact on our financial position."

The tussle comes amid a worldwide reexamination of the tax strategies employed by U.S. multinational corporations. French authorities raided the Paris headquarters of Google and McDonald’s in May and the European Commission is investigating tax deals that Amazon and Apple reached in Luxembourg and Ireland.

Facebook's transfer of some of its assets to Ireland has become a common maneuver used by U.S. technology and pharmaceutical companies, tax experts have said. The strategy allows the companies to keep more of the money they earn, but it has come under criticism from some in Congress who say the firms are not paying their fair share.

Facebook continue to push to its tax rate. The social network has said expects its effective tax rate to fall from 40 percent to about 27 percent this year. That is considerably lower than the federal corporate tax rate, 35 percent. But even its posted effective rate may be higher than what the company actually pays because it doesn’t reflect deductions taken for stock options issued to employees or other expenses, tax experts say.

An IRS spokesman said the agency does not comment on companies. A Facebook spokesperson could not be immediately reached for comment.

10 lakh bank employees to go on pan-India strike today over proposed SBI merger

Most banks, including the SBI, had earlier informed the customers that banking services would be affected on July 29.

Fri, 29 Jul 2016

Normal banking operations may take a hit on Friday, as public sector bank employees will be on a one-day strike against the proposed merger of associate banks with the State Bank of India (SBI). They are also opposed to the banking reforms announced by the government recently.

About 10 lakh bank employees and officers of all the public sector banks, private banks and foreign banks will observe a full day all India bank strike.

 The United Forum of Bank Unions, the umbrella organisation of nine bank unions, has been opposing Centre's move towards privatisation of public sector banks, privatisation of the IDBI Bank by reducing the government share to less than 49%, mergers of public sector banks and mergers of State Bank of India and its associate lenders.

Most banks, including the SBI, had earlier informed the customers that banking services would be affected on July 29 due to the strike at all banks on 'issue and demand to stop banking sector reforms'.

The employee associations have also demanded stringent action against the willful defaulters.

Take Some Time To Chill Out With These Blissful Yoga Moves

You deserve a little relaxation.

Lindsay Holmes- 07/28/2016

In the Udaya video above, instructor Caley Alyssa will take you through a series of yoga moves that are the perfect remedy for a stressful week. The forward folds are designed to help your blood flow and unwind your mind. The sequence takes approximately five minutes, giving you virtually no excuse not to prioritize a little me time.

Learn how to do the poses by watching the video and incorporate them into your to-do list today. You’ll be amazed by how calm you’ll feel when it’s over.

Find more yoga teachings at Udaya.com.

Canadian foreign minister meets with Wigneswaran and TNA

29 July 2016

Canada's foreign minister, Stephane Dion who is currently visiting Sri Lanka met with the chief minister of the northern province, C V Wigneswaran on Friday. 

On Thursday, Mr Dion met with the Tamil National Alliance leader, R Sampanthan, and spokesperson, M A Sumanthiran on Thursday to discuss progress on political solution. 

Stéphane Dion  ✔@MinCanadaFA Meeting with leadership of the #Tamil National Alliance to hear views on progress towards political solutionpic.twitter.com/ijQ3qtwfvE — Stéphane Dion (@MinCanadaFA) July 28, 2016

The Culture Of Impunity

By Rajan Hoole –July 30, 2016

Dr. Rajan Hoole

Antecedents Of July 1983 & The Foundations Of Impunity – Part XIII

The Privy Council judgement in Kodeswaran’s case no doubt offended that influential section of the Sri Lankan (Ceylonese) intelligentsia who firmly believed that their independence and national sovereignty consisted in their freedom to enact laws that are bad, inconsistent and repressive. This was reflected in the early acts of the United Front (SLFP, LSSP and CP) government elected in 1970. Appeals to the Privy Council were stopped by the Minister for Justice, Mr. Felix Dias Bandaranaike (FDB). It was under his instructions that the treasury circular of December 1961 to stop the increments of those who did not pass Sinhalese had been drafted.

A new Republican Constitution was enacted on 22nd May 1972 that had removed Section 29 and where Parliament was supreme, so that the courts could no longer reverse bad laws. One could see in these developments an obdurate, rather than a rational, response to the judgement inKodeswaran’s case.

The Republic of Sri Lanka at its very foundation in 1972 was marred by obscurantism, irrationality and intolerance. Instead of solving the manageable problems of the Tamil-speaking minority which existed under the Dominion (Soulbury) Constitution, the 1972 Republican Constitution exacerbated them by removing all tangible checks on the majority group in parliament.

The transition from the already questionable quality of reasoning in Chief Justice H.N.G. Fernando’s judgement in Kodeswaran’s case to retired Chief Justice M.C. Sansoni’s reasoning in his Commission Report is a comment on institutional decay in the nation from 1967 to 1980. If the objectivity of Fernando was limited by the Sinhala Only Act, that of Sansoni was limited by the causes of violence advanced in Prime Minister Jayewardene’s deplorable speech in Parliament on 18th August 1977.

Read More

Sri Lanka: Against nonsense on reconciliation

We must now do some rethinking about what is required to promote ethnic reconciliation. I would point to three essentials without which ethnic reconciliation can never get going. The first is a political solution which will enable fair and equal treatment for the Tamils, the prerequisite without which there will never grow the relations of mutual trust and reciprocity that will lead to ethnic reconciliation.

by Izeth Hussain

( July 30, 2016, Colombo, Sri Lanka Guardian) The Jaffna University beating up of Sinhalese University students by their Tamil counterparts sent what has been appropriately called “shock waves” throughout the country. True our University students have been notoriously prone to violence and there have been such incidents before. But the ethnic dimension of what had happened could not be ignored: it happened because of the introduction of a Kandyan dance item into what had traditionally been a purely Tamil ceremony, and it was obviously seen therefore as a further instance of a relentless process of “Sinhalisation” of what was traditionally Tamil geographical space, this time at the very heart of the Tamil homeland, Jaffna. The inclusion of the Kandyan dance item could therefore be seen as essentially exemplifying the Sinhalese triumphalist drive after 2009, and the violent Tamil students’ reaction could be seen by the Sinhalese side as possibly portending a renewal of Tamil militancy.

The ethnic dimension of what had happened was blatant and obtrusive. But – strange as it may seem – the Government chose to ignore it. Initially the Government TV channel ignored the clash altogether in its news coverage, and Government spokesmen denied that there was any ethnic dimension to it at all. One of them cited as evidence the fact that the Sinhalese students at Jaffna University found lodgings in Tamil homes! I was reminded of the exasperation I used to feel over reactions to many articles I wrote on the anti- Muslim riots between 1976 and 2002: both at the Government and media level it was denied, adamantly denied, that there was any ethnic dimension to those riots. It is a welcome fact that we have come a long way since then. The Government has been forced to acknowledge the ethnic dimension; the media has been publicizing inter-ethnic clashes that have taken place earlier at other Universities; the civil society has faulted the Government over not being sincere about ethnic reconciliation; and the Government seems to be showing a new earnestness about getting to grips with the problem of reconciliation.

However, that new earnestness may turn out to be not much more than rhetoric. The reason for that arises out of certain facts about the Sri Lankan state. It has been in practice a racist Sinhalese state, not properly a Sri Lankan nation state. That was why our earlier Governments would not recognise the ethnic dimension of those anti-Muslim riots, and that is why the present Government initially blacked out news about the Jaffna University clash and then denied that it had an ethnic dimension to it. It is in the nature of the racist state to ignore the ethnic dimension of problems as long as it does not threaten Sinhalese dominance. But an active civil society – the emergence of which is a fact of enormous significance in Sri Lanka – is making the Government to really face up to the problem of ethnic reconciliation. We can assume also that the quarter century ethnic war is a factor favouring the evolution of the Sinhalese racist state into an inclusive nation-state.

But – in deciding whether the Government will really get to grips with the problem of ethnic reconciliation – we must take count of another important fact as well. The Sri Lankan state has been not only a racist Sinhalese state; it has also been fiercely resistant to some crucial aspects of modernity: notably it has been fiercely resistant to the achievement orientation that is at the centre of modernity. The patronage system that became spectacular after 1956, together with its concomitant of utter contempt for the merit principle, has become deeply ingrained in our political culture. That was shown recently when Minister Lakshman Kiriella unabashedly divulged that many lucky fellows have been appointed Consultants without having any of the appropriate qualifications because of the services rendered by them at the last elections. We must add that all of them are hugely remunerated at the expense of the Sri Lankan people, more than half of whom are struggling to make ends meet more than ever before in their lives. We have to expect that the Sri Lankan state, racist as it is and backward in its political culture, will be incompetent, more particularly when it enters uncharted territory as in the case of the problem of ethnic reconciliation. That has been clearly shown by the fact that several Ministries and institutions are engaged over that problem, without effective co-ordination, and that a Special Task Force appointed for that purpose is really non-existent. So the new earnestness shown by the Government over ethnic reconciliation could turn out to be not much more than windy rhetoric.

We must now do some rethinking about what is required to promote ethnic reconciliation. I would point to three essentials without which ethnic reconciliation can never get going. The first is a political solution which will enable fair and equal treatment for the Tamils, the prerequisite without which there will never grow the relations of mutual trust and reciprocity that will lead to ethnic reconciliation. No one really seems to know the state of negotiations between the Government and the TNA on the implementation of 13 A. There are Tamils who believe that an understanding has been reached about the full implementation of 13 A. But, as practically everyone knows, the problem is not to reach understanding at an elite political level. The crucial problem is to make it acceptable to the Sinhalese masses who seem to have a deep ineradicable allergy to devolution on an ethnic basis. We wonder what the Government has to say about that.

My two other essentials arise out of the recognition of the fact that the South African model of truth and reconciliation is irrelevant, totally and utterly irrelevant, to the problem of reconciliation in Sri Lanka. There the apartheidists acknowledged that they had been in the wrong, were contrite, and were ready for reconciliation, and on the African side there was Mandela who could promote reconciliation. Here neither side will acknowledge that it has ever been in the wrong, insisting that the other side has always been in the wrong, and the political culture will not allow anyone of the moral stature of Mandela to emerge as leader. The South African case is relevant to Sri Lanka only to the extent that it provides an excuse for our political and other bigwigs to travel to that country, ostensibly to study the reconciliation process going on there.

Let the Sinhalese side acknowledge that the ethnic problem, particularly in its militant form, was a creation of the Sinhalese, not of the Tamils. Discrimination was taken to an outrageous extreme in the standardisation scheme of 1971. Let the Tamil side acknowledge that the Sinhalese have thereafter shown willingness to take corrective action over discrimination. Let the Sinhalese side acknowledge that the ethnic war was made unavoidable by the State terrorism unleashed from 1977 o 1983, which left no alternative to the Tamils but to fight to affirm their human status.

Let the Tamil side acknowledge that they spurned every opportunity to reach out to a political solution and that they made a farce of the peace process. Let them acknowledge the genocidal horror of the expulsion of 80,000 Muslims from the North, at a few hours notice and with not much more than the clothes on their backs. Let them acknowledge the horror of not just using child soldiers but of kidnapping children for that purpose. Let them acknowledge the utter inhumanity of using 330,000 Tamils as human shields at the final stage of the war. But, above all, let both sides, the Sinhalese and the Tamils, get together to confront their common enemy, the politically backward and racist Sinhalese state, and pressurise it to move meaningfully towards ethnic reconciliation.

Concerns of another UNHRC resolution endorser

By Manekshaw-2016-07-30

It was a few days after Canadian Prime Minister Justin Trudeau released a statement expressing his country's solidarity with the Tamils of Sri Lankan origin who were commemorating an event in Toronto, Canada to mark the 33rd anniversary of 1983 Black July, Canadian Foreign Minister Stephane Dion arrived in the island on Thursday (28) and his Sri Lankan visit is considered as a first visit of a Canadian Foreign Minister to Sri Lanka since 2003. 

Canadian Prime Minister Justin Trudeau in his special statement expressing his solidarity with the Canadian Tamils of Sri Lankan origin mentioned that his country was committed for real peace, reconciliation, accountability and justice in Sri Lanka.
Canada is one of the countries where a large number of Canadians of Sri Lankan Tamil origin live and most of them had migrated to Canada following the Black July 1983 communal riots and the civil war which had continued for nearly three decades in the North and the East.

The visit to Sri Lanka last week by Canadian Parliamentarian Gary Anandasangaree who is a Tamil Canadian of Sri Lankan origin has highlighted the strength of the Tamil population of Sri Lankan origin in Canada and the country's concerns for the peace and reconciliation in the island nation.

Canadian Parliamentarian Gary Andasangaree who is also the son of the veteran Tamil United Liberation Front (TULF) Leader V. Anandasangaree made his visit to Sri Lanka after thirteen years since he last arrived in the island in 2003.
Gary Anandasangaree who visited the island had travelled extensively in the Northern and Eastern Provinces and observed the post-war situation in person in the two provinces.
Gary in his interview with Ceylon Today based on his visit to the Northern and Eastern provinces pointed out the need of strengthening the civil administration in the two provinces by drastically reducing the military presence.
He also pointed out the shortcomings in the resettlement of Internally Displaced Persons (IDPs) in the North and the East.
So, following Gary Anandasangaree's visit to the island last week, his country's Foreign Minister Stephane Dion has arrived in the island and at his first press conference with his Sri Lankan counterpart Mangala Samaraweera in Colombo on Thursday (28), expressed his country's concerns over Sri Lanka's commitment towards implementing the UNHRC resolution which was adopted in October 2015.
Canada being one of the co-sponsors of the UNHRC resolution on Sri Lanka last year, Canadian Foreign Minister Stephane Dion expressing his country's concerns over the resolution urged the Government of Sri Lanka to implement the resolution without further delay.

The ground realities
Understanding clearly the ground realities which remain in the war-torn areas in the North and the East the Canadian Foreign Minister said: "The journey towards reconciliation will be long and strewn with obstacles, but it is important to focus on the future. The long-term objective must be to respect distinct identities while working to bring them together to strengthen the whole country."
With its involvement in the failed peace process facilitated by Norway as one of the co-chair members fifteen years ago, Canada is also very much aware about the constraints in building peace and reconciliation in Sri Lanka.

The Canadian Foreign Minister's visit to Sri Lanka being the first high profile visit of a foreign dignitary since the UNHRC Chief Prince Zeid Ra'ad Al-Hussein submitted his oral submission last month on his observation on the progress made by Sri Lanka, the Canadian Foreign Minister's comments on the present state of the peace and reconciliation process in the island and on expediting the implementation of the UNHRC resolution are noteworthy.

Canada being a country of immigrants and successfully handling several ethnic issues, the Canadian model was also suggested by the Tamil political circles in overcoming the ethnic issue in the country.
The Canadian Foreign Minister also expressed his country's desire for sharing its experience on issues such as official languages, devolution of power and sustainable economic growth in a multi ethnic society.
The Canadian Foreign Minister also met Leader of Opposition and Leader of the Tamil National Alliance (TNA) R. Sampanthan in Colombo on Thursday (28) and the importance of finding a permanent solution to the ethnic question through the intended new Constitution, was emphasized by the TNA Leader.

As Canada offered its assistance in sharing its experience in devolving powers and settling the language issues, the TNA Leader's emphasis on finding a permanent solution to the ethnic question through the new Constitution has highlighted that Canada could even play its part in making the right suggestions in dealing with the ethnic issues in the intended new Constitution.
With the international community showing its concerns over strengthening peace and reconciliation in the country, the recent developments in the local political scene such as the Kandy march organized by the Joint Opposition led by former President Mahinda Rajapaksa and the deliberate attempts made in creating obstacles in implementing the UNHRC resolution in the South clearly indicate that the path for peace and reconciliation in the island still remain on rugged terrain. 

Dion’s Sri Lanka visit is Canada’s opportunity to lead globally

The Trudeau government should make a substantial contribution to help those most affected by the war.

By RAJ THAVARATNASINGHAM

PUBLISHED : Thursday, July 28, 2016 10:47 AM

This week, Foreign Affairs Minister Stéphane Dion is making his first visit in his current role to Sri Lanka to highlight the country’s human rights situation and promote reconciliation and accountability in the aftermath of the civil war, which ended in 2009.

It is a welcome opportunity for the Trudeau government to show its commitment to responsible engagement on the world stage and to help fulfill its pledge to make a lasting contribution to international peace and development.

The reality is that seven years after the end of Sri Lanka’s devastating civil war, a permanent peace has not been achieved. While the new Sri Lankan government has made some progress, the pace of change has been very slow. Those affected most by the war languish in poverty. Countless civilians remain unaccounted for. The road to justice and reconciliation for victims of the war has been plagued by delays and reluctance by the Sri Lankan government to hold those responsible accountable.

With Canada being home to 350,000 Tamil Canadians from coast to coast to coast, our government is in a unique position to help create and support a lasting peace in Sri Lanka. The international community has a small window of opportunity to promote reconciliation in the island nation, and that moment is now.

By helping victims of the war, Canada can live up to its commitment to support reconciliation efforts in Sri Lanka. Through taking this leadership role in the global arena, our country will transform lives. It’s particularly critical that those affected by war have access to trauma counselling and projects that support livelihoods in the agriculture, fishing, crafts, and light industrial fields. This type of support will provide those who survived the war, particularly women, with dignified means of feeding, clothing, and housing themselves.

We are calling on the Trudeau government to make a substantial contribution to help those most affected by the war. This funding will make a significant impact on the lives of hundreds of thousands of victims in Sri Lanka, and will position Canada as a leader in post-war development and progress among the G7 countries. It will help fulfil Prime Minister Justin Trudeau’s vision to “refocus Canada’s development assistance on helping the poorest and most vulnerable, and supporting fragile states.”

Most importantly, this contribution will pave the way towards reconciliation and create a conducive environment for a lasting peace in Sri Lanka. Canada played a vital role in 1950 during the establishment of the Colombo Plan, which marked the birth of our country’s foreign assistance to Sri Lanka and its neighbours. The plan showed the best of Canada’s values as a compassionate, engaged player in global affairs. Once again, Canada has a great opportunity to seize the moment, build on this proud legacy, and be the global player that our prime minister envisioned.

Raj Thavaratnasingham is president of the Canadian Tamil Congress.

The Hill Times

Canada to assist Lanka project for quality govt services

Colombo   July 28, 2016

Canada will assist Sri Lanka in a language project which aims to improve delivery of government services in both official languages Tamil and Sinhala, Foreign Minister Mangala Samaraweera said today. 

The two countries will sign a Memorandum of Understanding to fund the National Languages Equality Advancement Project during the ongoing visit of Stephan Dion, who became the first Canadian Foreign Minister to visit Sri Lanka in 13 years. 

The project aims to improve delivery of government services in both official languages - Tamil and Sinhala, Samaraweera said. 

Dion said Canada has much to share with Sri Lanka including the experience on issues such as official languages, the devolution of power, sustainable economic development, empowerment of women, legal expertise and youth skills development. 

Samaraweera and his Canadian counterpart discussed the importance of providing an economic peace dividend for the people of Sri Lanka and the interconnected nature of reconciliation and development during their meeting. 

The language disparity between the majority Sinhala community and the minority Tamil community is being often cited as one of the root causes of the ethnic conflict in Sri Lanka. 

Tamils' issues mainly centered with Sinhala being made the state language in 1958. Later in 1987, Tamil was also made an official language. Yet the delivery of state services in the Tamil language was largely ignored. 

Samaraweera said he told Dion that Sri Lanka wants to see the return of Tamils who had fled to Canada when the ethnic conflict raged in the early 1980s. 

"We are keen to engage with the Sri Lankan community in Canada, and invite them to visit the country that they left, or was compelled to leave, long ago. I explained that we are keen that they also explore meaningful ways of contributing to Sri Lanka's reconciliation and development efforts," Samaraweera said. 

"Canada is committed to helping Sri Lanka further strengthen democracy and peace for all of its citizens. We note the importance of meaningful international involvement in such accountability and reconciliation mechanisms," Dion said. 

Dion also said that there is a need to focus especially on communities most directly affected by the conflict and Canada is ready to contribute to the re-establishment of livelihood opportunities for those displaced. 

He also called on President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe. He will visit Jaffna tomorrow.

Country in peril ! Defense secretary deceives president -Whither SL and national security ?

(Lanka-e-News- 29.July.2016, 11.00PM)    The defense secretary Karunasena Hettiarachi  has acted most high handedly overriding the instructions issued by president Maithripala Sirisena the commander in chief of the forces, based on reports reaching Lanka e news .

It must be warned such a situation prevailing in the country is most alarming , and such a deceit being committed is very rare  in a country.

This high handed action of the defense secretary pertains to Commodore K.C.Welegedera who exposed the corruption and murders committed during the period of ex Navy Commander Karannagoda which was earlier on revealed by Lanka e news in its reports. Lanka e news exposed that an unjustifiable  punishment was meted out to Welegedera by the Naval courts in order to silence him,   and that Welegedera made an appeal to the commander in chief . It was also revealed  by us that the appeal which had to be routed through the defense secretary was not being forwarded to the president by the former who is hiding it and delaying .

Lanka e news on the 14 th  highlighted this delay caused by Siripala Hettiarachi the additional secretary to president who was  holding back the appeal . It was only after that and a delay of 24 days , the relevant file was sent  to the president .

Subsequently , following a cabinet meeting , the president ordered  Hettiarachi to instruct the Naval Commander to withdraw the punishment meted out to Welegedera  by the Naval court. The ministers who were present bore testimony that such an order was indeed issued by the president.

Lo and behold ! this defense secretary who holds a most responsible position directly under the president had thereafter acted most irresponsibly . Karunasena Hettiarachi has indulged in a most shocking and abominable  underhand action. He had by letter informed the Naval Commander and Navy’s legal division that the president has ratified the punishment meted out by Naval court !

The defense secretary Karunasena Hettiarachi , the additional secretary , Sirpala Hettiarachi and the Navy Commander Rear Admiral Ravi Wijegunaratne are directly involved in this conspiracy of deliberately altering  the instructions specifically given by the president , based on reports reaching Lanka e news.

These conspirators are conducting themselves in this crude and criminal manner solely because they want to save those who were involved in smuggling of people as refugees via boats  to Australia during the nefarious decade. Welegedera is due  to give evidence in the cases under the investigations conducted by the  CID, but the Navy is obstructing him. This is because the present Navy Commander and his predecessor are directly involved in the human smuggling that was carried  on earlier.

In the circumstances ,both Karunasena Hettiarachi the defense secretary and additional secretary Siripala Hettiarachi in charge of the file who went so far as to change the instructions on the sly  given by the president, in order  to protect and safeguard the corrupt and the crooks must be sacked forthwith , for they have totally  eroded the confidence reposed in them by the public . 

Mind you this is not only a most high handed action but is also  suggestive of what crooked and crafty conspiracies they could resort to in the future , not to mention  high treason duping  the president and the country . Besides they are not just white collar workers . Not only the people even the president is trusting them implicitly being the defense secretary and additional secretary.

If the grave dangers and the portentous trends laden in these   actions of the two secretaries and those contributing to such conspiracies are not identified with the urgency those merit , doubtless these villains are going to commit more villainy with greater determination in the future including slitting the throat of the highest in the hierarchy. 

Connected reports
1.Good governance govt. trembles and is tremulous before apparition of sinister discarded Rajapakse !
-Navy officer who exposed the murders and corruption in trouble again

2. Defense secretary confirms again he is taking good governance for a ride !
-Punishes Navy officer who went abroad once while Yoshitha Rajapakse who went 29 times without permission is scot free !

3. Incredible but true ! Rajapakse lackeys and lickspittles taking Commander in chief for a ride..!!
-Rajapakse bootlicker in Navy delivers judgments against good governance innocents..!

---------------------------
by     (2016-07-29 19:30:25)

The Central Bank Increased The Interest Rates!

By Hema Senanayake –July 30, 2016

Hema Senanayake

The Monetary Board met on July 28, 2016. On that meeting the Monetary Boarddecided to increase the main interest rates of the Central Bank. Accordingly, what is known as the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR), have gone up by 50 basis points each, to 7.00 per cent and 8.50 per cent, respectively with immediate effect. The resultant effect of this decision is that the market interest rates will go up. Why did they do it? On the same day, the central bank issued a press release explaining as to why the Monetary Board took this decision.

According to the press release, we can presume that the Monetary Board had three main concerns in taking this decision. The Board intends to keep the inflation rate at mid-single digits and secondly, the Board wants to contain the widening trade deficit and thereby support the balance of payment situation. This decision making process is interesting and could appear logical, but unfortunately it is not so. Hence, the resultant effect could be that the central bank would not achieve what it wants to achieve namely the above mentioned three objectives. Why do I say so?

With a view to simplify my answer, now, I invite readers to participate in making the decision made by the Monetary Board. Let us begin it. If there is a certain simple parameter in the economy which parameter correlates to inflation and to the trade deficit then you could change the inflation rate and the trade deficit by changing that parameter. Since, the Balance of Payment is strongly linked to the trade deficit, if any economic parameter changes the trade deficit then that parameter effectively correlates to the Balance of Payment too. It means that, if there is an economic parameter that could change the inflation and trade deficit, then that parameter could effectively change the Balance of Payment situation too. So far it is simple. I assure you that it will remain simple until the end of my argument.

Now, you are told that private sector credit growth is the economic parameter which correlates to the said three variables, namely, inflation, trade deficit and the Balance of Payment. This means that, if you allow private sector credit to grow, and as a result the inflation might increase, trade deficit might get widen resulting to have negative pressure on the Balance of Payment. Conversely, they might say that if the private sector credit growth is contained or reduced, then the inflation might be reduced, the trade deficit might also be reduced resulting positive effect on the Balance of Payment. So, private sector credit growth is the important parameter. Based on this information, what decision you want to make now? You may decide, in favor of the reduction of private sector credit growth, so that you might expect to contain inflation and to reduce trade deficit which would result in having positive impact on the Balance of Payment. Yet, there is one more step in this process.

Then, again you would further be informed that, if you increase the rate of interest, then people would borrow less and less and as a result private sector credit growth would be reduced. As you may see, now, it made simple, you would decide to increase the rate of interests, as was decided by the Monetary Board, so that private sector credit growth would be reduced in achieving the reduction of inflation and trade deficit; reduced trade deficit would support the Balance of Payment situation as mentioned above. It seems all very logical but not so. What is the problem?

The problem is that it is not the private sector credit growth that matters, instead the total domestic credit growth is what matters and the total credit growth does not purely depend on the rate of interests. In fact the total domestic credit growth is something that depends on a lot of variables. I repeatedly insisted that the central bank lacks certain important policy tools to contain the credit growth without increasing the interest rates. Keeping market interest rates low would reduce inflation than increasing the rates to keep inflation low.

Read More

SL 5% plus growth on target post-policy tightening: CB

• Proactive decision to offset possible fiscal slippage from VAT delay, wants credit growth to slow to 12% 
• VAT Bill to be tabled in Parliament on 11 August, July inflation up 5.5% 
• Credible policymaking a focus as SL braces for market borrowing over the next few years to finance debt

By Uditha Jayasinghe-Saturday, 30 July 2016

A combination of macroeconomic developments, including high credit growth, rising inflation and uncertainty on Government revenue collection after the VAT suspension, pushed the Central Bank to tighten rates, Governor Dr. Indrajit Coomaraswamy said yesterday, backing the proactive measure and assuring Sri Lanka would still hit a growth target of about 5%. 

A day after policy tightening, Dr. Coomaraswamy was optimistic that the Monetary Board decision to increase monetary policy rates by 50 basis points by the country’s banking regulator would not affect the country’s growth targets of 5% or “slightly over”.

Despite Finance Minister Ravi Karunanayake setting the growth target for 2016 at 5.8% in the Budget last November, Central Bank officials insisted growth prospects for the country were periodically reassessed on prevailing macroeconomic conditions. They stressed that focusing on 5% growth was not a downgrade on prospects and insisted growth would remain robust as key industries such as remittances and tourism continued to expand strongly in the first half of 2016.

Even though Dr. Coomaraswamy dismissed the need to increase rates during his first press conference after being appointed Governor in July, he acknowledged high private sector credit growth that stayed near a four-year high of 28% in May from a year earlier, hardly slowing from 28.1% a year ago, and June consumer prices rising to a 32-month high of 6.0% after the Government raised Value Added Tax (VAT) from 11% to 15% to tackle a soaring deficit, pushed him to change his mind.

“I’m going to take refuge in a quote made by John Maynard Keynes who said that ‘when the facts change I change my mind,’” the Governor quipped.

Almost on cue after the Central Bank announcement, the Census and Statistics Department on Friday said inflation rose to 5.5% in July from a year earlier, but slowed down from the previous month’s 32-month high of 6%. Core annual inflation, which excludes fresh food, energy, transport, rice and coconuts, rose 5.8%, slowing down from the previous month’s 6.4%. It hit a 38-month high of 6.6% in May.

On a month-on-month basis, the Colombo Consumer Price Index (CCPI) rose 0.2% in July, compared with 2.1% in June. July inflation, as measured on a 12-month moving average basis, touched a 17-month high of 2.7%, compared with June’s 2.2%.

“Private credit continues to be buoyant and it is higher than the desirable levels at the moment. The second fact is the macroeconomic framework for this year, which was to deliver 5% growth with inflation in the mid-single digits and a stable Balance of Payments assuming that there would be a 2% GDP contraction in the Budget deficit,” he said.

The Governor went on to say that regulators are targeting a slowdown in private credit growth to 12%, which would be sufficient to hit the 5% growth targets. The change in monetary policy was also to protect against further delay in revenue collection if the VAT Bill fails to be passed by Parliament next month.

“The VAT Bill will be presented in Parliament on 11 August and if it goes through we might be able to catch up on revenue. Obviously the Central Bank will take that into account but there is a possibility of slippage in fiscal policy and clearly monetary policy has to lean against that.”

“We want to have a framework of policymaking where we are forward-looking, so we felt we needed to take some action. We also thought we have some room to manoeuvre in doing so because growth impulses are fairly strong and we are confident Sri Lanka will hit 5% growth or a little more.”

Taking the sting from primary dealers who would be affected by the tightening, Dr. Coomaraswamy urged the public and private sector to look at the big picture.

“We want people to think of the Central Bank as a doctor, that is what patients want of their doctor – to diagnose early and treat early because then the treatment is pretty mild. If you allow a delay, then you have to have a major operation in the end. We saw some of these issues emerging and we thought we should move early and, of course, we can recalibrate depending on how things pan out.”

Focusing on lacklustre export performance and weak Foreign Direct Investment (FDI) in the first six months of 2016, Dr. Coomaraswamy was hopeful both would show improvement in the second half. However, funds from the recent bond issue by the Government would be sufficient to meet immediate debt repayments of $1.1 billion since the bulk of the $2.4b has been already worked off.

“Clearly over the next three to six years we are going to have to access capital markets to meet our debt obligations and that is one of the reasons we want to have this proactive approach to policymaking within the Central Bank because if we can establish credibility around our policymaking, that would give us better access to capital markets. We are going to have to go and borrow and to get the best possible terms we need to have credibility.”

Balance of Payments remain poised in a fine balance, with the Governor admitting that prolonged lapses in revenue collection and higher inflation could cause concern for the Monetary Board about aggregated demand developments.

---

CB to ensure security of National Payment Platform

The proposed National Payment Platform (NPP) will be supported by the Central Bank, which will ensure security and stability in the system, Central Bank Governor Dr. Indrajit Coomaraswamy assured yesterday.  

The much-needed National Payment Platform (NPP) was approved by Cabinet earlier this month and will soon be a reality empowering efficiency in the country for Government, businesses and the public at large.

The NPP proposal was submitted by Finance Minister Ravi Karunanayake on the recommendation of the Inter Ministerial Committee chaired by Telecommunication and Digital Infrastructure Harin Fernando. The Information and Communication Technology Agency (ICTA) and the Central Bank will be spearheading the groundbreaking initiative

“The law devolves considerable responsibility on the Central Bank to ensure that there is security and stability in the payment system so the ICTA Agency has been doing some work and what has happened now is Central Bank officials and ICTA will convene all stakeholders to ensure that we have a system which is stable, has security and the Central Bank will be integrally involved in taking this initiative forward,” the Governor said.    

In essence the NPP will bring about digital commerce to facilitate governments, businesses and citizens to perform digital commerce with efficiency, ease and low cost. It will also enable the public to transfer funds from any of their bank accounts through mobile phone for the payment of goods and services using their National ID.

The NPP will bring in savings for the Government by increasing efficiency, thereby reducing cash movement and the cash float in the market. The NPP will also ensure Sri Lanka’s ranking in the global index of Ease of Doing Business improving considerably.

Private businesses will be able to make online payments, including to crucial Government institutions such as the Customs, Inland Revenue and Excise Departments.

“The most convenient method used by public in obtaining goods and services, is the international credit card such as Visa, MasterCard, and American Express. However, Government institutions such as Sri Lanka Customs, Department of Inland Revenue, Department of Excise and others are less interested in using this method as the charges are increased according to the value of the transaction,” the Cabinet paper said.

An online- and mobile-based system rather than a credit card-based system would be more acceptable to these Government institutions, the paper added.