The Way Forward After Communal Violence in Sri Lanka

Sri Lanka needs a platform for genuine and objective discussion in the hope of moving forward and achieving reconciliation.

BY   AMJAD SALEEM- MARCH 26, 2018

In Sri Lanka, the start of February was about celebration for the past 70 years of independence, but its end was about reflective contemplation over an uncertain future. Following a wave of anti-Muslim violence in the central district of Kandy, a nationwide state of emergency was declared on March 6 — and lifted on March 18 — the first time in seven years in a country with a history of civil war.

The Way Forward After Communal Violence in Sri Lanka.docx by Thavam on Scribd

Time to end Sri Lanka's culture of impunity

The country has adequate laws to protect its citizens from hate speech and hate crimes, but they must be enforced

Muslims store dry rations to distribute among families following attacks by Buddhist mobs in Sri Lanka. (Photo by Quintus Colombage/ucanews.com)

Kingsley Karunaratne, Colombo -Sri Lanka-March 27, 2018

Anti-Muslim violence is over in Sri Lanka for now, but social and religious problems have intensified as a result of the disturbing attacks.

According to police, 465 houses, vehicles and businesses were destroyed or damaged during the recent trouble. Two people were killed and Muslim mosques were attacked.

Violence broke out after a Sinhalese truck driver was killed by four Muslim youths in Theldeniya in Kandy district over a traffic dispute.

If the police had taken timely precautions on the driver’s funeral day and afterwards, the situation could have been avoided. The lethargic police gave Sinhalese Buddhist mobs who came from outside Kandy the chance to cause havoc as they pleased.

Many Muslims said most incidents took place during a curfew while the police and Special Task Force were deployed in the region, but they never took steps to interfere, stop or arrest the perpetrators.

Now Muslims are scared to live in their own houses and fear they will be attacked again by Sinhalese mobs. Even though the state of emergency and the curfew have been lifted, the government will have to keep police and army contingents throughout the district for the security of Muslims.

It will take time to heal the wounded hearts and minds of Muslim and Sinhalese people. Buddhist and Muslim clergy should get involved to work for religious co-existence.

In some villages, Muslims ran for shelter and protection to Buddhist temples. One such incident took place in a village in Theldeniya. The chief monk at Gomagoda Temple protected babies, children, men and women in his temple. The monk told Buddhists to protect Muslim houses and property too. Similar incidents happened in other places.

Though these deadly attacks were planned and carried out by outsiders, Sinhalese nationalist organizations like Mahason Balakaya and Sinhala Jathika Balamuluwa have been accused of playing a part in the violence.

The Terrorist Investigation Division has arrested 161 people including Mahason Balakaya leader Amith Weerasinghe, Sureda Suraweera, Buddhist monk Arachchikubure Sobitha Thero and seven other members of the extremist organizations.

Ultranationalism is a very dangerous trend and if meaningful steps are not taken by the authorities, Sri Lanka will be ruined.

On March 16, the district secretariat in Kandy paid compensation to victims of violence. The government paid 500,000 rupees (US$3,200) for a damaged house and 100,000 rupees for an attacked shop. The families of the two killed were each given compensation of 500,000 rupees on March 19. Muslim places of worship will also be compensated for damage.

All damaged properties should be fully renovated within four months with the help of soldiers.

 

A Muslim devotee and local council member Cader Nijam examine the vandalized Jumma Mosque at Pallekele in Kandy following attacks by Buddhist mobs. (Photo by Quintus Colombage/ucanews.com)

 

Though restrictions on social media have been lifted, Sri Lanka plans to clamp down on hate speech by enacting new laws and setting up an institution to monitor social media and censor inflammatory postings.

This step is positive in one way but there is another school of thought that the move will limit freedom of thought and expression.

In previous years too, certain social media sites provoked hatred against ethnic and religious minorities, mainly Muslims who were criticized for the hijab (head covering), halal artifacts, ritualistic food items, high birth rates and forced conversion of Buddhists to Islam.

It is obviously the duty of the government to prosecute and convict these perpetrators. However the government has not yet learned that lesson.

At the tail end of Mahinda Rajapaksa’s regime, an anti-Muslim media campaign claimed that Muslims were planning to take control of Sri Lanka with global Islamic forces such as Islamic State.

In June 2014, Galagoda Aththe Gnanasara Thero, leader of Bodu Bala Sena, made a hate speech in a rally against Muslims. Buddhist mobs later destroyed Muslim houses, businesses and mosques. At least four people were killed. But impunity prevails for Bodu Bala Sena, with not a single prosecuted or convicted.

Even after 2015, the new government did not carry out further investigations to book those responsible for violence, property damage and killings. However the government in January 2018, paid 20 million rupees in compensation to victims of the riots, some 273 families.

In 2009, Sri Lanka’s 26-year civil war ended when the army crushed militant rebels. Sinhala nationalist forces then searched for a new enemy and targeted the Muslim minority. How on earth can a country exist like this? The economy was ruined. The common man was burdened with a high cost of living. Development is at a standstill and the country cannot afford any more such calamities.

We have to rethink the future of the country and come to a consensus that enough is enough for communal and religious hatred so that we can achieve a progressive Sri Lanka.

Sri Lanka has adequate laws to protect its citizens from hate speech and hate crimes. They must be enforced to punish people who propagate communal hatred and incite sectarian violence, ensuring justice for citizens.

Kingsley Karunaratne is administrative secretary of the Rule of Law Forum, which is affiliated to the Asian Human Rights Commission. His organization works toward the radical rethinking and fundamental redesigning of justice institutions in order to protect and promote human rights.

Is The 19th Amendment Unconstitutional?

By Amrit Muttukumaru –MARCH 26, 2018

Amrit Muttukumaru

This brief note will focus exclusively on the constitutional propriety of the 19th Amendment to the 1978 Constitution. It will not dwell on its pros and cons.

The people of Sri Lanka went to the polls on 8 January 2015 on the explicit understanding (i) they were going to elect a powerful ‘Executive President’ under the 1978 Constitution (ii) the ‘Executive Presidency’ was to be subsequently abolished (iii) its abolition and the concomitant new dispensation was to be presented to the ‘People’ for their approval.

Its mere weakening was never on the radar.

HE Maithripala Sirisena who was elected on this basis had no mandate to allow the weakening of the ‘Executive Presidency’ through the 19th Amendment without the prior approval of the people at a referendum.

Its approval at a referendum is compulsory since as per Article 3 (untouched by 19th Amendment) which is ‘entrenched’ in the Constitution:

“In the Republic of Sri Lanka sovereignty is in the People and is inalienable. Sovereignty includes the powers of government, fundamental rights and the franchise. “

The key takeaways are:

1) Article 3 is ‘entrenched’ in the Constitution

2) “sovereignty is in the People and is inalienable”

3) “Sovereignty includes the powers of government, fundamental rights and the franchise. “

Another facet to the premise that a referendum is needed is:

Article 4 (b) (Post 19th Amendment):

“the executive power of the People, including the defence of Sri Lanka, shall be exercised by the President of the Republic elected by the People ;”

The 19th Amendment has undeniably weakened “the executive power of the People” which “shall be exercised by the President of the Republic elected by the People;”

The key words are: “President of the Republic elected by the People”. This must be viewed in the context of:

“the franchise” of the “People” being “inalienable” ( Article 3 ‘Entrenched’ in the Constitution)

Nevertheless, with all due respect to the constitutional expert Dr. Nihal Jayawickrama it is difficult to subscribe to his assertion in his learned article ‘The Illusory Executive Presidency’ in the ‘Colombo Telegraph’ of 19 March that the 19th Amendment has diluted the powers of the Executive President under the 1978 constitution to such an extent that the holder is now virtually reduced to what existed under the 1972 Constitution where the President was largely a ‘Ceremonial’ Head of State.

Conclusion

It is the view of this writer who has no pretence for any expertise in constitutional affairs that the 19th Amendment is inimical to the sovereignty and franchise of the people which is inalienable and hence compulsorily DEMANDS the approval of the people at a referendum. This is in addition to not less than two-thirds of the total membership of Parliament approving the same.

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President, the real target of NCM - Mangala

Wednesday, March 28, 2018

Finance and Mass Media Minister Mangala Samaraweera yesterday said the real target of the No Confidence Motion (NCM) was the President.

In an interview with ITN, he said this NCM was not against the Prime Minister but a means to come into power through the back door by politically bankrupt forces that have been defeated in elections twice. Though the NCM is against the Prime Minister, the real target is the President.

The President is protected by the UNP and the PM, and those who are against the President know this very well, he explained.

He stressed that the NCM tried to remove that protective layer, bring in a new Prime Minister, they can manipulate, change the Speaker and finally make Mahinda Rajapaksa Prime Minister though the back door.

“Thereafter, they will bring in an impeachment motion against the President-that is their true aim,” Minister Samaraweera said.

“This is what they are attempting to do but this attempt too will be defeated and it will only remain as just another attempt,” he added. 

Memo to UNP ‘Defy Rajapaksas’ The battle-cry of our generation

2018-03-28

What was not done during the last two and half years need to get done in the coming three months

“Because we don’t think about future generations, they will never forget us.”~Henrik Tikkanen, Finnish AuthorAmerican students took to the streets to defy gun violence. It was more to defy those politicians who were financially backed by the National Rifle Association (NRA), the infamous Non-Government Organization (NGO),whose aim was only more sales of weapons of destruction, guns and more guns.

On March 24, the kids and families of ‘March For Our Lives’ took to the streets of Washington, DC and in 800+ other locations in US.

Their message is clear. Theirs is succinct; theirs is angry; theirs is direct and theirs is legitimate and precious.

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• A placid and value-oriented society has been transformed into an unrecognizable conglomeration of individuals
• How on earth, one can forget the ‘White Vans’ and the killing of Thajudeen?
• How could any sane person forgive the open brashness of thugs garbed in yellow robes, pretending as if they are pious Monks of Maha Sanga?

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High school students made their case in the court of public opinion. Their rhetoric and the accompanying facial expressions sounded authentic; their determination and devotion to a cause looked stoic; their organizational skills looked almost unreal and the adults who followed them looked even humble and patient.

The power of youth was on display most vibrantly and dazzlingly. America’s gun culture definitely took a turn; I hope for the better, that no person of their parent generation thought possible.

A sophisticated democracy showed what a sophisticated movement could achieve just in one day.
Eight hundred plus rallies all over the United States of America may not have shaken her democracy at her foundations, yet it surely may have sent a series of ripples along a brittle existence of a society bent on ‘safeguarding’ an unsophisticated 2nd Amendment behind which the notorious ‘gun lobby’ was hiding.
When youth take up an issue and decide to run with it, it is unlike a movement or event, which is usually organized by adults.

Nuanced approaches are ignored; analytical methods are discarded and a direct attack on the base of the issue is being adopted-Not-looking-beyond-the-obvious-methodology seems to be paying lucrative dividends.

How can Sri Lankan youth be galvanized into action? When were they galvanized last? By whom and for what cause are the questions that need to be answered before we discuss the possibility of sending our schoolchildren and youth below 35- years to a worthy cause.

Historically speaking, the Janatha Vimukthi Peramuna (JVP) and its leader Rohana Wijeweera in particular, is one political entity that was both capable of attracting and then unleashing them on a wide scale of violent uprising against the then Government of Sirimavo Bandaranaike and her Sri Lanka Freedom Party (SLFP).

However, the romanticist allegiance a sizeable segment of our youth in the early 1970s had towards, not necessarily the JVP but more so towards the utterly mythical goals and the development of a social democracy such as Sri Lanka in the ‘70s, cannot be underestimated. Nevertheless, the JVP did not achieve all its successes, not in terms of attaining the goals of overthrowing a democratically elected Government, but in attracting hundreds of thousands of youths towards itself, overnight.

A sustained steadfastness to the cause and sacrificing of sweat and blood of the original leaders, especially their leader, Rohana Wijeweera, has been chronicled by many an author and scholar.
The magic of youth is that it does not seem to care about the dangers and obstacles they have to overcome to reach their given goals of the time.

Youth with its inherent attraction to adventure and curiosity seems to get involved in political causes much more easily and emotionally. The sentimental element of hard political facts and looming gloom and doom any socio-political dynamic would leave behind plays a spirited role in that engagement.

It is time to change, not just its façade; they must do a fundamental change, from top to bottom, not only in their personalities, in their attitude, in their demeanour, in their outlook, in their lock stock and barrel and in their very soul. If not, get ready for a sweeping defeat at the elections to come

And the most significant of this engagement is that when the youth or children of a society gets engaged in a political activity, their respective parent generation too gets directly or vicariously keeps their engagement going and this is extremely useful in a democracy where Governments are elected and not selected through clannish wars or military coups.

The inherent advantage of conversion of youth to a particular point of view is precisely that- conversion of the parent generation through the youth.

Ranjith Madduma Bandara’s challenge

However, this political strategy cannot work in a vacuum. In this context, the role of Ranjith Madduma Bandara, the new Minister of Law Order, is enormous and extremely decisive.
He needs to act now and to act fast. What was not done during last two and half years need to get done in the coming three months.

I’m sure it can be done if he wants to without any interference from high-ups in his Government.
Ranjith Madduma Bandara can justify his own position as the new Minister of Law and Order and the decision of the Government to hand over such an important and pivotal portfolio.

To paraphrase Captain Kirk of Star Trek, Madduma Bandara should go where no Minister has gone before.

He should find compelling evidence of all the stories that have been going around the notorious ‘cocktail circuits’, media outlets, street corners, distant hamlets and even among the air-conditioned rooms where the powers that be gather, to buttress and eventually prove beyond a shadow of doubt that the previous First Family and its henchmen and women made unprecedented amounts of illegal money and thereby did untold impairment and harm to our culture.

A placid and value-oriented society has been transformed into an unrecognizable conglomeration of individuals who are pursuing money and more money without a care for whose toes they are trampling and whose dentures they are selling to enrich themselves.

Then he, Madduma Bandara and the current administration can go to the people, especially the youth who will give no quarter and ask for none, to come forward and ask for their ‘place in the sun’.
Castro uttered in his long speeches after overthrowing one of the most corrupt regimes in Cuba’s history, that of Fulgencio Batista, ‘Cuba esta sola’ (Cuba is alone).

In the same vein, we can say that today’s youth is alone. They need leadership. We must not let them be led by a fringe organization like the JVP. JVP’s monopoly on youth has to be not just broken, it needs to be shattered.

The causes are many and aplenty. The disappearance of Prageeth Ekneligoda; his wife has become a forlorn voice in the current milieu of ‘aggressive indifference’ of a society that is pursuing material wealth and cushy power at the cost of decency and decorum.

Lasantha Wickrematunga’s murder is still an unsolved case. Rasthupaswela and Katunayake Free Trade Zone murders in broad daylight remain unexplained and our society has chosen to be quiet, once again that ‘aggressive indifference’ which is killing our natural curiosity and intent to go after what is palpably wrong and illegal.

A profound sense of quietude has overcome our psyche and the collective mass of people is being led as if nothing has happened during the regime that was run by the Rajapaksas.

How on earth, one can forget the ‘White Vans’ and the killing of Rugby footballer Wasim Thajudeen?
How could any sane person forgive the open brashness of thugs garbed in yellow robes, pretending that they are pious Monks of Maha Sanga?

How on earth one could one forget and forgive the untold miseries brought about by these ruffians on an untold number of innocent Tamils and Muslims under the cloak of patriotism and devotion to the Dharma?

Today’s youth, specifically those who still attend high schools, are completely oblivious of this maddening streak of communal and ethnic discriminations.

Their friends are Tamils, their friends are Muslims and they simply don’t have time, nor the inclination to find out the ethnic background of the neighbour next-seat in the classroom.

This is the recipe the United National Party must follow. Stuck in a historic disorder of political dilemma, the UNP and its leadership need to rid themselves of their immediate past of two and half years.

They must remember that whatever they did during that time has not produced the desired results.
It is time to change, not just its façade; they must do a fundamental change, from top to bottom, not only in their personalities but also in their attitude, in their demeanour, in their outlook, in their lock stock and barrel and in their very soul. If not, get ready for a sweeping defeat at the elections to come.
The writer can be contacted at vishwamithra1984@gmail.com

Maithri, Ranil, How Does Your Garden Grow?

By Grusha Andrews –MARCH 27, 2018

“Mary, Mary quite contrary,

How does your garden grow?

With silver bells- and cockle shells,

And pretty maids in a row”

Mary Mary quite contrary’ is an old nursery rhyme. Queen Mary, also known as ‘Bloody Mary’ of historical infamy was the daughter of King Henry VIII. In an attempt to break away from the Church of England, she tried to revert back to the Catholic Church in the immediate aftermath of her coronation. Systematic and purposeful murder of Protestants was carried out to achieve this end.

Literary historians believe that this nursery rhyme is actually a cunning preservation of history by the tortured folk poetically immortalizing Queen Mary’s methods of torture. The silver bells stood for thumb screws that were torture devices and cockle shells were genital torture devices. The pretty maids in a row symbolized people lining up to be executed by the Halifax Gibbet, a guillotine-like device. “How does your garden grow?” was a reference to the cemetery, where with increasing deaths, the cemetery “garden” would grow.

Four hundred and sixty years after the death of Bloody Mary, in a country once colonized by the British, two immature post-colonial men are quite contrary with each other. They are taking a troubled walk in their’ garden’, the country they have pledged to rule united, now a cemetery for reason. An electorate, baffled by uncertainty are watching the near total suspension of adult behavior. What is the anatomy of this infantile relationship between the President and the Prime Minister of Sri Lanka? 

Maithri, Ranil: quite contrary

To the rational mind, the singular person who deserves the joint contrary of Sirisena and Wickremesinghe is none other than Mahinda Rajapaksa. Instead of channeling their power and energy on bringing the Rajapaksas and their cronies to justice, both the President and the Prime Minister forgot the pact they made with 22 million citizens of this country at the drop of a hat. They both made cryptic and deceitful alliances with the two main persons of the Rajapaksa clan, Mahinda and Gotabaya Rajapaksa. It is widely believed that the ‘peaceful’ exit of Mahinda Rajapaksa, in the wee hours in the  immediate aftermath of the Presidential Election of 2015 was due to a ‘gentleman’s promise’ extended by Wickremesinghe that ‘ all will be well’ if Rajapakse co-operated with a non-violent transfer of power. Although the above is not conclusively substantiated, the behavior of the said ‘gentleman ‘for the last three years of his Premiership is uncannily supportive of this claim. Small wonder how old buddies take precedence over the promises made to millions of citizens in a split second. Small wonder still is how gentleman’s promise made to a despotic ex-dictator (and to his brothers by proxy) can be kept religiously for three years but the people who have maintained him on a lap of luxury for decades are easily forgotten. Sri Lankans have a huge problem with naming phenomena. When a domestic helper steals five hundred rupees, she is a lowly worker class thief. When the Premier is connected to the largest financial scam (aka Bond Scam) in the modern history of the nation, he is still a gentleman, high class, and yes, a Royalist! Gosh, we must all continue to regard him an unreal, phenomenal, larger than life demi-god and continue to call him statesmanly, sophisticated, elegant, cultured (a pearl probably has more culture)and quite outside our league and feel grateful for his leadership!

Then there is the Trojan horse, the President. Erected on the hope of 62 lakh voters, fed by the civil society activists, this Trojan horse came to the middle of the political city to make things right: dead bodies were unearthed, commissions appointed, rhetoric delivered. Millions of citizens who dared to dream of a better tomorrow rose from long political apathy to re kindle their sense of justice to oppose the only text book case of a despot that Sri Lanka has ever seen: Mahinda Rajapakse. The irony of it is that the hearts of those who outvoted Mahinda Rajapakse to enthrone Sirisena still loved Rajapakse, as one would love a brutal ex. They loved him for ending the 30 years’ arms struggle against the LTTE, for the city beautification, for the highways, knowing very well that all the Rajapakse fingers were in the national till. They loved him as they hated his brutish brat sons. They loved him as they also loved the smiling image of Thajudeen and wept for God’s tears. It was a national syndrome of love and hate. They wept as the very man they voted out just 24 hours ago left the Temple Trees ‘peacefully’ (what you don’t know can’t hurt you).

Outclassed by the elitist Wickremesinghe  and his esoteric buddies Sirisena appears to have lost his political nerve. Inept in the English language and in the art of getting those competent to decode difficult political scriptures, he fell in to the common trap of the rural disadvantaged who are an easy prey of soothsayers and bumpkin advisors. Equally uneasy with the tycoons of the private sector as with the elegant and west-philic Wickremesinghe, the conversation has died spelling the end of the anyway doomed marriage.  Never before in the history of Sri Lanka has the class and privilege disparity between a President and a Prime Minister been so stark, infringing on the aspirations of a desperate electorate. He systematically distanced himself from the learned advisors with vast experience and maturity to seek comfort in serenade singers without insight in to governance who gave him false hope in perpetuating power. According to his own interview to Sirasa TV pre- local government elections, Sirisena actually believes that he can ‘salve the economy’ with the help of one individual, Prof. Lalith Samarakoon, who has self-imported himself from the USA for this purpose. He even fell for the teenage trap of Faizer Mustapha who actually convinced him, with the help of equally immature lawyer types that he can be president for six years instead of five. Sirisena didn’t need to understand the amended constitution to figure that he did not have a six year tenure. He just needed to know grade 5 arithmetic and a well-meaning grandmother to advise him to keep away from manipulative frenemies.

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JO alleges MPs offered Rs. 100 mn each to vote against no-faith motion 

By Shamindra Ferdinando-March 27, 2018, 11:04 pm

Members of parliament have been offered as much as Rs. 100 mn each to oppose the no-confidence motion (NCM) moved against Prime Minister and UNP leader Ranil Wickremesinghe, Joint Opposition (JO) heavyweight MP Dallas Alahapperuma alleges.

Matara District MP Alahapperuma said so at a public meeting at Verona, organized by the Sri Lanka Pojujana Peramuna (SLPP) in Italy over the last weekend.

Parliament is scheduled to debate and vote on NCM on April 4. The JO handed over NCM signed by 55 members, including four of President Maithripala Sirisena’s group to Speaker Karu Jayasuriya on March 21.

Declaring that a section of the UNP MPs would certainly vote for the NCM, Alahapperuma said that those who had realised that they would never be able to contest a general election successfully were likely to accept the bribe.

Among those present at the meeting were former UPFA Deputy Minister Rear Admiral Sarath Weerasekera, Convenor of the Patriotic National Forum Dr Nalaka Godahewa and Chairman of the Global Sri Lanka Forum (GSLF) Wasantha Keerthiratne

The JO Chief Organiser said that whatever the outcome of the NCM, the Sirisena-Wickremesinghe coalition would certainly lose its two-thirds majority in Parliament. The government group consists of 107 (106 UNP + 1 SLMC) and 44 SLFPers.

Four SLFPers have signed the NCM.

Secretary General of Parliament W. B. D. Dassanayake said that a simple majority out of those present in parliament at the time of the voting was sufficient to adopt a NCM.

Dassanayake said so when The Island asked him whether 113 votes were required to pass NCM against PM Wickremesinghe. Parliament comprises 225 members. The official explained had there been only 20 members at the time the vote was taken, simple majority meant 11.

Former State Minister Prof. Rajiva Wijesinha yesterday said that parliament as well as the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) should be seriously concerned about the possibility in an attempt to bribe members of parliament.

Prof. Wijesinha said that he had made two complaints to the CIABOC about attempts to bribe members of parliament. The CIABOC had questioned him on both allegations and he had named all those involved, he added.

In response to our query, Prof. Wijesinha has sent us the following statement: "The first was in 2015 when I reported that a top UNPer (name withheld), on Christmas Day 2014, told me and my sister that he had to go to see the leader of a minority party (name withheld) who was demanding money to support Maithripala Sirisena for the presidency. The second was when I reported that Nahil Wijesuriya had told me that, when he supported the UNP in 2001 at a senior UNPer’s request, the Rs 60 million he gave, in the form of two cheques into the hands of the top UNPer, was used to bribe MPs to cross over to bring down Chandrika Bandaranaike Kumaratunga’s government.

"Bribing MPs is nothing new, the father of a top UNPer (names withheld) would describe how he had bribed MPs in 1964 to bring down Mrs Bandaranaike´s government. I do not think this is confined to one side or the other, but given the massive resources the UNP has at its disposal now after the bond scam, they have more money though less political support.

The commission questioned me on both allegations and also questioned Nahil Wijesuriya regarding the second, though not the witnesses in front of whom he spoke."

Prof. Wijesinha said that Parliament couldn’t ignore allegations against its members in respect of financial fraud. The academic said that the CIABOC should take tangible measures to inquire into accusations against members without further delay.

Sri Lanka Premier Wants India and Japan Cash to Balance China

Ranil Wickremesinghe

Photographer: Gian Ehrenzeller/Keystone via AP

By  Iain Marlow and  Anusha Ondaatjie-March 27, 2018, 2:15 AM EDT

• Ranil Wickeremesinghe says debt levels mean tough years ahead
• He hopes European investors will closely follow Asian ones

Prime Minister Ranil Wickremesinghe said Sri Lanka is seeking foreign investment from India, Japan and others amid criticism over his country’s reliance on Chinese loans for infrastructure projects.

 

In an interview in Colombo, Wickremesinghe defended a deal last year that gave a joint venture led by state-owned China Merchants Port Holdings Co Ltd. a 99-year lease to the southern port of Hambantota. The agreement gave Sri Lanka $1.1 billion in revenue at a time when it’s spending 80 percent of government revenues on servicingoutstanding debts.

 

“On Hambantota, the burden is off us, because China Merchants and the Sri Lanka Ports Authority have taken it over,” Wickremesinghe said on the sidelines of a business conference on Monday.

 

“We’ve been looking at inviting a broad range of foreign investors," he said. "Initially the investors will come from China, Japan, India. Then the others will follow. We’d like to see them coming in from Europe.”

 

Since Wickremesinghe took power in 2015, he’s been under pressure to improve Sri Lanka’s finances. A previous administration secured billions of dollars worth of Chinese loans after the South Asian nation emerged battered from three decades of civil war in 2009, contributing to a debt burden that threatens to impede economic growth.

‘Tough Years’

Even with the sale of Hambantota and other concessionary measures, Sri Lanka has been forced to pursue other revenue-raising measures, including a recent tax reform. The country’s total debt to China was $5 billion at the end of 2017, according to government treasury figures.

“It’s an easing of the Chinese part of the debt burden, but we have the international sovereign bonds, so 2018, 2019 and 2020 are going to be tough years for us,” Wickremesinghe said.

Sri Lanka’s $1.5 billion 2027 bonds fell 9 cents on the dollar this year to 96.4 cents on Tuesday, near a record low since issuance last year, according to Bloomberg-compiled data.

The country has $1.5 billion in dollar bonds due in 2019 and another $1 billion in 2020, according to the data. Sri Lanka last paid a $500 million dollar bond in 2015.

India Worries

Sri Lanka was an early participant in China’s infrastructure-building plans that eventually became the Belt and Road Initiative backed by hundreds of billions of dollars in financing. Still, its appetite for Chinese cash waned after the debt burden forced it to sell the Hambantota port back to China Merchants Port Holdings.

The deal also prompted concern in India about its geopolitical rival China using a port close to its southern coastline for future military or strategic uses.

Public anger over Chinese debt helped Wickremesinghe rise to power three years ago with President Maithripala Sirisena in a coalition government that pledged to reevaluate China-funded projects they alleged were corrupt. But faced with few good options, the government has since negotiated concessions -- including turning a Chinese freehold land reclamation project in Colombo into a long lease -- while largely pushing ahead with the projects.

The administration’s sale of the Hambantota port in a debt-for-equity swap to China has been criticized by former President Mahinda Rajapaksa, who had originally courted Chinese investment for his home district of Hambantota before losing power in 2015. A new political party backed by Rajapaksa triumphed over the ruling coalition parties in local elections in February.

Read more: Sirisena Reshuffles Sri Lanka Cabinet After Local Poll Defeat

Wickremesinghe said Monday that Sri Lanka needs to “focus on what is achievable and doable” by courting Asian investors first.

Colombo Port City development, on April 21, 2017.

Photographer: Taylor Weidman/Bloomberg

“Just as much as there is the Belt and Road Initiative, the Japanese are also taking a big initiative -- and the Indians,” he said.

Japan is interested in investing in the Colombo port, as well as the undeveloped east coast port of Trincomalee, a colonial-era British naval base, Wickremesinghe said. Indian investors have also expressed interest in a Chinese-built airport in Hambantota that’s barely used and has been criticized as a politically motivated Rajapaksa-era project.

— With assistance by Lianting Tu

WHO IS FOOLING WHOM?

 

2018-03-28

1. FROM WHOM IS THE PRESIDENT RUNNING AWAY? ‘NO CONFIDENCE’ MOTION HAS BEEN BROUGHT AGAINST THE PRIME MINISTER, SO WHY IS THE HEAD OF STATE RUNNING AWAY FLYING TO PAKISTAN???

GUILTY CONSCIENCE??? HAS HE FINALLY REALIZED THAT HE IS PRESIDENT TODAY BECAUSE OF RANIL??? “OH WHAT A TANGLED WEB WE WEAVE WHEN FIRST WE PRACTISE TO DECEIVE”

This quote talks about the complex destructive effect that lying brings to the life of people because lying often has unforeseen consequences.

Perhaps we should also remind our President of his promise to RENDER THE EXECUTIVE PRESIDENCY NULL AND VOID IN 100 DAYS!!

POOR GUY HE HAS BEEN SO BUSY FULFILLING ALL THE PROMISES HE MADE, WITH THE EXCEPTION OF THE EXECUTIVE PRESIDENCY, THAT HE HAS LOST COUNT OF THE DAYS!!!

1a) Perhaps in a frantic effort to prove his superiority we saw him flying down Green Path a few days ago, complete with Police escort, followed by STF Jeeps, followed by huge luxury cars, again followed by STF JEEPS WITH T56 RIFLES AT THE READY, AND AGAIN MORE CARS!!!
We did not just criticize, we found fault with the RAJAPAKSA REGIME for indulging in this kind of monstrous waste of the country’s money. WHAT ARE WE DOING NOW???

QUESTIONS, QUESTIONS, QUESTION

2. QUESTIONS, QUESTIONS, QUESTIONS, but we get no answers. ALOYSIUS AND PALISENA ARE STRUGGLING HARD TO GET OUT, UDAYANGA HAS NOT YET BEEN FOUND, JALIYA MISSING, MAHENDRAN MISSING, WHO ELSE IS MISSING? NAMAL HAS BEEN REFUSED ENTRY TO US!!! WHAT A CONTORTED CACOPHONY OF “MISSING” “NOT FOUND” AND “FOUND”!!! LOOK AT THE “MESS” ,THE COUNTRY IS IN TODAY - MISSING PERSONS, NO CONFIDENCE MOTIONS, THE HIERARCHY TAKING OFF, PROBLEMS UNSOLVED AND ALL OF THEM SAYING WHAT HAS TO BE DONE WOULD  BE DONE BY THE END OF THE SINHALA AND TAMIL NEW YEAR!!! WHAT ABOUT NOW??? YET ANOTHER SAYING THE UNP WILL BE REORGANIZED BY MAY THIS YEAR!!! DID IT TAKE THEM ALL THIS TIME TO REALIZE WHAT AND WHERE THEIR PRIORITIES lay??? DIDN’T ANYONE OF THEM REALIZE THAT THE PARTY IS IN SHAMBLES AND THE COUNTRY IN A WORSE STATE OF CHAOS!!! THERE IS NO LOYALTY, NO TRUTH, AND NO JUSTICE!!! ALL THE VITAL ISSUES IN ANY SPHERE ARE CONVENIENTLY BEING PUSHED FURTHER AND FURTHER BACK!!!
Let’s take them one by one and have a look:

3a. EDUCATION: No ruling has been made on HOW MUCH A PARENT MUST PAY TO GET A CHILD INTO SCHOOL. It should be one rate for the MEGA RICH, the RICH, the MIDDLE CLASS and the POOR. IF AND WHEN this happens we can talk of an equitable system of EDUCATION in our country and come to terms with the demise of FREE EDUCATION!!!
3b. HOSPITALS: CLEANLINESS, AVAILABILITY OF ESSENTIAL DRUGS, CRACKING DOWN ON THE BLOODSUCKERS THAT TAKE EVERY CENT THEY CAN FROM POOR PATIENTS, ESPECIALLY CANCER PATIENTS!!!

BUILD MORE HOSPITALS FOR CHILDREN AND MORE SCHOOLS FOR THE FORCES CHILDREN!!!

3c. CLEANLINESS: After the ravages of the war, the country was in total disarray. In all fairness to them, the previous Government rebuilt all the shattered buildings, created a sense of well being, whether they used the Army or not, the buildings along Reid Avenue and Independence Square were and still are a pleasure to look at. People can often be seen shopping in these Arcades. In addition to this, one could see the Abans Cleaning people constantly sweeping roads, the shop areas, the Viharamahadevi Park, collecting garbage, and keeping the roads clean. It is not the same today, the Park Grounds are always littered, the roads that were so beautifully laid out are badly broken and hastily repaired causing inconvenience to the public.

This is not only true in Colombo but out of Colombo as well. There is an absolute desecration of the roads and environment, even of the Highways, that were so very welcome. It was a pleasure to look at our island home then; it was so clean, so orderly and so pretty with flowers everywhere.

3d. JUDICATURE: Bodies being exhumed and body parts go missing so many unsolved murders-even when they know who is responsible. So many miscreants walking free; even allowed to travel abroad!!!

Others housed in hospital or luxury cells with round the clock security. I guess the worst is the land cases, where poor people have had to walk the path of justice to gain only injustice!!! Cases being postponed month after month after month, till in MANY cases they run into years!! ONE that I know of personally, has gone into 20 years and YET no conclusion!!! Is this JUSTICE??? PERHAPS CALLING IT A “MOCKERY OF JUSTICE” IS MORE APPROPRIATE!!!

3e. TRANSPORT: We are still compelled to travel in the FILTH, STENCH, AND DIRT OF OUR TRAINS AND BUSES!!! We complained before but NOTHING, ABSOLUTELY NOTHING, HAPPENED!!! WHAT THEY ARE GOING TO DO IS RAISE THE TRAIN FARE FROM THE 1ST BY 15%!!! NOW, WHY ARE WE COMPLAINING THAT NOTHING HAS HAPPENED??? YOU TRAVEL IN THE SAME FILTH AND STENCH AT AN ENHANCED PRICE OF AN ADDITIONAL 15%. THEY ARE CONTEMPLATING RAISING THE PRICE OF GAS, DIESEL, PETROL AND MANY OTHER ITEMS, WHICH WILL AUTOMATICALLY RAISE THE PRICE OF ESSENTIAL FOOD ITEMS. SEE HOW ACCOMMODATING THEY ARE, THIS GOVERNMENT, UNLIKE ANY OTHER WE’VE KNOWN!!!

THAT’S NOT ALL, WE ARE TREATED TO ‘NO CONFIDENCE’ MOTIONS, THEN ‘CONFIDENCE’ MOTIONS, MISCREANTS BEING SPRUNG OUT OF JAIL, CRIMINAL AND LAND CASES NOT SOLVED, GUYS GONE MISSING (WONDER WHO KEEPS A RECORD???) IT JUST GOES ON AND ON AND NO ONE GIVES A DAMN!!! THAT IS THE SORDID SAD STATE OUR COUNTRY IS IN TODAY!!!

‘Yahapalanaya’ for financial institutions

 Wednesday, 28 March 2018

‘Yahapalanaya’ is a slogan heard all too often in the current political arena; however rest assured this article is nothing to do with politics, rather the financial institutions and the financial system stability of the country. 

In the preceding months we witnessed yet another financial institution/group nosedive, namely the Swarnamahal Financial Services Group, and add to the Central Bank’s list of financial institutions pending resolution. 

apital is no panacea

The primary response strategy of the Central Bank consequent to these distressed financial institutions has been to bolster the threshold capital requirements of financial institutions across the board. The amount of capital a financial institution must hold or ‘capital adequacy’, is a foremost means of regulating financial institutions. 

However, capital adequacy is no panacea for all the ills facing financial institutions. There are other important elements in a financial institution that require regulatory scrutiny to ensure the safety and soundness of the financial institution. Therefore, contemporary regulatory regimes have enhanced focus on these elements, which can be categorised as quantitative elements such as requirements on assets, liabilities, earnings, or liquidity of financial institutions, and qualitative elements such as requirements on corporate governance.

However, the focus of this article is on the qualitative elements and in particular corporate governance for financial institutions. 

Good governance (‘Yahapalanaya’)

It is important to distinguish the meaning of good governance in the context of financial institutions from the political slogan; the latter has come to mean a myriad of things to the politicos as witnessed in the media and could not be further from the intentions of its proponents! 

The primary objective of good governance at financial institutions is to safeguard the stakeholders’ interest on a sustainable basis and in this regard the depositors’ interest should take precedence over shareholders’ interest. Governance weaknesses can affect the safety and soundness of a financial institution and depending on the importance of the institution; it can result in the transmission of problems across the financial system (‘contagion’).

Some may see the irony of a discussion on good governance at financial institutions; given that the watchdog entrusted to enforce these standards itself is in the firing line for its governance practices or the lack thereof in the bond fiasco. Nevertheless, establishment of good governance at financial institutions is a means of prevention rather than a cure to the ills facing financial institutions; and prevention is better than cure! The regulator can promulgate any amount of regulations; however they shall not be a substitute for good governance, as the unscrupulous will always find a way to weasel out of any regulation. 

Licensing and authorisation

This is the process by which the regulator grants approval for the operation of a financial institution. The approval is usually granted upon the prospective financial institution satisfying the entry requirements stipulated by law and regulations. The most common requirements of entry concern ownership, capital and management. 

This is the first step in establishing good governance at financial institutions and its importance cannot be over emphasised. The licensing and authorisation requirements act as a filter by eliminating any unsuitable applicants and letting only the acceptable ones to pass through. In management terminology, these requirements help to prevent the problem of ‘adverse selection’. However, given the proliferation of financial institutions in the country and the institutions that are falling afoul, one wonders whether the regulator has made optimum use of the licensing and authorisation filter. 

Nevertheless, it should not be construed that what is called for is a blanket ban on any new entrants. In fact, a suitable new entrant should be allowed in at the expense of existing mismanaged financial institutions. The Central Bank can improve financial system stability by allowing in suitable new entrants and taking regulatory action on some of the mismanaged financial institutions, such as consolidation or a solvent winding down of these institutions. However, the likes of internationally infamous Lycamoblie referred to in the media as a potential investor for the troubled Swarnamahal Financial Services Group certainly does not fit the bill of a suitable new entrant.

Specialised leasing companies

These are a type of financial institution that engages in the finance leasing business; however these are not permitted to accept deposits from the public. Specialised leasing companies only account for 0.6% of the total assets in the financial system. However, due to the finance leasing business being regulated, the Central Bank must stick out its neck for these institutions, even though they do not mobilise savings like the rest of the financial institutions regulated by the Central Bank (these are not financial intermediaries).

At time when we speak of proliferation of financial institutions and the associated regulatory burden, one cannot help but wonder why the Central Bank needs to regulate these institutions. A simple fix to this issue is to amend the Finance Leasing Act, and exclude specialised leasing companies from carrying on finance leasing business. These companies can continue to operate as consumer credit institutions without the intervention of the Central Bank.

Owners/controlling shareholders

The governance at any financial institution shall only be as good as the owners/controlling shareholders. It is the owners that appoint the directors responsible for the management of the financial institution and if the owners are of questionable background, their appointee directors can be no better.

The ownership is the most important criteria that must be vetted by the regulator at the licensing and authorisation stage. However, as change of ownership can take place at any time throughout the existence of the financial institution, it becomes a continuing requirement and at each time the vetting must be carried out with the same intensity.

The regulator should take an active approach to identify the ultimate beneficial owner/s (natural person/s) of the financial institution, lifting any veil of incorporation in the case of holding companies or group structures. Once the ultimate owners are identified, as redundant as it may sound, it is absolutely essential that the regulator collaborate with authorities like the IRD, Police, law enforcement agencies and other financial sector regulators or in the case of foreign nationals the counterparts of these authorities in the respective countries, to ascertain whether any impediments exists with regard to the owners. Any and all cost incurred for such vetting exercise is fully justified, given that it is the public that has to ultimately bear the huge bailout cost of any failed financial institution run by unscrupulous individuals.

Directors

A similar vetting process to that of the owners should be carried out in respect of the directors of a financial institution and in the case of a holding companies or group structures, the directors of the parent and ultimate parent should be held to the same standards, as they wield direct influence over the directors of the subsidiary financial institution. 

The vetting process for directors must ensure the integrity and competence of the directors. However, looking at some of the current boards of financial institutions, one wonders whether the regulator even considers this criterion. Frankly speaking, the integrity and level of competence of some directors is befitting for three wheeler companies; definitely not financial institutions, where the directors act as the curators of public funds. 

The reality is that in Sri Lanka directors, including the ones in financial institutions, are appointed on their connections rather than on what they can contribute to the management of the company or financial institution (does this draw startling resemblance to how the country’s Yahapalana administration operates!?). Hence, a majority of the non-executive directors are there to merely collect the director’s fee cheque or to foster a mutually benefiting business relationship with the company. 

The regulator should consider incorporating a field in the application for appointment of directors, which requires the prospective director to state the responsibilities or the scope of work expected of the director. In the case of listed financial intuitions the same should be incorporated in the announcement to the CSE. This statement shall form the basis for the director’s annual performance review, which shall be available for inspection by the regulator. This should persuade financial institutions and their owners to appoint directors with competencies to contribute to the management of the financial institution, instead of making appointments solely based on connections. 

‘The nine-year rule’

There is a corporate governance requirement that precludes non-executive directors from sitting on a board of a financial institution beyond a period of nine years. The rationale for this rule is that longstanding relationships among the directors themselves and, between the directors and management could impair the integrity, objectivity and independence of the directors. Therefore, the enforcement of this rule provides an assurance that these relationships are at a level that does not suggest excessive familiarity, undue influence or coercion. 

But, why nine years? It is likely that the rule is a copy paste from a governance code of a developed jurisdiction and therefore has not considered the local context. One would think based on the local experience this period should be shorter.

The rule does not apply to executive directors on the likely premise that if an executive director is required to step down, it would disrupt the operations of the financial institution and attract undue negative press. However, given that executive directors are not immune to the excessive familiarity, undue influence or coercion resulting from long standing relationships and corporate governance requirements dictate that financial institutions have in place proper succession planning, it may be appropriate to reconsider the non-application of this rule to executive directors.

Nevertheless, if an executive director subsequently becomes a non-executive director, the above rule shall apply and the nine year period should be counted inclusive of the time such director functioned as an executive director, as otherwise it would defeat the purpose of this rule. 

Final remarks

The requirements for good governance at financial institutions cannot be addressed in a single article. The foregoing is a discussion on the most important precursors to establish good governance. Any attempt at good governance without first satisfying these precursors is futile. 

Good governance at financial institutions is essential to safeguard the financial institutions and the stability of the financial system. Therefore, for the sake of the public let us hope that good governance is restored in financial institutions and the same fate as ‘Yahapalanaya’ in politics does not befall on the financial system of the country. 

(The writer is a Regulatory Compliance Specialist and can be contacted via e mail: srivante@gmail.com.)