By Dinesh Weerakkody
While all over the world many stock markets were registering big falls, our stock market was upbeat and Sri Lanka business community was hopeful of an economic recovery with Ranil Wickremesinghe’s UNP in the driving seat. The Colombo Stock Exchange saw a major rally with many investors, who have stayed in the sidelines for over a year due to PA bungling, coming back in hordes. According to analysts, the market will from now on be on a roller coaster ride because investors are pinning their hopes on the UNP administration to rebuild this devastated economy. The market is expected to gain further, expecting the UNP to re-engineer the economy.

Economic growth has dipped to almost zero, according to analysts. The growth slow down is not a sudden thing, it has been there for some time and the government did very little to address the policy lapses and institutional inefficiencies. The policy lapses corruption and political instability has adversely affected our exports and economic growth. We all know political stability is a must for economic growth. The probationary PA - JVP alliance could not provide that stability. The MOU between the PA and JVP was in fact a compromise of economic policies for political survival. The millions of farmer loans that were written off at the request of the JVP, only crippled the economy further. All political parties should realize that there is no free lunch, it is the tax payers who finally bear the burden of subsidies and public sector debt. Now it is upto Wickremesinghe to take appropriate action to address the structural reforms, ailing infrastructure and macro economic instability. The PA government’s decision to increase salaries in the public sector will have further serious setbacks in the medium and long term. In fact it is short sighted policies like this that led to the collapse of the PA government within one year.

The UNP has now got a golden opportunity to show their capabilities to the country. In fact, I have said many times that Wickremesinghe is one of the most competent politicians this country has. Wickremesinghe has shown the electorate that he has the capability and skill of his Uncle J. R. Jayewardene to outsmart the government of the day. The most important thing for Wickremesinghe and the UNP now is not to compromise on principles but to have an efficient administration. The UNP alliance has a good opportunity to get in and implement a common programme with the support of the PA if necessary to pull this country out of this current rut. This maybe the last opportunity the UNP has to redeem itself and the country and secure the future of this country.

We all know that in the post independence history of our country, there has been no other era so hopeless and so desperate than the present time and burden after burden was heaped on the people, and the economy was pushed into the doldrums. It was on that basis the joint opposition led by the UNP moved a no-confidence motion against the government in April. The PA government since April was like a patient gasping for breath. The government’s downfall as I said before was because of the incompetence and arrogance of some of her ministers and the way they responded to criticism. In addition Kumaratunga’s inexperience, ad-hoc and impulsive style of governance led to her government’s undoing. Furthermore, many of her ministers were only interested in enjoying the privileges of power for as long as possible. Only a few ministers were able to accomplish anything worthwhile for the voter. If the PA is to make any impact in the future, Kumaratunga will have to do some soul searching and repackage her party. On the other hand, to save her presidency, she may also have to learn to co-exist with Wickremesinghe. Publicly saying she can’t work with Wickremesinghe at this moment would lead to her own downfall.

The private sector, the engine of economic growth, is oozing with confidence with the poll verdict. They are confident that the UNP can find a way out of the current impasse. Many business groups are urging both the PA and the UNP to get back to the negotiating table and to stop the war that is bleeding the economy dry already hit by a world recession, the war and the US recession, will hit us further. Growth will be less than 1% and the election handouts of the PA would further affect the economy and also seriously jeopardise the IMF pact. Therefore, our private sector will have to do something more than holding hands to protect their business interests if they are to put any pressure on the UNP or PA to act decisively to resolve the North-East Conflict. We all know the taxes paid by the business community are a major source of state revenue, which in turn are used to fund the war. Therefore, it is the government’s duty to consult the private sector and also provide for private sector representation in the administration.

The UNP must reactivate the peace process with the LTTE and agree on the constitutional reforms that are needed to transfer more power to parliament. Recently, a survey carried out by Org-Smart revealed that the majority of the business community in Sri Lanka put peace on top of their agenda, even ahead of economic reform. Therefore, the government and the opposition must realize that this is the best possible moment for a bipartisan approach to address the most difficult problems facing this country. We all know that defence expenditure is screwing up our development effort. The present spend of Rs. 80 billion is unbearable and today the war is the key factor that is preventing Sri Lanka from realizing her full potential. In fact, the PA government, because of poor management, existed on the various taxes drawn from the people and on temporary IMF facilities. Therefore, the new UNP govenrment should urgently do something to temporarily tide over the crisis and work on long term strategies with the support of the other political parties.

Therefore, all political parties must realize that what we need at this moment are leaders who are capable of leading Sri Lanka to become a nation that is peaceful to live in. Only the return to a rule of law and a work ethic of integrity and hard work will ensure a future for generations of Sri Lankans yet unborn. Wickremesinghe must never be afraid to insist on the highest standards of work and productivity and the govenrment should work in partnership with the people to secure a lasting peace and a prosperous nation. As a nation we have fallen behind our regional neighbours. The American tragedy and how the nation reacted to that tragedy should be a learning experience to our self centred politicians.