Development challenges - II

Sri Lanka on the look out for a new development strategy has to distance itself from neo-liberalism of good old JRJ and the so-called human faced liberalism of CBK. There cannot be any longer unbridled market dominance that has failed from Washington to Wellington. If you only contemplate for a while you would see unfettered or unregulated markets have never existed. Right through it was regulated for the benefit of the financial and industrial oligarchy.

Lesson one to be learnt is that market fundamentalism preached by the neo-liberal gurus was all unpractical and extremely damaging to the populace. It should be regulated markets, especially when they are financial.

It is perplexing to see certain learned academics and influential politicians still pushing the authorities for capital account deregulation when even the conservative World Bank has expressed its reservations. Perhaps they are on the pay books of the West. True, it’s hard for one to unlearn the untruths taught in the citadels of global capitalism.

An equally compelling truism that must be understood in designing a national development strategy is the need for the Sri Lankan economy to be more integrated to the world economy. Under globalization no economy could stand alone.

As the examples of Malaysia, China and even Korea show the integration should take place on terms decided upon by the nation concerned and not by external advisors or multilateral financial institutions. It should be selective integration and not all out integration. This in other words means a policy of safeguarding national interests and national industries.

While this also calls for self-sufficiency in the agricultural sector and in selected industries, it does not mean the boycott of everything foreign as some extremist and obscurantist elements preach. No country could exist without being part of the international division of labour.

Further, both local and foreign past and present experience teaches us the unreliability of the International Monetary Fund and the donor community who have politicized these structures while preaching absolute neutrality to their clients. The dilly-dallying and the informal messages that come from that august body as regards our request for a standby arrangement defy all logic and smack of unwholesome hand-twisting by the “big” bosses.

Thus, by the sheer force of circumstances we have been forced to look elsewhere for development funding.

This is not unique to Sri Lanka. Nor is it a mere reaction to a possible LTTE pressure. It is much more fundamental. Though the latter did play its part, historically it is a transient phenomenon. The same pressure albeit in different degrees persisted earlier when the LTTE factor played and would persist in future though it would not play any part.

In the global struggle for a better world we see new forces emerging, new alliances shaping up. Though things have not crystalized and taken concrete shape we see a trend towards greater South - South cooperation, greater regional alliances for mutual benefit. Sri Lanka should look earnestly to play a pro-active role in the SAARC, BIMSTEC, SCO, NAM and other such regional groupings so as to strengthen its independence vis-a-vis the IMF.

Unlike in the heyday of neo-liberalism the world is no longer uni-polar. It is a multi-polar world that is emerging with the centre of gravity of the world economy moving East, particularly to Asia.

‘The awakening of Asia’ the sleeping giant as one philosopher predicted over 200 years ago is actually taking place. Therefore, in designing our development strategies we have to look East and not West.

A word of caution, here too. Sri Lanka could not and should not aspire to be another Singapore as an ex-President preached and all ignorant followers naively believed. Singapore is a City State. Sri Lanka is a bountiful island with rich bio-diversity and a rich cultural heritage besides a history of technology of its own.

Nor could it become another China or Hong Kong as some would believe none. Sheer difference in size itself would preclude Sri Lanka becoming another China. Unless one looks merely on a trading partner basis none could imagine Sri Lanka having a relation with India similar to that of Hong Kong with China.

It is time to stop conjuring fantasies on foreign models and genuinely seek a home-grown development model as current thinking in vogue or as the Mahinda Chinthana suggests.