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
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
‘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
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.