Established institutions not adequately consulted - Prof. Gunaruwan | Daily News


 

Preparing MCC’s constraint analysis

Established institutions not adequately consulted - Prof. Gunaruwan

Chairman of the four-member committee appointed to review the proposed Millennium Challenge Corporation Compact (MCC) Prof. Lalithasiri Gunaruwan yesterday charged that Sri Lanka’s established institutions have not adequately been consulted or involved in preparing MCC’s constraint analysis.

Speaking to the media at the Government Information Department, Prof Gunaruwan said that none of the government agencies, not even the MCC administrative team under the Prime minister’s Office were in a position to provide detailed calculations and the National Planning Department doesn’t know anything about the agreement.

He further said that as it was empowered by Financial Regulations (FR) 34,35,36 any Government Capital Investment Project has to be thoroughly appraised by the National Planning Department and all macro level analysis has to be done before granting the approval.

“We inquired from apex agencies and we could not find any such multi-sectoral and multi-directional impact analysis done. But there is a report called constraint analysis conducted in 2016 by the Harvard University Centre for International Development. That report has identified and recommended a land project and a transport project as the biggest constraints to Sri Lanka’s development. They say that the selection was done based on Economic Rate on Return (ERR).” he added.

He further said that the security impacts, social impacts, sovereignty impacts or any other impacts on the agreement have not been properly evaluated.

“We also found that there are many clauses which are not in line with Sri Lanka’s legal system, present laws and also constitutional provisions. Therefore, we concluded that if the proposed compact agreement signed by the Government would basically put the country into difficulty and proposed the Government not to sign it,” Prof Gunaruwan said.

“There is a lot of misinformation going around after the submission of the final report of the committee and the President wanted us to explain the facts to the public,” he said.

Refuting a media statement which claimed that Prof. Gunaruwan’s report alleges that US$ 10 million was provided by MCC to the previous Government following the signing of two agreements with the MCC in 2017 and 2018, Prof. Gunaruwan said that the Committee has never mentioned such information in the report and only put a footnote mentioning that they got to know that two preparatory agreements had been signed for US$ 7.4 million and US$ 2.6 million. But we have not mentioned in our report whether the grant money came or not.

Commenting on a statement by the Finance Ministry during the previous regime claiming that Sri Lanka began negotiation with MCC in 2001 on the directive of Ranil Wickremesinghe, the then Prime Minister, Prof Gunaruwan said that the Congress approved the MCC in January 2004 in the Millennium Challenge Act of 2003 and established the MCC as a government entity separate from the Departments of State and the Treasury and from the U.S. Agency for International Development (USAID). “So how did they begin negotiations even before establishing the MCC?,” he questioned.

 


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