While much speculation was in the air over a possible cabinet reshuffle involving several key ministries President Maithripala Sirisena was out in Indonesia on a visit to attend the Leaders’ Summit of the Indian Ocean Rim Association. As a result, there were no major political developments, except for some skirmish in the Parliament. President returned to the country on Wednesday night.
In the home front, concerns of economic woes as well as deteriorating law and order situation were still taking the centre stage of political debate and media space. The main concern of the government appeared to be the need for countering the efforts of the Joint Opposition trying to capitalize on both these issues.
Government’s decision to halt proposed Dambulla and Ratnapura highway projects due to debt repayment burdens and difficulty of obtaining new loans is ample testimony to the current state of the economy.
Even though, Prime Minister Ranil Wickremesinghe on Wednesday, responding to a question in the Parliament said that the government had been faced with the task of repaying loans obtained during the previous regime, the ability of the new administration to manage the economic situation has also now come into question, especially in the context of the current global economic situation.
These concerns probably prompted the government to organize a press conference on Wednesday with deputy ministers Harsha de Silva and Eran Wickramaratne in attendance to clarify matters connected to the economy.
The debt burdens are such, Highways Minister Lakshman Kiriella had indicated the government’s position with regard to future infrastructure projects, notably highways. He said that though some of the projects have been temporarily halted, if private companies agree to build highways with their own funds, projects can be undertaken on build, operate and transfer (BOT) basis under which the builders can exclusively enjoy the fruits of income for up to about 15 years.
That probably seems to be the only available option in a scenario where the government’s debt burden has reached UD$ 36 billion for the next ten years which means annual repayment will be around US$ 3.6 billion.
Meanwhile, restructuring of some of the state-owned enterprises which have been a colossal burden on the economy also has come up again in view of the undertakings given by the government to the IMF.
IMF’s Managing Director Christine Lagarde was due to visit Sri Lanka weeks ago, but her visit was postponed due to an unforeseen change in her schedule. Largarde is reported to be looking into the possibility of visiting Sri Lanka in the near future.
Meanwhile, an IMF team led by senior staffer Todd Schneider was already conducting discussions with officials in Colombo. The team held talks with Finance Minister Ravi Karunanayake and Treasury officials on how to improve the performance of state-owned institutions. The goal set by them was to get these entities at least to the break-even level of performance The IMF approved a US$ 1.5 billion loan last year, to be paid in six instalments, subject to the government meeting the IMF’s targets. The government pledged to reduce the fiscal deficit to 3.5 percent of gross domestic product by 2020, which is half the deficit for 2015.
The target is to be achieved by restructuring state-owned enterprises, including through their full or partial privatisation, and by slashing subsidies and increasing taxes if necessary.
These “benchmarks” included restructuring six of the largest state-owned ventures—the Ceylon Petroleum Corporation (CPC), Ceylon Electricity Board (CEB), SriLankan Airlines, National Water Supply and Drainage Board (NWSDB), Airport and Aviation Services, and Sri Lanka Ports Authority.
Among other items discussed were the sale of “non-strategic” assets such as the Colombo Hilton Hotel, Lanka Hospitals, the Hyatt Hotel and SriLankan Airlines. The IMF has estimated their sale could earn the government US$1.5 billion. Despite expected opposition from workers and political parties backing them, it’s time for the government to go ahead with one or two of these things.
The way foreward would be the implementation of a strategic advocacy programme for all stakeholders with a focus on enterprises performing a socially and financially viable role, rather than being a burden upon the state coffers, and protecting unproductive work ethics.
Commotion in Parliament
Meanwhile, Wednesday’s parliamentary sessions became a pandemonium with heated debates and near fisticuffs with the announcement of Speaker Karu Jayasuriya’s ruling that Wimal Weerawansa’s Jathika Nidahas Peramuna (JNP) could not act as an independent party in Parliament.
The tense situation compelled the Speaker to suspend the sittings several times and finally order the removal of MP Dinesh Gunawardane from the House. He was suspended from attending the sittings of the Parliament for one week following a vote in the House.
The question of acting independently in the Parliament arose a few weeks ago when Ven Athuraliye Rathana Thera, a sitting MP wanted to resign from Hela Urumaya and wanted to function as an independent member.
Hela Urimaya took up the position, it was not legally possible for the Thera to do so, as he contested elections and was elected as a member of Hela Urumaya. However, there remains a technical issue as he contested as a member of the United National Front led by the UNP because of a last minute arrangement prior to the general election of August 2015. However, his, is a mere decision to act independently and not a case of asking for recognition as a separate political party.
Meanwhile, political analysts see Weerawansa’s move as a part of Joint Oppositions’ (JO) strategy to get more talking time in Parliament as each party now working together with them, if recognised as independent parties, would get a time slot allocated in the parliamentary debates. .
Announcing his ruling in the Parliament Speaker Karu Jayasuriya said what he had to decide was whether he could recognise any party other than those six political parties which contested the general election on August 17, 2015 and, thereafter duly recognized by the Commissioner of Elections in terms of the Constitution and the Standing Orders of the Parliament by the Gazette Extraordinary dated August 19, 2015.
He further stated, it was not within the purview of his business as the Speaker to go into the nitty-gritty of internal arrangements and agreements among the political parties in these alliances. He said his opinion was that the political parties that are recognized in the Parliament should be decided under a legal basis in terms of the Constitution and the Standing Orders of the Parliament.
He took up the position that as the Speaker, he had no power to create new political parties which are fully recognized under the Constitution and the Standing Orders of the Parliament.
Following the Speaker’s ruling and the unpleasant situation that erupted in the Parliament, it has been reported that the JO had taken a decision that none of the political parties in their group should ask for separate recognition in the Parliament in the future. However, whether this move is merely abiding by the Speaker’s ruling as he is the final arbiter on this type of issues concerning the Parliament or whether it is part of JO’s future strategy is yet to be seen.