Beware of the ‘hurrah’ boys

by FS

(November 21, Colombo, Sri Lanka Guardian) In every administration, there are the ‘hurrah’ boys, ‘golayas’ and hangers on.

Their role is essentially to say ‘yes’ or nod their head at anything their ‘venerated’ leader says, irrespective of whether it’s right or wrong, fact or fiction, a myth or reality. All for one reason – being in the favoured circle, and to cultivate powerful contacts to get contracts. Make money – essentially that’s the objective.

As President Mahinda Rajapaksa embarks on his second term of office, having been sworn in on Friday at an unprecendented event that drew thousands of Sri Lankans to the Galle Face Green and at an unprecedented cost across the land, it is incumbent that the leader of the country makes sure that the ‘golayas’ and ‘hurrah’ boys wouldn’t spoil his second ascension to the throne.

Take for example the advertisement last week run in national media by Sri Lanka Insurance (SLI) on the acquisition of shares held by Shell Gas. This is what it said:

“Igniting the flame of hope ! -- We had a furnace within our reach, and yet we went hungry, because we did not want to play with fire. But a multi-national flame played with our lives day in and day out; it scorched us and taunted us; and we cannot forget it. But our Honourable President has now extinguished this consuming fire. He has at the same time ignited a flame of hope for us. And now, the simmering rice has never smelt sweeter. And we will thrive in this aroma, for it is the scent of alighting our aspirations. And we know that all Sri Lankans will rejoice as the scent of hope spreads throughout the isle. -- The employees of the Sri Lanka Insurance Corporation, together with Mabima Filling Complex, Kerawalapitiya Storage Terminal and employees at Head Office.”

The message is not only damaging to the Sri Lankan economy but has erred in many ways. In the first instance, it was the government (whichever government) that sold a majority stake in the old gas company to a multinational (Shell). It was also not taken back by the government: it was in fact Shell that exited in line with an earlier decision by the global group to move out of LPG, a losing business, across the world. It was not the President who made the decision, as the message in the ad implies or infers.
Furthermore gas prices are controlled by the government and on many occasions, Shell has been refused a request to raise prices.

The opposition has also erred in referring to the Shell exit as a ‘government’ takeover or re-vesting of the business. As stated earlier it was Shell that wanted to exit and if not for its global decision, the company would still be in Sri Lanka. Shell made the offer to the government rightly, as the state owns the balance 49% and the first preference should be given to the next biggest shareholder (the government). The re-vesting however has happened in recent times in the LMS, Waters’ Edge and SLI cases by the Supreme Court based on corrupt deal-making when the stakes were sold. The return of these properties to the state has foreign investors worrying that any privatisation could be subject to a state acquisition if a ‘wrong has been committed.’

However, the most damage from this ill-advised advertisement is in being critical of a multinational or foreign companies, at a time when Sri Lanka is desperately trying to attract foreign investors with FDI at sharp lows. What is the message Sri Lanka is giving to the world? Are we wary of foreign investors? Would we not hesitate to take over a state asset that has been sold to a foreign investor or local, private investor if it doesn’t ‘serve’ the people?

In a way there is no clear policy in terms of foreign investment and, for that matter, on local investment too. There is a need for the President to clear the air about these uncertainties, confusion and furthermore good governance in decision-making on key projects, development as clearly illustrated in an explosive story by the Business Times (which is running for the second week) over deal-making for prime properties in Colombo.

While the President’s speech at the swearing-in ceremony came some pointers to future policy, direction and development, more needs to be done. Investors and business are looking for clues/pointers – they have been in the past few months – on the economic direction of the government. Most likely the direction would come tomorrow when Rajapaksa presents the 2011 budget in Parliament.

Huge challenges face the President in his second term: Picking the right people for the right job (professionals, not political cronies); an inclusive approach to development (making people partners and decision-makers); improving relations with the West; stop corruption and crony capitalism and, good governance and transparency in all deals.

Colombo has become a capital of deal-making. Want a deal? Then tap a powerful politician as many of our stories have shown.

Finally as he embarks on a very crucial journey for the Sri Lankan state, Rajapaksa – an adroit and astute politician and probably the most influential leader in the post-independence era – should be alert against the ‘golayas’ and ‘hurrah’ boys. They can make or break his grip on power just like the misleading advertisement.