Is This Development?

| by Tisaranee Gunasekara

“….it’s a show, it’s a show”

Mookie and Sam (You Tube)

( August 26, 2012, Colombo, Sri Lanka Guardian) The Chinese deal to provide Sri Lanka with a communication satellite and a space-academy was one of the fastest BOI projects to get off the ground, according to the proud-boast of the state-media.

Unsurprisingly; there is an intimate connection between the Ruling Family and the space-project. “The idea of having a satellite was the brainchild of President Rajapaksa who spelt it out when he was in China recently” (The Sunday Observer – 19.8.2012). That is an extremely believable claim about the incomparable-brain which produced such winners as Mihin Air and the Magampura-Ruhuna Mahinda Rajapaksa Port (MRMR Port).

Plus, becoming the world’s youngest astronaut and Sri Lanka’s first man-in-space are the desiderata of the youngest Presidential offspring.

There will be a gigantic hiatus between the still underdeveloped Lankan economy and the space project. The space project will thus not have any backward or forward linkages with the economy; instead it will be an island of anomaly unconnected to the Lankan reality, a gargantuan white elephant at the service of the Ruling Family and their coterie. Sri Lanka spends just 1.9% of her GDP on education (far behind tiny Maldives and poor Bangladesh) and just 0.05% of her GDP on research. Had the rulers wanted to take the country to the space age (instead of enabling their progeny to cavort in space at the country’s expense), they would have increased educational and research spending generously. But the rulers claim that Sri Lanka is too poor to spend more on education and research. That choice is a symbol of Rajapaksa economics, of its blatant disregard for economic logic, of the primacy it accords to Rajapaksa whims and fancies over the interests of national development or popular wellbeing.

Mihin Lanka which lost the country US$18.6 million in 2011 is a classic example of how Rajapaksa economics work. This venture which has no relevance to the national economy or popular welfare is being kept alive, year after loss-making year, simply because it is a presidential brain-child, bears his name and probably provides lucrative employment opportunities to many a Rajapaksa kith and kin.

Family needs, whims and fancies dictate national policies.

The MRMR Port was opened in a hurry, in time for the second presidential inauguration of Mahinda Rajapaksa. Unfortunately no importer or exporter wanted to use this port located in the middle of nowhere. The Rajapaksas, having decided to build a huge port in Hambantota (despite the rock) for familial reasons, took their economic irrationality a step further by ordering all vehicle importers to use it instead of the Colombo Port.

This was gross and short-sighted state intervention in market economics; and not for a worthy purpose such as poverty alleviation, combating inequality or promoting popular welfare, but for the greater glory of the Ruling Family.

Not only is Sri Lanka addicted to ‘prestige projects’; Lankan leaders impose irrational economic policies on the private sector in order to keep those wasteful prestige projects going.

Everything is subsumed into familial needs, interests and desires.

Family-First Economics and the Hub-Myth

The Rajapaksas want Sri Lanka to become an infrastructural-hub; accordingly by 2015, there will be “five international harbours, two international airports, two expressways, seven-star hotels via Shangri-La (and) the most powerful communication satellite in the region…” (The Sunday Observer – 19.8.2012).

Can a country which cannot build a properly functioning coal power-plant become an infrastructural-hub?

According to the Minister of Power and Energy, the Norochcholai plant experienced 12 breakdowns since February 2011. CEB Chairman states that the plant is constantly breaking down because “there are quality issues in the plant” (Colombo Page – 14.8.2012). If this plant is emblematic of the quality and efficacy of the Rajapaksa physical infrastructure projects, Lanka and Lankans are in trouble. Imagine expressways, airports and dams malfunctioning like the power plant, not to mention that nuclear power plant the regime is bound to want to possess sooner or later. A country which is incapable of maintaining the integrity of its stock-market cannot become a financial-hub. For the second time in nine months, a Chairman of the Securities and Exchanges Commission had been compelled to resign, allegedly by the appointing authorities. Reports claim that the stock-market is becoming a cornucopia for a handful of well-connected players who engage in ‘pump and dump’ activities. A stock-market controlled by robber-barons is hardly hub-material.

Last week the regime announced a new land policy enabling the leasing of state land for hotel projects for 99 years. Turning Sri Lanka into a haven of rest and recreation for the national and global wealthy is a favourite Rajapaksa development-dream. This R&R mania is at variance with the reputation for lawlessness Sri Lanka seems to be gaining, as exemplified by the recent UK travel warning which cautioned British nationals about an upsurge in anti-Western rhetoric and sexual molestation. The regime reacted with anger, but the reported molestation of a French tourist less than a week later indicates that the ongoing crime wave is not sparing tourists anymore than it spares children. Luxury hotels and domestic airports will not turn Sri Lanka into a tourism-hub if the country becomes a haven of lawlessness. A country which holds untimely and disruptive elections even as drought and inept water management devastate harvests cannot become an agricultural-hub. A country which refused to send coaches to assist her Olympic entrees while providing 30 officials with an Olympian jaunt to London at national expense cannot become a sports-hub. A country which cancels compulsory English and IT courses for its new university entrants but compels them to undergo ‘leadership training’ in military camps cannot be serious about becoming an educational-hub.

In the meantime, national savings are declining and the resource gap is widening compelling Sri Lanka and Sri Lankans to borrow ever more just to maintain basic investment and consumption levels.

Youth employment is a high 20%. Income inequality is rising. 20% of children under-5 years are underweight. Though the Lankan economy continues to grow, the benefits of that growth are bypassing more and more ordinary Lankans. That is as it should be. The Rajapaksa developmental strategy, which combines worst capitalist practices with the most archaic feudalist thinking, is not aimed at promoting productive and self-sustaining growth or popular welfare. The main purpose of Rajapaksa development is the development of the Rajapaksas. Just as the war against the LTTE was used to gather all threads of politico-military power into Rajapaksa hands, the developmental war is being used to institute a massive economic power-grab.

For instance, the new Divineguma Bill is reportedly an attempt to render the provincial councils powerless and vest those powers in an institution under the control of Presidential Sibling, Basil Rajapaksa. For all its grand rhetoric, a familial state cannot deliver development because its main concern is perpetuating the power and the prosperity of the narrow group of stakeholders – the family and the clan. There can be times when familial interest dovetails with national interest but such times are rare and when the two contradict familial interest will always win, even at enormous cost to the country and the people. A Banana Republic, Rajapaksa style may well be Lanka’s ultimate destination.