Engaging Razeen Sally’s Review of Sri Lanka’s Economic and Political Scenario

Michael Roberts

Razeen Sally is an acquaintance and a reputed scholar attached to the Lee Kuan Yew School of Public Policy at the National University of Singapore. When I spotted his review of the Sri Lankan economy and its political setting in the prestigious Wall Street Journal in mid-December, I immediately inserted it in THUPPAHI with a feisty title of my own coinage. This was in part because I had reservations about some of his evaluations. These thoughts arose in part from some of the economic indicators emphasised by one Jon Springer of the prestigious Forbes agency in USA.

In part my queries arose from my readings of the political economy of Sri Lanka in spatio-economic terms on the basis of my historical and political researches. Several themes associated with this peculiar respective had already been presented in my review of the issues surrounding the construction of a cricket stadium at Sooriyawewa as one pillar in the Rajapaksa family’s “cultivation” of their “home garden,” viz., Hambantota District — an essay that had earned me a reprimand (private email) from a good friend in Jayantha Dhanapala and attracted sarcastic comments in transcurrents.

I must therefore clarify the reasoning that guided me on that issue because it bears on my response to Sally’s article. Way back in the 1980s my historical researches encompassed the factors generating the emergence of a capitalist class and an adjunct middle class (I conceptualize both as overlapping entities) in the 19^th and 20^th centuries. Building on my work on Caste Conflict and Elite Formation (CUP, 1982), this line of research concentrated on the role of the Burghers as the initial spearhead of middle class thinking and Ceylonese nationalism in British times.[i] Among several themes, it focused on the centrality of Colombo in the British colonial dispensation: as the hub of a new transport network, the commercial and political centre and the island’s “ideological manufactory” (the site of virtually all English-language newspapers produced in colonial times).[ii]

The results of this work were/are embodied within People Inbetween (Ratmalana, Sarvodaya, 1989). People Inbetween includes information provided by friends from the Geography Departments of Peradeniya and Colombo on the patterns of internal migration in Sri Lanka over the years 1832-1970s, while one chapter focused on the growth of Colombo. The principal contention in this chapter was that Colombo had become a hegemonic centre (and, as an addition today, one aspect of this was that it served as a springboard for migration abroad). The implication in my mind is that over the last hundred years the island’s spatial economy has been imbalanced.

It was from this perspective that I evaluated the investments in developing Hambantota District with its inland port as the principal component,[iii] but supported by other developments — including the Colombo to Galle/Matara highway (and its eventual extension to Hambantota), Mattala airport, the hotel investments locked into the area, the convention centre and the Sooriyawewa cricket stadium. My assessment was — and remains — long-term: viz., the impact over 20/30 years or more. It is a perspective that was firmly held then in 2011 despite the pessimistic and even derisive estimates from several quarters, including early claims that few ships were calling at the port. Thus far, I have not seen data or arguments that lead me to jettison this early appraisal of the long-term possibilities.

 

 

I believe that the combination of modern port, road infrastructure, Mattala airport and the several five-star hotel chains locked into investments in the area will render the region into a growth epicentre and that the people of Monaragala, Uva and Amparai and Batticolaa south will also derive benefits. Gerald Peiris informed me that the schedules of major shipping companies were worked out years ahead so that the gestation period for the use of Hambantota would take time, but that it was well-placed to benefit from the enormous shipping traffic passing across the Indian Ocean at proximity to Sri Lanka’s southern coastline.

Peiris also indicated (without elaboration) that there were several white elephants implanted in the Hambantota arena. He may have been thinking of the airport at Mattala. However, recent reports indicate that

• IndiGo (acronym for InterGlobe Aviation Limited) had signed an MRO, that is, a long term Maintenance, Repair and Overhaul Agreement, with Sri Lankan Airlines to have its aircraft maintenance at Mattala — a shift (partial? whole?) from Europe to a location that makes sense for a major Indian airline.[iv]
• Unlike the BIA at Katunayake and that at Chennai, the Mattala runways ‘length and width gives it a capacity to handle the landing of the Airbus 380. This means that several airlines can re-adjust their flight plans to overfly Sri Lanka with a resulting benefit of overflight revenues.
• Reports in recent years (not, alas, collated by me) indicate that the bunkering facilities at Hambantota port are being used by ships, while its capacity to handle the giant container ships augurs well for the long-run future.[v]
• Other news reports indicate some flights from China are bringing tourists direct to Mattala. If valid, this fact also augurs well because Chinese tourists have recently become a major input in Sri Lanka’s t booming tourist trade. The Chinese tourists now boost the market everywhere and are of particular weight because they fly out of China all year round and are not hidebound by season.

These, then, are recent market developments that provide fodder for my long-term evaluation. However, my appraisal contained a caveat within my own mind. I am no economist and have no head for figures. I did not have any data on the costs involved and the financial arrangements which the Rajapaksa government had entered into with China (and other states).  I gathered that these terms of loan were at a debilitating commercial rate; but Saman Kelegama  had also told me that GSL could roll the credit because the sums were minute in the Chinese scheme of things.

Thus, Summing up …

It was against this background of ruminations that I read Razeen Sally’s review and decided to insert it in Thuppahi for the benefit of my small pool of readers unknown.

I took further steps:

(A) To make sure that Razeen Sally had not penned his summary from his professorial chair in Singapore without any recent visits to the island, I sent him a short note on the 8^th December 2014: “Did you visit Lanka before penning this article?” I received this immediate response: “Dear Michael, I can guess the implication of that comment. The answer is yes. About three visits a year, on average — it’s only four hours’ flight from Singapore. And about 10,000 miles travelled out-station in the last six years. On the economy, there’s quackery, mostly from non-economists…..”

(B) At the same time I sent a copy to a pal, Gerald Peiris, a geographer with a solid understanding of Sri Lanka’s economy and an awareness that is grounded in long ethnographic experience in the field and continued residence in the island. Peiris is a busy man, but he sent me an immediate reading of Sally that was quite scathing. I then honed in on three Sally statements that had generated reservations in my own mind — to which Peiris responded immediately with the caveat that it was ex tempore.

So, now in January, I present the Peiris review separately in conjunction with my clarification of background and my reasoning. BUT there is more to come. In the course of December (late December) and just this week in January I sent the original Wall Street Journal essay by Sally to several individuals in Lanka and abroad who had some expertise in the field (my specific queries and the Peiris assessment were not, repeat not, included).

It is not a good time of the year to burden individuals and the SL elections complicate the background. It is not surprising that only a handful responded and that two of these comments, from Sisira Jayasuriya (Monash University, Melbourne) and Kalana Senaratne (Hong Kong University), were brief. These comments are now presented in a separate posting, while the extended comment from Mick Moore provides a fifth item.

Needless to say, all these thoughts will be sent to Razeen Sally and his response will hopefully expand the debates in fruitful ways. I only hope that those busy persons whom I approached earlier, as well as others, will now chip in. …. And so, too, readers here in this thuppahi setting.

*** LIMITED BIBLIOGRAPHY

Ionescu, Ghita 1969 “Eastern Europe,” in G. Ionescu & E. Gellner (eds.) Populism. Its Meanings and National Characteristics, London: Weidenfeld and Nicolson, pp. 97-121.

Jayasinghe, T. 2014 “Mattala Int’l Airport – A Dire Need And A Wise Investment,” 28 December 2014, http://www.asiantribune.com/node/86140

Kelegama, Saman 2014 “Challenges remain for China–Sri Lanka Free Trade Agreement” 18 December 2014, http://thuppahis.com/2014/12/18/challenges-remain-for-china-sri-lanka-free-trade-ageement/#more-15169 –reprint from East Asia Forum, March 2014.

Kruglanski, Arie and Michele Gelfand 2012 19 “Learning from Sri Lanka,” September 2012, http://nationalinterest.org/commentary/learning-sri-lanka-7485

Roberts, Michael 1994b “The Asokan Persona as a Cultural Disposition,” in Roberts, Exploring Confrontation, Reading: Harwood Academic Publishers, pp. 57-72.

Roberts, Michael 1994c, “The Asokan Persona and its Reproduction in Modern Times,” in Roberts, Exploring Confrontation, Reading: Harwood Academic Publishers, pp. 73-88.

Roberts, Michael 1994d “Four Twentieth Century Texts and the Asokan Persona,” in Roberts, Exploring Confrontation, Reading: Harwood Academic Publishers, pp. 57-72.

Roberts, Michael 1994f “The 1956 Generations: After and Before,” in Roberts, Exploring Confrontation, Reading, Harwood Academic Publishers, pp. 297-314.

Roberts, Michael 2009 “The Rajapaksa Regime and the Fourth Estate,” 8 December 2009, http://groundviews.org/2009/12/08/the-rajapakse-regime-and-the-fourth-estate/

Roberts, Michael 2011 “Populist Politics And The Sooriyawewa And Premadasa Stadiums,” March 2011, ttp://transcurrents.com/tc/2011/03/populist_politics_and_the_soor.html AND http://www.thesundayleader.lk/2011/03/13/populist-politics-and-the-sooriyawewa-and-premadasa-stadiums/ AND http://thuppahis.com/2012/01/28/mahinda-rajapaksa-cakravarti-imagery-and-populist-processes/

Roberts, Michael 2012“Populism and Sinhala-Kingship in the Rajapaksa Regime’s Political Pitch,” 29 January 2012, https://www.colombotelegraph.com/index.php/populism-and-sinhala-kingship-in-the-rajapaksa-regimes-political-pitch/ AND reprinted with different title in Roberts, Tamil Person and State: Essays, Colombo, Vijitha Yapa Publications, 2014, pp. 404-22.

Roberts, Michael 2013 “Mixed Messages and Dangerous Oversimplification in President Rajapaksa’s Independence Day Speech,” 13 February 2013, http://thuppahis.com/2013/02/13/mixed-messages-and-dangerous-oversimplification-in-president-rajapaksas-independence-day-speech/

Roberts, Michael 2014 “Ideological Cancers within the Sinhala Universe: Roadblocks in the Path of Reconciliation,” 10 May 2014, http://groundviews.org/2014/05/10/ideological-cancers-within-the-sinhala-universe-roadblocks-in-the-path-of-reconciliation/

Springer, Jon 2014 “Ten reasons to Invest in Sri Lanka,” …. http://www.forbes.com/sites/jonspringer/2014/10/30/ten-reasons-to-invest-in-sri-lanka/

Thiranagama, Dayapala 2012 “Ending the Exile and Back to Roots: Fears, Challenges and Hopes,” 2 January 2012, http://groundviews.org/2012/01/02/ending-the-exile-and-back-to-roots-fears-challengesand- hopes/.

Worsley, Peter 1969 ‘The Concept of Populism,” in G. Ionescu & E. Gellner (eds.) Populism. Its Meanings and National Characteristics, London: Weidenfeld and Nicolson, pp. 212-50.

   ***  ENDNOTES

[i]  As expressed in the journal Young Ceylon (1850-52) and in the Ceylon Examiner which a Burgher-led coterie bought in 1859. Again, when the cricket field was selected as a permissible field of political challenge the XI men who played for the “Ceylonese” against the local “Europeans” in 1887 were all Burgher.

[ii] Significantly, the one exception was the Morning Star published in Jaffna in the late 19th and early 20^th centuries.

[iii] The port has been dug out from within the land ‘mass’ of the island. Pro-government sources claim that it will become one of the world’s largest inland port and extol its potential for adjunct developments — developments which are mostly foreclosed in such ports as Rotterdam because of built-up areas and high costs of land. See http://www.sundayobserver.lk/2010/08/15/HPort.asp?id=s09

[iv] “The agreement would not only help IndiGo to save a considerable amount by not sending an airplane to Europe for similar checks, but also secure a multi-million dollar revenue for Sri Lankan over the long duration of the agreement” (http://mytravnews.blogspot.com.au/2014/07/indian-320-fleet-to-undergo-major.html).

[v] “With all the foreign investment flowing into the country and with the development of the Tourism Industry this airport is a timely investment which had been long overdue. With the Hambantota Intl’ harbor close by now attracting at least one ship a day and the industrial parks coming up this airport is going to be an asset. If the country waited for another 10 to 15 years to construct this airport the cost factor would be tremendously high and perhaps and any future government will think twice due to the question of affordability” (T. Jayasinghe 2014).