The modern UNP was the more urban, business-friendly party and the SLFP was the more rural, socialist-friendly party. Now, insomuch as we have parties at all, the UNP has turned.
In this interim government, Ranil Wickremsinghe is leading the most business-unfriendly incarnation of the UNP I’ve ever seen. Not only are their policies mixed at best, he and Finance Minister Ravi Karunayake are outright hostile to the private sector.
Mixed Signals
To a degree, even dumb government policies are OK as long as they’re predictable. Investment is essentially planning and that requires a predictable environment. This interim government has been nuts.
With things like the Port City or Lotus Tower nobody knows what’s happening and no one knows what’s going to happen next. The government spokesman Rajitha Senaratne is deeply unreliable and different people in the government contradict each other on the daily. Even with things that weren’t Rajapaksa pet-projects, it’s unclear which direction policy will take.
More substantively, this government has imposed taxes retro-actively, which makes everything unpredictable. Should you invest in a sector, or will it be taxed to the ground next year? Who knows. Should you pay dividends, or will the government take that money away? Have you pissed off Ranil recently? Did you go to Royal College?
In this environment it’s hard to plan investments, and you can see the results in the flatlined stock market. It’s a good time to buy, but people are honestly just waiting.
Mixed Bag
Then let’s start with appointments. The biggest appointment – Ravi Karunayake as Finance Minister – is not someone with a stellar reputation. He’s never been convicted, but he has been indicted – for violating the Exchange Control Act in connection to jailed financier Raj Rajaratnam. He was also involved in the unsuccessful privatization of Sathosa, but all the records got burnt in a fire. So… that’s your Finance Minister.
Prime Minister Ranil Wickremesinghe also appointed Arjunan Mahendran to the Central Bank. Mahendran has a son-in-law who was a known wheeler-dealer in the stock market, but it was assumed that Mahendran was above that. However, as soon as he was in office, the son-in-law’s company made millions on a bond issue where no one else seemed to have the same information. Strange.
In response to criticism, Ranil appointed a committee of UNP loyalists with no particular expertise to investigate and gave a speech saying, essentially, that the past government was much worse and that he’d come after the private sector. Ravi has also gone to a primary dealers meeting (which doesn’t come under the Finance Ministry) and berated the people there for complaining.
Even in the face of all this blow-up over one appointment, this government is trying to make more. Now they’re trying to use their minority stakes in private banks to change the directors there, replacing them with government appointees. Given the performance of government appointees at the top, this is hardly reassuring news. They could say that the prior appointees were bad, but I honestly don’t trust this particular government either, and they should maybe wait till after an election.
Meanwhile people like Harsha De Silva who were quite voluble and clear in criticizing the past government have nothing to say. It’s not an especially inspiring performance by the UNP.
So
Business and the economy are supposed to be the UNP’s strength but, quite honestly, they’re sucking at it. Are things better than under the Rajapaksas? I would say yes. Things were quite predictable there but there was always an undercurrent of rot – people could take land, money, etc on a whim. The country was also accumulating unsustainable debts and spending billions of dollars on vanity project. This government has stopped that so props to them. We are also able to complain and have some hope of a difference. All good, no doubt.
Good governance, however, is not the same as ‘not bad governance’. Good governance would be transparency and responsiveness in appointments. Good governance also involves getting elected, which the UNP still hasn’t done.
In the specific case of now, I’d say that good governance means governing with humility and carrying out Maithripala Sirisena’s 100 Day plan. It does not involve bungling around with the private sector and blaming then and the media when things go wrong. If you have a mandate and a plan you can take on business, but I frankly don’t think that the UNP has a mandate for anything besides what Sirisena has said or promised.
As it is I don’t think they should take the urban business vote for granted as they have in the past. They have yet to earn mine.
Oh heeeeey. An N95.
Firstly, LOL at Greene. If it was an iPhone we should be more worried (at least it shows the Govt. is scaling down their expenses). Indi, as much I respect your views and have always followed you I disagree on some points. This Government is poor – I agree. It is, however, still heaps better than a dictatorship. The 100 day thing was never going to work. It will not – why? Because this country needs years to recover from the stuff that has happened; war, corruption bla bla. Being unfriendly to the corporate sector is not necessarily a bad thing. Those guys will get on with their business regardless. This Government (or at least I hope…also doubting a lot…don’t get me wrong) is trying to do their best. Foreign policy is a big thing. Not just here, globally. Mangala Samaraweera is doing a great job there and so is Ranil. I like Ranil, unlike most of Sri Lanka. He does stuff. Unfortunately I can’t say that about Maithripala Sirisena, a very honourable man, of that there is no doubt. But not the leader this country needs (perhaps Ranil – but I will be stoned for even suggesting that :)). And as for dodgy appointments to top jobs – well years and years of habit is hard to break. The UNP wont change it, but neither will the SLFP. The elections will reveal more. Looking forward to change for you guys and lots of banter on your blog.
Indi this government is stuffing up but if you tried to write an article about the stuff ups and thefts of the previous government you would have an extremely long blog post.
@Ankie
The worst thing in this government is Mangala S. You dont know the person. Mangala S is like the US ambassador in SL. He is doing what west, US wants in SL.
He is NOT acting for SL interests. The reason you feel Mangala S is doing a good job is because they are favorites in foreign or western media. The western governments like Mangala so western media like Mangala. They like the people who act for their interests…
You cannot judge a man based on what is in western media say
@Nuwan,
It is said the bond issue had made a loss of billions which is even more than the cost for southern highway. That is within the first 2 months of this government. :)
Foregt the theft, this government is acting AGAINST the interests of Sri Lanka. Mangala S is like the LTTE agent in SL. That is far far bigger damage than all the thefts of the previous government combined.
@sach
Yes Mangala is probably sucking up the west. Don’t you think that is a good thing in light of the fact that Sri lanka has enormous war crimes hanging over her head. Diffuse the situation a little – things could be a lot worse. And re: the bond issue – have you forgotten about previous corporate f*ck ups…like the Ceylinco Golden Key fiasco? Corruption is not easily eradicated. Mangala, LTTE – hardly. They are making mistakes yes but they are nowhere near the level of the previous lot. And…
@Nuwan – how true. People are sadly too quick to forget. And Indi wouldn’t have been able to slag the last Govt. off because his site would have probably been banned and he would be avoiding white vans. Just saying guys – it’s not so bad :)
At ankie ,
sucking upto the west doesn’t matter as long as it does serve srilanka.’s interests. The issue is it doesn’t. You mention about war crime issue. So what has srilanka achieved in terms of war crimes charges by sucking up to the west? Has US stopped crying on war crime charge? Has US and UK stopped supporting ltte overseas? Has norway stopped doing underhand deals with LTTE remnants and tna? No. ..instead they have found a government that is ready to suck upto them and they can easily armtwist.
USA was at a dead end regarding war crime issue. With China ‘s veto power us can’t do anything. So this government is helping the west to get their aims by supporting the UN investigation.
I don’t want a fm who bends backwards to west but a man who will defend his country and his people.
Many in colombo think by playing by US rules, USA would leave us alone. .that is childish.
About corruption. The new president cbk has been far far corrupt and an utter failure. You do not know about past governments to know that MR is not worse.
MR government had many many issues. Despite all that mahinda is wayyyy better than ranil. …..
Ankie,
sucking up-to the west does not mean antagonizing the east which is what ranil and mangala are doing.
Only things US brings is military bases and human rights charges and EU, only HR charges. And you really can’t develop a country with those. Both of these places are quite bankrupt. Neither has money to invest in high risk places like here. Middle-east and the Chinese are ones who got the money. Even EU understands this (that why they are joining up with the AIIB).
And if you are thinking that being buddies with US is ok, then think again because it wasn’t I who uttered the following words.
“To be an enemy of America can be dangerous, but to be a friend is fatal”
And all due respect about your liking, Ranil was accused of running death squads and the only reason why he never got formally charged is because both Chandrika and MR didn’t want to do that. Ranil did not do that to Chandrika and he will not do that Rajapakshe bros either (yeah its a strange dog don’t eat dog situation) despite all the denouncements and investigations. And talking about dictatorships, MR did held elections and he did loose. Compare it with Ranil who did every petty thing possible to stay at his party leadership.
And I think you are mixing up SL government with private companies. Golden key was a private embezzlement while CB bond issue seems to be like a issue related to the CB governor (an government official).
Indi thinks I am quiet. Quite the contrary. I have been on multiple media outlets and given interviews on what we are doing and what are plans are. I have made no bones about stating my position about the bond issue either. just to note that Parliament will finally decide what will happen to the accused in it. Everything is relative. How many times did I speak out on the massive corruption by Cabraal and the stock and bond market mafia during the last regime? Nothing happened. In fact they were rolling in the dirty money they robbed from the pension funds of hard working people. Instead the bosses of SEC had to go! Mohan Pieris not only threw away the case filed against them but insulted the 13 trade unions who signed the fundamental rights petition going to the extent of calling them nasty names. 100 days a short period of time to undo all the wrongs but we are doing our best within the law. Yahapaalanaya means due process. while it’s okay to criticise I hope those doing so would consider all aspects of the problem we are trying solve. Thank you.
Harsha de silva, if you truly care have an eye on what Mangala is doing. People did not vote UNP in.
Firstly, we should not antagonize our relationship with China. Rajitha S has NO idea what he’s talking about most of the time… and we are sucking up too much with the West… Mangala, you need to wake up.. America is in so much trouble right now, and creating havoc in the Middle East. Is this what we want to happen here? Another war…?
Re: Bonds issue, yes, nothing is being done about that.. Harsha de Silva, I had so much respect for you because you were one of the few who were not afraid to say anything… But your silence (or perhaps you were told to keep quiet) is deafening..
Development is at a standstill and there is no proper guidance given to anyone…
Accusations are being thrown around and even a few arrests, but thanks to ‘tiny’ bails being posted (*cough* Sajin Vass *cough*), they are being released with a slap on the wrist.. what happened to good governance? I am not saying to arrest everyone in the previous regime, but at least make people accountable..
Talking about previous regime, when looking at the parliamentary lineup, lot of familiar faces… I suppose Maithripala and Ranil are looking at the April elections and nothing more..
Also, what is happening with the Armed Forces? And the maintenance of the parks? For example, earlier the Army would have their guys cleaning up Independence Square early morning and they ran the Walker’s cafe. Now, no one is there, cleaning up (even at 9am) and the Walker’s cafe is run by some inefficient people… I can imagine they do not like working in restaurants and doing up construction… BUT thanks to keeping them occupied (and not sitting around idle in camps, like they are doing now), they not only contributed to the country but also they are kept busy (and less likely to be involved in illegal activities or suffer from PTSD). It is sad that we cannot acknowledge the good the previous regime did (and perhaps improve it)… we only try to reverse everything indiscriminately .
It is sad that after all this time, our politicians cannot look further than their pockets and noses and focus on the country for a change..
Dear Minister,
I do understand that 100 days isn’t a lot of time, but the fact is you don’t have a lot of time.
And when it comes to the behavior of politicians, Sri Lankans follow John Mitchells advice (without even knowing who that is), “”Watch what we do, not what we say”.
Srilankan government purposely hurts china . China is and was the best friend of srilanka. That is what mattets..
1. On the day after RW became PM, he badmouthed china in an ndtv interview .
2. Ravi made bad remarks against china .
3.sujeewa made bad remarks against china over and over again. This idiot doesnt know the difference between talking ill of chinese projects in a political debate in local television and making remarks in public .
4.port city joke and the disrespectful manner these idiots dealt with china.
5. Allowing dalai lama to come anyway it seemssaner counsel had prevailed and it is stopped at the moment …
This mega stupid government is destroying our biggest strength
This will make srilanka an easy target for west at UN…..
I will never ever forgive the UNP drohis
Only good thing done by this interim government is bringing down the petrol. But are we really benefiting the reduction? Nope. I still buy the lunch packet for the same price. What exactly went down? Red rice or a normal rice price has gone up. Nothing is cheap as promised.
Forget all dat. Development of most of the areas are stalled. What’s the change we are talking about? Better Mr. Sirisena call for a general election and make things right
Kasun,
Governments don’t really reduce the oil price. It depends on the market. Currently (Brent crude) oil is down to 55 $ compared to 100+ $ last year this time.
http://www.oil-price.net/
At best they did not have a plan. At worst they don’t know what they are doing. These are bunch of delusioned idiots who think that western countries and investors will come rallying for good governance and reconciliation. Even the western governments are head over heel for China and Chinese investments.
Some of the action of this government and the PM are hilarious; asking the head of Transparency International to lead an investigation on curruption. What is the credibility of that report? It is like asking the head of Human Right Watch to produce a report on Sri Lanka or head of Green Peace to prduce a report on climate change….
I’d say don’t expect miracles to happen within 100 days. I do agree that the current government is not the best of best. But 1000 times better than the dictatorship we used to live under.
At banda,
This government had actually signed a document to get technical assistance from likes of HRW to inquire about war crimes in srilanka . Yeah this government is that stupid .
Worst of this government will be seen when the local war crimes probe ascertains the alleged war crimes and TNA use that to demand an self governing authority claiming Tamils are safe under “Sinhala” governments. This country could have been the next asian tiger, if not world powers and regional power decided to play game of thrones.
Reshan Auston,
I totally totally disagree with you. This government IS doing miraculous things. Whether those miracles are good for the country is another matter. :D
Things are better for sure. People feel a sense of freedom. There is better law and order. The govt actually obeys the supreme court verdicts (judges are not lackeys). People feel free to criticise the govt and not worry about getting picked up. government owned companies are run by qualified professionals. The governer is investigated and has gone on leave. Cabraal was never investigated for any of the allegations against him. Development will stall for a year or so. But its definitely worth than the ugly dictatorship that majority of the Sri Lankan people rejected in January.
Gungan ,
yep. Everything shiny. People can’t really contain them selves untill the next election say “Thank You” to our new saviors.
I guess the things are better but not by that much. Although this government might be getting stuff done they are overshadowed by the media circuses.
I’d be happy to host a rumbustious dteabe on Development Drums. I’m planning an edition on corruption which will bring together Mushtaq Khan and Daniel Kaufmann, who come from quite different perspectives, which I hope will be interesting.But I’d welcome suggestions for other interesting topics and guests on Development Drums.Oh, and keep up the good work.Owen