In a televised address to the nation last Tuesday, President Wickremesinghe reiterated his oft-repeated commitment, not to let the country slide back into its previous debt-ridden state and his determination to transform the country into a developed state by 2048.
A major challenge to the President’s vision today, is the country’s lack of foreign currency. To face this and other problems, he presented a road map to achieve the targets he envisioned. He also set a time frame for the achievement of this goal -2048.
A time frame of twenty-five years.
Whatever the shortcomings in the President’s address to the nation; one of our leaders has presented the country with a definitive time-bound plan of when the country will be able to get out of its indebted situation.
Many of us may not be around when this actually happens, but we can be happy knowing, that if the country does achieve this goal, our children and grandchildren will not have to live through the nightmares of early 2022.
To the President’s credit, since he assumed office, basics are today available in the market. Fuel though rationed is available. The eight-to-nine-hour rolling power cuts are but a nightmare of the past. Basic foodstuffs are available. Medicines though not freely available, can be obtained, albeit at a price.
He also steered the country out of the worst days of the crisis and brought inflation down from 70% to 25%. However, there are still many mountains to climb before we reach the debt-free goal in 2048/.
Last month the price of fuel (petrol, diesel kerosene, etc.) was lowered. However, the BBC reports of oil prices rising in the international market in the wake of Saudi Arabia pledging to cut oil output from July this year. Other oil-producing nations too have agreed to cut production.
In effect, it means we will soon see a price increase in fuel -which will mean an all-round increase in prices here. Even today, the cost of living is way beyond the means of an average worker. It costs between Rs. 35,000/- to Rs. 40,000/- for a family of four (father, mother and two children), to have two square meals a day per month.
Yet, the average wage hovers between Rs. 25,000/- to Rs,30,000/- with the minimum wage remaining static at Rs. 12,500/-.
What this implies is that a large number of families are consuming less. It also means they are consuming less nutritious food. The National Nutrition and Micronutrient Survey reveals 93.9 per cent of households have reduced their essential non-food expenditure such as EDUCATION and HEALTH due to a lack of cash to buy food.
It means the next generation will be less educated and open to further exploitation due to growing poverty and lack of education. These people cannot wait for another 25 years to come out of this position of acute poverty. While the President promised to protect the vulnerable sections of society, he has not spelt how this will be done or when it will be achieved.
The President’s vision of a debt-free Lanka is based on four main pillars on which he hopes to shape the future, namely: Fiscal and Financial Reforms; Investment Drive; Social Protection and Governance and State Owned Enterprises Transformation.
The fiscal and financial reforms are being implemented and prices of fuel etc are being tagged to import costs.
The second pillar of the President’s strategy is to attract foreign currency. A major challenge to attracting this vital element to our economy is the rampant bribery and corruption prevailing today. Just two days ago this paper highlighted how officialdom is not only blocking private foreign investment it is in fact driving investors away.
We can only hope the proposed Oversight Committees will be able to weed out the few bad apples which are soiling the name of the country.
State Owned Enterprises (SOEs) continue to burden the exchequer. During the first four months of 2022, the cumulative loss of SOEs amounted to rupees 860 billion. Yet, in 2020, the Government spent a mere rupees 52.5 billion on Samurdhi Relief Payments to the poorest.
Rather than throw funds into loss-making ventures, we need to pay greater attention to the most vulnerable sectors. If privatisation changes these SOEs into profitable ventures so be it. China turned its economy around through a process of privatisation, and so did Russia.
None can claim Russia and China have been sold out. Their experiences stare us in the face, let’s do it.