|Saturday, 10 November 2001|
Economic and political agenda of a people's President
Following World War II, the World Economic Pillars of South Asia, popularly known as the 'Tiger Economies' have been severely shaken over in the past few years.
Major economic turbulence has caused countries to go into recession, thousands of banks to be closed, millions thrown out of employment and their money devalued drastically.
However, due to the macro economic policies of Her Excellency Chandrika Bandaranaike Kumaratunga, President of Sri Lanka and Minister of Finance, Sri Lanka came through unscathed. Except for the year 1999, when Sri Lanka recorded a 2% in exports owing to the heavy devaluation of the Thai Bhatt, the Indonesian Rupiah, the Japanese Yen, and the Malaysian Ringett.
Owing to this unprecedented devaluation, exports from these countries were very much cheaper in comparison with Sri Lankan products, It was also at this time world economy was affected by the rise in price of crude oil which rose from 8-10 US $ to 36 US $ per barrel.
Despite all this, Sri Lanka recovered in no time at all owing to its prudent, competitive, liberalized economic policies.
Even after the 11th September tragedy, which was a calculated attack on world economy and free enterprise, the American economy declined drastically and created a domino effect that was felt in countries around the globe. Japan recorded zero growth and some other countries even had minus growth, so great was this economic impact.
yet in Sri Lanka all we felt was a slight tremor. There was no large-scale unemployment, no closure of financial institutions banks etc.
And so it is with foresight we say that with the present macro economic policies and with the implementation of the micro economic policies of this government, the year 2002 will no doubt bring greater rewards.
Presently in Sri Lanka, new businesses and enterprises are springing up almost daily, In fact a member of the opposition party even thought it prudent to launch his new multi million rupee venture in collaboration with foreign partners at this time.
The economic climate is getting better day by day. Bilateral trade with SAARC countries especially with the Indo-Lanka Free Trade agreement and the forthcoming signing of the Free Trade agreement with Pakistan, the economic future of Sri Lanka is bound to be better than ever before in recorded history.
"Our new policies are designed firmly, over a medium term and long term framework. They are expected to more than double our income and virtually eliminate unemployment by first decade of the 21st century.
They are essentially pro market policies which will encourage the private sector and reduce structural rigidities which impede competition and productivity. They will be supported by well targeted poverty alleviation policies which will distribute incomes better.
This is an enormous challenge to us because we wish to implement these policies in a totally democratic framework, with emphasis on good governance and utmost respect for human rights. You are well aware that there are only a very few countries in the world which have achieved these twin objectives simultaneously."
Statement made by President Chandrika Bandaranaike Kumaratunga as Minister of Finance in Paris 27th April 1995.
This Policy Statement of H.E. Chandrika Bandaranaike Kumaratunga is the DNA of the PA Government's economic and political agenda.
This policy statement was relevant yesterday, it is relevant today and will be relevant in tomorrow's economy.
In 1996, 90% of Non-Tariff Barriers, such as licensing, quantity restrictions and canalization were removed, thereby eliminating many market distortions.
Under strong liberalisation, industries have emerged as a major sector accounting for nearly three-fourth of Sri Lanka's export earnings.
These are garments, textiles, rubber based products, tea (value added), coconut fibre products, cut flowers and foliage, aquarium fish, gems and jewellery, activated carbon, surgical gloves, diamonds, food & beverages, tobacco, shoes & leather products, wooden products, paper & paper products, plastic products, electronic products and IT software etc.
Between 1992 and 2000 the number of exporters grew three fold. This growth was due to proper macro economic fundamentals being in place, and to measure such as the rationalization of import tariffs by stopping ad hoc waivers and the reduction and compression of duty rates to a 3 band system.
It is important to note that, on the whole, Sri Lankan exports under the stewardship of H.E. the President have maintained a positive growth rate during the 1994-2000 period, even when most of the countries in the world were feeling the after effects of the Asian Crisis in 1998.
World exports that year dipped 1.59% while Sri Lankan exports still recorded a growth rate of over 2% during this period.
Only in 1999 did Lankan exports register negative growth mainly due to the fact that exports of Sri Lanka's competitors in the South-East Asian region had become cheaper because of the devaluation of their currencies. The Sri Lankan export sector quickly recovered the following year recording a growth rate of over 20% compared to the 12% growth in world exports.
Another noteworthy feature is the continued, uninterrupted growth of non traditional exports from US $ 2,641 million in 1994 to US $ 4,697 million in 2000.
Total Exports for 1992 - 2000 had an Average Growth of 10.65% This growth had been possible due to the fiscal incentives given in H.E. Chandrika Bandaranaike Kumaratunga's Budgets to new and existing export undertakings.
Targeting the Economy for the Unemployed Youth
Chandrika Bandaranaike Kumaratunga's economic policies aimed at accelerating economic development and organizing the youth of the country at village level for gainful employment through the Samurdhi movement utilizing the government's targeted income transfers and local savings are the two major thrusts of the policy to meet the serious problem of youth unemployment.
Substantial programs of training unemployed youth in marketable skills are in progress. The World Bank and the donor community are supporting this endeavour.
Sri Lanka's per capita income moves up.
Sri Lanka's economy recorded a real GDP growth rate of 6% in 2000, significantly above the rate growth of 4.3% in 1999. The annual average growth rate from 1994 was 5 per cent.
The gross National Product grew by 5.8% in 2000 compared with 3.8% in 1999. The high growth of GDP, together with relatively low population growth, raised Sri Lanka's per capita GDP to Rs. 64,855 (USD 856) in 2000, from Rs. 58,077 (USD 825) in 1999. Consequently, the international classification moved up further within the lower middle income category which consists of countries with a per capita income in the range of USD 795 - 3,125.
Output increased in all major sectors, but the manufacturing and services sectors became the major contributors to growth, accounting for 26% and 61% of total growth respectively.
The increasing integration of the Sri Lanka economy with the global economy has been clearly demonstrated by the close association between domestic growth rates and the growth momentum in the world economy in recent years.
Overview of the IT Industry
Although the industry is still young, we are witnessing a dynamic business environment particularly after the liberalization of Sri Lanka's telecommunications policy.
Over the past five years, we have seen the number of telephone connections quadruple making our average teledensity 4/100. The number of PCs in the country is about 300,000, and about 70,000 new PCs are imported every year.
This is mainly due to the PA Government's policy of removal of import duty for IT equipment.
Investment in the IT industry has increased considerably over the past four years. It continues to increase and by the year 2003, would have a strong IT portfolio.
About 75% of BOI approved investments in this field is either foreign owned or joint ventures.
Sri Lanka has certain well-developed business sectors, which are in a position to utilize IT products and solutions effectively in their business activities.
This provides the opportunity for the Sri Lankan IT sector to produce industry specific software such as design software for the jewellery industry or the garment industry.
Developing an IT culture within local organisations, both public and private, is a high priority of the PA Government.
The Malabe IT Campus
The establishment of the Sri Lanka Institute of Information Technology, under the direction of President Chandrika Bandaranaike Kumaratunga needs special mention. It currently trains 400 students in the 2nd year and 650 students in the 1st year.
With plans to increase the intake to 1000 next year, the numbers in the 2nd and 3rd segments will substantially increase.
Thus, the annual output of top quality professionals in the near future will increase to about 2000.
In the year 2005 Sri Lanka would be marketable as an IT destination with at least 10,000 top quality professionals.
Lanka's greatest feats in sports achieved in past six years
by by Dinesh Weerawansa
Sri Lanka's greatest achievements in sports have been achieved during the last six years, a fact which no one could disagree irrespective of political and social differences.
Susanthika Jayasinghe winning an Olympic medal in Sydney, 2000 is undoubtedly the best feat by a Sri Lankan in the field of sports.
It surpasses that golden feat of our cricket team winning the World Cup in 1996. With over 200 countries taking part in Sydney and winning women's 200m bronze medal to give Sri Lanka its first ever Olympic medal in 52 years, Jayasinghe made Sri Lanka proud in Australia.
These two greatest achievements in Sri Lanka sports were achieved during President Chandrika Bandaranaike Kumaratunga's era as the island's head of state. Searching rural talent from the provinces and grooming them for the future is one of the key areas for which President Kumaratunga gave priority in the field of sports when she was first elected President in 1994. Her vision for the future brought immediate results in many fields, including sports.
Less than two years since she assumed office, Arjuna Ranatunga and his champion team reached the pinnacle of world cricket. They brought down mighty Australians by seven wickets in the final played on March 17, 1996 in Lahore.
Less than six years after, Ranatunga has now come forward to support President Kumaratunga's ruling People's Alliance by contesting the Colombo District at the forthcoming General Elections.
Ranatunga is now ready to 'bat' for the People's Alliance team, led by President Kumaratunga.
Sri Lanka gained a prominent place in the world sporting map after Ranatunga and his men won the mega event. The other world class feats by a Sri Lankan sportsman in the past were accounted for by the late M.J.M.Lafir, who emerged world billiards champion and Duncan White, who won the first Olympic medal for Sri Lanka, a silver at the 1948 London Games.
Promoting sports at district level and selecting fresh talent at provincial level is a key area for which the People's Alliance Government of President Kumaratunga has shown a keen interest. Her able leadership has put Sri Lanka on the correct path and the great achievements in the field of sports is only a part of it.
The Sports Ministry was instrumental in forming District Sports Foundations in each district.
All DSFs have their own funds for which the Ministry made an initial grant of Rs. 100,000/- for each district. These funds are utilized to assist promising rural sportsmen and women with `Nutrition scholarships'. Each district has a Sports School while every Divisional Secretariat has a divisional sports training centre.
In athletics, there are district athletic pool training under 20 paid coaches and the top athletes in all the districts are being paid monthly payments.
It was the People's Alliance Government, which introduced individual sponsorships for country's top athletes ranging up to Rs. 80,000/- each per month.
In addition, sponsors were found for each sport, pumping millions of rupees for National Sports Associations.
This is in addition to the large sums of rupees the Ministry of Sports is spending for the development. Each District Sports School is equipped with sports goods worth over Rs. 400,000 each, which includes a stamina building machine. Knowledgeable paid coaches are being appointed to these institutions.
Over Rs. 3.5 million was spent to re-develop the Bandarawela Stadium which hosted the 1996 National Sports Festival.
Nearly Rs. six million is spent annually to stage the National Sports Festival, a breeding ground for outstanding rural sportsmen and women.
Among the Government's other sports projects is the modernization of the Race Course Sports Complex at a cost of Rs. 15 million.
The Government's latest sports project will be the infrastructure development for next year's Asian Track & Field meet at which 44 countries are due to take part. A new artificial track will be laid. A new giant electronic screen will be constructed to international class and a two new buildings too would come at the Sugathadasa Outdoor Stadium, the venue for next year's athletic extravaganza. The Government has agreed to spend Rs.200 million for this project. The main problem to develop sports has been the finances but the Sports Ministry has faced the challenge well finding sponsors to bring up each sport to international level. Over 50 million has been found to give financial backing to the National Sports Associations through sponsorships mediated by the Sports Ministry. The cricketers have accounted for the main share in Sri Lanka's Sporting achievements in recent times. It has been the sport that is attracting the biggest foreign revenue through sponsorships, TV rights and guarantee fees.
The PA era in sports started with ace women sprinters Susanthika Jayasinghe and Damayanthi Darsha winning the silver and a bronze medal (respectively) in the same event (women's 200m) at an Asian Games - in Hiroshima in 1994.
Since then, there have been many feats in the field of athletics. In 1998, Darsha won Sri Lanka's first Asian Games gold medal in 24 years.
She won women's 200m and 400m gold medals while Sugath Tillakaratne won men's 400m gold and 200m bronze. At the same year, Sriyani Kulawansa won women's 100m hurdles silver medal at the Commonwealth Games in Kuala Lumpur.
Sri Lanka netball team has been going great guns and they won the Asian title once more early this year. Our footballers too have done well within their limitations while the ruggerites too have had their own share of success. The Lankan rugby team won the Neighbours Cup four-nation tournament and also beat China and Australian Northern Territories in back to back Tests. In September this year, Sri Lanka had its first ever win over South Korea in seven-a-side rugby.
When the progress of our sportsmen and women is talked about, one cannot forget the great contribution made by the Government in formulating a long term sports development programme. For the first time a National sports policy was formulated after a Sports Congress attended by the experts in the respective disciplines.
Sri Lanka still has a long way to go and our sportsmen and women will have to face tomorrow's challenges when they compete with international athletes.
Sri Lanka's top priority in athletics is the Asian Championships, Commonwealth Games and Asian Games lined up for next year while Susanthika Jayasinghe is looking forward to win a gold medal at the Athens Olympics in 2004. In cricket, Sanath Jayasuriya and his men will be looking forward to regain the World Cup in 2003. Sri Lanka cricket team will also be looking forward to register its first ever Test win over the West Indies in the forthcoming series starting on November 6, 2000.
Produced by Lake House