Well-researched book on Sri Lanka's economy

Lost Opportunities: Sri Lanka's Economic Relationship with Japan
Author: Piyadasa Ratnayake
Karunaratne & Sons Ltd, 2004. 409 pp.
Rs. 1250.

Distributor: Sarasavi Bookshops

APPARENTLY, there are plenty of publications on Sri Lanka's post-independence economic development in recent times.

A closer examination of them reveals that many of these publications have been reporting historical facts on almost all sectors of the Sri Lankan economy without critically analysing them.

When analysing historical facts relating to economic development of any country, it is very vital to analyse those facts base on the ground of why it happened rather than just explaining what has happened.

This is the most remarkable difference with regard to Piyadasa Ratnayake's approach when it comes to analysing Sri Lanka's economic relationship with Japan in his book titled Lost Opportunities: Sri Lanka's Economic Relationship with Japan.

Major objective of the book seems to be examining why Sri Lanka has failed to achieve expected economic achievements despite the strong socio-economic base country had in the 1950s.

From the 1950s until mid 1960s, Sri Lanka was positioned at very high rank in the level of economic as well as social development compared to the other countries in Asia.

However, since then most of the Asian countries have achieved substantial socio-economic development while Sri Lanka is lagging behind. Even today, the level of economic and social development in Sri Lanka is in the form of decline rather than improving in many aspects.

The author strongly disagrees with the orthodox view of previous researchers that implementation of 'the wrong economic policies at the wrong time' as the main reason for development failure in Sri Lanka.

Instead, the present study argues that development of a country cannot be achieved just by introducing good policies and institutions alone.

To become successful, it is necessary to have strong supports from other non-economic factors such as political nature, leadership, good administrative structure, culture, religion, ethics, ethnic heterogeneity, language, social traditions, economic nationalism and attitude etc. Sri Lanka's economic failure is largely due to the influence of non-economic factors noted above.

Language issue

One simple argument to reveal the study's critical nature is the view by author on the language issue which has been linked to the ongoing ethnic issue and also blamed for many other issues.

The orthodox view is that the introduction of Sinhala language as the official language for education and administrative work in the country in 1956 was a major setback to economic development and social harmony in Sri Lanka.

However, the author disagrees on this and argues against it bringing evidence from many Asian countries. All countries in Asia have used the majority's language as official language but had no problem in reaching their development objectives.

The root of the problem of Sri Lanka was not due to the introduction of Sinhala language as official language but the author argues that the non-implementation of the language policy by the English educated intellectuals and administrators of the country.

Neither they attempted to publish sufficient materials in Sinhala language nor did they attempt to change colonial education system. This is the major problem that affected country's socio-economic development.

The book is also highly critical about Sinhala politicians who used the British introduced democratic system for their own advantage and suggests that politicians have simply used people as a major input in their corrupt behaviour.

The majority of Sri Lankan political history suggests that always one party provided many things free of charge just to obtain power while the other party was trying to show people a total miracle world using impracticable socialist ideology to be in power.

While coming to power from time to time, both sections of politics have progressively destroyed administrative structure of the country, people's commitments for nation's development and positive attitudes. They also have gradually created a virtual unproductive labour force in the country.

While reviewing the socio-political deterioration of Sri Lanka, the book also examines why the popular development strategies such as improving foreign trade, foreign investment and foreign aid that helped many countries to achieve development objectives, did not help Sri Lanka.

The author finds that the reason for the failure of such favourite methods to achieve development is mainly due to the very high significance of those non-economic factors discussed before. This has caused a major failure with regard to Sri Lanka's economic relationship with Japan.

The book explains using Japanese experience that without a future vision, economic nationalism, strong political and administrative structure and the commitment of the people in the country no one would be able to achieve success.

Therefore, non-economic factors have a very significant role to play in a development agenda of any country.

Japanese experience

Furthermore, the book also attempts to investigate what Sri Lanka can learn from Japan to overcome present problems giving a special reference to Japan's development success in the last half century.

It points out four major lessons from Japanese experience: (1) adoption of a domestically-oriented development policy under a stable political environment, a strong political leadership and an elite bureaucracy; (2) people's contribution and their understanding of responsibility; (3) system of democracy that is needed for development; and (4) contribution of education and cultural factors (language, ethics, religion, tradition etc.)

The book has six chapters and devotes five of them to discuss Japan-Sri Lanka link in the forms of trade, direct investment and ODA.

There are substantial data and figures provided for readers in a systematic way to understand issues relating to the Japan-Sri Lanka closeness. One interesting feature of the book is that the author has analysed from aid recipient point of view as well as donor's point of view.

It appears that the author has substantial advantages in analysing both side of the issue as he has been living in Japan for a considerable period of time.

The book includes excellent and comprehensive references and is written in a simple language that is accessible not only to academics but also to anyone with an interest in economic development issues in Sri Lanka.

Overall, this publication contributes substantially to the understanding of what has caused Sri Lanka to lag behind the other Asian countries in the process of achieving economic developmental goals.

It is a well-researched and well-written publication that is well-worth reading.

- Dr. P. Edirisuriya

Department of Accounting and Finance, Faculty of Business and Economics, Monash University, Caulfield Campus, Melbourne, Australia.

E-mail: [email protected]