Treasury Bond liberalization
THE opening of the local Treasury Bond
market to foreign investors by the Central Bank of Sri Lanka marks a
qualitatively new phase in the development of Sri Lanka's capital
market.
It is another major measure in the liberalization of the country's
economy and a strong stimulant to the continued inflow of foreign
investment. As indicated by the Central Bank, the move could lead to a
further "broadening of the country's investor base".
Indicative in these developments is the State's keenness to keep the
local economy in a state of robust health.
A huge influx of foreign investment per se may not be a pointer to
dynamic and substantial development but moneys well invested lead to
economic growth and the generation of more and more employment.
Given Sri Lanka's strong regulatory environment mediated by
organisations such as the SEC and BoI, the possibility of profitable
investment being made is great.
All this is good news for the State which is hoping to reach the 8
percent growth mark by year's end. However, the State would need to
ensure that the inflow of funds results in a strengthening and expansion
of the local production base.
For, money needs to "chase" goods and services for a robust
perpetuation of the economic system, if not the possibility is great
that we would be having inflation and an escalation of living costs.
So, the State's regulatory agencies have quite a job on their hands,
guiding and directing the incoming moneys to profitable investment. In
other words, the State has to continue on a course of steady fiscal
discipline.
It goes without saying that the State's investment policy must be
aimed at attracting to this country long-term, productive investment. We
need to guard against "fly by night" investors who are drawn to Sri
Lanka by the lure of short-term gain.
One of the chief means of achieving this is the effective containment
of the conflict which is, of course, receiving the attention of the
Government.
Besides these not so obvious implications of the incoming foreign
investment, the State could be said to have acted very pragmatically by
opening the Treasury Bond market to foreign investors. For, now there
could be substantial funds for the financing of the State's budgetary
operations. The possibility emerges of bridging the budget deficit more
easily.
In the final analysis, the State should ensure that Sri Lankans of
all economic backgrounds are commercially active. This could be
facilitated by ensuring that greater economic equity prevails. It is a
people with sufficient financial means who could keep the wheels of the
economy humming.
Therefore, economic liberalization is hugely welcome as long as
growth and equity reign in a balanced fashion.
To achieve these laudable objectives, State economic planning has to
continue to occupy a position of importance.
Foreign direct investment has added to the robustness of our economy
over the years, but our attitude should not be one of welcoming foreign
investment or finances merely because such heavy foreign finances prove
prestigious.
The regulatory environment should be continuously strong to ensure
that these funds serve the national interest and requirements
We need also hardly say that the incoming foreign investment must be
accountable. Besides being long-term investment, such moneys should
contribute towards the empowerment of the local people. |
Emphasising the importance of migrants' rights
As globalization of social and economic forces
engender an exponential increase in migration, this critical issue
has now reached the centre stage in international fora. And it is no
more possible to consider migration only as a national issue due to
its reach and international nature. Consequently the international
community, in recent times, has taken several measures to address
this complex issue in all its dimensions and aspects.
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Tamil community losing faith in LTTE:
Desertions hit Eastern flank
THE existence of any organisation, whether it is
democratic or terrorist, depends on its manpower. Any organisation
sans manpower stands to die out. The destiny of a terrorist
organisation also does not change from this. If one forgets its
terror inclinations, the LTTE claims to be an organisation
representing the Tamil community in the North and East.
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