Saturday, February 24, 2024
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Rajapaksa Brothers not the only Culprits

Sri Lanka’s Supreme Court issued a symbolic ruling that the powerful Rajapaksa brothers – including two ex-presidents – were guilty of triggering the worst economic crisis by mishandling the economy. At least they must be given the credit that they brought Ranil Wickremesinghe to fix the problem. In a majority verdict on multiple petitions filed by academics and civil rights activists, a five-judge bench of the Supreme Court ruled that the respondents, who all later resigned or were sacked, had violated public trust. The biggest disaster for Gotabaya Rajapaksa was the appointment of Dr PB Jayasundara as the Secretary to the President. He single handedly destroyed the entire economy . His side kicks still continue in HNB , DFCC Bank and Lanka Clear as government representatives. The GR team that wrought havoc must be clinically removed by the current government . The public deserve this . That is the bare minimum people want.

Making Sri Lanka bankrupt

When Nivard Cabraal was reappointed Governor CBSl after Dr Lakshman was sacked, despite Cabraal’s political immaturity many business people had big hopes that he would stabilize the economy. Unfortunately he clashed with Ali Sabry and Basil Rajapaksha on policy and especially the exchange policy. The final result, Cabraal freezed  the Rupee at 203 to 1 USD without capital controls allowing people thru black channels to move their LKR money to other countries causing a forex crisis in the country . Few weeks later Cabbral forced by Basil Rajapaksa allowed the LKR to float causing economic mayhem . The rest is history. Gotabaya Rajapaksa in desperation appointed a  Presidential Advisory Group. Dr Indrajit Coomaraswamy, former governor of the Central Bank of Sri Lanka, Dr Shanta Devarajan, Professor of the Practice of Development, Georgetown University and Dr Sharmini Cooray a director of the Institute of Capacity Development of the IMF . Non of them had no real market experience other than teaching in prestigious institutions . What they did and what they accomplished, we the public is still not aware. Did they advice Gotabaya to default? Dr Coomaraswamy is being accused for borrowing over $15 Billion USD at market rates form the market whilst as governor ? Sri Lanka is still struggling to reschedule this massive commercial debt ? President Sirisena rewarded him with a Deshamanaya. Gotabaya Rajapaksa after sacking Attigale the discredited treasury secretary and Governor Cabbral Brought back Nandalal Weerasinghe who was admonished by him for failing to respond with proper strategies to resuscitate the economy during COVID

https://youtu.be/ciEgwox2EUY?si=dUGE24JiQ6VmPzKU .

The first thing Weerasinghe did was a cowboy act . He decided to default on the debt repayment without asking for more time from the creditors or rescheduling the loans. He called it a soft default. To date no financial text book has come up with a definition for a soft default. Then he raised interest rates overnight by 100% . The final impact of this decision, done to bring inflation down to below 5 % . Has resulted in destroying 25% of the private sector , the tourism sector (who will never be able to repay their loans) . Also Pushed up interest service payments of the government to record levels . Resulting in government being forced to push electricity prices and taxes to unbearable levels to the poor . The biggest beneficiary of this stupidity were the bond traders . The government failed to tax the extraordinary gains. Instead the government heaped more burdens on the tax payers and the poor. The public must hold the top treasury officials and the Governor accountable too for mismanagement . This should be the next case the public must file? The questions to be asked? A) was the so called soft default done with the approval of the cabinet and parliament?B) What were the other options ? C) What was the impact of the irresponsible interest rate policy of the Central Bank.

Conclusion

Sri Lanka’s economic woes are far from over. Whilst the CBSL toasts their victory for bringing inflation down to 5% . This has hardly had any impact on the real economy. Instead,  1. Economy is Contracting with no growth.  2. 25% of the private sector pushed out of business 3) over 500,000 people pushed below the poverty line 4) Unbearable debt in the tourism sector which can never be repaid. 5.) pushed government debt and interest repayment to new highs with unsustainable interest payments. So whilst we blame Gotabaya Rajapaksa and his brothers totally for destroying the economy . Pause a minute; what about the so called economic and treasury experts who hide behind the politicians and happily heap all the garbage on the politicians and the public. History is repeating it self . Unfortunately our current politicians are lost in their own garbage and noise to see through this destruction.

Writer’s Comments

The comments and thoughts are reflections of people opinions. People see no positives in good governance or leadership from the opposition . Bureaucracy riddled with Rogues and  protected. Cricket crooks protected. The monthly interest and salary for most people after paying all bills left with no money to buy even a good bottle of arrack without thinking of other commitments . Middle class is being eliminated. No positives for the common man .

Adolf

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