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Ranjit Fernando
The private sector suffered for 30 years and all expected 2010 and the post-war period to be one of growth, unfortunately that has not happened, a corporate manager said.
Former NDB Bank C.E.O./director Ranjit Fernando speaking to Benchmark recently said that the private sector is still waiting for the peace dividend.
Fernando, now chairman of United Motors Lanka said, “So 2010 appears to be where we were in 2008 and 2009; no different. Unless fundamental changes are made, I don’t think the climate is going to be different just because we have defeated the L.T.T.E.,” he told Benchmark’s Special Correspondent Ms. Savithri Rodrigo.
“I also believe that in the past four years we have made significant movement towards governmental authority and the private sector is relegated to a second-class position today.
I say this because the belief of the Government is in the state sector. You find a reintroduction of state-sponsored food authorities. The era which people have forgotten is when we had to wait in a queue to obtain a shirt or saree! That was a state-dominated economy.”
Continuing, Fernando said, “For much of the past four years we had hyperinflation which affected the private sector, because factor costs increased and could not be passed on. Those who targeted foreign markets were hampered by an administratively managed exchange rate, which were borne by the private sector.
Above all, this is a regime of high taxation, which taxed more from the private sector than what was available to investors in any project. Touching on F.D.I. and its prospects for Sri Lanka, Fernando maintains that “we could have been another Singapore in the S.A.A.R.C. region,” but he believes that we don’t “have the correct policies with regard to F.D.I.”
“Investment will find its way to Sri Lanka if the climate is conducive. We must target the correct sectors and companies that we want to come in. Another concern is the preoccupation with the amount of money that is brought in by a foreign investor.
It should be focused on how many jobs the enterprise would create. That is how we should look at F.D.I. It should not be a blanket invitation for all to come in,” he added.
Elaborating further, Fernando said, “Although the war and the finishing of the L.T.T.E. was a necessary condition for growth, it was not a sufficient condition for growth. Because we need to unite the country and solve the fundamental question that has plagued this country and brought on the war that lasted 30 years.
It is eight months since the end of the war. Unfortunately, no meaningful steps have been taken to address the fundamental issue of the ethnic question.”
Stressing on the seriousness of the issue at hand, Fernando alluded to certain politicians “whose political survival depends on continuing this issue”, which he said, “we must face.”
The widely-watched business TV programme is presented by LMD and produced by the wrap factory.
The CEO appears to be directiong a broadside against government policies. He is entitled to do that in a democracy. The fact is that the people of this small democratic country have endorsed this path and it would be beneficial to the country if business leaders embraced this relaity and worked within this framework.
At this stage of mass scale re-deveopment, a controlled eceonomy is not necessarily bad. China is a great example and again some level of authoratism is required to control such an ecenomy.
The CEO is a strong advocate of the private sector, good. However, isn’t it the poor migrant labour who are the highest earners of this country’s foreign revenue? Going back to refer to the saree queue era is a bit of negative politics. These are the stories that were doing the rounds just before the recent elections.
The CEO does not seem to understand that with the sort of policies he is promoting, the welath created will still be in the hands of a selected few and the jobs generated will be shared amongst those who went to school in Colombo. This is not going to solve the social and economic problems faced by the rural youth. Those rural youth who are lucky to pass through the state higher education systems will head for greener pastures overseas due to their lack of English skills and inability to fit into the private sector. Ostensibly, that is why the current government is on a different path.
The CEO is talking up liberalisation on the one hand and about various controls on investment, on the other hand. As we have seen in the past this is easier said that done. SL has been elevated by the IMF to the next higher level. Isn’t this an indication that the policies of the governement are working? My advise to ths CEO and others is, it is you who have to facilitate the unification of the country, in line with the policy direction set by a government with mass popular support. Rumbling and grumbling for next seven years will definitely pull us back as the government needs the support of business leaders like you, to take the country forward
I do not agree with Mr. Fernando’s views. Private sector in third world countries like Sri Lanka does not act responsibly like the private sector players in developed countries. For example; can our Harry J be compared to Bill Gate who has given out more than his net worth to charity? One thing we can say is; our man had grabbed everything he could from public sector for a song. Have you ever heard he had given anything back to the public?
Now for Mr. Fernando’s pitch of a free rein for private sector. First it must be said that he does not utter one word about social responsibilities that should be attributed to the private sector in Sri Lanka. It is a known fact that most in the private sector have no ethics or principals. So, the government should introduce laws that are necessary made them responsible players in the Sri Lankan economy.
Remember how the rice cartel had acted recently. If not for the timely intervention by government and the CWE, rice prices would have gone over the ceiling. That was only one example. And for another; if not for the price strictures on gas, its price too would have gone much higher than what is it today. In short, private sector action only shows us that supply and demand theories are hopeless.
Perhaps what Mr. Fernando is moaning about is the need to get back to RanilW’s regaining Sri Lanka. It may have looked respectable during those days when ‘private sector’ looked as if it is the only panache for all our economic ills. Now that we seen debacles like Golden Key and how government had rescued its cousin Seylan Bank, people are more cautious of the private sector.
The world economy is not likely to return soon to the level of pre 2006, therefore we should look the government take up the lead role in economic development. In my opinion, the CWE and the Government owned business agencies should compete with the private sector in an equitable manner to provide a service to the public. Only those that have ulterior motives would construe it as going back to a command economy or to the days of the 1970s.
Sri Lanka’s private sector is one of the most corrupt in the world Good eg Harry J and Kothalawala If they wre given freedom they are shouting for they will rob every man ,women and child in Sri Lanka and vanished from this island as most have a foot abroad. These so called bussines poeple allways blame public sector But let me give an eg. Our public heath sector is one of the most cost efective in the world according to WHO. The two supream systems of the world according to these business idiots uk and usa spent 8.5% and 16% of their GDP on health but both these have big problems in their health care delivery systems we SL spend 1.4% of our GDP on health and our health indicers are par with uk and usa I havent seen a single business man appriciate our health care system What will happend if we leave our heath care to private sector? Development of sri lanka needs private sector but they should be patriotic like private sector in UK USA or in singapore and they should be regulated. OTHERWISE ROBERS IN SRI LANKA’S SO CALLED BUSINESS COMINUTY MAKE A HELL AND VANISHED.
There are many aspects to be considered when one analyses the post war events of Sri Lanka. It is important to realise that Sri Lanka has gone through about 30 years of war. People left their homes not knowing whether they were going to come back in one peice. There was great turmoil and terrorist activities throughout the country. Thousands of innocent lives were lost and about 30,000 people were either injured badly, lost limbs,lost their sight or were maimed badly. Many families lost their loved ones and are still suffering both physically and psychologically as a consequence of this war.
The second world wa lasted less than ten years, as opossed to the Sri Lankan war. The allies occupied the capture territories for almost 060 years adnd ruled those areas as “the winner takes it all”. There are people who expect Sri Lanka to restore some kind of blance in these areas overnight whilst the allied forces took 60 years. When an enemy is defeated after having gone to war, they have lost all avenues of negotiation.
Under these circumstances, it is up to the president of the nation and his law-makers who should be allowed to design the future of the country in a way that the country will remain united and free of terrorism once and for all. People in other countries and people with vested interest, should not be given the oppurtunity to dictate terms to the president and his government.
It is upon a stable foundation that people from other countries and well-wishers would want to invest in Sri Lanka. If Sri Lanka remaiins srtong and united without breaking under pressure we are bound to do well, as did Singapore and Malaysia. Sri Lanka has one of the best democracies in the world, where there is free education and even free post-graduate education.This is irrespective of race, religoun or ethnicity. Instead of critising the government, everyody should rally round the president an the government in this hour of need.