Galloping From Crisis To Crisis Into The World Of Casino Capitalism
May you live in interesting times’ is a Chinese curse and we Sri Lankans are certainly living in interesting times. Crises appear and disappear with such rapidity that we often find it hard to recall what the last crisis was all about.
In recent weeks we had one Julampitiye Amare, a native of Hambantota – whose village is in proximity to that famed village of Medamulane of the Rajapaksas – leading a gang of armed motor cyclists – like cowboys riding horses in the days of the Wild West – opening fire with automatic weapons at a gathering of rival JVPers in a house killing two and wounding many. It caused a national uproar with the realisation that law and order preached by the police and those in power was a figment of their imagination. Julampitiye Amare, a man with over 104 warrants of arrest issued by many courts, is now behind bars but with the last report of a jailor opening the doors of the Tangalle prison for him the day after he rode through town killing JVPers, Amare being behind bars for long is a matter of conjecture.
Julampitiye Amare faded off the limelight following the historic storming by a mob of the Mannar Courts complex following a decision made by the Mannar Magistrate. The allegation that the Magistrate was threatened by a cabinet minister added fuel to the raging controversy with cries once again: where is law and order?
These crises dropped into the background following the greatest injustice committed to youth of the country. These young men and women who had struggled for eleven or more years facing all possible odds: poverty, hunger, disease and malnutrition, their parents selling off their pathetic possessions to enable their children to enter universities and gain entry to a world not so wonderful but yet an escape from the degradation of poverty which their former generations had lived through, were denied that opportunity by two jokers responsible for education in this country. Little wonder the more sophisticated of the victims call the jokers Thompson and Thomson after the bungling detectives in the Tin-Tin comics.
All that is not new as our readers will well realise. The news right now is the racketeering now being attempted to subvert the Security Exchange Commission (SEC). The Chairman of the SEC Thilak Karunaratne resigned from his post due to pressure exerted on him.
According to business reports Karunaratne had been subjected ‘to pressure’ by a group of shady investors and crooked brokers opposing regulation of the stock exchange. Junk stocks saw phenomenal rise and phenomenal price increases through the process known as ‘pumping and dumping’. Insider trading as well as market manipulation were taking place as well. Regulation of the SEC was attempted to stop all that.
A commentator noted that some brokers were extending credit at their will and pleasure. The SEC was investigating all this buccaneering in high finance and attempts were being made to have directives put in place to stop this exploitation of the market. The country’s Bourse needs regulation to prevent it from being ripped apart with devastating long term effects on the private sector – the so called Engine of Growth.
Those defending the Mafia point out that foreign investments have come in during the past year and any attempts at regulation would have negative effects.
However respected and responsible business chambers of repute like the Chamber of Commerce do not hold such a view. The Chamber of Commerce in a statement issued last week said that the turn of events would not be good for the country. The resignation of the SEC Chairman before one year of his appointment lapsed would be viewed with concern by investors and shareholders. An effective and stable regulatory framework was critical to ensuring a robust and sustainable capital market which delivers long term values to all shareholders, it said.
Business sources said that a vast number of respected business people and a number of reputed broker firms have stood up for the SEC and called for justice, equity and the Rule of Law.
The tragedy is that the Rajapaksa regime supports the financial buccaneers who if given unbridled powers could turn the SEC into a casino and commit the country to the path of casino capitalism. The Rajapaksa government has fallen prey to these shady investors and crooked brokers. The President it is reported has said that the country’s SEC has fallen to low levels because of the policies of the SEC. The Secretary to the Treasury P. B. Jayasundera is reported to have said that political considerations come first and the SEC has to compromise or resign.
Last year the Director General of the SEC Malik Cader and former Chairperson Indrani Sugathadasa too resigned following developments that have led to the recent resignation of Thilak Karunaratne.
The SEC is comparatively a new institution and happenings within the SEC have no immediate effect on the country at large and ordinary citizens are blissfully unaware of these developments. But the path carved out by this group of financial buccaneers will inevitably lead the country to the world of casino capitalism. Quite apart from that, the lifetime savings of the people in the EPF and ETF are now being invested in the stock market. There are many allegations that these pension funds are being used in the process of pumping and dumping in the stock market. Both UNP leader Ranil Wickremesinghe and economist Harsha de Silva have asked in parliament, for details of these investments and the government has assured that the funds would be invested on the advice of the Monetary Board.
The Monetary Board too has some political appointees of doubtful qualifications in the field of finance and is not a gilt edged guarantee. Politicians, bureaucrats and political appointees cannot be permitted to play casino games with pension funds and it is advisable that they stick to investment in Government Bonds.
There are other crises for which this all powerful government is groping around for answers but without success.
We are making these comments in a hurry lest a power blackout hits us and knocks out our computer. It was not many Poya Moons ago that our cocky Minister of Power Champika Ranawaka was waving the Sri Lanka flag like a school boy boasting that Sri Lanka was the only South Asian country without daily power cuts. Ranawaka can point out to the failure of the monsoons for the power cuts. True enough, but it is also due to the breakdown of the Norochcholai 300MW coal power plant (1st Phase) built by a Chinese firm on a loan of $ 455million from the Exim Bank of China. This was the show piece of the Rajapaksa regime and a Rs. 100 currency note with the picture of the Norochcholai plant is now in circulation! The hours of the blackout have been extended and the period given for repair of the power plant too has been gradually increased. This power plant has been built with public funds and the people are paying for the blackouts! The other new power plant installed by the Rajapaksa regime at Kerawalapitiya too was out of order for some time but now is said to have been repaired.
There are many other crises for which the people are paying through their nose. The financial blackholes of the economy such as SriLankan Airlines and Mihin Air are costing the tax payer millions. Time and space do not permit us to go through all the other blackholes.
Meanwhile, the country’s top priority is the provincial councils elections in three provinces. It will cost millions to the tax payer but it is all important to the Rajapaksa regime which is sure to win them all without an effective Opposition. It will be like Usain Bolt doing the 100 meters with no other competitors!