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WHY THE GOVERNMENT SHOULD HAVE HONOURED THE MOC ON THE EAST CONTAINER TERMINAL
by Sanjeewa Jayaweera
The announcement that the Sri Lanka Port Authority (SLPA) will be the sole owner and operator of the East Container Terminal at the Colombo Port has been greeted by many as a tremendous victory for the country. Leading up to the announcement, we were inundated by news reports as to why we should not be selling a national asset to a foreign party and that the country’s sovereignty and even security was at stake. This despite 80 per cent of ports worldwide been developed and operated as joint ventures involving foreign investors. Two of the existing terminals at the Colombo port are operated with the involvement of foreign investors, and as shown later in this article, they contribute handsomely to the overall profitability of SLPA.
The unionized employees attached to the Jaya Terminal (JCT) were at the forefront of the agitation, egged on by the Janatha Vimukthi Peramuna (JVP), a few cabinet ministers and Buddhist monks and some sections of the media. The trade unions used their favourite tactic of threatening industrial action if the government did not give a written undertaking that the ECT would be 100% owned and operated by the SLPA.
In the middle of all this, the Indian High Commission in Colombo released a press statement stating that the Government of India expected an expeditious implementation of the trilateral Memorandum of Cooperation (MOC) signed in May 2019 and that the commitment of the Government of Sri Lanka (GOSL) with regard to the ECT has been conveyed several times in the recent past, including at leadership level. They drew attention to the fact that the Sri Lanka cabinet also decided three months ago to implement the project with foreign investors. By any reckoning, it was a pretty forthright statement.
By staying that a commitment has been made at leadership level, they confirmed that our President and Prime Minister had assured them that the project will go ahead. It is not unheard of for governments to go back on undertakings given. However, in this instance, it seems that the GOSL has gone back on repeated assurances and as recently as a few days, weeks and months ago. It is a poor reflection on our country and in particular those who govern it. For most, it will appear as if the GOSL caved in to the demands of the trade unions and various other interested parties. Naturally, questions will be posed as to whether government to government agreements can be rescinded due to mob pressure.
GOSL is keen to attract Foreign Direct Investments (FDI) to Sri Lanka, and there is no doubt that the country’s development needs lots of it. Even hardline Communist countries like China and Vietnam have actively sought and obtained FDI. They have created the necessary environment for foreigners to invest in their countries. Unfortunately, in Sri Lanka, as is the case in most other issues, we only pay lip service to attract FDI. Corruption, bureaucratic inefficiency, lethargy, archaic labour laws and misplaced nationalistic idealism try their best to dissuade those who wish to invest their capital in our country. That is why we have stagnated for over 70 years. There is no doubt that the actions of both the Yahapalana and the current government has seriously impacted our country’s image regarding FDI.
The misinformation perpetuated by those opposing the trilateral MOC was disingenuous. The project proposal was to grant a lease of 35 years to the parties who would invest and operate the ECT. It was to be on a Built Operate Transfer (BOT) model. The land was never going to be sold, as stated by some. This was totally incorrect. In most countries, a lease of 99 years, as granted for the Hambantota port, is understood to be freehold and can be deemed a sale. However, to repeatedly state on various forums that the country is selling its national assets was dishonest.
It was envisaged that SLPA would own 51% of the project. It is fair to assume that the Adani group would have sought the participation of a local company who owned a minimum of 15% of the project. This would have meant that the SLPA and the Sri Lankan company together would have owned 66% of the project. So, I am at a loss to understand as to how people could say that Sri Lanka was selling a national asset.
The development of the ECT would require an investment of around US $ 650 million. This is equivalent to Rs. 130 Billion. The SLPA had already spent approximately US $ 80 million, developing a 400-meter finger berth and some backup yard space. The question is, who is going to fund the balance of US $ 570 Million (Rs. 114 Billion)? Certainly, SLPA on its own, does not have the financial capacity. I presume it will be the GOSL. According to the Annual Report (AR) of the SLPA for the year ended 31st December 2018 (FY 2018), there is an existing debt due to GOSL of Rs. 60 billion. Obviously, the SLPA can borrow part of the money as debt in all probability under a GOSL guarantee. Some amount of this debt would need to be dollars. They would certainly need to pay a premium interest rate given the negative credit rating of the country. In FY 2018 the SLPA provided Rs. 11.3 billion as an expense to the income statement as foreign exchange losses. This reflects the exposure to existing foreign currency debt. One can only imagine what it would be in the future with further depreciation of the Sri Lankan rupee and additional dollar debt.
It is evident to any sensible person that in the context of the current economic and financial crises that our country is facing, we do not need any additional financial commitments. This is especially so when capital is readily available from local and foreign entities. The GOSL need to invest in education, health, and many other vital areas. In my view, this itself is a good enough reason to allow foreign investors who would have brought much needed foreign currency to the country.
Secondly, in addition to capital, foreign investors would bring superior technology and best practices along with a good marketing plan that would attract the bigger shipping lines. Additionally, management would be in the hands of professionals with proven skills and capabilities in the maritime industry. A recent discussion highlighted the complete transformation of Sri Lanka Telecom (SLT) once it was privatized and a Japanese investor took over the management. I should know, because in 1993 when I built a house and applied for a telephone connection, I was told that the waiting period was two years! Given that transhipment volumes account for about 80% of the Colombo port’s business, most of which is to India, an Indian investor’s presence would undoubtedly enhance and ensure the ECT’s success.
Thirdly we know that the JCT terminal operated by the SLPA is inefficient and the profit generated is not commensurate to the revenue. According to the Annual Report (AR) for FY 2018 of SLPA, Rs. 8 billion was received for the year from the two privately managed terminals as Lease rentals, Royalties and Dividend Income. This is income from just being the “Landlord” and a 15% investor in these two terminals. I understand that various other revenue streams are generated and received from the two terminals. So it seems that just being a “Landlord” and a minority shareholder is far more profitable for the SLPA, GOSL and obviously for the citizens of this country than SLPA undertaking the entire investment and operation of the ECT terminal. According to the AR 2018, the Return on Capital of SLPA is only 2%.
The current Chairman of the SLPA, General Daya Ratnayake, in a television talk show said that there are 10,000 employees at the JCT terminal when the actual requirement is only 3,000! In my opinion, this too is excessive. The two privately owned terminals handle more than twice the volumes handled by SLPA at the JCT terminal with a staff cadre less than 3,000. A reflection of efficiency and productivity! It is a fact that many politicians of both parties have used the SLPA as a convenient source of employment for their supporters. Their wages and various other perks will make most public servants, and even those in the private sector cry in frustration. Even 40 years ago, I remembered stories of how some port workers would get a friend to sign their attendance while they were doing another job or sleeping at home!
According to AR 2018 the overall salaries, wages, allowances and other related staff costs at the Colombo port is around Rs. 20 billion paid to 8,948 employees. An average cost of Rs. 2.2 million per employee. The Rs. 20 billion includes an overtime cost of Rs. 3.6 billion despite being significantly overstaffed! I presume a reflection of poor work norms? No wonder the unions were agitating.
Unfortunately, this is how state enterprises work and the reason for their sorry state. Only a handful of state enterprises make money. The losses posted by the Ceylon Electricity Board, Ceylon Petroleum Corporation, SriLankan Airlines and the National Water Board are staggering. The fact of the matter is that ordinary citizens are funding these losses through both direct and indirect taxes. It is generally acknowledged that governments must not involve themselves in running businesses because of their lack of entrepreneurial skills. Into that equation when you add rampant corruption and nepotism, we have an ideal recipe for failure!
Fourthly, whether we like it or not, keeping India happy is essential. She is the regional power under whose umbrella we take refuge. Long gone are the days when Mrs Sirima Bandaranaike masterfully navigated our foreign policy to remain non-aligned. To her eternal credit, she kept both India and Pakistan as our friends during and after the 1971 Indo Pakistan war. Since 1977 we have had a plethora of Foreign Ministers, to whom the subject of foreign affairs was double Dutch. We need to exclude from that list the late Mr Lakshman Kadirgamar, a skilled and highly competent Foreign Minister.
No doubt, the world has become much more complicated since Mrs Bandaranaike’s time.After the collapse of the Soviet Union, we have seen China’s inexorable rise as an economic superpower. They now want to be recognized as such with a status similar to the USA. In this scenario, many countries are forced to align themselves to either the USA and its allies or China. President George W Bush in September 2001 stated “Every nation, in every region, now has a decision to make. Either you are with us, or you are with the terrorists.” I must hasten to say that he was not referring to China; however, the message is quite clear.
In the last 50 years, India has played a decisive role in our country’s affairs, and it is our misfortunate that India and China are not the best of friends. However, geopolitical reality is that we need to be friends with India just as much with China which is at odds with what President Bush said! The actions of the GOSL in abrogating the MOC might adversely impact our relations with India. This is when the country’s economy is in dire straits, fighting a raging pandemic and facing a barrage of issues at the forthcoming UNHRC meeting. Not the best of times to antagonize Big Brother!
It was announced that the cabinet has approved for the “West Terminal” at the Colombo Port to be developed as a joint venture with the Indian and Japanese governments and their nominees. One must assume that many who agitated against the ECT would again take to the streets and protest. Will India and Japan be once bitten twice shy? In case both the ECT and the West terminals are developed parallely will there be sufficient business volume for both the terminals to make money or will ECT become a White Elephant?
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There’s an ill more dangerous and pervasive than the Coronavirus that’s currently sweeping Sri Lanka. That is the fear to express one’s convictions. Across the public sector of the country in particular many persons holding high office are stringently regulating and controlling the voices of their consciences and this bodes ill for all and the country.
The corrupting impact of fear was discussed in this column a couple of weeks ago when dealing with the military coup in Myanmar. It stands to the enduring credit of ousted Myanmarese Head of Government Aung San Suu Kyi that she, perhaps for the first time in the history of modern political thought, singled out fear, and not power, as the principal cause of corruption within the individual; powerful or otherwise.
To be sure, power corrupts but the corrupting impact of fear is graver and more devastating. For instance, the fear in a person holding ministerial office or in a senior public sector official, that he would lose position and power as a result of speaking out his convictions and sincere beliefs on matters of the first importance, would lead to a country’s ills going unaddressed and uncorrected.
Besides, the individual concerned would be devaluing himself in the eyes of all irrevocably and revealing himself to be a person who would be willing to compromise his moral integrity for petty worldly gain or a ‘mess of pottage’. This happens all the while in Lankan public life. Some of those who have wielded and are wielding immense power in Sri Lanka leave very much to be desired from these standards.
It could be said that fear has prevented Sri Lanka from growing in every vital respect over the decades and has earned for itself the notoriety of being a directionless country.
All these ills and more are contained in the current controversy in Sri Lanka over the disposal of the bodies of Covid victims, for example. The Sri Lankan polity has no choice but to abide by scientific advice on this question. Since authorities of the standing of even the WHO have declared that the burial of the bodies of those dying of Covid could not prove to be injurious to the wider public, the Sri Lankan health authorities could go ahead and sanction the burying of the bodies concerned. What’s preventing the local authorities from taking this course since they claim to be on the side of science? Who or what are they fearing? This is the issue that’s crying out to be probed and answered.
Considering the need for absolute truthfulness and honesty on the part of all relevant persons and quarters in matters such as these, the latter have no choice but to resign from their positions if they are prevented from following the dictates of their consciences. If they are firmly convinced that burials could bring no harm, they are obliged to take up the position that burials should be allowed.
If any ‘higher authority’ is preventing them from allowing burials, our ministers and officials are conscience-bound to renounce their positions in protest, rather than behave compromisingly and engage in ‘double think’ and ‘double talk’. By adopting the latter course they are helping none but keeping the country in a state of chronic uncertainty, which is a handy recipe for social instabiliy and division.
In the Sri Lankan context, the failure on the part of the quarters that matter to follow scientific advice on the burials question could result in the aggravation of Islamophobia, or hatred of the practitioners of Islam, in the country. Sri Lanka could do without this latter phobia and hatred on account of its implications for national stability and development. The 30 year war against separatist forces was all about the prevention by military means of ‘nation-breaking’. The disastrous results for Sri Lanka from this war are continuing to weigh it down and are part of the international offensive against Sri Lanka in the UNHCR.
However, Islamophobia is an almost world wide phenomenon. It was greatly strengthened during Donald Trump’s presidential tenure in the US. While in office Trump resorted to the divisive ruling strategy of quite a few populist authoritarian rulers of the South. Essentially, the manoeuvre is to divide and rule by pandering to the racial prejudices of majority communities.
It has happened continually in Sri Lanka. In the initial post-independence years and for several decades after, it was a case of some populist politicians of the South whipping-up anti-Tamil sentiments. Some Tamil politicians did likewise in respect of the majority community. No doubt, both such quarters have done Sri Lanka immeasurable harm. By failing to follow scientific advice on the burial question and by not doing what is right, Sri Lanka’s current authorities are opening themselves to the charge that they are pandering to religious extremists among the majority community.
The murderous, destructive course of action adopted by some extremist sections among Muslim communities world wide, including of course Sri Lanka, has not earned the condemnation it deserves from moderate Muslims who make-up the preponderant majority in the Muslim community. It is up to moderate opinion in the latter collectivity to come out more strongly and persuasively against religious extremists in their midst. It will prove to have a cementing and unifying impact among communities.
It is not sufficiently appreciated by governments in the global South in particular that by voicing for religious and racial unity and by working consistently towards it, they would be strengthening democratic development, which is an essential condition for a country’s growth in all senses.
A ‘divided house’ is doomed to fall; this is the lesson of history. ‘National security’ cannot be had without human security and peaceful living among communities is central to the latter. There cannot be any ‘double talk’ or ‘politically correct’ opinions on this question. Truth and falsehood are the only valid categories of thought and speech.
Those in authority everywhere claiming to be democratic need to adopt a scientific outlook on this issue as well. Studies conducted on plural societies in South Asia, for example, reveal that the promotion of friendly, cordial ties among communities invariably brings about healing among estranged groups and produces social peace. This is the truth that is waiting to be acted upon.
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By Sanjeewa Jayaweera
It was on 3rd January 1972 that our family arrived in Karachi from Moscow. Our departure from Moscow had been delayed for a few weeks due to the military confrontation between Pakistan and India. It ended on 16th December 1971. After that, international flights were not permitted for some time.
The contrast between Moscow and Karachi was unbelievable. First and foremost, Moscow’s temperature was near minus 40 degrees centigrade, while in Karachi, it was sunny and a warm 28 degrees centigrade. However, what struck us most was the extreme warmth with which the airport authorities greeted our family. As my father was a diplomat, we were quickly ushered to the airport’s VIP Lounge. We were in transit on our way to Rawalpindi, the airport serving the capital of Islamabad.
We quickly realized that the word “we are from Sri Lanka” opened all doors just as saying “open sesame” gained entry to Aladdin’s cave! The broad smile, extreme courtesy, and genuine warmth we received from the Pakistani people were unbelievable.
This was all to do with Mrs Sirima Bandaranaike’s decision to allow Pakistani aircraft to land in Colombo to refuel on the way to Dhaka in East Pakistan during the military confrontation between Pakistan and India. It was a brave decision by Mrs Bandaranaike (Mrs B), and the successive governments and Sri Lanka people are still enjoying the fruits of it. Pakistan has been a steadfast and loyal supporter of our country. They have come to our assistance time and again in times of great need when many have turned their back on us. They have indeed been an “all-weather” friend of our country.
Getting back to 1972, I was an early beneficiary of Pakistani people’s love for Sri Lankans. I failed the entrance exam to gain entry to the only English medium school in Islamabad! However, when I met the Principal, along with my father, he said, “Sanjeewa, although you failed the entrance exam, I will this time make an exception as Sri Lankans are our dear friends.” After that, the joke around the family dinner table was that I owed my education in Pakistan to Mrs B!
At school, my brother and I were extended a warm welcome and always greeted “our good friends from Sri Lanka.” I felt when playing cricket for our college; our runs were cheered more loudly than of others.
One particular incident that I remember well was when the Embassy received a telex from the Foreign inistry. It requested that our High Commissioner seek an immediate meeting with the Prime Minister of Pakistan, Mr Zulifikar Ali Bhutto (ZB), and convey a message from Mrs B. The message requested that an urgent shipment of rice be dispatched to Sri Lanka as there would be an imminent rice shortage. As the Ambassador was not in the station, the responsibility devolved on my father.
It usually takes about a week or more to get an audience with the Prime Minister (PM) of a foreign country due to their busy schedule. However, given the urgency, my father spoke to the Foreign Ministry’s Permanent Sectary, who fortunately was our neighbour and sought an urgent appointment. My father received a call from the PM’s secretary around 10 P.M asking him to come over to the PM’s residence. My father met ZB around midnight. ZB was about to retire to bed and, as such, was in his pyjamas and gown enjoying a cigar! He had greeted my father and had asked, “Mr Jayaweera, what can we do for great friend Madam Bandaranaike?. My father conveyed the message from Colombo and quietly mentioned that there would be riots in the country if there is no rice!
ZB had immediately got the Food Commissioner of Pakistan on the line and said, “I want a shipload of rice to be in Colombo within the next 72 hours!” The Food Commissioner reverted within a few minutes, saying that nothing was available and the last export shipment had left the port only a few hours ago to another country. ZB had instructed to turn the ship around and send it to Colombo. This despite protests from the Food Commissioner about terms and conditions of the Letter of Credit prohibiting non-delivery. Sri Lanka got its delivery of rice!
The next was the visit of Mrs B to Pakistan. On arrival in Rawalpindi airport, she was given a hero’s welcome, which Pakistan had previously only offered to President Gaddafi of Libya, who financially backed Pakistan with his oil money. That day, I missed school and accompanied my parents to the airport. On our way, we witnessed thousands of people had gathered by the roadside to welcome Mrs B.
When we walked to the airport’s tarmac, thousands of people were standing in temporary stands waving Sri Lanka and Pakistan flags and chanting “Sri Lanka Pakistan Zindabad.” The noise emanating from the crowd was as loud and passionate as the cheering that the Pakistani cricket team received during a test match. It was electric!
I believe she was only the second head of state given the privilege of addressing both assemblies of Parliament. The other being Gaddafi. There was genuine affection from Mrs B amongst the people of Pakistan.
I always remember the indefatigable efforts of Mr Abdul Haffez Kardar, a cabinet minister and the President of the Pakistan Cricket Board. From around 1973 onwards, he passionately championed Sri Lanka’s cause to be admitted as a full member of the International Cricket Council (ICC) and granted test status. Every year, he would propose at the ICC’s annual meeting, but England and Australia’s veto kept us out until 1981.
I always felt that our Cricket Board made a mistake by not inviting Pakistan to play our inaugural test match. We should have appreciated Mr Kardar and Pakistan’s efforts. In 1974 the Pakistan board invited our team for a tour involving three test matches and a few first-class games. Most of those who played in our first test match was part of that tour, and no doubt gained significant exposure playing against a highly talented Pakistani team.
Several Pakistani greats were part of the Pakistan and India team that played a match soon after the Central Bank bomb in Colombo to prove that it was safe to play cricket in Colombo. It was a magnificent gesture by both Pakistan and India. Our greatest cricket triumph was in Pakistan when we won the World Cup in 1996. I am sure the players and those who watched the match on TV will remember the passionate support our team received that night from the Pakistani crowd. It was like playing at home!
I also recall reading about how the Pakistani government air freighted several Multi Barrell artillery guns and ammunition to Sri Lanka when the A rmy camp in Jaffna was under severe threat from the LTTE. This was even more important than the shipload of rice that ZB sent. This was crucial as most other countries refused to sell arms to our country during the war.
Time and again, Pakistan has steadfastly supported our country’s cause at the UNHCR. No doubt this year, too, their diplomats will work tirelessly to assist our country.
We extend a warm welcome to Mr Imran Khan, the Prime Minister of Pakistan. He is a truly inspirational individual who was undoubtedly an excellent cricketer. Since retirement from cricket, he has decided to get involved in politics, and after several years of patiently building up his support base, he won the last parliamentary elections. I hope that just as much as he galvanized Sri Lankan cricketers, his political journey would act as a catalyst for people like Kumar Sangakkara and Mahela Jayawardene to get involved in politics. Cricket has been called a “gentleman’s game.” Whilst politics is far from it!.
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Believe me, seeing certain videos, on social media, depicting action, on the dance floor, at some of these entertainment venues, got me wondering whether this Coronavirus pandemic is REAL!
To those having a good time, at these particular venues, and, I guess, the management, as well, what the world is experiencing now doesn’t seem to be their concerned.
Obviously, such irresponsible behaviour could create more problems for those who are battling to halt the spread of Covid-19, and the new viriant of Covid, in our part of the world.
The videos, on display, on social media, show certain venues, packed to capacity – with hardly anyone wearing a mask, and social distancing…only a dream..
How can one think of social distancing while gyrating, on a dance floor, that is over crowded!
If this trend continues, it wouldn’t be a surprise if Coronavirus makes its presence felt…at such venues.
And, then, what happens to the entertainment scene, and those involved in this field, especially the musicians? No work, whatsoever!
Lots of countries have closed nightclubs, and venues, where people gather, in order to curtail the spread of this deadly virus that has already claimed the lives of thousands.
Thailand did it and the country is still having lots of restrictions, where entertainment is concerned, and that is probably the reason why Thailand has been able to control the spread of the Coronavirus.
With a population of over 69 million, they have had (so far), a little over 25,000 cases, and 83 deaths, while we, with a population of around 21 million, have over 80,000 cases, and more than 450 deaths.
I’m not saying we should do away with entertainment – totally – but we need to follow a format, connected with the ‘new normal,’ where masks and social distancing are mandatory requirements at these venues. And, dancing, I believe, should be banned, at least temporarily, as one can’t maintain the required social distance, while on the dance floor, especially after drinks.
Police spokesman DIG Ajith Rohana keeps emphasising, on TV, radio, and in the newspapers, the need to adhere to the health regulations, now in force, and that those who fail to do so would be penalised.
He has also stated that plainclothes officers would move around to apprehend such offenders.
Perhaps, he should instruct his officers to pay surprise visits to some of these entertainment venues.
He would certainly have more than a bus load of offenders to be whisked off for PCR/Rapid Antigen tests!
I need to quote what Dr. H.T. Wickremasinghe said in his article, published in The Island of Tuesday, February 16th, 2021:
“…let me conclude, while emphasising the need to continue our general public health measures, such as wearing masks, social distancing, and avoiding crowded gatherings, to reduce the risk of contact with an infected person.
“There is no science to beat common sense.”
But…do some of our folks have this thing called COMMON SENSE!
