The doubling of Sri Lanka’s main stock market index in 2010 has led to some effusive news reports, most recently in The Guardian . Inevitably, these reports have been lauded in Sri Lanka’s state-owned press, alongside its own hype. But, as other recent analysis shows, these reports make two mistaken assumptions :  that the index’s rise is entirely due to fundamental improvement in the stocks, and  that the market is indicative of the wider economy’s progress. Firstly, the index has been driven up by Sri Lankan government buying , while foreigners are exiting . Secondly, the Colombo bourse is unrepresentative of the wider economy. This is what the Sri Lankan Sunday Times’ economic column warned last October about the mistaken presumption: “There is little doubt that the recent [stock] market performance is not directly related to either economic performance or market fundamentals. It has been guided by market sentiments, speculation and government intervention .” See also this discussion in October by LBO of over-valuation and government buying. In fact, international equity investors’ wariness of the Sri Lankan market is underlined by one detail: Foreigners have been net sellers in 2010 and 2009 – after having been net buyers since 2001 (See Reuters’ reports in Dec and Feb 2010). 2010 saw a net foreign outflow of US$240m (Rs 26.4bn), more than twice 2009’s outflow of US$103m (Rs 11.4bn).
“It is not the possibility of statehood, but the impossibility of living under oppression that drives protracted struggles for self-determination. As both resolved conflicts and resumed struggles [across] the world attest, oppression is not forever, but resistance to it is .” “The Tamils, like other peoples seeking freedom from oppression through independent statehood, have long been told their demands are impossible 'pipe dreams'. Yet the unpredictable and changing international dynamics through generations of resistance have proven otherwise for many.” See our new editorial here .
EU member states should be working more actively to ensure that [international] development projects in Sri Lanka, especially in the north and east, do not help institutionalise an unjust peace or fuel new grievances and violent conflict, particularly with regard to the use and ownership of land.
Foreign direct investment in Sri Lanka dropped in 2010, despite the end of the war in May 2009, Reuters reported last month. Highlights: Despite approval of 268 projects worth $2.5 billion, only about a third were started, the Board of Investment's (BOI) said. FDI to September was $310m, compared to $350m in the same period in 2009. Despite severe fighting, 2008 was a record year with $889m. 2009’s total was $602m. The top five investing countries in 2010 were India, Malaysia, Britain, China and Mauritius. Sri Lanka is seeking $1bn FDI in 2011, $1.5bn in 2012 and $2bn in 2013.
When ratings agencies upgraded Sri Lanka’s debt rating – to still well below ‘investment-grade’- late last year they added a warning : the government needs to demonstrate a commitment to fiscal discipline and cutting its deficit to keep these ratings. However, despite solemn promises – including those in the November budget – of economic reforms, the Sinhala-nationalist government is unwilling to abandon the populist measures on which both its electoral support and its ethnicised vision of the economy rest.
Disappearances and extrajudicial killings of Tamils are once again on the rise in Sri Lanka. In Jaffna a simmering terror campaign by government-backed paramilitaries has escalated with several people going missing and the bodies of others, bearing horrific wounds, being dumped in public spaces. The victims include business people and prominent members of the community. And it is no coincidence this is happening amidst international efforts, led now by India , to restore normalcy in the Tamil areas and kickstart the economy there.
When people are abducted and never seen again – ‘disappeared’ – or their bodies are later found dumped, and when they are gunned down in public or in front of their families, these acts are often described as ‘senseless’. Senseless because nothing these people might have done - or are suspected to have done - is seen to justify such horrific ends. But there is a purpose to disappearances and extra-judicial killings: terror. These acts are not just about the individual, but the rest of society. They constitute a specific form of violence aiming to define the relationship between the state and the community concerned, between fear and submission.
Of the 135 individuals recently accepted into the Sri Lanka Administrative Service (SLAS), described as the apex of the government’s bureaucracy, all but one (a Muslim) were Sinhalese. Unsurprisingy - there weren’t any Tamils amongst the 257 people short listed. See the full report by LakbimaNews here . Secretary of the Ministry of Public Administration and Home Affairs, P.B. Abeykoon, says the intake of Tamils in the civil service was dwindling even in the early 80s , when he joined the civil service. There were only four to five Tamil recruits even then, he recalls. The government's...
Sri Lanka’s rhetoric on the urgent need for development in the Northeast belies its systematic efforts to disrupt the Tamil people’s recovery and subvert international assistance towards further consolidation of Sinhala dominance over them. The state’s cynical calls for the international community and the Diaspora to contribute to development of the Northeast must be viewed against its actual practices and past record.
"There is a definite trend to reduce aid agencies to [mere] service providers where the government says where, what, when and how. Therefore, it might be more difficult for NGOs to operate in the future according to humanitarian principles or their mandate" "The main question is whether the government will take care of the Tamil population, as much as it does with Sinhalese population in the south." - comments by aid workers. See AlertNet’s report on Sri Lanka’s restrictions on international aid agencies helping Tamils.