Celebrating all the wrong things

Originally appeared on The Morning

By Dhananath Fernando

There can be no independence without economic freedom

The lockdowns amidst the pandemic left all of us with ample time to explore new avenues in life. A friend of mine, excited to learn, enrolled himself in a bunch of online lessons with the motive of productively utilising this time. However, as time progressed, he got too lazy to keep up with the lessons and succumbed to the comforts of his home. He watched television, read novels, and baked way too many cupcakes. He did everything except follow through with his lessons, all the while feeling immensely guilty for failing to do so.

Every independence day, I can’t help but draw parallels between my friend and my motherland. We, Sri Lankans, are quick to celebrate independence with much excitement, just like my friend was to learn, but we fail to actually do the hard work to follow through with the initial commitment. We are quick to identify that learning is vital and even advocate for education. However, we lack initiative. Similarly, we proudly celebrate the British leaving us but have failed to do the work to achieve freedom in real terms.

As a result, over the years, Sri Lanka has only achieved certain elements of independence and democracy. Economic freedom remains an enigma up to date. Whether our fellow Sri Lankans have the ability to engage in business and trade with each other voluntarily has become a serious question. 80% of our land is owned by the Government. People have to wait in long lines and oil the palms of bureaucrats with discretionary powers to obtain a licence to cultivate a crop they think is best to earn a living.

Whether our fellow Sri Lankans can make economic decisions for the betterment of themselves and their children is a question which still remains unanswered. Yet, we opt to proudly celebrate “independence” with minimal comprehension of the true essence of freedom. I fail to see a big difference between my friend and this popular uninformed “patriotism”. 

Over the years, we have been excessively reactive rather than being proactive. Similar to my friend who celebrated the opportunity he had to learn but failed to follow through with it, we too continue to celebrate independence in its literal terms. To put things into perspective, let’s take a look at Sri Lanka’s economic incidents in the recent past.

We signed a Free Trade Agreement (FTA) with Singapore and went against our own terms and celebrated the “victory”. Since then, we have done very little to enhance Sri Lanka’s involvement in global trade. Instead, we continue to hamper the island’s economic growth and development through consistent import and export restrictions as highlighted by this column on numerous occasions.

We spent way too much time debating the Millennium Challenge Corporation (MCC) Compact for more than two years and eventually celebrated not signing the agreement. The agreement could have helped Sri Lanka enhance her land use and improve transport and traffic. It is clear the issue was politicised. However, we could have informed the donors as to why we opted not to sign the agreement before they directed the funds elsewhere. Even without the MCC Compact, we have done very little to reform the island’s myriad transport, traffic, and land use issues.

Recently, we celebrated withdrawing from signing a Memorandum of Understanding  (MoU), foregoing much-needed Foreign Direct Investment (FDI) for the development of the East Container Terminal (ECT). The development here had already been delayed by more than five years. Do we have a plan for the ECT’s development? Have we thought of competitive bidding? Do we have a better cost structure to implement investments on strategic assets? Sadly, the answer is “no”, yet again. It is clear that we Sri Lankans celebrate poor policy measures as victories and fail to embark on proactive actions that cause real change.

What causes real change?

Instead of celebrating policy measures that stunt Sri Lanka’s growth, we have to work towards establishing economic freedom and initiate important but hard reforms. What we should celebrate, however, is the implementation and impact of progressive policies.

The Economic Freedom of the World Index by the Fraser Institute states that countries with high economic freedom are more likely to prosper. The quality of life in these countries is evidently much better than countries with low economic freedom. If we wish to be free and independent, we have to prioritise economic freedom.

Sri Lanka has to implement reforms that ensure people’s ability to do business with ease, voluntarily without any barriers. We have to strive towards attaining a small government. The legal system and property rights have to be strong. People should be able to resolve their court cases faster and with improved efficiency. Sri Lankans should be given the right of ownership to their land and property especially on what they wish to do and grow on these lands.

Sri Lanka’s monetary system has to be stronger. We should have sound money where people do not lose the value of money in hand, due to the use of a bad monetary policy. When the value of money depreciates (from inflation), it is the poor who lose their freedom to buy what they want. Vulnerable sections of Sri Lanka are definitely the most affected.  Inflation is the unkindest tax of all as the poor have no defence against it.

Our businesses should have the freedom to trade internationally and barriers to trade have to be removed. Sri Lankans should not pay about 80% on their tiny bathroom tiles or 300% for the vehicles they use as taxes. They should be given access to trade internationally without any barriers. A minimum and appropriate regulatory environment is fundamental if we Sri Lankans wish to enjoy real freedom. Currently, to register a sole proprietorship or a partnership, a library of documents have to be submitted to authorities. It takes weeks for these documents to process when it should be a matter of a few minutes. The Government should not hinder the growth and development of our own people and their businesses.

On last year’s Independence Day, President Gotabaya Rajapaksa stated that he wants to remove regulatory barriers at all levels. A few weeks ago, he appointed a committee to evaluate unnecessary regulation for businesses.

The Economic Freedom of the World Index compiled by the Fraser Institute is a good indication of whether a country is moving in the right direction in terms of economic freedom. I wish and pray that we celebrate actions and reforms taken to improve economic freedom instead of celebrating the wrong forms of independence. If we fail to initiate hard reform and establish economic freedom, we will continue to celebrate independence for the wrong reasons. Then Sri Lanka’s prospects would be the same as my friend who makes no progress.

The opinions expressed are the author’s own views. They may not necessarily reflect the views of the Advocata Institute or anyone affiliated with the institute.

The ban that did more harm than good

Originally appeared on Daily FT

By Aneetha Warusavitarana

In the immediate aftermath of the devastating Easter attacks, one of the first steps taken by the Government was to announce a social media ban. This ban was ostensibly to protect us; the rationale being that this would stop the spread of hate, stop the spread of misinformation and fake news, and prevent the inciting of violence. In the Government’s eyes, this ban was the all-encompassing panacea to these problems.

Was the social media ban effective?
Rumour is a powerful weapon at any given time. In the context of a nation that is wracked with grief and fear it was a veritable weapon of mass destruction. Fear is also one of the most effective drivers of hate. If the objective of a social media ban was to prevent further violence, then in retrospect, the first step the Government should have taken would be to speak to the country addressing the fear that would drive retaliatory violence. Instead, the main method of communication was banned, even before the President or Prime Minister of the country addressed the nation. Effectively, the Government followed the precedent of the CEB, and left the entire country in the dark – with no reassurance that anyone in a decision-making position had a grip on the situation.  

In practicality the social media ban was ineffective, as VPNs were immediately downloaded, and people were active on Facebook and WhatsApp. This meant that fear mongering, fake news and hate was prolific. The irony is that if this ban was not in place, the Government would have been able to better monitor and address the slew of fake news. 

Does the Government have the mandate to ban social media?
The right to freedom of expression can arguably be curtailed in instances of hate speech. However, if one group of students organise a rally in campus grounds, and this rally is used to spread hate and incite violence against a different group of students, the answer is obviously not to ban rallies on campus grounds. Banning rallies on campus grounds would first, punish a majority for a crime they did not commit, unfairly infringing on their freedom of expression. Secondly, it would not address the problem. Rallies that incite violence are not exclusive to campus grounds – it could simply be organised elsewhere.

This analogy stands for the ban on social media. Banning social media at such a crucial point meant that the Government officially shut down communication lines among individuals, and importantly cut people from an important source of information. 

This goes completely against the mandate of the Government. What would have been effective was if the Government maintained clear, open lines of communication with constant, timely updates from verified Government sources. As the ban was ineffective, social media was rife with fake news, and the only effective method to combat it proved to be the counter-sharing of verified news alerts or first-hand reports from credible journalists, which disproved the fake news. 

A small but effective group of individuals took up this task, and spent hours sharing verified information and addressing the fake news which incidentally ranged from ‘there’s a tsunami heading this way’ to ‘my neighbour’s aunt’s brother-in-law said that another bomb has gone off’. The Government failing its mandate, restricting the country’s right to expression, and limiting access to information just exacerbated an already volatile situation. 

Who deals with the consequences?
A dangerous precedent has now been set. Last year, during riots in Digana, the Government imposed a similar ban on social media. The Government’s first reaction to the Easter Sunday attacks was to re-introduce the ban. 

According to the OECD, when the Egyptian Government blocked internet for 5 days in 2011, it cost the national economy $90 million. As the internet was still running in Sri Lanka, we can hope that the economic fallout from this disastrous decision will be less in our case. However, this is important. According to Statista, $88 million was spent on social media advertising in 2018 alone. The social media ban negatively affected the plethora of businesses which use Facebook or Instagram as platforms to run on, of which it is safe to assume that small and medium enterprises would have been hit hard. While Government officials are clamouring to propose plans to revive our tourism, they are silent on this front. 

Moving beyond these immediate, short term losses, the long-term consequences are worrying. This ban sends a negative signal to the international community. The Government mismanaged the crisis, to say the least, and the social media ban was the cherry on the top. It is clear that the Government favours this ban in times of crisis, even after the first ban came under criticism and scrutiny. This disregard of individual rights in the face of crisis, the fact the Government clearly has no qualms in compromising these rights, even when they do not translate to increased security or safety is not a message a country wants to send to investors or donors. 

The attacks were a national tragedy, and as a country we need to grieve and recover from this. However, once we do, and once a semblance of normalcy returns, the impunity with which the Government blocked social media with complete disregard for individual freedoms is not something we can ignore or forget.