Chapter 02 | Movements Towards and Away from Globalisation

Dhananath and Sarath discuss the historical shifts between globalisation-friendly and unfavourable economic policies in Sri Lanka as detailed in Sarath’s book. The discussion categorises various periods in Sri Lankan history based on their alignment with globalisation: Pre-independence (1920–1947): Defined as globalisation-friendly due to established British institutions, legal systems, and the necessity of trade for economic takeoff. Post-independence (1948–1955): Characterised as a continuation of liberal policies where no significant harm was done to the economy. Interventionist Period (1956–1964): Identified as globalisation-unfriendly due to protectionist tendencies influenced by leaders like S.W.R.D. Bandaranaike, who followed the protectionist models of India’s Nehru. The Black Period (1970–1977): A period of extreme state interference and shortages, driven by Trotskyite influence and socialist ideologies. Liberalisation (1977–2004): A major shift towards an open economy initiated by J.R. Jayewardene, which allowed for the free movement of goods and services despite the ongoing civil war.