Friday 21st April, 2023
Parliament is going to debate the government’s agreement with the IMF, which has approved USD 3 billion for Sri Lanka under the Extended Fund Facility Arrangement. The debate is scheduled to take place from 26 to 28 April, we are told. Public finance is the province of Parliament, which should scrutinise the country’s agreements with international lending agencies, etc. But the one between the government and the IMF is now a fait accompli, and there is absolutely nothing that Parliament can do about it, at this stage, even if it is found to be detrimental to the country’s interests. There’s the rub. So, what is the use of having a debate thereon, one may ask.
The government dipped into the country’s meagre foreign exchange reserves, expecting a deus ex machina from Beijing, and finally opted for a shameful debt default. Having blundered by refusing to seek the IMF’s help in time and thereby bankrupted the economy, the government had no bargaining power when it chose to beg for a bailout. It was left with no alternative but to agree to anything to secure a loan. Beggars are said to be no choosers, and it is only natural that the IMF has imposed constricting aid conditions. The Opposition has been blowing hot and cold on IMF assistance. It urged the government to seek an IMF intervention, and now it is finding fault with the loan conditions. What one gathers from the utterances of the Opposition bigwigs is that they expect the IMF to grant loans without conditions; some of them have even warned that they will not honour some of the loan conditions if they form a government. These worthies are living in cloud cuckoo land. They seem to be believing in their own rhetoric. They should stop trying to hoodwink the public. The blame for the present economic crisis should be apportioned to the Opposition MPs as well because they were in the governments that were notorious for reckless borrowing, waste and corruption.
The country is in the current predicament because Parliament neglected its fiduciary duties. It should have taken up the debt crisis years ago and discussed ways and means of sorting out the economy. Some of its members have had the chutzpah to claim that they had been unaware of the parlous state of the economy until the government decided to default on debt! They are not fit to be legislators! There is no need for special briefings for them on the state of the economy; Central Bank and Finance Ministry reports are available to them, and anyone with a nodding acquaintance with economics and statistics would have known that something was terribly wrong with the country’s foreign reserves.
It is not difficult to predict the outcome of the parliamentary debate to be held on the government’s agreement with the IMF. The House is very likely to be divided along party lines with the government MPs supporting the agreement and others opposing it for the consumption of the public. A division will be called and the ayes will have it because the government can still muster a simple majority in the House. The possibility of some Opposition MPs backing the government with a view to securing ministerial posts cannot be ruled out.
What Parliament should take up for debate urgently, in our book, is the delay in taking legal action to secure compensation for the unprecedented environmental disaster caused by the sinking of X-Press Pearl ship in 2021. It is being claimed in some quarters that Sri Lanka will be able to obtain as much as USD 6.2 billion from the shipping company concerned if a case is filed post-haste. Legal experts have warned that time is fast running out. No less a person than Minister of Justice Dr. Wijeyadasa Rajapakse has alleged that someone capable of influencing the litigation process has received USD 250 million in a questionable manner. Parliament must take up this issue of national importance urgently, and ensure that legal action will be initiated forthwith to obtain compensation for the X-Press Pearl disaster, and a high-level probe conducted into the Justice Minister’s serious allegation.