- Opines program with IMF is the only solution whether people like it or not
- Recalls when negotiating with IMF, one of the biggest issues is “Government changes and the policies change”
- Says issue is not the substance but are we prepared to standby and to support IMF agreement
- Says Parliament could discuss any alternatives and make final decision
- Warns if MPs not prepared collectively then Parliament must take responsibility for consequences
- Insists MPs cannot say we are for half and not the other half; stresses SL has to take whole thing in full
- Refers to any medicine for recovery is bitter and SL has to bite the bullet
- Warns SL cannot have second Aragalaya
President Ranil Wickremesinghe on Friday put the onus on the critical support program with the International Monetary Fund (IMF) to all parties and Members of Parliament.
“The program with the IMF is the only solution. Whether we like it or not we have to deal with the IMF,” Wickremesinghe said, adding that “The whole Parliament has to consider this issue. Any member or party doesn’t agree, we have the right to ask what is your solution or alternative.”
In his keynote at the Advocata Institute reforms forum, Wickremesinghe said all parties must abide by the Staff Level Agreement (SLA) which the President said is likely to be finalised and signed by the end of August.
He noted that even during the Asian crisis 1997 and the 2008/9 period what helped the recovery was IMF initiated reforms.
Sri Lanka previously has had 16 programs with the IMF and the President recalled that when negotiating with the IMF one of the biggest issues is “Government changes and the policies change.” Therefore, Wickremesinghe said “So the issue is not the substance but are we prepared to standby and to support this agreement.
“If we are not prepared collectively, then the Parliament must take responsibility for the consequences. We can’t say we are for half and not the other half. We have to take the whole thing in full.”
Noting that “any medicine for recovery is bitter”, the President also stressed that not only MPs but people outside the House must also bring their influence to bear on those who have to take decisions inside the Parliament.
Wickremesinghe also called upon anyone who has a formula or proposal to make it easier, to come forward and present it. “Certainly, we should hear it and the Parliament could decide between these two proposals. If not, we have no other way except to bite the bullet,” the President stressed.
It was emphasised that the first item on the country’s agenda was the economy and it may be the second item as well. Wickremesinghe said without stabilising the economy nothing else can be done.
Apart from the Staff Level Agreement with the IMF, the President said the second more important issue was ensuring that the country’s debt is sustainable. He said that when it comes to foreign debt Sri Lanka is getting caught up in the geopolitics of the region and can the country navigate its way. He added that the agreement on official foreign debt was critical for the way forward on debt restructuring.
President also said that local debt has far reaching consequences and financial advisors Lazard is looking at both foreign and local debt.
“It is certainly going to be a difficult time. I won’t say no. The first six months will be difficult, a period which we have not seen before in our history. But we all have to go through it,” the President Wickremesinghe emphasised.
The Advocata Forum was also told that the challenge for the economic recovery was the social and economic dimensions of the crisis.
“Over 6 million are malnourished and more people are losing jobs. How long will it last and how are we going to support it? We are setting aside additional money from the Government but you will see demands from companies that are doing well for some form of allowances or salary increase. To implement these reforms, restructuring you need stability. We have already seen the impact of shortage of fuel and inflation. We cannot have a second Aragalaya,” the President warned.
“We need to look at the well-being of a large number who will be affected. Find resources and offer targeted support to the vulnerable. The gap between the haves and have nots is increasing. It has not decreased in the last 10-15 years. The disadvantage groups being pushed back and this is one of the reasons for the Aragalaya,” the President opined.
Wickremesinghe recalled that in 1977 the country wanted change and the then UNP Government made the change by opening up the economy but unfortunately it could not be continued and take it forward. “In between came globalisation and Sri Lanka didn’t keep up with it and today we are paying the price. So no point going back to the old system and being stuck again. We need to think anew. No need to rebuild on the old plan,” he said.
“There have to be changes. There has to be a rise in incomes, workers have to be looked after, and ensure good education facilities. There is no going back to an old system. We are going to a new system and that new system is what the young want. So then shape it yourself, look at what you want,” the President told the Advocata Reforms Forum.
The need for Sri Lanka to become a highly competitive export-oriented economy was also stressed by the President. “First and foremost, the time we take to stabilise is also the time for reforms, change the laws and the systems and procedures, institutions within six-nine months. Use the time for planning and opening up,” Wickremesinghe added.