e-Con e-News

Sri Lanka Taken Hostage


Galle Face, Mannar Basin, Trincomalee & other Masquerades…

blog: eesrilanka.wordpress.com

Before you study the economics, study the economists!

e-Con e-News 10-16 April 2022

The lush trees of Galle Face Green were first clearcut by Dutch invaders, to fire their cannons against Sinhala attacks from the south. The Dutch word faas (face) described the front of their fort’s Gal Gate, as it faced Galle. The area’s rocky shores was originally Gal Bokka, hence the name Galle Buck, with gal being Sinhala for rock.

• All eyes are now diverted to the stand-off at Galle Face, with multiple interests vying for popular support. The whites headed by the USA, jostle to continue their over 500-year control over the ocean, as India tries to snatch the Mannar Basin and Trincomalee from under their claws, while pointing furiously at China, to divert the whites and resident Anglomaniacs (see Random Notes).

• Two weeks ago, English Unilever’s largest public shareholder, asset manager BlackRock displayed almost-astrological clairvoyance? Among Sri Lanka’s top known international sovereign-bond (ISB) holders, Blackrock announced they were hiring a legal adviser for ‘potential’ debt restructuring talks. BlackRock claimed this was in response to Sri Lanka’s worsening foreign-exchange crisis, adding to the faux-panics aroused by the credit downgrades of US-regulated rating agencies. Clairvoyant, indeed!

     This week, Sri Lanka announced ‘its first debt default since it gained independence’ and set to talk with the US-controlled IMF. ee offers a tentative look at possible responses to IMF plans. In the meanwhile, bringing cartels and multinationals to heel (through a global boycott of Unilever?, see ee Quotes), and international unity to control the IMF, World Bank, WTO, etc, is needed more than ever (ee Focus).

• After the ‘great financial crisis’ of 2008, Capitalism began planning a facelift for 2020, to preserve the world’s division of technology & labor, and prevent greater democracy. ee signalled this shift in 2019, long before Covid and these current wars (ee 15 November 2019, Facelift).

     This superficial fair’n’lovely world makeover is being led by multinational corporations (MNCs) like England’s Unilever, the largest conglomerate, which has far more control over Sri Lanka’s politics and economy, than any government or the people.

     US-led capitalism’s tactics have been inflicting heavy damages on people across the world. Their control over energy supply, through merchants and moneylenders, has created havoc in the country (Random Notes).

I just came back from Kabul. Things are going better in Afghanistan than most believe here – Victoria Nuland, US Permanent Representative to NATO, Speech to Presse Club and AmCham, Paris, France, February 22, 2008

It’s more than planetary confluence that the current chaos escalated with the USA’s strategic ‘retreat’ in Afghanistan, August 2021. Then Nepal was forced to accept their MCC prescriptions in March 2022. Pakistan’s Prime Minister was ousted last week. It’s becoming increasingly clear how the Faustian-Mephistophelian deals made to ‘assume’ power, eventually backfire. Trying to act like white boys (& girls) and play the playboy, playgirl and oligarch, is not the basis on which to build and extend the independence of a nation.

     With political and economic leadership driven into disarray by a combination of US and Indian manipulation, drug lords, gangsters and mercenaries are being given a new lease on life. Sri Lanka’s base as a drug entrepot was escalated by our 1980s ‘open economy’, after the US began their covert war on Afghanistan. Their war was financed by promoting opium cultivation, and heroin became a daily diet for people thrown out of the ‘open economy’ set up at the behest of the IMF.

• Turbulence and wars both economic and bloody are being instigated by the US-led Western bloc. Sri Lanka has long been heavily exposed to the whimsies of white markets, let alone their capricious tourists. We have been made heavily dependent on imports for pre-industrial production & daily necessities.

     Multinationals, larger than many countries put together, are pushing governments to their knees. People are yet to learn who their real enemies are. The media, mass media and social media, controlled by MNCs, will be the last to tell us the truth.

     It’s being made even more costly to stay alive, and death only adds to the loads carried by the living. Life is being made especially perilous and precarious for those left out by the beloved ‘free market’ of the capitalists. Capitalists have been making an extra killing from the pandemic, throwing people out of work, escalating wars on Asia, Africa and the Americas, and by creating false scarcities to inflate prices.

     A Lanka-wide system of rationing & distributing essential goods has to be immediately implemented, along with strict capital controls. The kerb (aka illegal aka black) markets for foreign exchange – including the transfer pricing policies of MNCs, like Unilever, etc, have to be controlled if not eliminated. It is only such capital controls that will appreciate the currency, reduce prices and raise real wages. If not, the costs of living and dying will become even more expensive.

      It is therefore vital that people in their villages, neighborhoods and workplaces, develop industrialized (including agricultural) plans, and ensure that politicians adhere to such needs (ee Focus, Alternative to IMF).

• What are the weapons of the isolated weak? Nagging. Poison. Gossip. Rumor. Sneaking around instead of confrontation. The whip is a weapon of the not-so-strong. The whip is indispensable if discipline is to be maintained. The whip emphasizes order and orders. It is usually used on serfs, slaves, servants, sailors, and soldiers. It’s also ceremonial. Its main function is to instil discipline in onlookers as well. The first tasting of blood awakens a certain lust. It grows and strengthens until it becomes a powerful and abiding obsession. And then seeps into civilized English discourse. Thus there is even ‘a parliamentary whip’. He ensures politicians act in the correct way, using bribery, penalties, and threat of exposure of their private lives and other deals.

     And so now off we go to the IMF, hat in hand. Again. 16 times we have gone to the IMF since independence, only to be plunged deeper into debt. This is their 17th lash of the whip. The economic whip. Who will the IMF’s whip lash out at? Not at the oligarchs, but at the most vulnerable. Almost every parliamentary political party in Sri Lanka’s dependent capitalist system seems to have accepted IMF dictat!

• Our latest Finance Minister Ali Sabry proclaims the ‘one good thing’ about Sri Lanka is that lawmakers across the political spectrum are in favor of going to the IMF! ‘So in the case of the current government, or in the extreme case of another government by the opposition that is unlikely, no one is saying not to go the IMF. In that sense, there’s policy certainty…’ ee Economists, Bloomberg

     So it’s springtime for the IMF, and winter for Sri Lanka. The IMF’s spring meetings begin in Washington on April 18. Sri Lanka’s delegation will also meet India’s delegation ‘on the wings’ of the IMF meet. New Central Bank Governor Nandalal Weerasinghe and Treasury Secretary Mahinda Siriwardena have already spoken with Anne-Marie Gulde-Wolf, IMF Deputy Director, Asia & Pacific Department.

     The IMF’s 2016 prescription harmed the economy’s health, ‘with a fall in growth rate from 5% in 2015 to 2.9% in 2019. During the same period, the government revenue also contracted from 14.1% to 12.6% of GDP.’ (ee Economists, India’s Observer Research Foundation).

     The IMF has changed, declares the JVP’s Harini Amarasuriya. Well, the IMF is the US government. So the JVP is saying the US government has changed? What has actually changed is the IMF’s PR and marketing strategy. Rather than just directly undermining health and education, they continuously undermine any attempts at modern industrialization, which alone can sustain such social services. The IMF remains a ‘neutron bomb that kills people but leaves buildings standing’, and World Bank economists are ‘genocide workers in the pay of economic totalitarianism’. So said a Venezuelan president in 1988, who then changed his mind and was forced to go to the IMF, which created even greater chaos.

Countries round the world are being pushed into economic chaos one by one. Sri Lanka is merely ahead in the firing-squad line. The Litro Gas chairman here, back from 5 days’ holiday, just resigned, blaming an import mafia and even government ministers (ee Quotes). Kenya, even with 86 oil wells, has even greater energy disruption, with oil companies being exposed and the government threatening company CEOs with long jail terms (ee Industry).

     Countries that attempt a foreign policy independent of NATO, are under attack. In Peru, a newly elected leftish government is facing mass demonstrations and strikes. Apparently these violent protests have also been organized by capitalists who actually run the country and are referred to as ‘parallel ministers’.

     ‘Parallel ministers’ are the capitalists who actually run ministries, regardless of the actual minister, regardless of administration, regardless of who’s elected, no matter which party comes to power in a capitalist parliamentary system. These parallel ministers remain in the shadows and the ministries are their homes. They cause scarcities, purchase media time, even fund strikes and protests, destabilizing governments and presidents. (ee Economy, Inflation Protests Erupt)

• People may have been made aware of the role played by illegal money systems (Undiyal, Hawala, etc.) in transferring funds between countries (see Random Notes), but few are aware of the far larger and more ruinous legalized systems used by such multinationals as Unilever to move funds via technological rents, royalties, licensing rights, technical assistance fees, etc., and transfer pricing, easily inflating accounting costs, and minimizing local tax liabilities (ee 29 May 2021).

• NATO’s latest wars, biological & military, have merely exposed the illusory nature of our underdeveloping economies. ee is dedicated to SBD de Silva. In the absence of needed statistics and public information on corporate shenanigans in Sri Lanka, SBD recommended, not only going back and forth through history, but traveling around the world to analyze our underdevelopment and test hypotheses. He often wondered why there were no university economics courses dedicated to studying Asia’s industrialization, from Japan to China. Most importantly, his predictions have come true: How long can this import orgy last?! Leasing companies this week were reportedly wanting to seize 5 million vehicles of people who cannot pay monthly debts (ee Industry)….

continued on: eesrilanka.wordpress.com

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