*Need to find political stability:
*There are externally and internally a lot of challenges
Finance Minister Ali Sabry, PC said that at this juncture, we must see some sense of certainty in governance irrespective of political differences and stay on course with Constitutional governance. The Minister in an interview with the Sunday Observer said this is a time when one needs not to do politics. No one is saying not to agitate on those things but political uncertainty and instability push all of us towards a very difficult position in terms of getting investments coming, the tourists back on track and our orders which we used to get.
Without political stability no one will take us seriously and that is a huge problem. Therefore, we must immediately find some sort of political stability one way or the other. The Minister said the Government has so far been able to maintain the majority. We would urge those 41 SLPP Parliamentarians who became independent in Parliament to reconsider their stance and join hands to weather the storm right now and then get the country back on track to put the supply chain in place.
Excerpts of the interview
Q: A delegation comprising you, the Finance Ministry Secretary and Central Bank Governor will attend a five-day discussion with the International Monetary Fund (IMF) in Washington from April 18 to 23. Could you explain?
A: We are meeting the IMF, World Bank, Asian Development Bank (ADB) and other bilateral countries as well and some US officials on the current situation as far as the economy is concerned and we are trying to officially engage the IMF on a program.
Q: You had told Reuters, Sri Lanka will need about US$ 3 billion in external assistance within the next six months to help restore supplies of essential items, including fuel and medicines, to manage a severe economic crisis. Your views?
A: The situation is very grave. There are externally and internally a lot of challenges. So, if we don’t address this right now, we will have a crash-landing which will totally destroy our economy, future and institutions. Therefore, we need to undergo real pain for the next six to nine months to have some hope at the end of the tunnel. So, we are looking at several measures and all those things cannot be divulged but basically, we are looking at debt restructuring, a moratorium and subsequent restructuring of the debt and then going to the IMF for a program where the IMF will grant us some sort of funds.
If we enter into a good understanding with the IMF along with that there will be the World Bank, Asian Development Bank and bilateral finance facilities coming into the fray. So, we are looking at all those things to avoid the balance of payment crisis and to continue with the process.
Q: Some say political instability has adverse effects on the country and its economy. Would you like to comment?
A: I mean this is the most difficult financial crisis Sri Lanka has faced ever since independence. There are no two words about it. Anyway, we had an ailing economy coming to 2019 post Easter Sunday attacks when we were about to recover from that Covid-19 pandemic. It has shattered our economy in terms of Gross Domestic Production (GDP) as well as tourism earnings. Then there were debts which were maturing.
So, related to the forex crisis and less dollars coming into the system, we are really suffering. This is a time when one needs not to do politics. No one is saying not to agitate on those things but political uncertainty and instability push all of us towards a very difficult position in terms of getting investments coming, the tourists back on track and our orders which we used to get.
Therefore, this is the time, we must see some sense of certainty in governance irrespective of political differences and stay on course with constitutional governance.
Q: You told Parliament last week that Sri Lanka must look at restructuring US$ one billion sovereign debt due for payment in July. Amid the political and worst economic crisis, is the Government in a position to settle this debt or should it go to the IMF as there is no other solution?
A: Absolutely it is not possible to pay that one billion US dollars right now. So, we need to go for a restructure and there are no two words about it.
The IMF will not do the restructuring and we have to do it through debt advisors in terms of finance and legal matters. The IMF will only talk to us and support us when we will restructure the debt. For the first time in history, the IMF has come to a conclusion that our debt is unsustainable. That means we can’t pay the debt. So, first of all they would want us to restructure that. Thereafter, they will start giving us some bridging finance. That is what the IMF will do.
Q: Opposition Leader Sajith Premadasa has said that poor economic policies had contributed to the country’s economic downturn. Your views?
A: I would say that we would have gone to the IMF a little before this but the situation was compounded not only because of the policy decisions or whatever it is. The Covid-19 pandemic was one of the biggest reasons for this and the massive oil hike due to the Russian war and its effects on tourism have contributed towards the very difficult situation that we are undergoing. So, the Opposition is trying to make merry out of the situation right now. However, it is not only the Government’s policies that failed, it is a combination of reasons which have caused the current situation.
Q: How do you view the attempt made by the Opposition to bring a No-Confidence Motion against the President?
A: Basically, they are again trying to make use of the opportunity for their political gain without looking at the national interest at this point in time. I think this is not a time to play politics. This is a very difficult time for the whole of the Sri Lankan community. However, if the Opposition wants to go through that, let them do and show the numbers they have in Parliament. We are confident that we have the numbers to defeat such an attempt in Parliament.
Q: The Opposition attempts to convince the people so far, the Cabinet of Ministers have not legally resigned and they still use all their ministry vehicles and other perks. Is there any truth in this allegation?
A: No. That is not true. All the Cabinet of Ministers have resigned and it has been accepted and there is a gazette notification to that effect.
Q: During the past couple of weeks the people are continuing countrywide protests asking the President to step down. Would you like to comment?
A: This is not a situation confined only to our country. At present so many countries are suffering from the Covid-19 situation. You could see what happened in Pakistan. Several countries are suffering post-Covid-19 situation and the subsequent Ukrainian war that has affected the oil prices, tourism as well as all the supply chain. Whatever the solution one wants it has to be in line with the Sri Lankan Constitution.
So, the President has been elected for five years and if they just ask him to step down after two-and-half years, where are we going to go? So, down the line we will have an issue and what is thereafter. What is the solution? Nobody is providing any sort of solution. So, this is the problem that we have faced right now.
Q: The Government has made an open invitation to the Opposition to find the required number of 113 MPs in Parliament and form a Government. If the Opposition is not in a position to do so, what would be the next option available and some say the country is heading towards an unstable situation?
A: They should respect that. Now two things are possible, either they can muster 113 MPs in Parliament and form a Government which we are happy to give it to them. Otherwise the second solution for them is to have a No-Confidence Motion against the Government and muster 113 votes.
Thereafter, once the Government is not able to maintain 113 votes, we can finalise it. But right now, the situation is that as long as there are 113 MPs you should allow the Government to function. Otherwise the lack of governance will have severe repercussions to the country.
Q: Don’t you think there should be political stability in the country to find solutions to the current economic crisis?
A: That is absolutely necessary. Without political stability no one will take us seriously and that is a huge problem. So, we must immediately find some sort of political stability one way or the other.
Q: At present 41 SLPP Parliamentarians have become independent in Parliament. Has this made any adverse effect on the stability of the Government or still it has been able to consolidate the majority in Parliament?
A: The Government has so far been able to maintain the majority. With those 41 members we would urge them to reconsider their stance and join hands to weather the storm right now and then get the country back on track to put the supply chain in place.
Q: The JVP says the Government attempts to suppress the peaceful demonstrations conducted by the people countrywide. Your comments?
A: That is not true at all. If you look at the JVP, they had a massive protest recently and they even entered the Presidential Secretariat. The UNP also had a massive protest. The Government had not reacted at all.
The Government only reacted when the protests turned violent. When violent protests take place, the Government and the security forces have to take defensive action. You can’t allow the people to just take the law into their own hands. It was only then the Government had responded.
Therefore, it is not fair to say that the Government had done anything of that sort. That is not true at all. Similarly, if you look at the situation in Colombo, there have been peaceful protests but nobody is responding. The Government has been just keeping a close eye. That is all.
Q: What led you to resign from the finance ministerial portfolio within 24 hours of your appointment and once again returned to the position on last Friday?
A: I think financial stability and sanity is very important to protect our economy and financial integrity. I am not a financial expert in that sense or an economist.
That is why I thought that I must pave the way for anyone to take over and do it. Unfortunately, no one is coming forward. If no one is coming forward I can’t see my country declining. The country is bigger than all of us. So, I am willing to go through that sacrifice to protect the interest of the country for the time being until at least someone who is ready.