42 new laws have been passed in parliament during the past 14 months:
We expect to increase State Revenue to 13.1 percent of GDP this year:
A dialogue on legal reforms between President Ranil Wickremesinghe and young legal professionals of the “What’s New” initiative took place at the Bandaranaike Memorial International Conference Hall (BMICH) in Colombo last Sunday. The exchange encompassed queries posed to the President by the youthful legal minds, alongside his responses, as outlined below
Q: Have you identified the reasons for the severe economic collapse experienced by the country in 2021 and 2022?
A: I refrain from detailing the factors contributing to the economic downturn in 2021-2022. However, the underlying issue stems from our prolonged reliance on debt. Our failure to effectively manage this debt led to the collapse of our country, as we found ourselves unable to meet our financial obligations due to a lack of income.
This predicament is not new and predates the tenure of former President Gotabaya Rajapaksa. The trend of borrowing began earlier, and unlike other nations, our loans were often allocated to non-tradable goods. Our reliance on the construction sector primarily focused on highways, limited our ability to derive significant benefits.
Despite this, initiatives like the Mahaweli project facilitated the provision of electricity and fostered agricultural development. It is crucial for everyone to acknowledge their role in the challenges our country faces; no one is exempt from responsibility. Moving forward, we must collectively address our inability to meet debt obligations.
Q: In a scenario where repaying the loans seems unfeasible, how can our nation progress forward?
A: Negotiations are under way to secure a grace period until 2026-2027 for repayment. Additionally, various other measures are being explored to navigate our financial challenges. In 2022, Government revenue accounted for 8.3 percent of the gross domestic product (GDP). By 2023, we managed to increase it to 10.9 percent, yet our GDP remained stagnant, showing a decrease of 2 percent. However, we aim to boost Government revenue to 13.1 percent this year, which should subsequently bolster our GDP. By 2028, we anticipate raising it further to 15.2 percent, representing a remarkable 175 percent increase from the initial 8.3 percent.
In a significant milestone, our primary budget achieved a surplus of 6.7 percent in 2023, a trend we aim to sustain at 2.3 percent. Conversely, the budget deficit stood at 10.2 percent in 2022, a figure we intend to reduce to 3.9 percent by 2028. Achieving these targets poses significant challenges, but they are essential for our financial stability.
As of 2022, our debt stands at 128 percent of GDP. By 2032, our goal is to reduce it to 95 percent of the GDP. We borrowed 35 percent of GDP by 2022, which we aim to lower to 13 percent in the coming years. These endeavours are vital for ensuring a sustainable economic future for our nation. This is the necessary course of action.
How do we proceed? The transformation of the country’s economy is imperative. We must transition from a domestic economy to one focused on exports. Currently, we lack the foreign exchange needed for imports. Therefore, shifting to a competitive export-driven economy is essential. Simultaneously, we should embrace a digital and sustainable green economy.
Q: Is it necessary to reform the current legal system of the country as part of the transition towards a new economy?
A: To establish this new economic paradigm, we require new legislation. The European trade system was established during the Dutch colonial period, and elements of the Roman-Dutch legal system still influence our laws today. In 1835, with the arrival of colonial powers, a new phase of economic openness began, accompanied by the introduction of new legal frameworks. Subsequently, the Government elected in 1970 implemented a socialist-controlled economy, prompting the enactment of corresponding laws.
In 1977, President J.R. Jayewardene ushered in the open economy era, necessitating the introduction of new legislation. Similarly, for this new economic program, we need to enact pertinent laws. The Government has made significant strides, passing 42 laws in the past 14 months, a remarkable achievement. Now, the challenge lies in presenting the remaining 62 laws. Postponing the Parliamentary vote is not an option. Any unfinished business will be carried forward to the next Parliament. If we persist with this program, a new legal framework will emerge in the coming years, paving the way for a revitalised economy.
We are in the process of introducing a new law to replace the Port City Law, aimed at establishing an offshore economy. Given the unique nature of this economy, the existing laws of Sri Lanka may not be adequate, and thus, UK commercial laws will apply within the jurisdiction of the offshore economy.
To effectively implement these laws, we recognise the need for a new group of lawyers who are well-versed in international legal standards. It is essential to introduce laws that are globally accepted to foster the country’s development. We are restructuring Government institutions engaged in commercial activities.
All Government corporations will be reorganised into companies, with their shares consolidated under a central entity. This restructuring aligns with commercial principles and imposes responsibilities akin to those of directors of public companies under the Companies Act. Sanctions can be imposed for any errors made. We aim to introduce legislation concerning public-private joint ventures to further facilitate economic progress.
A new Public Financial Management Act is set to be introduced, along with a Public Debt Management Act and an Agriculture Modernization Act, all aimed at achieving specific economic goals. An Economic Transformation Act will be enacted to spearhead these objectives, potentially leading to the establishment of an Economic Commission in lieu of the current Board of Investment.
Control over trade zones under the Board of Investment and newly established trade zones will be consolidated under this Commission. To bolster domestic productivity, a National Productivity Commission will be established, recognising the imperative of enhancing local products to remain competitive globally.
Simultaneously, the establishment of an Economic and International Trade Institute is under way to further support economic growth. To streamline the legislative process, these initiatives will be presented collectively to the Supreme Court, avoiding the need for separate submissions over time.
Legislative efforts will encompass the introduction of a new law governing tourism businesses, as well as the transfer of Government property management responsibilities. Additional legislation addressing climate change and environmental conservation is also on the agenda, with a focus on safeguarding vital natural reserves such as Sinharaja, Sri Pada, Horton Plains, and Wasgamuwa Parks.
Moreover, structural reforms will involve the dissolution of the Department of Commerce, paving the way for the establishment of new international trade centres. These centres will operate in tandem with the Ministry of Foreign Affairs, signalling a concerted effort to revitalise and optimise Sri Lanka’s trade landscape.
We are actively pursuing the implementation of new legislation in the education sector. Efforts are under way to consolidate vocational education under a single authority and to establish new technical universities. Likewise, attention is being directed towards reforms in the healthcare sector.
The Education Act of 1944, while historically significant, no longer aligns with the needs and aspirations of our modern society. It is imperative that we enact new laws to usher in a new era of progress and prosperity for Sri Lanka. Our goal is to encourage a society and economy that is resilient and equipped to navigate future challenges effectively.
The decisions we make today will shape the future of our nation. Despite facing considerable challenges, we have made significant strides in revitalising our country within a remarkably short span of time. By April and May, we anticipate legally resolving the bankruptcy that has plagued our nation. However, it is essential that we honour our financial obligations and fulfill our loan repayment agreements.
The legislative process involves presenting proposed laws to Parliament for consideration. Following parliamentary approval, these laws undergo scrutiny by the Supreme Court before being enacted. Despite some opposition, it is crucial to uphold the integrity of our legal system and safeguard the authority of Parliament. Any attempts to undermine the law or restrict parliamentary powers through dubious interpretations must be resisted.
The authority of the Parliament in our country is founded on the 1972 Constitution, replacing the previous British constitutional framework. Legal precedents such as the cases of Ranasinghe against the Bribery Commissioner and Liyanage against the Queen are considered immutable within this jurisdiction. As a result, in 1970, the Government was mandated to establish a legislative body and draft a new Constitution. Colvin R. de Silva played a significant role in this process, advocating for the exercise of popular sovereignty through the National Assembly.
Under this arrangement, Parliament wielded executive authority, and the Cabinet was held accountable to Parliament. Both legislative and judicial powers were vested in Parliament, enabling it to carry out the functions traditionally performed by the courts.
In 1977, Colvin R. de Silva played a significant role in the development of the legal framework. He emphasised the alignment of legal practices with English law principles during this period.
The introduction of the Executive Presidential system in the 1977 Constitution marked a significant change in the governance structure. This shift transferred the executive power of the people to a President. While other aspects remained unchanged, such as universal suffrage and the role of Parliament, fundamental rights were also incorporated into the Constitution. The responsibility for enacting and upholding these provisions rested with the Parliament.
When the President appoints the Cabinet, their accountability to Parliament remains unchanged. Thus, the power now resides within Parliament, as outlined in the Constitution, where Parliament’s authority, fundamental powers, and universal suffrage take precedence. As President, I currently hold executive powers, which can be repealed by Parliament, but the powers of Parliament itself cannot be abolished.
During Colvin R. De Silva’s tenure in Parliament, the emphasis was on socialism, while President J.R. Jayewardene introduced the open economy. Similarly, we are committed to advancing along this trajectory. Both Colvin R. De Silva and President Jayewardene, who were classmates at Royal College, shared a similar mindset, recognising the primacy of Parliamentary sovereignty.
Hence, we must proceed in accordance with UK law. Any attempts to impede these efforts can be brought before Parliament for scrutiny by its legislative and judicial branches. These endeavours cannot be obstructed, as it is imperative to prevent further suffering among the population.
In terms of human rights, the foremost right is the preservation of living, followed by securing a promising future for the youth. All other considerations come thereafter. Engage in whatever political endeavours you see fit. However, the imperative for transformation cannot be overstated. Without it, our nation’s future is at stake. This is why I urge your active involvement and contribution.
Q: How has your legal background influenced your role in the Presidency?
A: Despite the legal expertise present among us, no individual possesses comprehensive knowledge of all laws. Often, individuals are familiar only with laws pertaining to their respective fields. Ultimately, seeking guidance from the Attorney General is imperative. Even when questioned in Parliament, it’s common to rely on the advice provided by the Attorney General. There are instances where insights from private attorneys are sought. I practised law for five years, but my responsibilities have since evolved.
Q: To prevent a crisis similar to the one experienced in Sri Lanka in 2022, international trade and active participation are deemed crucial. While you’ve outlined certain Government initiatives towards this end, I’m interested in learning about additional measures beyond those mentioned.
A: In the realm of international trade, our focus lies in signing free trade agreements with various nations. We aspire to engage in trade agreements with the Regional Comprehensive Economic Partnership (RCEP), facilitating commerce with East Asia, West Asia, and Australia.
This endeavour not only enhances economic prospects but also presents fresh opportunities for the legal profession. Under agreements with countries like India and Thailand, lawyers are poised to offer legal interpretations and engage in debates during law-related disputes.
Moreover, they stand to provide invaluable legal counsel to investors. Looking ahead, we aim to establish agreements with the World Trade Organization (WTO) to further bolster our trade objectives. We’re optimistic about forging agreements pertaining to environmental sustainability and climate change in the future.
Q: How crucial is the independence of the Central Bank (CBSL) for Sri Lanka’s economic recovery and to prevent future economic crises?
A: Independence is a hallmark of many prominent Central Banks worldwide. Aligning with this global practice, we have taken steps to enhance the autonomy of the Central Bank of Sri Lanka. By adhering to the IMF’s conditions, we have delegated various responsibilities to the Central Bank.
Q: What are the economic implications of women’s underrepresentation in the workforce due to diverse reasons?
A: The Government aims to elevate women’s workforce participation to 45 percent, yet several challenges persist. Issues include job placement for women and childcare responsibilities. Relevant authorities are tasked with addressing these hurdles. Efforts are also under way to address broader social issues affecting women, with two bills on women’s rights slated for parliamentary approval. A draft legislation to combat violence against women is in the pipeline.
Q: What are the government’s objectives in reforming labour laws?
A: The Government recognises the necessity for a contemporary labour framework, as the current laws are outdated. Crucially, consultations with both employees and employers are vital in crafting new legislation. Our aim is to engage in dialogue with workers and businesses alike to develop a law that serves the interests of both parties effectively.
Q: How do you plan to enhance the prospects of the community with special needs through the legal reform program under your leadership?
A: Several measures have been taken for the special needs community, but there’s room for improvement. Plans include appointing a committee to draft laws as part of upcoming legal reform activities. However, there are other areas, such as the needs of the special needs community that require attention.
Initially, efforts were focused on addressing the needs of low-income individuals in the country. Moving forward, discussions are under way to prioritise various communities, with each sector requiring five years of focused work. To ensure effective implementation, relevant officials will receive foreign training and guidance
Q: Has there been no progress in addressing the struggle of the parents in the North for their children who disappeared by force, even after seven years?
A: To address the issue of missing persons, we have taken over the Office of Missing Persons and have been actively conducting investigations. Moreover, the previous Government appointed Justice Nawaz to supervise the recommendations of other commissions. To date, Justice Nawaz has presented a thorough report on the subject, and we are optimistic about implementing the recommendations outlined therein.
As per the report, certain cases require investigation by the Truth and Reconciliation Commission (TRC), while others are within the jurisdiction of the Office of the Disappeared. We are keen to kick-start this process and strive towards resolving these enduring issues.
Q: What is your opinion on abolishing the Executive Presidential system and creating a new system like the Westminster system?
A: In considering the potential adoption of a new Westminster system or any alternative models, it is crucial for us to engage in thorough discussions. We must carefully assess the unique requirements of Sri Lanka and adapt our approach accordingly. Rather than simply replicating foreign frameworks, we should tailor our strategies to align with Sri Lanka’s unique circumstances.
For example, if we decide to transition away from the Executive Presidency, we should explore feasible alternatives like the Swiss model, which features representation from all political parties in the Cabinet. It is crucial to carefully consider the path forward and avoid merely copying external models without thorough examination.
