Sri Lanka: Large Scale infrastructure projects of Sri Lanka, democracy and anti-globalization sentiment.

Protest-action-vs-the-Colombo-Port-City-project-in-Negombo-Photo-by-NAFSO

by Natasha Fernando  27 August 2018

Recently, the Japanese Minister of Defence Itsunori Onodera, the Ambassador of Japan in Sri Lanka Mr.Kenichi Sugunuma, Defence Advisor to the Japanese embassy Captain Atsuhiro Morore, and representatives of Japanese government paid a visit to Sri Lanka’s Eastern Naval Command Headquarters in Trincomalee and the Hambantota Port. The Japanese have raised concerns that they will not allow [i]militarization of the Hambantota Port. The Hambantota Port and Colombo Port city are large-scale infrastructure developments in Sri Lanka funded by the Chinese. From the inception of these projects in Sri Lanka, India and USA have raised concerns on the implications the projects could have on security in the Indian Ocean Region. While the USA is concerned with [ii] “unsustainable debt-burden on Sri Lanka due to non- concessional loans from China”, India has also raised security concerns of growing Chinese presence which led the Sri Lankan government to enter a delicate balancing act by allowing Indian airport’s authority to lease out the Hambantota International Airport.

Large Scale Infrastructural Developments in the age of globalization

Globalization can be understood as a worldwide process by which people, companies, governments and other entities have advanced integration and interaction. These interactions encompass economic, cultural, and political dimensions. While Globalization has afforded many benefits, it is negatively perceived as well.  The benefits include: prospective for increased diplomatic footprint, gaining international or bilateral aid for development in multiple sectors such as health, education, and energy etc. The negative perceptions of globalization or anti-globalization sentiment resent corporations deeming them exploitative.

Opponents of globalization also criticize trade agreements as asymmetric due to unequal bargaining power.  Among the opponents are trade unionists, environmental, human, land & indigenous rights activists. Arguably, in a democracy, all constituencies irrespective of their perceptions towards globalization are given a voice, and to participate in a governance model that is inclusive. Within this context, it is interesting to examine whether the littoral state of Sri Lanka, has upheld certain democratic values pertaining to large-scale infrastructure developments of national importance. Sri Lanka is a middle-income country which is strategically located in the Indian Ocean with key large-scale infrastructural developments that have garnered international attention and also domestic resentment.

Transparency of large-scale infrastructure projects and democracy

Sri Lanka is currently on the map because of its role in China’s Belt Road initiative (BRI); the Colombo port city and the Hambantota port are part of the BRI. These Chinese funded large-scale infrastructural projects have been handed over to the Chinese on a 99-year lease. The Colombo port city is envisioned to become an International Financial Centre with a populace of 40,000 and to be governed under a separate jurisdiction. As of now, the country is faced with the question of whether a constitutional amendment is needed to complete the project as envisioned.

This project from its inception was vehemently opposed by the fisheries community who argued that construction interfered with their traditional livelihoods, while land rights activists argue the project was conducted without a cost-benefit analysis, social discounting and economic parameters which makes the project a ‘white elephant’. The project is criticised for not benefitting the people of the country directly along the lines of inclusive development.

Furthermore, environmental activists have opposed the project on grounds that an environmental impact assessment was not conducted prior to beginning construction work and that construction had damaged the reef, eco-systems and endemic marine species of the vicinity. There is also massive doubt on whether the project is sustainable due to a lack of a solution on waste disposal of the large community that is to inhabit the city.

While these doubts are presented as anti-globalisation sentiments, and despite little empirical evidence to support the proposition that the port city or the harbour will bring in long-term development benefits; it is believed the projects have potential to increase Foreign Direct Investments, job creation and the multiplier effect of creating more opportunities on much-needed infrastructure developments such as roads, highways, smart town and city planning, sanitation, energy etc. Also, Sri Lanka’s strategic location in the Indian Ocean Region has the potential for Sri Lanka to become a vibrant maritime hub within an urban economy and to compete regionally.

Democratic values, transparency and inclusive development.

On an objective note, a democratic state is one in which there is transparency in governance. Transparency to a large extent has the potential to reduce corruption and not infringe on the rights of individuals. It is thus imperative, before entering into such large-scale projects (which includes the presence of powerful regional actors such as [iii]China having stakes on the development), the government conducts multi-stakeholder public consultation. This includes a wide scale awareness of how the project will benefit all communities and awarding of proper compensation to those [iv]vulnerable communities affected by these projects.

Transparency, in this case, includes assessments done on political, economic, social, technological, environmental and legal impacts prior to signing binding contractual agreements. Constitutional experts have argued, before signing of these binding contractual agreements, a referendum should have been conducted owing to the implications the project has on sovereignty of the state. It has been further argued that issues with regard to the port city do not confine to creating public awareness but also transparency in procuring the [v]relevant licenses and calling of tenders from foreign companies to ensure fair market competition.

The contents of the agreements signed between the government are only privy to a very few people in high politics and are shrouded in mystery which has caused the public discontent and skepticism. Against such a background, policymakers and statesmen in the future should be mindful of balancing the interests of opponents to globalization, the need to develop the country’s economy and make decisions inclusive of multiple stakeholders. Development is not just confined to the elite but to all members of a community; which are the true values in a democracy.

Recommendation

Sathiya Moorthy writing to the South Asia Journal highlights the following: those governments incumbent during the inception and continuation of the projects have defended the project without any empirical evidence on how the project would bring in long-term benefits balancing the ability to repay the loans and make profits against competition from countries such as Singapore.

“If anything, the incumbent government of President Maithiripala Sirisena and Prime Minister Ranil Wickremesinghe have converted the massive Hambantota loan taken by the previous Rajapaksa regime into equity for the Chinese investor. Ironically, while being a powerful minister of the Rajapaksa government, Sirisena was not known to have contested the credit-arrangement for him to oppose or stall the ‘equity-swap’ as the President. PM Ranil and his UNP were silent over the original Hambantota deal while being unsparing in their criticism of the Rajapaksa leadership over every other act of commission and/or omission of the Rajapaksas”

See more at http://southasiajournal.net/defending-hambantota-still/

The above quote highlights certain peculiarities with regard to political prudence, respect for democracy and the blatant disregard for Sri Lanka’s national security. It could be safely assumed that Sri Lanka lacks a mature political culture where politicians prior to acting on political whims and fancies consult relevant experts on projects of national importance. It is recommended that at least future statesmen consult firstly, national security advisors for inputs on these projects, next multi-sectorial consultation with experts from legal, technical, economic fields and also development experts and environmentalists. I do not profess that anti-globalization sentiments should hinder development projects but with holistic knowledge and foresight analysis on implications of these projects; better outcomes could be achieved which are in the best and strategic interests of the island rather than falling into the schemes of extra-territorial powers. Prior knowledge and foresight analysis could in the least increase the penchant for a developing, small state such as Sri Lanka to safeguard itself against distortive foreign intervention and minimize the asymmetry in development benefits.

Furthermore, to increase transparency and minimize corruption, administrative remedies, judicial review, and procedural law in Sri Lanka should be strong with the ability for the [vi]public to contest decisions taken by public authorities. While proponents of these projects may view these as roadblocks to development they are not. These remedies are available to increase transparency on how planning permission is obtained, how public life is affected by the project. Also, how ministries and line ministries conduct themselves adhering to the correct procedures in their conduct without acting ultra vires leaving less room for misappropriation of public property and funds.

 

[i] Refer : http://www.sundaytimes.lk/article/1046917/japan-wants-sri-lankas-hambantota-to-be-military-free

[ii]Refer: The conomic Times Article on US concerns : https://economictimes.indiatimes.com/news/international/business/us-concerned-over-unsustainable-debt-burdens-to-lanka-by-china/articleshow/60425371.cms

[iii] Refer Smruti S. Pattanaik commentary on IDSA : https://idsa.in/idsacomments/new-hambantota-port-deal-china-consolidates-its-stakes-in-sri-lanka_sspattanaik_140817. Author flags concerns by Indians on Chinese influence in Sri Lanka.

[iv] Refer NAFSO critical analysis on Colombo Port City project at : http://www.nafso-online.org/2017/01/critical-analyses-of-colombo-port-city.html

[v] clearance from the Central Environmental Authority, Sand mining License and also national security clearance from national security and defence advisors which is considerably overlooked by all media reporting on the topic. It is important that the relevant experts are consulted prior to signing the agreements instead of acting on political whims to ensure state sovereignty. The experts should be consulted based on merit and the level of discretion they are expected to exercise on high political matters of national importance.

[vi] Refer Public Interest Litigation case on environmental  implications : http://ejustice.lk/2017/10/19/port-city-case-11215/

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