Mandela's approach to reconciliation

As a result of my last post, I started flipping through Meredith's The State of Africa and came across the chapter on South Africa under Mandela. Some may have heard of his support for the Springboks rugby team and most would have heard of the Truth and Reconciliation Commission. There was more, however. Thought this was worth sharing:

National reconciliation became his personal crusade. From the moment of his inauguration he strove to establish a new racial accord, constantly reassuring the white minority of their well-being under majority rule and stressing the importance of building a 'rainbow nation'. Addressing a huge crowd on the lawns below Union Buildings in Pretoria on inauguration day, he urged a spirit of forgiveness. 'Wat is verby is verby', he said in Afrikaans. 'What is past is past'.

Towards his old political adversaries he remained magnanimous. He welcomed F W de Klerk into his cabinet, praising him for his contribution to establishing democracy and commending him as 'one of the greatest sons of Africa'. He was assiduous in cultivating right-wing Afrikaner politicians, determined to avert the the risk of right-wing resistance. He ensured that statues, monuments and street names commemorating events and heroes from Afrikaner history remained untouched. He regularly spoke in Afrikaans, describing it as a 'language of hope and liberation'. When appealing to civil servants to support government reforms, he addressed them in Afrikaans. In changing the name of his official residence in Cape Town from Westbrook, he chose the Afrikaans word, Genadendal, meaning "Valley of Mercy', the name of the first Christian mission in the Cape.

His gestures of goodwill were manifold. He organised what he called 'a reconciliation lunch', bringing together the wives and widows of foremer apartheid leaders and leading black activists. He made a special trip to visit the widow of Hendrik Verwoerd, the architect of apartheid....Even more remarkable was the lunch he arranged for Percy Yutar, the prosecutor in the Rivonia trial who had argued for Mandela to be given the death sentence and expressed regret when this did not happen.

More than anything it is Madela's attitude that is striking and as a leader his example sends an unambiguous message to his people.

There are plenty of differences between the situation in South Africa and in Sri Lanka, the LTTE were undoubtedly a villainous group of terrorists, with no redeeming qualities whatsoever, but reaching out to the community, with sincerity and commitment can surely do no harm.

All this went down very well, but Mandela's proposal for a truth commssion provoked a huge row. He said it was needed:

..not for the purpose of exacting retribution but to provide some form of public accounting and to help purge the injustices of the past. Unless past crimes were addressed, he said, they would 'live with us like a festering sore'. De Klerk, a deputy president in Mandela's government of national unity, denounced the whole idea, arguing that a truth commission would result in a 'witch-hunt', focusing upon past government abuses while ignoring ANC crimes. It was, he said, likely to 'tear off the stitches of wounds that are beginning to heal'.

 Apparently a great debate ensued, some demanded reparations from the whites,  others suggested a general amnesty, the common theme in the Afrikaans press, according to Meredith being 'atrocities were committed by both sides, so let us forgive and forget'.

Some of this starts to sound familiar, but perhaps the tragedy is that there was no real local debate on the subject. Instead we had the LLRC Commission foisted on us, created to forestall a UN commission, itself the result of debate overseas.

It is not always possible to arrive at the truth intuitively. A rigourous process of debate can help shape and modify ideas, which by a process of whittling down, sifting and distilling may sometimes result in the truth.

Sometimes the process of thought is as important as the ideas that result.

 
 



    

Kath Noble on Chinese projects

Kath Noble has written a piece on Chinese infrastructure projects. While I have no argument with her basic thesis, she repeats, in passing, the common misconception about the World Bank -

"On the plus side, the Chinese don’t try to tell Sri Lanka what to do. This makes a refreshing change from agencies like the World Bank, which refuses to lend unless the Government undertakes major reforms to key policies. Want to build a power plant? Tough luck, because they will only give money to the private sector, and then only if the Government promises to buy the electricity these companies generate at inflated prices for decades to come."

It is correct that the World Bank does indeed require conditions, but for the most part these conditions are intended to ensure that the project does provide some benefit for the country in which it is carried out, as this report points out.To quote:

"From its earliest days through the 1960s, the Bank took a project-by-project approach to development assistance, focusing on capital-intensive infrastructure projects. By the late 1970s, however, it had become clear that the policy and institutional environment in which projects were implemented was a major determinant of the performance of the Bank’s growing project portfolio. Indeed, in many borrowing countries, policy-induced distortions were so severe that projects could not be expected to succeed no matter how well designed they were."

The link between governance and growth is something I have talked about before, all the bank is trying to do is to ensure proper policies are in place so that the project works. These policies will help the populace but are irksome to the politicians.

The real reason that politicians prefer Chinese projects is that they come with no questions asked and kick backs all around, both on the Chinese side as well as the local side. The Chinese officials approving the loans probably make as much money as the politician's getting the loans. Unfortunately the general population has to cough up, when the loan needs to be repaid.

Apart from the policy changes required by the World Bank, there is also the tiresome process of monitoring that the Bank insists on. The Banks approach to monitoring is, to quote:

1. Clearly articulated statement of objectives, reflected in the design documents and lending agreements
 
2. Results framework with output and outcome indicators capable of measuring the results chain leading to achievement of the objectives, specified during project design
 
3. Regular supervision and supervision reports
 
4. Self-evaluation by the managing units: Implementation Completion and Results Reports (ICR) completed within six months of project closing
 
5. Independent validation of the ICRs by the Independent Evaluation Group (ICR Reviews) and independent field evaluations of about one in five projects: Project Performance Assessment Reports (PPARs) 

6. Project evaluations also feed into higher level evaluations, including country-level and sector-level evaluations, as well as meta-synthesis evaluations.

All of which mean that it is (a) a lot more difficult to come up with a useless white elephant idea, which no one knows about and then (b) to proceed to steal the money which is part and parcel of the whole idea.

Politicians are thus ever ready to trumpet the benefits of Chinese projects while condemning the World Bank and other lenders. Not that everything that the World Bank has done is a success or that they are right every time, but at least with these projects there is some accountability somewhere. With Chinese projects there is none.

Who decided to build Norochcholai coal plant, minus a pier or some other economical means of getting coal to the station? Not the World Bank, which funded some village hydro projects, apparently with some small success. Nor did they fund the Hambantota habour (minus container terminal) or the Mattala Airport (runway larger than Changi airport, Singapore).

For anyone interested in development, the world has had a good sixty years of experience to learn from since the first new independent states emerged after the second world war. In the 1950's and 1960's there were questions as to what would succeed. By the late 1980's it was clear what needed to be done.

Why is Sri Lanka, in the 21st century, making the same mistakes that many a nation on the African continent made in the 1950's ?

For further reading on this I would recommend Martin Meredith's The State of Africa, there are so many striking parallels, both economic and political with the Sri Lanka of today, it's almost frightening.    

Prostituting journalism

This was the editorial of today's Sunday Observer. I thought it interesting enough to be worth sharing.

Apparently, INGO's and Foreign Missions (any guesses as to which ones?) are behind this dastardly plot. Clearly people are annoyed by this but I wonder, why the perpetrators have been termed 'suicide journalists'?

Anyway, it was only last week that the Observer informed us that the alleged crime wave had been blown out of proportion. In that instance it was the open economy that was held to blame, although it does concede, correctly, that the new constitution, was  partly to blame.

The faults of that constitution have been extended of late, mostly recently the 18th amendment. 

The taming of the Sunday Times

It is often remarked that the local media lacks something in terms of critical analysis. What nonsense!;  is the reply, just see the stories in the Sunday Leader on Srilankan Airlines or the Sunday Times lead on the investment in Greek bonds by Sri Lanka's Central Bank.

There is definitely still criticism but it is distinctly more muted than before, nothing illustrates this better than the story on the Central Cinema. The Sunday Times broke the story last week, but tucked it away on page 19 of the paper. Strangely enough, the story was not carried in the online edition. Perhaps it was just an omission.

Further, quite unaccountably, the important follow up: the destruction of the cinema was missed. There was a one line item in the online edition but that was it. was left to the Sunday Leader to carry a follow up.

Why is it that a newspaper that breaks an interesting story, fails to follow up on it. Sloppiness? Inefficiency? It seems hard to believe. In the context of the failure to put the original story on the online edition (where it could be read by potential overseas investors) and the placement of the original story at the back of the newspaper and one gets the distinct impression of 'soft pedalling'.

I have noticed this before (an example here). A few stories make the lead but a lot more are hidden. Most people have little time to spend trawling through the paper looking for tidbits of information and are thus uninformed. There was a time when the Sunday Times would have pursued this with vigour, but those days seem to be in the distant past. It is still, on the whole, one of the better papers, although this is not saying much. 

The question is why have they lowered their standards? Are they afraid? Have they bought into the GoSL view? It could be anything although analysts tend to believe the latter rather than the former view.  The GoSL liberated the country from ruthless terrorism, give them a little leeway to act.

Unfortunately a lot of people who have bought the hype may not realise that the fundamental requisite for growth is confidence and that confidence in the laws and system of justice is the very foundation of this. Expropriation of property, especially if it is, as the Leader claims, in violation of a court order, strikes at the very heart of confidence.

I am a pessimist, always seeing the glass half full rather than half empty. Perhaps these are minor blips, once these (admittedly) under utilised properties are developed things will start to happen. Perhaps. I tend to think that the most important thing for a state to do is get the governance right and step back and let private investors take over.

I may yet be proved wrong. I certainly hope so.

Central Cinema torn down

Heard that the Central Cinema in Maradana was torn down last night. The Sunday Times website carries a brief news item.

People from around the area say that bulldozers arrived in the middle of the night and started flattening the cinema. The owners apparently tried to contact higher authorities but were unsuccessful in preventing the demolition.

The Sunday Times website says the Urban Development Authority (UDA) demolished the cinema after the owner failed to meet tax obligations. The report in the print edition of last Sunday's paper stated that the owners had apparently won their case in the district court.

UDA takes over the Central Cinema in Maradana

There is a story in the inner pages of today's Sunday Times that the Central Cinema is Maradana has been taken over. Unfortunately the web edition of the paper does not carry the story, but if you do have the paper take a look, its on the top of page 19 and easy to miss if one is not looking for it.

The gist of the report is that after the 8pm show ended on Friday a group of people including police and soldiers drove in and seized the premises.  When the owners went to the police to lodge a complaint they were asked to prove their ownership. On presentation of the relevant documents the police said there was little they could do since the UDA,which took over the premises is under the Defence Ministry.  

The UDA website however lists the Central cinema property which suggests that the officials were simply executing some older order but I can recall no report of this. I don't think it was a part of the takeover of under utilsed assets.

Can anyone shed any light on this?

For a change, today's papers have a lot of interesting stuff, from the Central Bank investment in Greek bonds, to the killing of a jungle cat, to a couple of issues at Sri Lankan Airlines.

Drugs, violence and trade: the sad tale of the US war on drugs

Indi has written something on the US war on drugs.  There is a sad and twisted tale behind this and its roots lie in, of all things, a failed trade policy.

The tale starts with protectionism for the US sugar industry. This started as far back as 1934 but was tightened in the 1970's. Under pressure from the sugar industry import quotas were tightened. Sugar imports from the Caribbean dropped  from around 6m tonnes in 1977 to around 1.2m tonnes by 1998, impoverishing many small nations. Therefore it is hardly surprising that farmers there found coca a more attractive crop and the underground American drug industry a more willing trading partner.

Sugar protectionism costs American consumers billions while providing the narcotics industry with its primary produce.

A second strand in this tale is the horrific violence that the Mexican drug cartels, enriched by the lucrative trade with the US have unleashed. Unfortunately, one of the lesser known facts is that the Mexican cartels buy their weapons, quite legally, from across the border.

Not only  does the US create the lucrative market (the emphasis on cutting supply, rather than demand keeps drugs prices high, enriching traffickers), force farmers south of the border to turn to illegitimate crops, they also arm the gangs. Some have expressed fears that the drugs violence in Mexico can spill over into the US, but it is rotten US policy that is igniting the region.

Cutting the Gordian Knot of problems is well nigh impossible, but legalising distribution and consumption will help. Abolishing the protectionism that impoverishes the Caribbean and hurts American consumers and industry will also help, but  there is another twisted evil, that bars reform: campaign finance by special interest groups. The NRA prevents a sensible gun policy and the sugar industry perverts trade policy but unless campaign finance is reformed so that these minority groups can no longer pull the strings of policy nothing is possible.

My simple suggestion is that private funding be abolished entirely, the state can give each candidate a small fixed sum and no further spending or funding (including "gifts" of free airtime) is permitted. Politicians can then concentrate on policy, instead of fund raising and end up having to spend the entire of their tenure serving the special interests of their donors.



Source: I picked up the information on the impact of US sugar protectionism on Caribbean farmers from Todd Buchholz's book.

 

Rod Stewart builds model railways

Rod Stewart has a hobby, building model railways. He seems pretty good at it too. More pictures from the Model Railroader magazine are here, images are not great but they do enlarge a bit if one clicks on them.

Interesting, huh?

Belief in astrology leaves nation in the dark

Well, not yet, but soon. Very soon.

The stars foretell it.

In the boundless wisdom of the rulers, the clocks were set back by half an hour, at the auspicious time of 06.42am on the 15th of April 2006.

Now we reap the benefit, the darkness will engulf us soon.

Why does S&P classify the Sri Lankan banking sector as 'high risk'

The ratings agency Standard & Poor's has issued a report that says the Sri Lankan banking sector faces high economic, credit and regulatory risks. The Central Bank was quick to issue a rebuttal but what is the report all about and should it concern the public?

The report details the risks the SL banking industry faces in comparison with that of the banking sector in other countries. It is important to note that the major  issues stem from the institutional framework and regulatory conflicts. It does not look at individual institutions but looks at risks the sector as whole faces.

The problems identified have to do with bank regulators (Central Bank) , the system of justice and broad macro economic policy. These will impact on the sector as a whole, although some banks will be more affected than others, depending on specific circumstances, such as the quality of their loans and internal control systems.

The issues highlighted will have long term detrimental impact, my guess is probably over a 2-5 year horizon. This gives time for corrective action, if regulators are interested. There has been no sudden deterioration in the banking system, the issues highlighted have been building up over the past 5 years.  

The report, is in my opinion,  of relevance for long term investors, particularly foreign investors. For local investors/companies, in my opinion,  there is not much that can be done except that investment horizons should be shortened (look for 2-3 year paybacks) and minimise dealings with more vulnerable entities. 

Pertinent comments in the report are:

"Nevertheless, in our view, Sri Lanka's economic imbalances could increase if credit growth continues at the current pace."

Banking sector credit is still growing quite fast, the main drivers being construction projects by the Government as well as private sector projects. This will keep the rupee under pressure and may push inflation and the budget deficit.

"relaxed lending practices and underwriting standards, as well as a weak payment culture and rule of law."

The relaxed lending practices is a relative term, it is not clear if this relates more to state banks or private sector banks. Credit evaluation is not standardised and the level of credit information is low, so evaluation, especially of personal loans cannot be as sophisticated as that in developed markets. 

The rule of law is a concern due to the inefficiency of the court system and the increased susceptibility to corruption and influence which means enforcing contracts, mortgages etc is difficult, time consuming and expensive. The GoSL repudiation on the oil hedging contract is an example of an issue that has raised this red flag amongst rating firms, banks and investors.

"We view the banking regulations in Sri Lanka as somewhat weaker than international standards. Governance and transparency of banks are weak by global standards."

"The key regulations for banks seem sufficient. However, finance companies are less regulated, in our view. This is despite the December 2008 collapse of a finance company triggering a run on a bank in that group."

"Moreover, we see a potential conflict of interest in the central bank's role. In addition to policy formulation and supervision of banks, the monetary board of the central bank also oversees Employees' Provident Fund investments. The fund is a large investor in Sri Lankan banking stocks."

Largely self explanatory, comments refer mostly to certain state banks and the recent interference in private banks, eg through the removal and appointment of directors, the EPF/ETF/SLIC using their shareholdings to remove experienced bankers and nominate unqualified state nominees. 

Finance companies are vulnerable due to high concentration of loans to certain asset classes (eg pawning, land and vehicles) and rapid growth in credit  in an environment of rising interest rates. Exposure to share market is also problematic since share prices have been falling.

How is this relevant to the public?

It is a broad macro level report. For the public in general the main issue is where they should invest their money. Remember Ceylinco? Could it happen again?

In my opinion there are several finance companies that look distinctly shaky, so be careful where you invest your money. Only invest in the ones that are listed by the Central Bank. Even amongst the regulated ones, some are better than others, so read the rating report (all are supposed to be rated) and go for the ones that have higher (A or BB) ratings. There is no point trying to get higher interest rates if one risks losing the capital invested.

For investors and businessmen it is a message that governance matters. Many have been pooh poohing the impact of corruption and have not noticed a deterioration in the rule of law. If the systems don't work, one cannot rely on the law to protect ones investment.  If you get into difficulties there is little hope unless one has influential friends. Some have discovered this the hard way.

Liberal economics and governance tend to go hand in hand with liberal politics. When one is lacking, it tends to show up in one of the others.

For those interested, the methodology behind the S&P assessment is detailed here.

The Show Must Go On

Thus sang Freddy Mercury, seriously ill and close to the end of his life, in 1990.

On the sunny island it seems that it is the Games that must go on. Sri Lanka may have lost the bid to host the Commonwealth Games, but they will host the Asian Youth Games in 2017 at a cost of US$300m.

The leadership cannot be faulted for lack of tenacity. Never mind that this admirable trait should probably be directed towards the many pressing problems that plague the country instead of sports. This is the familiar cry of the critics but what harm in one event, just one, that will put us on the map?

In July last year, Sri Lanka was supposed to host an IPL style Premier League but that flopped, ostensibly due to the lack of participation by Indian cricketers, but more probably because it was being organised without consultation with the relevant cricket boards. Cricket is a well organised sport and it is necessary to work through the proper channels and protocols if something is to happen. One cannot dream up something and then expect the rest of the world to go through various contortions to conform to our pressing needs. We expect it, but it does not always happen.

Happily, the team names were transferred to rugby and this year we witnessed the Carlton Super 7's, complete with Bollywood stars, just like the IPL. No sense in wasting a good idea, eh?

Rugby however, is small beer compared to cricket, so the putative Premier League is back, for a second innings, so to speak.

Like the Premier League, it seems that the Olympic dream still burns bright and true, hence the Youth Games; surely only a stepping stone to greater things.

In between the various bids for sporting attractions, Colombo also played host to a night race tied to a music festival.

The only thing unusual about the night race was the host city: the capital Colombo. Most of the others are either centred on, or feature Hambantota. This will shortly be rectified however, for a race track is planned for Hambantota.

All in all, it seems that we need not one, but many events, all of which will put us on the map. It's a new trend in marketing, putting cities on the world map but what is the underlying driver of it all? It is surely the one thing that makes the world go round: Love.

The ruler's love for their hometown and country is undisputed and second to none. Pure and unconditional, it determines all policy. Who can fault love? Actions in its name must surely be good and as Freddy said, don't stop me now.

Queen has such great music. Artistry of a high order and so profound. Perhaps we should also remember that he warned that, too much love can kill, just as none at all. Perhaps we should make it our anthem.

 ...Too much love will kill you
If you can't make up your mind
Torn between the lover
And the love you leave behind
You're headed for disaster
'cos you never read the signs
Too much love will kill you
Every time...

                        -Queen-

School children attacked by university students-for speaking English

The Daily News carried a story that a group of 'international '(ie English language) school students from Panadura were attacked by a group of university students. The reason for the attack was apparently that the 'international' school students spoke English. The students had entered the university to participate in a tree planting campaign.
 
English is seen by some sections of society as a barrier, it is colloquially referred to as 'Kaduwa' or 'kadda' for short. Kaduwa is the Sinhalese term for sword and it is used in the sense that it is the instrument that cuts people off from advancing. It suggests that there is, rightly or wrongly, resentment against the English language.

Perhaps it is the lack of opportunities and the perception that English helps people to get jobs. Its probably correct, this is what is driving the demand for English language education. The lack of opportunities is what is also driving people into jobs overseas. 

The university students probably thought the school children were being uppity and decided to teach them a lesson, but their action shows just how debased and perverted a nation that we live in.

There is never a shortage of people who jump up to claim that we are heirs to an ancient civilisation, that we are, oh so much superior to the hypocritical and materialistic West, but does this act of violence spark even a murmur of dissent? It barely made the news. Is this what we have descended to, to accept as normal behaviour?

   

People tighten their belts but pressure on rupee continues

There is a report in today's Sunday Times that local bakery owners have noticed a decline in sales following increases in the price of bread.

I happened to have a chat with a banker on Friday and he said much the same thing. Based on volumes of imports channelled through this particular bank he said that they had noticed about a 15% decline in wheat imports, a 20%-25% decline in milk powder imports and perhaps a further 10%-15% in other supermarket food and FMCG items.

People are indeed tightening their belts therefore the pressure on the currency should ease. This has not because of Government expenditure and construction projects.

The US$500m raised by the Bank of Ceylon was borrowed by the Government and used to settle creditors, possibly including some petroleum bills. No one has a clear idea of what it was used for but bankers seem to think that the money was spent within a couple of weeks.

The infrastructure projects including the Mattala Airport and Hambantota port as well as private sector construction projects contribute to the growth in imports which rose 17% in the quarter to March 2012.

The problem with construction projects is that once started they are difficult to stop.

Infrastructure and construction are not bad things in themselves. They contribute positively to the calculation of the GDP number, which is, in simple terms, a measure of output. They can also create a lot of genuine activity in the local economy, depending on the amount of local content in the project.

The problem is that with the Chinese projects, local content is small, so the process of construction provides minimal boost to the local economy, despite the fact that they do in fact flatter the GDP calculation. Materials, equipment and even labour comes from China.

This is partly why the country reports high GDP growth number while many people fail to see an improvement in their standard of living. Money comes in and goes out, barely touching the local economy. If local labour, local contractors or local suppliers were used, jobs would be created and local businesses would benefit.

The bigger issue is the viability of the projects themselves. A Chinese funded and built project is still good, provided it serves the purpose and most importantly generates an adequate return that covers the cost of finance. The project needs to be able to service the debt used to build it at a minimum. If it fails to do so, then there is a big problem, as the Spanish are now slowly waking up to.

The morning after a particularly hard party can be painful.
  


A little more on the positive side of labour in  Chinese projects is here. There is a good debate in the comments section.

 

Colombo to Haputale by Rail

There is something special about train travel. Perhaps it is the fact that the passengers are seated high above other traffic, perhaps because trains have priority over road users, possibly the immense power of the engine itself or the graceful shape of the train as it wends its way across the horizon. It is hard to pin down but when riding the train many will feel it.

I had read about the train journey in the observation carriage from Colombo to Badulla, all the travel guides advise visitors to do it. I finally got around to it a couple of months ago and it was well worth the effort.

Prospective travelers have three options; first-class observation car (Rs.750, one way), the air-conditioned Expo carriage (Rs.3,950, return) or the ordinary second-class compartment.

The observation carriage needs to be booked 14 days (not 10 days as advised by some websites) in advance of the journey. Tickets sell out fast so one needs to be there at opening time on the prescribed day. When I tried to book it 10 days ahead it was sold out so we had to take the Expo carriage. Booking the Expo carriage is convenient, it can be booked online or at a travel agent and at anytime. Second class travel is an option for the adventurous and should be fine, provided the journey is kept short, of which, more details below.

I think I was fourteen when I last went on a train, which was a long time ago. Walking into the Fort Railway station, things seem to be worse than I remember: overcrowded trains and a dirty, smelly station. I had opted to go from Colombo to Haputale, a journey of eight hours according to the time-table, looking at the crowded second-class carriages I was glad that we had decided to take the Expo carriage.

The Expo carriage is painted nicely but looks a lot better on the website than in real life. It has clean, airline type seats and is staffed by two helpful stewards who will offer breakfast, lunch, and tea. There is free bottled water, a decent lavatory and air-conditioning. The air-conditioning is not really necessary when travelling in the hills but it is welcome when on the plains. Unfortunately the windows are sealed shut, so it’s not possible to open them to feel the cool upcountry breezes. The windows were not very clean, there were black streaks that seemed to be some kind of waste from the engine but luckily they were not dirty enough to spoil the view.

Although clean, the seats are not very roomy and the overhead compartment is not very big so it is best to travel light. Some of the lids on the overhead lockers don’t have good springs so they have a tendency to close while one is taking things out or putting things in.

The food is like airline food, nothing great but edible. For me food is an important component of any trip and having read reviews which said the food was bad, I took my own sandwiches. The Keells at Crescat has some good whole wheat bread and some nice hams, cheese and other meats that can make a good sandwich. The bread had just come out of the oven when I went at 11am. Being particular about my tea I took a flask of strong home-brewed tea with me, the Expo staff were happy to supply me with cups, milk and sugar.

The train set off on time from the Fort station at 5.55am. The lights in the carriage were a little bright so it was difficult to see out of the windows at first, but as soon as it became light we could see the suburbs slowly waking up beneath us.

Life in rural areas tends to cluster around the road. Shops, houses and businesses congregate thickly near the road and thin out as one moves inwards on the lanes and by lanes that spread out from the main road. When one is on the road, one is a part of the activity on the road. The railway however, is away from the road. It travels on a higher elevation, parallel to or across the road. With its increased elevation, passengers on the train find themselves looking down, like distant observers, while daily life unfolds below them. It’s fascinating, almost voyeuristic at times. Children going to school, people walking to the shops, talking in the street, sweeping their doorsteps, watering their plants, digging their gardens, the suburban townscape can be very interesting.

(Click on the pictures for the high resolution image)

As the train starts move away from the suburbs the scenery changes. My childhood memories of the first part of the journey to Kandy were of paddy fields with farmers working the fields with buffaloes. There were far fewer fields and no buffaloes but the scenery was still pleasant and once the train starts to climb there are good views of the hills, especially past Kadugannawa.

From Peradeniya onwards the climb gets steeper and the views, progressively better. Once past Hatton the views are superb and past Nanu Oya, especially when approaching Ohiya, quite spectacular.

The approach to Ohiya skirts the Horton Plains reserve and the colours of the natural forest and vegetation are stunning: trees in deep greens, reds and orange, the grass in light green and yellow. Bella Sidney Woolf, in her book How to see Ceylon bemoaned the encroachment of tea estates on the natural vegetation. I never understood what she meant, until now. The tea estates have a beautiful green that looks very pretty but the glory and variety of the forest puts the cultivated estates in the shade.

The only problem with doing the whole journey is the time taken. Moreover the train tends to run late so the journey gets even longer: Colombo to Haputale was scheduled to be eight hours but we were an hour and a half late when we arrived at Haputale. On the way back we were 45 minutes late. According to people in Haputale the train is usually an hour or two late.

Haputale Station

Haputale Station, with the mist rolling down at about 10.45am

The beauty of the scenery means that the journey is a must-do, but for best effect I would suggest that it be done in stages. Since the best of the scenery is towards the end, travelers could do Hatton-Haputale or Nanu Oya-Badulla. For someone with a large budget it is possible to take the seaplane to the Castlereagh reservoir, which is a couple of kilometres from the Hatton town and then take the train from Hatton. Someone intending to do the journey from Nanu Oya could take the seaplane to Nuwara Eliya and then take a taxi to Nanu Oya. Alternatively, people can drive to either Hatton or Nanu Oya and take the train from there. On a shorter journey (three to four hours) a less comfortable carriage would not matter so much, so either the Observation carriage for even second-class should be fine with the added advantage that the windows can be opened, so it is possible to enjoy the fresh, clean air.

The Colombo-Peredeniya leg, not to be sneered at, could be done separately. The next time you need to go to Kandy, just take the train and enjoy the scenery.

Tips on the Expo Carriage

Not all seats on the Expo carriage have equally good views. Fortunately, provided the train is not crowded the stewards do allow one to switch seats. The best views are mostly on the right hand side of the carriage, so pick a seat on the right but keep a sharp lookout for good scenery on the left.

Rows 4,6,and 9 are good.

Row 7 is about medium.

Row 1 has smaller window, a messy tray table and limited legroom.

The worst seats are rows 3 and 5, only half a window to look through.

Exporail Website

General Tips

Take some sandwiches and water, especially if travelling on the observation carriage or 2^nd class.

Do the journey in short legs.

Take a book to read while waiting for the train, it may be late

Journey’s of three to four hours are:

Peredeniya Junction to Hatton

Hatton to Nanu Oya

Nanu – Oya to Haputale or Ella.

Haputale to Badulla

For timetables and further info, have a look here.

Why is Colpetty crawling with security?

Residents of Colpetty have noticed a sudden increase in the security presence in the area. There are sentries and checkpoints everywhere and frequent patrols. There are even a few mobile units on motorcycles cruising around.

Security is especially tight in the areas behind Temple Trees, in the lanes adjoining St Michael's church. Driving back tonight I noticed it myself.

Observant residents claim that the increased security presence coincided with the release of Sarath Fonseka. Hmm... Wonder what it means?

Political dynasties: a response

Changing Perspectives has written something on political dynasties.

This is my response:

There was a 'ruling class' that used to dominate parliament, the judiciary, the civil service, the church, industry and other institutions in the UK. This was not a family but a section of society- a class. In Britain, the influence of that class has declined steadily since 1945 and for the most part has broken down completely.   Jeremy Paxman documents their involvement in his book published in 1991, but it has declined significantly even since then.

In Sri Lanka there existed something roughly akin to that at the end of British rule in 1948. These were people who had been to St Thomas', Royal, Trinity and the other 'big' schools, or been to Oxbridge. It persisted in some way until the 1970's but although Bandaranaike and Jayewardene were from that class, much of the rest of the government, the public service and others were not.

With the advent of the change in language in 1956, the riots of 1958, and the abolishing of the Civil Service in the 1960's, many Civil Servants, judges and police officers simply migrated, retired or resigned, therefore the governments of the day was not dominated by that class. The sudden departure of vast numbers of educated people wrought havoc and traditions of independence and integrity were lost. New entrants to the services could not absorb all of the practices and knowledge of the departing seniors within a short period of time. In any case many of of the new comers were political appointees and as such were interested more in serving their political masters rather than the public at large.

The dynasties of old no longer exist. In fact, in a proper functioning democracy the dynasty or even the person in a position has little relevance. It is the institution that matters.

A quick primer on the UK and the importance of institutions. The Royal family in England is a constitutional monarchy and only have only a symbolic role to play. Originally the monarchy was very powerful, and its subjects treated badly.

Over the course of an 800 year struggle, starting with the Magna Carta the people rebelled and seized power from the monarchy,  ultimately reducing them to mere symbols. Initially it was the barons who rebelled and imposed the Magna Carta on the king. After many battles with the crown over several centuries came  The Bill of Rights of 1689. This was the foundation of the modern parliament

All of these were aimed at only one thing: limiting the power of the king. 

Having won their freedom, they guard it jealously. Freedom is guaranteed by institutions: an independent judiciary, an independent civil service and police, parliament and a free press which keeps people informed of what is going on. If the judiciary is independent, they can strike down unjust laws, if parliament happens to pass any such laws. The Civil Service and police will not enforce such laws, this is how the power of the rulers is checked.

The Civil Service runs the actual administration of the country. They must be impartial and serve everyone equally. Their independence is guaranteed by Permanent Secretaries (senior civil servants who cannot be removed), the Public Services Commission, which alone can determine the promotion, transfer and salaries of Civil Servants. Politicians should not  interfere in this process.

It is important that the civil service and police be independent of the rulers so that they do not become tools to distribute political largesse or of repression. 

Similar structures ensure the independence of the judiciary and the police. 

England has no written constitution but in most modern democracies the power of the rulers is limited by the constitution as well as the institutions listed above. The idea of the institution is important because no one wants to be ruled by the whims and fancies of an individual. People must be ruled by laws, not by men.

These checks and balances existed at one time in Sri Lanka but in the years since independence have been removed through constitutional change, abolishing the independent civil service and through corruption. The result is that the rulers are now all-powerful, which is detrimental to the rights and liberty of its citizens.

There are vast celebrations held at public expense to celebrate independence from Britain but the rights of Sri Lanka's citizens have been eroded greatly since 1948.

Is it all Greek to you? A simplified guide to the state of public finances

This is something that I wrote in May 2010 for an internal newsletter. There was an election coming around the corner and I felt that people should understand some of the fundamental problems that a Government should address. It is now more relevant than ever, especially since the problems are now apparent. I have been meaning to update the figures but have been too busy at work.

The Government continues to spend merrily, but the budget deficit is a lot better than it was in 2009, the reason being that taxation has increased, so that Government revenue has increased. Are citizens getting good value, in terms of services, for the vast sums expended? It is up to each individual to decide this question, but ask yourself if:

a) Would you send your children to free state schools and universities, if you had the means to send them to private universities here and abroad?

b)  When was the last time you used the free health services provided in state hospitals? How satisfied were you? 

c) Would you turn to the courts and law enforcement authorities, confident that you would receive justice if you had a dispute with the CEB, the CPC, a bank, your landlord or a debtor? Where do you turn to, if you have a dispute with a minister, over a simple matter of property?  

   

The press has highlighted a financial crisis that is taking place in Greece. In a nutshell, what happened was that the Greek government had borrowed too much money and seemed unable to repay. Investors who had lent money to Greece (by buying Greek treasury bills, bonds etc) panicked and it seemed that the Greek government would have difficulty in raising money. This would have meant that Greece, which needed to borrow money to pay expenses would not have been able to pay its workers or run its public services.

It has not yet come to this because the European Central Bank and other European Governments look likely to work out a package to save Greece.

The Government of Sri Lanka has published a pre-election budgetary position report on the 2^nd of March 2010, which shows a weakening position.

The figures for Sri Lanka (in summary) are as follows

(The figures published are provisional. Chart from LBO).

Government revenue in 2009 is Rs.702bn (please refer column 4 headed “2009prov”) but expenditure is 884bn. The Government is spending Rs.182bn more than it earns – something that should be impossible, but happens anyway.

Anyone earning a fixed salary will wonder how it is possible to spend more than one earns. The answer is simple: by borrowing money. Of course, this means that while we can spend and enjoy today, we must repay tomorrow – with interest added to the bill.

As everyone knows, the Government’s revenue is made up mostly of taxes; VAT, income tax, Nation Building Tax, import duties etc but what does the Government do with all this money that we end up with a deficit?

The main items of expenditure in 2009 (in order of importance) are:

Interest                                     Rs.308bn

Salaries & pensions     Rs.268bn

Subsidies                                  Rs.194bn

Other goods/services            Rs.113bn.

Note that the single largest item of expense is interest. That is because the Government has for many years been running a deficit and borrowing to meet the difference so the interest cost has risen every year, until it is now the largest single item of expense. Given that the revenue deficit is RS.182bn and interest payments are Rs.308bn, the country is, in effect, taking new loans in order to pay the interest on the old loans.

Why is it that we have a deficit when taxes go up every year?  (Government tax revenue rose from Rs.509bn in 2007 to Rs.585bn in 2008 to Rs.619bn in 2009). The problem is the expenses have been rising faster than taxes. The increases in expenses between 2008 and 2009 are shown below:

Interest costs rose by                          Rs.95.8bn

Salaries/pensions rose by                 Rs.29bn

Subsidies rose by                                 Rs.24bn

Other goods/services declined by   (Rs.7bn)

The fastest increase in spending is on interest. There are two reasons for this. One is that the amount of debt has increased. The other is that the rate of interest paid on the loans has also gone up, partly because of tighter monetary control and partly because the country is now borrowing mostly in the open market rather than obtaining concessionary loans from donor agencies like the World Bank.

There is obviously a limit to which anyone can borrow and spend, so either income (in the form of taxes) needs to rise or expenditure needs to be cut for finances to reach a sustainable state.

Controlling the deficit early is essential: every time the government borrows to spend, the deficit has the potential to expand because of the added interest cost. If the cycle of ‘borrow and spend’ is continued things can go out of control very quickly.

This is why the deficit is important and why the IMF has set certain targets for the deficit. This is what got Greece into trouble.

Sri Lanka’s overall budget deficit is 10.3% of GDP. Last year Greece’s budget deficit reached 12.7% of GDP. Greece’s total debt as a % of GDP reached 94.6% of GDP. Sri Lanka’s total debt was around 82.9% of GDP. Things are a little too close for comfort when compared to Greece.

In the middle of last year the IMF warned that Sri Lanka’s debt, which has almost doubled from the year 2000, was in a very unhealthy state. Not only has the debt grown, its composition has changed. There has been a shift from lower cost external concessional borrowing to higher cost domestic and nonconcessional external borrowing. In addition to increasing the cost of the portfolio, the non-concessional borrowings have been of shorter maturities than concessional funds.

The country has been borrowing more, borrowing at higher interest rates and borrowing for shorter term periods, meaning that loans become repayable more quickly and can thus cause cashflow problems.

Clearly there is a serious problem. What can be done? It is not easy, but for the deficit to fall either Government revenue must increase (higher taxes) or expenditure must fall.

No one would like to pay higher import duties, VAT or other taxes but if waste were eliminated, expenditure would fall, even if nothing else changes. This alone may not be enough, but it would be a start and then other means for reducing expenses can be found.

It is better to face the problem early rather than let it go on until it blows out of control, like in Greece.

DFD, no more.

The great baritone,  Dietrich Fischer-Dieskau died last week. I have been out of touch with matters musical for some time so it was quite by accident that I discovered the fact. 

 

Listen to him in Schubert's lovely Im Fruhling, accompanied by Richter, here.  A recording of a rather humourous Schubert song, with Gerald Moore, the pianist he was most associated with, is here. The Economist has a nice obituary.

RIP

The role of women in Sri Lanka's exports

The country has a few major exports, tea, garments and the remittances of migrant labour being the most important.

I just realised that the majority of the workforce in all of these sectors is women. In the tea industry, almost all of the most productive work is done by women.

In the garment trade, the majority of the sewing staff are women and are well represented in other parts of the industry as well.

The migrant labourers include skilled and unskilled workers but all of the housemaids are women.

Interesting, huh?

Does anyone have any statistics of employment by sex in these sectors to share?

How to be a Dictator

For anyone wishing to reach higher office and succeed, this is a rather funny guide to the path to the top. Apparently bad behaviour is almost always good politics.

For people who want a taste of the book, there is a good review here.

While on the subject of dictators, don't miss this film when it comes out.

Who is calling the shots in Sri Lanka?

Dino had written a post on this.

My view is that the US attitude to, and involvement in, Latin America was dictated in part by the Monroe Doctrine.

The perceived involvement of the USSR in affairs there drove US policy and interference. Sri Lanka is small, distant and has little strategic value unless the Chinese are indeed pursuing a "ring of pearls" policy across the Indian Ocean. 

For the US this could be a concern but it is a much greater concern for India, hence the active involvement of India. The warm relationship that Sri Lanka enjoys with Pakistan in contrast to the colder one with India doubtless contributes to Indian suspicion of Sri Lanka.


Let us not for a moment forget that there are real concerns over governance, law and order and civil liberties that will cause both Europe and the US to look hard at the country. The Tamil lobby plays its part but remember that there is a never ending stream of people, from the Fonseka family, to the Bharatha Lakshman family to many, many unknown others who, through various channels appeal to the US and Europe in the hope that something can happen, since the systems of justice and law-enforcement no longer work, and indeed are preying on the citizenry.

In conclusion, I don't the the US intends to interfere, certainly not in the way they did in their 'near abroad'. Times have changed and misadventures in Iraq and Afghanistan have taught them painful lessons. However, a domestic uprising if frustration builds to a sufficient level is a real possibility, we have seen ominous rumblings before.

The great saving grace that has prevented this so far, in my opinion, has been the flight of the young. They leave in droves, to the Middle East, to Japan, to South Korea, to Italy, indeed anywhere where they can get a toehold. The Arab Spring was driven by the unemployed, youth as long as we export our frustrated people the country will not reach a boiling point. The added advantage is that the monies sent back, help keep the local economy alive. Virtually every family has some one abroad who sends money back that helps pay the bills and keeps everyone, including the Government happy. Not only will they have no trouble, they can even boast that economy is doing well, even as private consumption is sustained by foreign inflows.    

GoSL buys 14 MI17 helicopters, spends Rs.328m on vehicles, Rs.350m on the sugar companies, what on earth is going on?

Buried within the inner pages of today's Sunday Times were two stories that almost made me drop my cup of tea.

Glancing through the political column the writer mentions,almost  en passant, that the cabinet approved the purchase of  fourteen MI-17 helicopters  from Russia. The purchase is to come from a US$300m credit line extended by Russia but does not mention the price. According to this site,  the cost of an MI-17I is around US$11-12m each. Even if the GoSL is buying the older models, they cost around US$7.5m each. The cost, at a minimum, will be between the range of US$105m- US$168m, but it is important to know the true cost because I fear that the whole of the credit line may have been spent on this. We don't have a war, there can be no possible urgency for the purchase, even if the airforce needed to upgrade its fleet this could at least have been delayed a couple of years.

The next story is almost as bad, a supplementary estimate of Rs.350m has been passed to pay recurrent expenses at Pelwatte and Sevanagala Sugar companies that were taken over by the Government. Obviously the companies have not generated sufficient income to meet expenses and the Government has stepped in to fill the gap, as it is obliged to do since it owns the business. Had these losses been incurred when the businesses were in private hands the owners would have to meet the shortfall, this is exactly why Government should have no involvement in running industries. They have always proved to be drain on taxpayers, but recent losses by state owned business have reached frightening levels, the Srilankan loss of Rs.19bn is a new record, as is CEB Rs.25bn loss.

The Government is also spending another Rs.328.2m on vehicles for various ministries. Just to put things in perspective, a retired Civil Servant of the old Ceylon Civil Service was criticising the Archbishop of Colombo who had come to see him many years ago in a chauffeur driven Mercedes Benz. He had asked the Archbishop how he could possibly justify this, the Archbishop had claimed that the car was a donation. Hardly a fitting way for a man of god to travel was the Civil Servant's comment. He said that when he was offered a Mercedes he refused, arguing that he could not possibly visit poor villages in such a luxurious car. He preferred his battered Volkswagen Beetle, with holes in the floorboards covered with wooden planks.

A further Rs.2.2bn has been approved to meet the shortfall of provisions on capitalisation of SriLankan Airlines and Mihin Lanka airline.

It seems that the Government has lost all sense of proportion, spending freely while the population have been hit by mammoth taxes, some of which will go towards financing these 'essential' expenses.

This should have been headline news, not buried inside the inner pages of the press.


The customs website gives a useful summary of some of the new taxes imposed, especially on food.
    

Does Dodol come from Malacca?

A friend of mine returned from a holiday in Malaysia with some sweets from Malacca that were called 'Dodol'.

They were absolutely delicious and were similar to Kalu Dodol. The colour was slightly paler and the texture much stickier, it was like pulling on chewy toffee, a very pleasant mouthfeel, in the technical nomenclature of a chef.

There were apparently several flavours, the one I had was coconut flavour which is why it was so similar to Kalu Dodol.    The more exotic flavours included Durian (also delicious, according to my friends). Wikipedia does not tell us where it originated but given that it is popular in as far flung a place a Zanzibar it may even be Indian. My friend was told that it originated in Malaysia and more specifically in Malacca.  


A recipe is available here.

Some links on Malaysian and Sri Lankan cuisine here.

In search of the perfect Dodol, from the Times of India.

The Norochcholai power plant lacks a pier

The topic of the infamous coal power plant came at a party recently. A guest, who seemed to know something of the matter remarked that one of the problems was that the power plant lacked a pier, therefore coal could not be unloaded directly onto the premises.

Instead, the coal is unloaded onto small barges and then transferred to the plant. This is, to say the least, grossly inefficient. Quite apart from the inefficiency, the barges cannot travel if the water is rough, which is pretty much most of the time during the rainy season. I was trying to verify this information and came across this letter, written in 2005 highlighting some of the problems, including the issue of unloading coal.

Another story that the guest had heard was that when the barges cannot transport the coal the ships are held up, so they simply dump the cargo and leave. It sounds a little difficult to believe, does anyone have any more information to share? If they are not dumping the cargo they must be paid heavy demurrage, which pushes up the cost of the coal.

Why is it so impossibly hot?

I thought we were over the worst of the heat by the end of April, but no, the nights have got much hotter and steamier in May. We have been fairly lucky the last few years, the monsoon set in early and things were cooling off by mid April.

This year the weather remained extremely hot until the third week of April, then we had a combination of extremely heavy monsoon showers and, whenever the rain stopped, a return of the heat. Nevertheless on the whole, things were a little cooler during the last couple of weeks of April.

I was   trying to sit under a fan a little while ago while oppressive waves of hot air kept beating down. Sometimes I wake up to find my head bathed in sweat, once my pillow was quite wet. The fact that I use a mosquito net makes it a bit hotter, but I fear the mosquitoes more than the heat.

I am a sound sleeper, so once I get into bed I rarely wake up before dawn, but these days I am occasionally wakened by the stifling heat, although I generally get back to bed fast enough.

I would envy my friends who have air-conditioners,  except that they have been so heavily stung by the increases in their electricity recently, it hard to feel anything more than pity.

The cancellation of the TFC deal leaves more questions unanswered

Newspapers on quoting the Presidential Secretariat reported on Saturday that the purchase of shares in The Finance Company by the National Savings Bank had been canceled.

The controversy started when the state-owned National Savings Bank(NSB) bought a 13.2% stake in The Finance Company(TFC) on the 27th of April. The NSB paid a price of Rs.49.74 per share well above the current market price, which raised many eyebrows. On the day of the deal The  TFC shares traded in the range of Rs.30-Rs.32.50. A few  days after the deal was completed the market returned to Rs.30, raising still further suspicions that something was amiss.

The deal was stoutly defended by the Chairman of  TFC, Preethi Jayawardena who said that the value of the share of TFC previously did not reflect the company’s performance or potential.

The valuation of shares can be complex and is sometimes subjective, but the market obviously does not agree with Mr Jayawardena because it returned to the previous levels within a few days. Usually when there is a sudden increase in the price of share, especially when a large block is traded, investors and analysts will take another look at the company, to see if there is some hidden undiscovered value. If they believe there is some undiscovered value, there will new interest in the share which should support the share price  at the higher level. The fact that this did not happen suggests that the rest of the market does not see any reason to re-rate the share.

The Finance Company posted some very unimpressive numbers for the quarter to December 2011. The Chairman of the TFC correctly points out that the TFC reported a profit of Rs.15m for the nine months to December 2011. It is however worth noting that the TFC reported a profit of Rs.33m for the six months to June 2011, meaning that the company lost Rs.17m in the most recent quarter.  In other words, after a more hopeful start to the year, company performance deteriorated in the most recent quarter.

A cursory glance at the reported numbers reveals that the company has a negative gross interest margin. The interest margin is the markup that a financial institution will keep over its cost of borrowings. It is the equivalent to the margin that a trader keeps when selling goods. A negative interest margin indicates that the TFC is paying out more interest to its depositors than it earns from its what it loans to customers, which means the company is losing money even before any administrative or running expenses are charged, a situation that even the most hardened banker would regard as dire.

Where then have the improvement in TFC's results come from? From a sharp increase in 'other operating income', of which we know nothing since the results carry no further details. The cashflow statement reveals that the profits for the year appear have benefited from a Rs.200m reversal of provisions for loan losses and doubtful receivables, analysts would want to know if there has been a real improvement in the quality of the portfolio.

The sellers of the two blocks included a director of the TFC. According to disclosures made to the CSE, these shares were purchased at Rs.48 per share on the 21st of September 2011.

If the deal itself looks questionable the manner in which it was cancelled raises yet more questions.

Was the trade reversed on the CSE? Not yet. Usually when an erroneous trade is made it is reversed on the day itself or at latest on the next market day. In this instance the NSB did not make the payment due on the shares on Friday, itself a breach of the CSE trading rules. It offered no explanation nor, as far as anyone is aware, did it make a request for the trade to be cancelled.

On Saturday there was a decree from the President ordering that the trade be canceled but there   was complete silence from the industry watchdogs.  The Central Bank and the SEC have remained silent leaving it to the President to take action. What of the internal Governance of the NSB, is there no investment committee that vets large investments?  Given the fact the similar deals have involved the ETF, EPF and Sri Lanka Insurance should there be a public investments board that vets all public sector investments?

Despite all of these unanswered questions on due process, one thing is clear – the value of transparency. Because the deal took place on an open market and because of the disclosure requirements of the CSE, it was possible for interested parties to examine and detect suspicious transactions. Perhaps the regulators should simply push for greater transparency, a good dose of sunshine in some dark corners will keep many a nasty germ in check.

Update : Further reading - the TFC deal and the CJ.

An avoidable tragedy

I heard about a tragic accident yesterday. Today I learned that the person involved was a former colleague, we had worked at the same company some years ago.

He had apparently changed jobs recently and got a new Toyota Harrier of which he was very proud, not having owned an SUV before.  A few days back, while reversing his vehicle he had run over both his wife and daughter. Both were in intensive care, the child has now died but the wife is apparently out of danger. The child was fourteen years old.

Reversing vehicles is always dangerous, there are special safety guidelines that may be applied at the workplace, but few people think of these things when at home. Running over a small child is quite possible, but how he managed to run over a fourteen year old and an adult is a mystery, probably the vehicle was high and visibility at the back, poor. Children should always be taught at an early age not to run after vehicles and more importantly, told why. We were told this when we were little but, I can' recollect that we were ever told why and I'm not sure how strictly we followed the rules.

Come to think of it, if we are just a little thoughtless, It can happen to anybody. It has almost happened to me, as an adult. I was directing a friend when he was reversing at the Galle Face hotel car park. He came back a little too fast and bumped into me. The speed was slow, about 5-10kph, but the force that it carries is surprisingly powerful and it knocked me off my feet. There is a six foot drop at the back of the car park, but luckily some bushes broke my fall and I managed to hang on to them until help arrived. It looked quite comical and many people on the green were too busy laughing to help but it could have been very dangerous.

A similar instance took place on a narrow estate road upcountry, with a steep cliff on one side. I almost reversed into the friend who was directing me. We were young and foolish and everyone was laughing about the incident afterwards, but looking back now I realise how dangerous it was.

Never stand behind a car when its reversing, even if one is directing, stand to a side and direct the driver.   

 

Tis the season to be jolly

I had expected yet more taxes to be imposed on consumer goods over the Avurudhu holidays.

Much to my disappointment, the Government did absolutely nothing, but they seemed to have saved the price increases for the Vesak holidays.

Milk powder, cement and gas have been the targets this time around. For anyone who still boils their drinking water here is a tip: buy a good quality water filter and save the gas. I would recommend the Unilever Pureit, which is one of the best around. It is available locally.

As for milk power- for adults in South Asia who lack a gene to produce the necessary enzymes to digest milk, drinking milk-especially in large quantities is a waste so you may as well as give it up. Its perfectly alright to add a little milk to ones tea or eat some ice cream but one can give up a regular glass of milk without foregoing much in the way lost nutrition.

For the rest, there is not much other than to tighten ones belt and plans ones travel arrangements carefully.

 The Government claims that the tax is not for the purpose of raising revenue (to pay for such necessities as an airline that managed to lose in a single year, almost four times its purchase price) but to help local farmers. This has been repeated oft enough and people may think that helping farmers is a good thing. The Government needs to to make a choice - do they want to support half a million farmers or four million households? Consumers, who bear the brunt of this supposed generosity need to ask why this is necessary.