Spotlight: Econ Op-eds in Summary (Week ended 20th October '21)

Snapshots

1. Fresh economic thinking and pragmatic policies imperative

By Nimal Sanderatne

• Drawbacks      in past economic policies and reforms seems to negatively affect Sri      Lanka’s present economic environment. Recently, the government has      identified these issues and seems to be taking measure to reverse certain      decisions such as the fertilizer ban. While this is a step in the right      direction, a pragmatic approach is needed in policies relating to      monetary, fiscal, agriculture and trade.

• Government’s      alternate economic policies and MMT has led to high inflation, fiscal,      trade and BOP deficits. Thus, Budget 2022 will need to include policies on      trade liberalization and a more realistic exchange rate, as low foreign      reserves in the country has created parallel exchange rates as well as      shortages of food and essential items.

• Further,      despite import restrictions, imports are on rise. While exports have also      increased compared to last year, the trade deficit is expected to remain      increasing. Given these circumstances, though foreign assistance and swaps      provide temporary relief, economic reforms are vital to stabilize the      economy.

For full article – Refer The Sunday Times

2. How do we market Sri Lanka globally as a unique country – green socio-economic system

By: Jayampathy Molligoda

• It      has been five months since the prohibition of chemical fertilizer imports      with the government now allowing the importation of potassium chloride–      which isn’t an organic material, though it can still be used for organic farming.      With regards to the tea sector, Analysis reveals no significant yield      declines from the prohibition of fertilizer imports so far, with      cumulative tea production being higher compared to last year.

• According      to the government proposal, stakeholders need not immediately convert tea      production into organic products and would therefore not result in income      losses for famers during this transitional period. Farmers are allowed to      use non-hybrid chemically bond fertilizer till self-sufficiency in the production      of organic fertilizer is realized.

• Currently,      organic fertilizer imports have been approved for the tea sector, with      domestic production of it increasing as well, although the government must      support this by providing sufficient levels of nitrogen and potassium to      maintain product quality. From a bureaucratic perspective, state policies      should be viewed as positioning Ceylon Tea as a unique product to      customers globally to be on par with the Tea Strategy Roadmap for 2030.

For the full article – Refer The Island

(Compiled by: Promodhya Abeysekara, Malitha Goonerathne & Mariyan Perera)