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Sri Lanka moves towards a financial abyss

Sri Lanka is on the verge of becoming the first South Asian state with a junk credit rating of leading international rating agencies as result of poor arbitrary handling of fiscal policy and state financial management by newly appointed finance ministry hierarchy, economic analayts warmed

The financial mess is the inevitable result of spending more than the state could afford on public relief measures aimed at providing political mileage for the new Prime Minister and Finance Minister Mahinda Rajapaksa appointed by the president.

Treasury officials have been directed by Mr Rajapaksa to allocate funds from the treasury for his ad hoc projects and then covering it up with reckless budget tricks, officials said.

Politicians like Mahinda Rajapaksa and his clan are notorious for making promises they can't keep. They began to unveil one by one of their old practices compelling the state to pay for it now, officials alleged,

Finance Ministry Secretary S.R. Attygalle appointed by the president on the recommendation of new Finance Minister recently told media that funds from Ministries which do not have urgent projects would be used to carry out urgent functions.

These urgent functions include Mr .Rajapaksa’s recent politically ambitious directives including relief for fishermen’s societies ,agriculture sector and other welfare activities , a veteran official said adding that the treasury secretary has to bear the responsibility of all those spending and budget tricks as the chief accounting officer of the finance ministry.

The Gamperaliya and Enterprise Sri Lanka programmes initiated by former Finance Minster Managala Samaraweera to up lift the living standard of rural poor by allocating a sum of Rs 80 billion and Rs. 15 billion respectively had been suspended by the new finance minister Rajapaksa.

An attempt is now being made to use this money to full fill his political agenda of Rajapsa and the clan displaying their new found political power, officials alleged.

The All Ceylon Makkal Congress (ACMC) slammed Finance Minister Rajapaksa’s decision to slash budget allocations amounting to Rs 250 Million for Northern IDPs.

Despite leading an illegitimate government, Mr. Rajapaksa has even instructed to divert this Rs 250 million for other work away from IDP resettlement, Leader of ACMC Rishad Bathiudeen MP alleged.

Unfortunately, the budget gimmicks that have worked out recently by new Treasury Secretary Attygalle appointed by the president will not be sufficient enough to make up the gaping hole that exists now, officials said.


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