11/08/2008, 00.00
SRI LANKA
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New economic plan focuses on domestic market, promises development

by Melani Manel Perera
President Rajapaska proposes to parliament the new economic plan for 2009. In opposition to "the process of neoliberal globalization," it increases import tariffs and reduces those on local products. The drop in the cost of gasoline and some investment in public spending find support among the poorest people.

Colombo (AsiaNews) - The president of Sri Lanka has presented his proposal for economic measures in 2009. Speaking on November 6 in front of parliament, Mahinda Rajapaksa (in the photo) announced that the country expects economic growth of 6%, in line with the current trend around 6.5%, and promised 300,000 new jobs.

The president began by saying that the new economic plan confirms the ten-year development plan of Mahinda Chinthana, the electoral manifesto with which Rajapaksa won the election in 2005. Before addressing the economic decisions for the year to come, he dedicated three initial points in his speech to the civil war that sees the government fighting the Liberation Tigers of Tamil Eelam (LTTE). Rajapaksa reiterated his call for the Tigers to lay down their weapons, and accused the rebels over the high number of civilian victims in the northern part of the country.

In regard to economic matters, the new plan intends to pay for local production, a decision that the president says is contrary to the traditional policy of his predecessors. "The process of neoliberal globalization that our country has followed for more than 30 years," Rajapaksa said, "has brought economic advantages only to a small part of our society." Sri Lanka "has suffered a tremendous mental setback" that has made the government incapable of responding to terrorism, and even of "building a road in the countryside." Blasting the work of the previous presidents, he emphasized the urgency of building infrastructure, developing agriculture, and also combating "the deterioration of moral values."

In the context of greater support for the country's economy, Rajapaksa announced among other things a reduction in value added taxes and an increase in import tariffs, for example on tea from abroad, which will be subject to a tariff of 4 rupees (0.03 euros) per kilo. At the same time, he declared his intention of investing in the health sector in certain rural areas, in small businesses and cooperatives, and on behalf of the indigenous populations in some regions of the island.

AsiaNews has found widespread approval for the economic measures for 2009 among the poorest people in the suburbs of Colombo. The most popular feature is the reduction in the price of gasoline, which will also permit the reduction of public transportation expenses, and the reduction of water and electricity rates. Some of the inhabitants of the capital have commented on Rajapaksa's actions by saying that "this is a great help for us, the poor people of the country. For our daily needs, we still use gasoline, and since we are poor we use public transportation for all of our travel throughout the day."

The decision to focus on the domestic market and local products is looked upon with hope by small and medium-sized business owners. A shopkeeper in Colombo comments to AsiaNews on the proposals contained in the new economic plan: "We are happy that the president is favoring our local products, increasing tariffs on foreign and luxury goods. This way, the people will get used to consuming our products and our goods."

The secretary of the Janatha Vimukthi Peramuna, Sri Lanka's communist party, is much less enthusiastic about the economic plan. According to Tilvyn Silva, Rajapaksa's decisions deceive the population with minimal subsidies handed out solely in order to win over public opinion. The fact that the president addressed the Tamils by using their language has also been viewed by some commentators as merely an attempt to gain support from international public opinion.

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