Sri Lanka: the economics of capitulation

Abstract

Since 1948, when Sri Lanka became independent, the two major par ties - the United National Party (UNP) and the Sri Lanka Freedom Party (SLFP) - have alternated in governing the country. The SLFP, in coalition with the Trotskyite Lanka Sama Samaja Party (LSSP) and the Communist Party (CP), last held office as the United Front (UF) from 1970 to 1977. The current UNP government came to power in the July 1977 elections. The years of the UF government had been marked by a state of emergency (following a major insurrection by the youth in the countryside), lasting for almost the whole term of their office, which severely curbed political and trade union activity, drastically cir cumscribed civil liberties and substantially curtailed judicial in dependence. The UFgovernment's policies of land redistribution, pro motion of rural development, increasing self-sufficiency in food pro duction and lessening dependence on tea and rubber exports were not far reaching enough to halt or reverse the steady pull of Sri Lanka into the world capitalist system. What resulted was a so-called 'mixed economy' professing to reflect the Buddhist virtues of 'the middle path'. But such policies were simply not viable, and in any case tended to be undermined by corruption and inefficiency. In the end, the government was discredited and suffered an overwhelming defeat in the elections of 1977. The landslide victory of the UNP marked a significant change in Sri Lankan politics, and has disturbing implications for the country's future. Elected on a platform of 'just and righteous' government, on promises of restoring civil rights, and pledged to 'democratic socialism', one of the government's first acts was to promulgate a new constitution which vested sweeping powers in the newly-created office of Executive President. From the beginning, the UNP has stressed its commitment to a free economy' and its wholehearted welcome of foreign investment and western aid. It is now pursuing, with frightening speed, a series of massive and far-reaching 'development' policies whose effect can only be to bring the country into a state of total dependency within the im perialist system. We examine some of these extraverted policies and their implications in the following article, which is based on a chapter from the author's forthcoming book on Sri Lanka: The Crisis of Dependent Capitalism: the Sri Lankan economy 1948-1980 (Zed Press, 57 Caledonian Road, London N1 9DN).