e-Con e-News

‘Before you study the economics, study the economists!’

e-Con e-News 15-21 October 2023

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Sri Lanka, Palestine & South Africa feature among the world’s

foremost struggles for majority rule in a unitary state…

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The USA is telling us to watch them engulf West Asia in blood in ‘real-time’. Again. They wish to tell the world: you can do nothing about it. Try if you must. (And if you fail, and you live, you can get a post-colonial PhD in Indiana!)

     They wish more rope. Shall we give it to them, or sell it?

‘We’re the United States of America, for god’s sake!

The most powerful nation in the history of the world.’

– Joe Biden, CBS 60 Minutes, 15 October 2023

The USA is threatening naval blockades of both West Asia, starting with Palestine, and of East Asia, centring on the South China Sea, escalating their fuel, fertilizer and food wars. This must surely shake the confidence of our most unbending advocates of export-oriented industrialization.

     The English, fearing an Imperial Japanese invasion from Singapore hooking up with Nazi Germany at the Suez via Sri Lanka in 1942, was forced by the Communist Party of Sri Lanka, to make concessions to cultivators and workers, and industry (see ee 15 February 2020, Indian Rhapsody). Would Sri Lanka’s present rulers, even dare?

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It was only the other day the SL President in New York took ‘centre stage’ (so said his family’s Financial Times of Colombo) at a US Carnegie Foundation Forum on ‘Ocean Nations’. (US Steel monopolist Andrew Carnegie, by the way, whose profits funded this Carnegie Foundation, was a Vice-President & funder of the US Anti-Imperialist League formed in 1898, during the US war on Spain’s colonies. The League was a battle waged by an older thief against a younger thief, who wanted to keep invading the world. The older thief is coy: we shouldn’t push it, we might go over the edge. Carnegie wished to protect his steel monopoly).

     Over a century later, the SL President at that Carnegie no doubt heard Manhattan’s robot-dentures clacking for a ‘Free & Open Indo-Pacific’ and a ‘Rules-based Order.’ The President, at least in his previous avatara, has been a fervent advocate of such ‘Western liberal’ nostrums. And why not? Free. Open. Rules. Order. Whoa!

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‘You’ve just said ‘rule-based order’. Have you ever seen those rules?

No, you haven’t, because no one has agreed on them with anyone.

So how can one talk about order based on rules that no one has ever seen?

In terms of common sense, it’s nonsense. But it is beneficial to those who

promote this approach. Because if no one has seen the rules, it only means that

those who talk about them are making them up themselves

from time to time to their own advantage. That is the colonial approach…’

– V Putin, 16 October 2023

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• This week as the US & petit-poodle England’s warships blockade, and their caged pitbull Israel froths and gouges deep into the flesh of remnant Palestine, we hear that that the US Carnegie Foundation, which recently sponsored the President’s speech in New York, advocates ditching this US ‘rule of law’ policy business.

     It’s an ‘abundant’ time. Palestine makes it abundantly clear, yet once more, white countries know nothing about real rule of law. Whiteness is lawlessness. The smell of blood thrills & flares their nostrils & nostrums – perfume to a lynch mob. Nothing like mass murder to unite them. Ah! The Concert of Europe: Malcolm X said, English may hate Irish, Protestant hate Catholic, Gentiles may hate Jews, but when they hear ‘Nigger’, they all run in the same direction.’ This week it’s the Palestinian – subset of that ‘ethnic’ category tagged in US penitentiaries as ‘Sand Niggers’.

     So no surprise how all their media & economists have to suddenly fall quiet on this ‘rule of law’ business. Such military precision. Not a word about such matters anymore from US embassy lipstick like EconomyNext or Advocata. Rule of Law. Not a squeak. It can’t be from embarrassment. They lack that lajja. And the media is not allowed memory!

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• Ranil Feels for the East Wind – The SL President, who is mostly airborne, next went to Beijing this week for the 10^th Anniversary of the Belt & Road Initiative (BRI). Sri Lanka’s links with China are ancient, and new promises were agreed upon. The President could have asked about the role of industrial strategy midst siege. China is an expert. He should have. Maybe the President is just flirting to attract more white largesse. We are not privy to that privy.

     And lo! After dragging their feet for months, the IMF suddenly announces on Friday that they have reached a ‘conditional’ ‘first staff-level agreement’ with Sri Lanka for ‘next review!’ First! Conditional! Talk about bureaucracy! Suddenly? The US wars in West and East Asia are about to reorient all the IMF forecasts! And we all know who decides. Here’s what was tugging at Morocco:

‘Failure to strike a deal would imperil the status of the central institution

of the global monetary system… Today, the US quota share is 17.43%,

and its voting share is 16.50%. Consequently, the US must agree

to all the IMF’s major decisions, including any changes in quotas.

In other words, whether we like it or not, any deal must satisfy the US Treasury.’

– Edwin Truman, advisor to Official Monetary & Financial Institutions Forum,

former director of US Federal Reserve’s International Finance Division

– ee Economists, Another stalemate on IMF quotas is not acceptable

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And the US Treasury is thirsty too it seems:

‘Sri Lanka is the only country in the world that will have drinking water

even if there is going to be a shortage of drinking water in the whole world.’

(see ee Agriculture, SL at the Pinnacle of the World in its Water Supplies)

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With Sri Lanka’s drought/flood media ever at the ready to sensationalize disaster, another flood involved an overflow of stories diverting from the upcoming privatization of water. We hear from all the ‘concerned’ voices like the UN’s Food & Agriculture Organization (FAO), International Fund for Agricultural Development (IFAD), & World Food Program (WFP), who apparently need to remind us ‘Building water resilience… requires collective commitment’! Tell that to the Vel Vidane of yore!

     Then there’s Asian Development Bank (ADB) & Japan International Corporation Agency (JICA), generously funding the digitalization of the Water Board in anticipation of the privatization (ee Random Notes, The Water Act).

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• US Advocata’s Digital Catatonic Tonics – Just as ee sonar detected not a hik squeak Gaza-wise from US thinktank Advocata, all of sudden there is an icy North Atlantic swoosh of their policy demands on Sri Lanka’s government. The most infamous Advocata-tonic this week ordered the President to ‘only use’ a ‘digital signature’ after 31 December 2023.

     Apparently, the President’s pen is not his own, with many hands groping to hold his pen (perhaps forging his good name), and the IMF (with Julie Chung offering the helping hand) wishes to make sure Washington holds his pen. And tight.

‘The Moving Finger writes; and, having writ,

Moves on: nor all thy Piety nor Wit

Shall lure it back to cancel half a Line,

Nor all thy Tears wash out a Word of it.’

– Omar Khayyám

• The IMF seeks to ensure that no matter how much the blood & many tears shed, and no matter the curses & votes cast on the road to Jayawardenapura or Galle Face Green (without pausing at Kollupitiya Junction), the Executive President’s writ holds as long as the irrigation of his fountain pen is regulated by the US Treasury (aka ‘Freest Marketeer’). The rest of the country’s bodily fluids could all ooze into the Diyavanna and India’s oceanic cesspit for all they care.

     Hence the IMF (& pipsqueak Advocata) demands Sri Lanka digitalize everything (IDs, Fuel, Health info, etc.), so a fund manager & their algorithm (off-Manhattan, for tax purposes) could determine the path of investment in Sri Lanka. All part of a ‘National Digital Strategy’, which the World Bank applauds for its focus on decentralizing SMEs! Now what does this mean, not just for national security, let alone industrial policy?

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• Carving up Sri Lanka’s national assets for the USA will be discussed at next month’s Sri Lanka Economic Summit with the Ceylon Tobacco Company and State-Owned Enterprises Restructuring Unit Director General Suresh Shah, World Bank IFC Country Manager Alejandro Alvarez de la Campa, (Unilever-front) Sunshine Holdings Group Managing Director Vish Govindasamy, Power and Energy Minister Kanchana Wijesekera, and Advisor to the Minister of Labour and Foreign Employment Shan Yahampath, with US Advocata CEO Dhananath Fernando moderating… (see ee Economists, Imperative for SOE reforms in focus at Sri Lanka Economic Summit

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‘Is the IMF setting Sri Lanka up for a 2^nd car crash?’

– Theo Maret, Financial Times of London

A rather provocative headline indeed, especially for those who think the USA’s IMF is a god, benevolent & concerned. Moneychanger Maret believes the IMF’s ‘unambitious targets’ are setting Sri Lanka up for another default. Someone should tell Maret, the applied mathematician, that he doth under-invoice: This is the IMF’s 17^th impending car crash!

     Maret (Market without the ‘k’!) spoke at a recent ‘Civil Society’ chat-up on Sri Lanka in perfumed Marrakech. Maret works for Global Sovereign Advisory (GSA), an ‘independent’ advisor of ‘governments & other sovereign entities on all their strategic, economic & financial issues.’

     Ghana hired GSA as debt advisors in Dec 2022, along with Lazard, and Hogan Lovells. Holders of Ghana’s bonds tapped Rothschild & Co and Orrick, Herrington & Sutcliffe as advisers. Sri Lanka hired Lazard and Clifford Chance in May 2022 to serve as ‘advisors on debt restructuring’ to appease the IMF.

     ee has noted before the kuchi-kuchi between actors on both sides of this debt game, like the Rothschilds. June 2023 ee reported that 3 of France’s wealthiest dynasties were helping take ‘French bank’ Rothschild & Co private, or should we say, ‘more private.’ While protected by the biggest guns in the world, real ‘finance’ is the actual very small island, usually offshore, NFA (no fixed address), and OTB (off the books). Maret recalls, eg, that IMF targets ‘leaked into the market’ in Nov 2022, and ‘rallied’ Sri Lanka’s Eurobonds to double their value.

     GSA’s Maret was a part of a closed-door ‘Civil Society’ chat-up, with Verite, a US-funded ‘SL thinktank’, and the US-World-Bank-linked Transparency International Sri Lanka (TISL). Guess who these ‘doors’ were ‘closed to? This ‘Civil Society’ (‘a rich dialogue among various stakeholders, including professionals & high-ranking members of the Sri Lankan delegation’) provided ‘civil’ fog for the IMF & World Bank annual meeting in Morocco.

     This ‘Civil Society’ chat drew attention to Sri Lanka’s allocation ‘of over 70% of its revenue to interest payments – the highest in the world!’ Which make any real ‘repayment’ not possible at all, especially when this ‘civil society’ of capitalists prevent Sri Lanka’s modern industrialization. This is the real corruption!

     Verite’s de Mel’s & TISL’s Perera’s ringing denunciations of the ‘corruption’ of the Sri Lankan government surely echoed louder across the icing western Mediterranean and into the Iberian Peninsula. The groaning to rearm moral fervor may have recalled young 16^th century Jesuits demanding the Pope send in the cannons to avenge some Sri Lankan King’s misdemeanor.

     Global Sovereign Advisory’s ‘civil’ intervention was more precise: the issue is the IMF’s criteria, especially for ‘market access’ – in other words, to grab national resources. And as the recent EU-Mercosur Treaty reveals, the EU’s Green/WhiteWash aims to grab critical raw minerals, while dumping fossil fuel-based car models, combustion engines, and agricultural pesticides.’ Maret also demands US control over SL’s foreign reserves & exchange rates (see ee Random Notes). EU meanwhile warns that Sri Lanka needs major investment to cut down charging time for EV cars! Forget production? (see ee Industry)

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• Sri Lanka, Palestine & South Africa count among the world’s foremost struggles for majority rule in a unitary state. And Sri Lanka’s Mannar Basin, the eastern Mediterranean’s Gaza Marine & south Atlantic Guyana’s Stabroek Basin have much in common.

     In 1948, the year the English were imposing Soulbury independence on Sri Lanka (with guarantees for ‘minorities’, including white & other merchants), the Zionists (many who’d collaborated with Nazi Germany) expelled half the population of Palestine in 9 months. Demolishing 500 out of 1,000 villages, Zionists depopulated 11 towns to create the state of Israel. The English had conveniently withdrawn their ‘mandate’ from Palestine just before – Nakba!

     In 1948, a white South-African government, imposed English-style apartheid, setting up Bantustans, framed on the ‘reservations’ of Canada’s Indian Act. They divided peoples into races (Whites, Blacks, Indians & Coloureds).

     The backdrop: In 1945, the US occupied Japan, and divided Korea & Germany. In 1947, the English divided India. In 1949, the US, after defeat in China, set up a quisling state in China’s province of Taiwan.

     Just before the most recent upheaval, Palestine had agreed to work with both Egypt & Israel to develop the vast Gaza Marine Gas Field, 30km off the Gaza Strip. Palestine, like Lanka etc, has been made dependent on fuel imports.

      Certain parallels are indicated by the seemingly surface activities of the agents of imperialism:

     It’s not just the Australians so generously protecting the indigenous donkeys of Mannar, while mining ilmenite in Puttalam. Or that the pearls that once were bubbled to the shores, long a source of international dispute, have come & gone. Or that there are other do-gooding-doing-good NGOs doing godly work as it were in them northwest parts bordering this ‘frontier failed rift basin’ just off Sri Lanka.

     In Sept 2021 ee noted , USAID & other funds were targeting ‘sensitive’ coastal communities (eg, Puttalam, Mannar, Trincomalee, Batticaloa) in Sri Lanka (& Myanmar) under various guises, to aid ‘peace-building’, ‘reconciliation’, ‘pluralism’, ‘women’s empowerment’, ‘religious diversity’, ‘conflict sensitivity’. One of the 1st acts of RW as the born-again PM in 2022 June was to hand out deeds to legally grant ‘ownership’ in coastal Puttalam, etc.

     There is a ruddy school of thought that believes the wars of the last decades in Sri Lanka are also umbilically linked to the grab for the Mannar Basin, flush with other bubblies, oils, gases & other energies.

     Some point to the grab of Guyana’s recently uncovered offshore gas fields by Exxon. Guyana was Cuba before Cuba, and the US & England set up ‘race wars’ to prevent it from becoming ‘another Cuba’. Guyana is expected to become Exxon’s top global oil producer. And even more, ‘Where the company ends and the government begins is increasingly unclear’ (see ee Random Notes)

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Palestine, like Sri Lanka, is heavily reliant on imports for energy. Yet the Gaza Marine Gas Field holds more than a trillion cubic feet of gas.

     In September 2022, Palestinians rallied at Gaza City Seaport to demand their right to receive gas from eastern Mediterranean gas fields, and the lifting of the Israeli blockade of the Gaza Strip.

     In June 2023, Israel gave ‘preliminary approval’ to exploit the Gaza Marine field.

     In September 2023, just before the recent slaughter, the Palestinian Authority again said it would sign an agreement to develop the offshore Gaza Marine natural gas field with Egypt and Israel.

     (On 9 Oct, US Chevron said it shut down a natural gas field off the Israel coast at official behest. The Tamar field, 15 miles off Israel’s south coast, meets 70% of Israel’s energy needs for power generation. Jordan & Egypt import 7% & 4% of their total gas supply from the platform. ‘Goldman Sachs analysts think the Tamar shutdown has ‘contributed’ to the rally in European gas prices.’ Others claim: the price rise was due to ‘a temporary shutdown of a leaky gas pipeline in the Baltic Sea, and a planned strike by liquefied natural gas workers in Australia.’

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• Just as any bordello could set up a tent at the country fair as long as it increased the overall interests of the top merchant (who had first pickings among the fresh aubergines), the meaning of ‘civil society’ was furthered constricted or revealed by the ‘Sri Lankan Civil Society Initiative on Anti-Corruption Reform for Economic Recovery’, which set up ‘a closed-door event’ to whitewash the IMF Annual Meetings in Morocco.

     Trying to figure why ‘closed-door’? Perhaps it is not just oxygen (which the World bank’s Transparency International otherwise preaches) they were excluding, but China against whom they are putting up a greater wall? It turns out this year’s annual IMF/World Bank meetings in Morocco has been ‘the most explicitly confrontational yet by US/NATO diplomacy toward China’.

‘At issue is not only what countries will be the major beneficiaries of future IMF & World Bank loan operations, but whether the world will back US unipolar dominance or start to move explicitly toward a multipolar philosophy of mutual support to increase living standards & prosperity instead of imposing anti-labor austerity in an attempt to maintain a trade & investment system that is now widely seen to be dysfunctional & financially predatory US demands to use these 2 organizations as arms of its New Cold War policy.’ (see ee Focus, Hudson)

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Instead of wailing about this good old colonial system, Transparency & Verite thundered about corruption! Their words could have surely pressed against the locked doors. Threatening to bust them up. But T&V are a salariat.

     Civil Society? EconomyNext and The Wickremesinghe family’s Financial Times and has become an open toilet paper of the US thinktank Advocata et al. But they have all gone rather quiet about ‘rule of law’, which has gone bunker-deep in US-occupied Palestine.

     Note a whiny tweet from Presidential Economic Advisor & Advocata chair Murtaza Jafferjee (this flush thintank is a complex corpocracy, with a CEO, & many many directors & fellows, many being women, beyond the requisite minority quotas, much like the ruling merchantry. Jafferjee is eagerly waiting for EC President Ursula Von Der Leyen to also condemn Israel’s denial of food, water & fuel to the Palestinians, as she did in the Ukraine. He laments such double standards are why the ‘Global South’ does not believe in their liberal platitudes. But other than that, all rather quiet in these openly lawless times. So what could it be?

     It turns out the US is about to ditch this rule-of-law biz. ‘Carnegie Council explains how the global rift necessitates a change in western policies. It especially sees a need to ditch the so called ‘value-’ or ‘rules-based-order’ policies.’

     Recall the President’s recent New York jaunt, included a roundtable on ‘Economic Opportunities in Sri Lanka’ was organized by Carnegie Endowment for International Peace & Sasakawa Foundation. Did they intimate to the SL Prez the new rules we must dance by? As articulate as anyone can be in English, is this why he put on that act of exasperation for viewers of Germany’s state TV’s English channel? Germans may not have watched.

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• ee continues to serialize Idirimagen Idiriyata, the Communist Party of Sri Lanka ‘s ‘Alternative Program’. This issue examines ‘the conceptual underpinnings, philosophy & ideologies of the alternative program’, where wealth would be equitably distributed, and national unity is the main condition for further development as a country.

     The program calls for ‘production of real goods’ to comprise ‘the mainstay of the economy’, hence the need for a high level of industrialization & technological transformation, even in agriculture. This needs a National Planning Council, with public ownership over natural monopolies such as energy, transport and communications. The program reminds that SoEs are a mainstay of not just Communist societies but also industrial capitalist ones.

     These CPSL proposals recognize the shift of economic power to Asia and the rise of a multipolar world order, calling for Sri Lanka’s own economic strategy, including trade & industrial policies, to be in tune with these geopolitical & geo-economic dynamics. (see ee Focus)

Civil Society’s Funders & Fundamentalists