Anushka Wijesinha

Changing how we think about economic growth and nature

Earlier this year, Sri Lanka’s census and statistics department released a new version of the country’s Gross Domestic Product (GDP) calculation. The existing National Accounts had been ‘rebased’ from the year 2010 to the year 2015. In explaining the re-basing, the department noted that “a number of improvements” to GDP compilation was done, the first item on the list was ‘Inclusion of generated value addition from the reclaimed land of Colombo Port city project’. It further went on to note that, “The GDP levels increased significantly over the period of 2015-2018 as a result of the[…] reclaimed land of Colombo port city project”, and “by the year 2019, the land reclamation had been completed and as a result […] the GDP growth rate was lower when compared to 2018”. The fact that the creation of an 269 hectare artificial land parcel attached to the capital, with sand extracted from nature, materially changed the country’s GDP base was startling. It triggered within us, again, a growing discontent we have felt for a while on how we think about economic growth and an unease with how we assess progress. For some years now, stemming from a love for the natural world, interest in biodiversity, and enthusiasm for photography, we had begun to think about critical issues with our current approach to economic growth. To be sure, neither of us are environmental scientists, ecologists, or experts on nature. But we realised that in our own professional worlds of economics and finance in Sri Lanka, there was little mainstream understanding of the threats faced by the natural world and their knock-on effects for our prosperity, health, and well-being. Particularly, there was little appreciation for the value of nature - for instance the emerging agenda of the valuation of natural capital.

Sri Lanka: Anatomy of a Crisis and the Path Ahead

Even though much of the recent foreign media coverage of Sri Lanka’s economic crisis and external commentary or analysis of it has focussed rather narrowly on the policy missteps in the last two years, the country’s economic problems have been at least a decade in the making. The debilitating economic collapse Sri Lanka is experiencing today is in no small part due to the flawed economic model followed in the years after the end of the civil war in 2009. This article serves to provide an international reader with a more useful reference point for the recent origins, evolution, and dimensions of Sri Lanka’s economic crisis, and selected perspectives on the policy issues and path ahead. It is written largely from an economics lens, and would need to be read alongside work by others that focuses more closely on human rights, the environment, and social justice issues.

Sri Lanka’s political turmoil risks derailing the economy further

Sri Lanka is facing unprecedented political turmoil, and with the economy in a tailspin it is in its weakest state in decades. The country is staring down the barrel of a sovereign debt default and is exposed to external shocks. As the country embarks on IMF bailout discussions, the main emerging risk facing Sri Lanka is the fallout of the current political instability on macroeconomic stabilisation efforts. Facing the prospect of a disorderly default, Sri Lankan officials have a decision to make — will they kow-tow to narrow political compulsions, or come together to agree on a common programme that steers the economy out of the current crisis and towards macroeconomic stability? Perhaps the current turmoil in parliament and the public’s growing recognition of the cause of the crisis will be what catalyses a political consensus for reform that has eluded Sri Lanka for so long.

Making Sri Lanka’s Technology Transition More Inclusive

For Sri Lankan youth entering the workforce over the next decade, there lies a critical window of opportunity to get equipped for jobs in the digital economy. Rapidly advancing the technical and soft skills training for the technology sector across the country is vital to avoid reinforcing and reproducing existing regional and gender disparities into the emerging digital economy. Sri Lanka needs to focus on enhancing technology access, usage, and literacy across the board, to help workers be better prepared for jobs in the technology sector.

SIGNALS OF CHANGE:
Three Emerging Post-Covid Trends for Sri Lanka’s Apparel Sector

Sri Lanka’s apparel industry – a significant export revenue earner and employer – was substantially hit by the pandemic. Aside from the short-term supply and demand shocks, the pandemic accelerated trends that were in motion prior to the crisis, and these provide signals of change and point to the direction in which the Sri Lankan apparel industry needs to head in. Moving from recovery to resilience and a new wave of growth will be shaped by three emerging trends - attracting new investment that drives innovation (in business models and products) and plugs into new supply chains and on focussing on meeting more stringent sustainability and other compliance requirements of buyers and preferences of consumers.

Refreshing Growth in Sri Lanka’s Provinces:
Changing the Narrative

For too long provinces outside Sri Lanka’s Western Province have been characterized as ‘lagging regions’, due to their slower growth trajectory, smaller share of national output, and more pronounced weaknesses in development indicators. It's time to change the narrative and see them as 'Secondary Growth Hubs', to transform how all stakeholders engage in partnerships to boost prosperity there - not in terms of how they need to be helped to get out of being ‘lagging’ but rather how they need to be partnered in creating more inclusive economic growth.

Looking Beyond Tariffs to Win in
Export markets: A New Focus for SMEs

Tariffs often take centre stage in discussions around market access for exporters – especially SME exporters. But this view is increasingly out of date. Standards are a new differentiator, even to markets where preferential tariff advantages are not available. Standards compliance should not be seen as a barrier, but as a way for firms to find new sources of competitiveness and branding

SIGNALS OF CHANGE:
Can Blockchain Solve Trade Finance Bottlenecks?

Trade finance is currently full of inefficiencies, and access to trade finance has proved to be a continual challenge for SME exporters. The industry is ripe for disruption, and blockchain is proving to be a key source of disruptive innovation. Several pilots have shown the way for blockchain to improve trade finance - both in reducing time and costs.