2018 should be the year Sri Lanka finally prioritises on economy and evolves a political cohesiveness that supports economic development. However, there is an acid test: the future of the UNP-SLFP unity government. The memorandum of understanding between the two parties lapsed on December 31; the SLFP says a decision will be taken after the local government elections.
The UNP-SLFP joint arrangement during the past two years had been chaotic, yet it prevented the country from falling into a crippling political contention of a worse kind. Imagine the plight of a minority UNP government in power amidst all these daily protests and strikes. And there would also have been organised efforts of sabotage and run rings around the government. But now, should the SLFP decide to part ways, the UNP will be forced to run a minority government, that would be at the mercy of the TNA and JVP. Sri Lanka cannot afford that political uncertainty and resultant instability. Current zigzagging of the government policy on almost everything has already made prospective investors scratching their heads. More political confusion would rob this country another couple of years of economic growth.
Economic growth for the past year is likely to be below 4 per cent. Slow growth rates in the past three years could be compensated for only if the government evolves a sound micro-economic base that would support a long-term holistic growth. However, good economics is bad for politics. A minority UNP government would forfeit long-term economic goals in order to somehow cling to power – this is exactly what it did by its mini-budget presented prior to the general election of 2015, which resulted in the government recurrent spending skyrocketing due to increased salaries and subsidies and worsened the balance of payment problem.
While some ministers close to the president want to stick with the unity government, others want to get out and reorganise for the next general election. Some are disgruntled at being ignored by the UNP, others want their fingers in the honey pot, which can be best accomplished being in the government. However, the SLFP does not have numbers to form a government, which would mean, their role would be in the opposition, trying out the usual tactics of obstructionism. A minority government is more susceptible to an acute obstructionism.
The campaign for the local government elections would also strain relations between the UNP and the SLFP. Elections in this country are poisonous and despite the good intentioned effort to avoid mudslinging, old habits die hard. Mutual animosity during the election would also embolden those who want the SLFP to withdraw support from the unity government.
The local government elections will decide not only as to who rule the local government bodies, but more importantly, who would own the SLFP. Poor performances at the election would diminish President Sirisena’s hold on the SLFP and see many MPs who have an eye on the next general election, switching loyalty to the Rajapaksa faction. That would mean the end of the unity government.
The president has an ace up in his sleeve: the report of the Presidential Commission on the Central Bank bond scam. The report was presented to the president last week and has been sent to the Attorney General to consider legal action against those who have been implicated in the report. The report is still a closely guarded secret, and should the president decide to submit it to parliament, it would become a public document and would make quite a bit of controversy. The essence though is in the timing. If the report is made public before the local government election, it would shift the narrative against the UNP. That would also cut the SLFP losses, or even, could turn corner and win some constituencies.
The president last week hinted that he was shifting gears in his campaign against corruption. “I am not sure who will be axed with my sword in my mission to have clean politicians,” he told a gathering of Sri Lanka Freedom Party (SLFP) and other smaller groups last week. His emphasis on corruption would give the impression that he was trying to fulfil one of his main election promises, which the Yahapalana administration has so far failed to deliver. The release of the Presidential Commission report, obviously the biggest scandal that happened under his watch, may redeem some of his past failures. But, that would also ruffle feathers with the UNP.
The future of the unity government will lie in the balance of political power between the UNP and the SLFP, as well as between President Sirisena and former President Mahinda Rajapaksa. Rajapaksa coterie has an easy go when the SLFP is weaker and the president is indecisive. A stronger and forceful presidency can keep these forces in line, and also help sustain the unity government, which at the moment is a political and economic imperative.