Minister of Power, Energy and Business Development Ravi Karunanayake does not see any “practical essence” in tagging responsibility for business development on to his other tasks. It is a new portfolio, which has been added on rather incongruously to a very, important, though, unconnected, ministry.
He says that business development is there by name, but the drive does not exist, to ensure that start-ups progress – these are the very companies which have problems. And he thinks he knows the cause.
“I think the biggest problem in our country is the Central Bank. Their monetary policy is certainly defeatist to the government. With the fiscal policies after I was appointed finance minister in 2015, we increased revenues almost 100% over the two years’ period that I was there. That was sizeable, it is what is keeping the government going on at the moment, but it did not match the monetary policy pursued by the so-called Central Bank. I mean, they pursue a more negative-growth-oriented monetary policy. Today, an innocent person going to the bank, you have to pawn yourself to get a loan from the bank, and it is just not helpful for a start-up to a small and medium enterprise. So our interest is to try and galvanise the support of the banks and every conceivable chamber, and to make it meaningful. If we are able to give a rate of about 5-6%, which is the regional trend in lending, I guess you don’t have to go after handouts which are being given liberally, which is nonsensical. On one side the Central Bank push it up, which they say is anti-inflationary, but we see inflation going up and interest rates also down. I think this has been the root cause of the negativism that is there. I think it is high time that the government pursues a pro-small and medium enterprise-oriented approach. Lack of knowledge of a business environment by the people who sit in offices, in administrative areas, or decision-making positions, has been the biggest problem.”
The entrepreneur, he says, comes into business thinking gloriously and ambitiously, to create a business empire. However, they do not receive assistance. They are faced with bureaucratic delays.
“You don’t have quick decision-making. If you go to an environmental entity to get approval, it takes a long time. Banks are a fiasco. You go to get a LKR 500,000 loan, you have to pawn your entire future life and you come out not knowing whether you have come out with a benefit or with a permanent liability. These are the areas that need to change, and this is what I was doing in 2015 to 2017, until the changes took place. But I am sure that we will be able to get back into the driving seat and able to get things moving from a more pro-Sri Lankan perspective.”
He sees the Bretton Woods institutions, the World Bank and International Monetary Fund, as another part of the problem.
“But then, what are you going to say? You can say they are part of the problem. But we are small in a global picture. It is that we should pursue policies which are favourable to us. Unfortunately, we have bureaucrats who are basically high-standing, whose job is to perform or lure the officials that come in, so that they can get a retirement job over there. This has been seen as the problem. Especially when you come across officials who don’t understand economics or finance, they easily massage their egos and get that job done.”
Conversely, he says, if you the bureaucrats do know their job, then foreign “experts” coming in does not help at all.
“End of the day, they take professional assistance from us, they put a foreign label, and come back and say this is the professional report that they give. This has been the bane of our society. We overly think of a foreign-skin mentality, which has always been to our detriment.”
He thinks that some very firm, pro-Sri Lankan decisions are needed, to safeguard and develop the three most important things: national security, the national economy and the youth. “If you walk the talk, I guess we have won 90% of the problem. I think we have the ability to steer, to navigate ourselves, if we are led properly. Unfortunately, there are far too many decision-making processes which are counter-productive.”
Sri Lankans procrastinate, he thinks, at taking the correct decisions. He points to countries such as Singapore, Thailand and Malaysia as exemplars, the success in coming out of poverty of which he attributes to fast, firm, decision-making.
In Sri Lanka, on the other hand, “Anybody who works is basically targeted and alienated, but you have to have the guts to go well beyond that. That should be the revival process of Sri Lanka.”