Balancing the economy and pandemic control | Daily News

Balancing the economy and pandemic control

Parliament. (Picture by by Sulochana Gamage)
Parliament. (Picture by by Sulochana Gamage)

Though the Government decided to relax the quarantine curfew in the Western Province to keep the country’s wheels turning amidst an unprecedented health crisis, it was trying hard not to loosen its surveillance as the daily situation reports were proof that all was not well.

In fact, health authorities, with the help of the Security Forces and Police, doubled down on their efforts to trace the infected persons and their close associates, and at the same time strictly advised the people to adhere to the health guidelines and refrain from non-essential travel.

As an effective vaccine for COVID-19 is unlikely until sometime next year (though Pfizer just made an announcement that their experimental vaccine is around 90 percent successful in phase 3 trials), some pointed out that the extended lockdowns would not be the answer, while others contended that lifting the curfew while the figures remain worrisome was too much of a risk.

It goes without saying that responsible behaviour on the part of the citizens has been required now more than ever before if the country is to free itself from the tentacles of this highly contagious strain of the Coronavirus which seems to be tightening its grip.

“We have to understand the ground reality and act accordingly. Closing down the country is the easiest solution, but the people have to live. It is my responsibility to keep the economy going while ensuring that all activities move forward,” President Gotabaya Rajapaksa stressed at a meeting of the Presidential Task Force on COVID-19 Prevention on Monday. He emphasized that keeping the entire country in lockdown in perpetuity until a vaccine or cure is found was simply out of the question as it would be economically and socially disastrous.   


Despite the COVID-19 scare, there was however much excitement over the United States (US) Presidential Election 2020, which occupied a greater share of the local and international media space over the week.

Following a nail-biting wait that dragged on for four days, the Associated Press (AP) and other international media outlets on Saturday reported the projected win of Democratic Party Candidate Joe Biden and his running mate Kamala Harris (who has biracial Jamaican-Indian roots), signalling the end of four years of the controversial Trump administration in the US. 

The very next moment, congratulatory messages started pouring in from all corners of the world, and President Rajapaksa and Prime Minister Mahinda Rajapaksa were among the State leaders who took to social media to congratulate the President-elect and the Vice President-elect of the US. Even some of President Trump’s staunchest allies including Benjamin Netanyahu of Israel and Boris Johnson of UK were quick to offer congratulations to the new power couple in Washington, DC.

President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa, in their messages, said that they were looking forward to enhance the bilateral ties between the two countries in a mutually rewarding manner. Significantly, the Biden-Harris victory came just days after the current US Secretary of State Mike Pompeo visited Sri Lanka for high-level bilateral talks. Opposition Leader Sajith Premadasa also joined in congratulating Biden and Harris, also wishing them the best in their efforts to transform the United States of America.

The Tamil National Alliance (TNA) took special interest in wishing Kamala Harris, not only the first female and the first coloured US Vice President, but also the first Indian-American elected to that office. Naturally, Indian Premier Narendra Modi took pride in Harris’ accomplishment, and commended her success as path-breaking, while also congratulating Biden on his “spectacular victory”. Incidentally, Modi had bonded well with President Trump, with both leaders sharing the same nationalist outlook and even attending huge rallies held in each other’s countries.   

Silence speaks volumes

While most world leaders rushed to congratulate Biden and Harris on their election, China and Russia were following a wait-and-see approach, and were conspicuous by the absence of their congratulatory notes.

The international media reported that the Kremlin said it would wait for the official results of the Election before commenting on the outcome. Similar sentiments had come from Beijing when questioned on its position on the US Election. “We will handle the issue of the statement (of congratulations) in accordance with international practice,” Chinese Foreign Ministry Spokesman Wang Wenbin had told reporters at a regular press briefing on Monday. 

President Trump had a markedly different approach to these two countries. He had a generally good relationship with Moscow while he waged a “trade war” against China and banned some leading Chinese companies including the leading smartphone maker and telecom infrastructure provider Huawei. President-elect Biden, on the other hand, has promised a tougher line on Russia and is apparently open to what the Chinese authorities have to say before taking further steps.  

In the meantime, incumbent US President Donald Trump’s premature declaration of victory, filing of lawsuits over ballot counting (without any evidence of voter fraud or intimidation), and subsequent refusal to concede defeat had heightened the global interest over the US Election. Some analysts opined that these post-vote tensions proved that Western democracies were no better than many countries in the Developing World, to which they regularly lecture on the importance of following democratic norms and traditions.

Budgetary figures

Turning back to domestic affairs, Parliament is to meet tomorrow to take up ‘Budget 2020’, as the Government seeks the Parliamentary nod for public expenses made throughout this year. As a few lobby correspondents have contracted COVID-19, Parliament has decided not to allow any journalist to enter the Parliamentary premises until further notice and journalists have been asked to follow the live streaming of sittings.  

In the hardest financial year in decades, the Government has been forced to cut down its expenditure and forego a considerable share of its revenue owing to the COVID-19 pandemic. According to the Appropriation Bill, the expenditure of the Government is estimated to be Rs. 2, 538 billion this year and compared to 2019 this is a reduction of Rs. 377 billion.

The revenue was plummeting as day-to-day economic activities were disrupted since March, but the Government managed to fork out urgent funds from its coffers for relief and pandemic control measures including the Rs.5,000 allowance. Revenue targets for this year have been revised and the current figure will probably come out in the Parliamentary debate tomorrow.   

Unlike in the previous years, the Budget has made direct allocations to the State Ministries this year. Therefore in order to find out the Government allocation for a particular sector such as education, agriculture or health, one has to add up the figures under the relevant Ministry and the relevant State Ministries. Political observers say the direct assignment of institutions and funds has enabled the State Ministries to manage their affairs in a more organized and efficient manner.  

Amidst the raging pandemic, many were keen on the projected expenditure on health. Approximately Rs. 227 billion has been allocated for the health sector this year with Rs. 159.5 billion for the line Ministry and Rs. 67.8 billion for the two State Ministries. This is an increase of Rs. 40 billion compared to 2019, where the budget allocation for health stood at Rs. 187 billion. It must be borne in mind that the Government now has to spend millions of rupees per day on PCR tests alone, an expenditure that would not be needed in a normal year.  

The Defence Ministry, which has undertaken additional responsibilities in the fight against the novel Coronavirus, has been provided Rs. 312 billion.  Another noteworthy observation with regard to the breakdown of figures as in the Appropriation Bill 2020 is that, the country has spent nearly Rs. 263 billion for the upkeep (operational activities) of the nine Provincial Councils though they were not functioning throughout the year owing to the indefinite postponement of the PC elections. A total of Rs. 557 billion has been allocated for the Public Services, Provincial Councils and Local Government Ministry and the Provincial Councils and Local Government State Ministry this year. At a time when the productivity and efficiency of Provincial Councils are under review, these numbers may be worthy of further discussion.      

More leagues to tread

After the passage of ‘Budget 2020’, the Government is to present ‘Budget 2021’ next week, with a set of proposals to confront the prevailing economic and fiscal challenges. Looking at the Budget estimates for 2021, the Government expenditure is estimated to be Rs. 2, 678 billion, a Rs. 140 billion increase compared to this year’s estimation. The health sector has been allocated Rs. 223 billion and the Defence Ministry has been allocated Rs. 355 billion.

The maiden Budget speech of the Sri Lanka Podujana Peramuna (SLPP) led Government will be delivered by the Prime Minister, who is also the Finance Minister, on November 17. This date also marks the completion of one year of President Gotabaya Rajapaksa’s ascendency to power. Prime Minister Mahinda Rajapaksa’s 75th birthday also falls on the next day (November 18). Hence, the Budget for next year is to be presented at an important juncture and it will be an opportune moment for a candid look back on the Government’s performance while taking stock of the future challenges.