US Officials Insist Sustainable Peace Must Include Peace Dividend
by Dharsha Bastians, ‘Daily Financial Times,’ Colombo, July 15, 2016
Visiting State Department officials insisted that accountability and reconciliation in Sri Lanka continues to be a key focus for the US Government, but defended their apparent focus on economic growth and investment on a two-day visit to the island, saying peace would not be sustainable in the country without a peace dividend.
Concerns have mounted about the Government’s commitment to implementing the Geneva resolution it co-sponsored last year and the US Government’s seemingly softening positions on truth and justice processes in the island. But the visiting State Department officials said they were being realistic about the nature of the country’s reconciliation challenges. “But it’s also important to give credit to those who are clearly trying to create a different future for this country,” US Assistant Secretary for Democracy, Human Rights and Labour, Tom Malinowski told a press roundtable in Colombo last night.
“This trip was no different from any other visits,” Malinowski insisted, after the two officials spent two days touring the Colombo Port and a private flour mill in Trincomalee and speaking about economic ties between the US and Sri Lanka in addition to their political engagements.
US Assistant Secretary for South and Central Asian Affairs, Nisha Biswal who is on her sixth visit to Colombo told reporters that for Sri Lanka to move forward on reform and reconciliation it must also move forward economically and that was ‘driving’ her focus on economic opportunity. “For people to be able to move in a direction to make decision and take the steps, they must also see what comes of going down this path. What we in the US firmly believe is that a united and reconciled Sri Lanka is also going to be a more prosperous Sri Lanka,” Biswal observed.
The visiting officials said the US was committed to continued engagement on truth and justice in Sri Lanka, making regular visits to determine ‘what is moving and what is not’. The US officials urged the Government to address the expectations of the people on reconciliation, reform and economic prosperity with a sense of urgency.
Assistant Secretary Biswal said the US Government was seeing a Government in Sri Lanka that was committed to be accountable to its people and its press, even though frustrations were growing about the pace of progress.
“In my conversations with people in Sri Lanka, I see impatience and frustration, but I don’t see despair. There is hope, but also anxiety that this hope will not be realised,” Biswal told reporters yesterday.
Biswal drew stark comparisons with her visit to the island in 2014, when she said she had encountered great despair in Jaffna. “Many people thought the country would go back to conflict. Across Sri Lanka there was a sense that the Government was not responsive or accountable to its people,” Biswal said, referring to what she called ‘dark days’ for the island.
Assistant Secretary Biswal recalled that before January 2015, since bilateral engagement with the Government of Sri Lanka was not working, the US Government had used other international forums to encourage progress on reconciliation. “We were put in a position where the only real avenue we had was to apply pressure through international forums such as the UN Human Rights Council,” she explained. “So there are different ways to encourage progress,” Biswal said, responding to a question about whether the US was toning down its pressure on accountability in Sri Lanka.
Malinowski said the US understands where the scepticism and suspicion was coming from since there was a long history in Sri Lanka of decades of promises not fulfilled. The mere fact that the Government has made an ambitious and principled set of commitments, was not enough to convince people who had lived that history, Malinowski noted.
“We want those people to know that we know that history too, and we are not taking anything for granted,” he said.
Assistant Secretary Malinowski who met with the Defence Secretary and the tri forces commanders during his visit said that one of the most important discussions the US was having was with the military. “We had very candid conversations about the steps that would be required to restore a full military to military relationship with the US, including the need for the armed forces to support the accountability process – recognising that this would be a difficult process for some in the military,” he explained.
Responding to questions regarding the Government’s pushback on the question of foreign judges on a special court to prosecute alleged war crimes, Malinowski said that the Geneva Resolution ‘fully respects’ the sovereignty of Sri Lanka. The Government would determine the structure and composition of the court, he explained. “The Government of Sri Lanka also made a commitment to exercise that sovereignty within certain parameters in ways that could include international participation at various levels,” Malinowski asserted. He said the commitment was made because there was an erosion of confidence in the courts of Sri Lanka. “The commitment was made with the understanding that this whole process of accountability is aimed at winning back that confidence,” Malinowski said.
International participation in the court, was not a remarkable concept, he said. “Sri Lanka itself has contributed judicial expertise to other countries and it has perhaps benefited from that.”
Assistant Secretary, Bureau of South and Central Asian Affairs
I have not been keeping track how often I’ve been coming to Sri Lanka until I saw the papers when I landed, which noted this is my sixth visit in twenty months. It is wonderful to be back here in Colombo, and wonderful to see so many distinguished friends, Ministers, and so many others, including so many from the business community that I’ve met and gotten to know over the years, with whom we work closely to promote trade and investment ties between our countries.
Ladies and gentlemen, this is indeed a remarkable time for Sri Lanka. It’s wonderful to be here to be able to partner with the wonderful things that have happened. Let me just take a moment to acknowledge the great work the Rotarians to all over the work and the incredible impact they have in societies and communities everywhere they are. It’s wonderful to hear a little about what Rotary International is doing here in Sri Lanka, and also to hear about the good work of the American Chamber of Commerce, with whom we also have a deep partnership. I do want to make a note that we often think the work of diplomacy is done by diplomats sitting in Embassies and meeting with government officials, but really the true Ambassadors in any relationship are the private citizens of the private sector, the civil society, the academics who engage and make connections between peoples, societies, and businesses. So it is indeed wonderful to see all of you here, and to see those connections happening between our two countries and peoples.
It is a remarkable time in this country. When you look around the world and you see so many of the countries and communities that are struggling, that are going in a negative directions, so many countries where the politics of division are taking root, here is a country that is coming together. Here is a country that is looking at the politics of unity. Here is a country that is on a positive trajectory. Here is a country that is looking to achieve its potential. This is why this is my sixth trip in twenty months.
In the past 18 months, the democratic progress we have seen and come to expect, the advances in reconciliation, accountable governments, and freedom of expression. These progresses have been paralleled by economic progress in tourism, shipping, manufacturing, and more.
Sri Lanka is showing the world how political reform and economic growth can go hand-in-hand. It is becoming a global example of how a post-conflict, ethnically-diverse country can achieve lasting peace and thriving, inclusive prosperity.
Your country has always had tremendous potential. 50 years ago, many expected then-Ceylon to follow Japan’s path — the path of sustained economic growth — and become Asia’s next commercial powerhouse. All the fundamentals were there – a robust export sector, a well-educated population, strong per-capita income, and a central and strategic geographic location.
However, that potential was not fully realised. We know success doesn’t come automatically because of these sound fundamentals. The inefficient economic decision-making that happened early on in the country’s modern history, but mostly a long and terrible civil conflict, and a tragic natural disaster all combined to keep Sri Lanka on the margins of the global economy for many decades. Even after the war, the lack of progress on reconciliation kept the country divided and the economy weak.
But that is no longer the case. Sri Lanka once again has the opportunity, the will, and the support to achieve what has eluded it for so long. Thanks to the Sri Lankan people’s commitment to democracy and accountable governance, and the good-faith efforts by the current government, over the past year and a half your country is now primed to become the economic success story it was always meant to be.
One can imagine a Sri Lanka becoming a more broad-based economy based on innovation and entrepreneurship. Where Sri Lankan start-ups can create the next generation economy. that takes traditional mainstays of tourism and agriculture. In fact, I was pleased to read in the paper today about venture capital firms partnering with American technology companies like Google to create the innovation funds to power those start-ups. On one of my prior visits I had a chance to visit MAS Innovation, where already some of the next generation technology is being put into use, and Sri Lanka is pioneering the smart clothing and wearable technology that is going to increasingly come to the marketplace in the years to come. It was thrilling to see some of the things being created there. These are Sri Lankan innovations that are powering a global movement.
And no other country, I believe, is more excited about and more committed to this vision and potential of Sri Lanka than the United States. Because as the world becomes more connected through trade and technology, we rapidly realise that our own growth and prosperity will be increasingly be linked to the economic success of countries like yours. Nearly 40 million American jobs already depend on trade, and, if history is any guide, that number will only grow with time.
We all know South Asia is set to be a major driver of that growth. This region has nearly 1.7 billion people – or one quarter of the earth’s population. It has more working-age people than anywhere else in the world, and its economies are growing at an average of over seven percent per year.
South Asia’s largest market, India, is now also the world’s fastest-growing major economy. And Sri Lanka stands to benefit from that growth – India is its largest trading partner globally, and Sri Lanka is India’s second-largest trading partner in the region. Sri Lanka also has easy access to the markets of the Middle East and emerging markets of Africa, a continent that boasts many of the fastest-growing economies.
With your strategic location along the major sea lanes of the Indian Ocean, Sri Lanka has the potential to become a premier transshipment hub, making it a strong, value-added link in the global supply chains. Plugging into those global supply chains will drive investment, productivity, employment, and growth.
In my many visits here, I’ve come to know this country is also blessed with a well-educated, hard-working population with great entrepreneurial spirit. One that includes some of the smartest and most talented men and women I’ve come across in my travels. Sri Lanka’s entry to a globalized market economy can provide a solid foundation for a truly open, unified society that is buttressed and propelled by transparent, accountable institutions and the rule of law.
This fair and transparent playing field will make Sri Lanka a global leader and example for other countries working to overcome periods of adversity. Here I have to say Sri Lanka’s decision to join the Open Government Partnership is a prime example of the country’s leadership. This partnership will give Sri Lanka access to the expertise of other countries striving for more transparent, accountable, responsive government, and a platform to highlight Sri Lanka’s experiences in open government and reform on a global level.
Similarly, Parliament’s recent passage of the Right to Information act will allow citizens to access information on government procedures, policies, and decisions; such openness creates an environment that naturally attracts investors from across the globe. We applaud these efforts and look forward to further political, economic, and social reforms that have been pledged by the government.
Paths to economic reform is not always smooth or easy, but the rewards at the end are well worth the hardships of the journey. As Sri Lanka continues on its path, it can count on the strong support of the United States. Development assistance from our public-sector can strengthen economic governance that will enable investments from our private-sector. That kind of formula for growth will also mean more jobs, higher incomes, and a better life for this generation and the next.
Just a few months ago, our two governments held the latest round of our trade and investment discussions, the TIFA talks, where we adopted a new action plan that aims to significantly increase two-way commerce and investment. This action plan, which is to be implemented over the next five years, covers a wide range of ambitious objectives, three of which I would like to expand upon today.
One proposal would work to strengthen workers’ rights and promote environmentally friendly manufacturing. More and more customers are demanding that the products they purchase, especially their clothing, are sourced in a way that is ethical and environmentally sustainable. Our goal is to increase Sri Lanka’s global competitiveness among this growing consumer base, especially in the United States and Europe – two of the world’s largest markets for garment imports. Sri Lanka has a unique opportunity to seize this moment, building upon its foundation of strong worker protections and respect for the environment, and attracting the growing list of manufacturers whose products meet high ethical and environmental standards.
Another proposal in the action plan aims to lift Sri Lanka’s trade and investment regime to world-class standards. It is a broad and ambitious goal, but one on which we are already making concrete progress. For example, a couple months ago, our Commerce Department worked with Sri Lanka’s Ministry of Power and Renewable Energy on ways to make the procurement system for private power projects more efficient and transparent. Sri Lanka’s energy needs are expected to rise as the economy grows and its people become wealthier, and a more efficient, transparent, and competitive energy sector will better attract the capital and investment needed to build new capacity.
Another area, Sri Lanka’s eligibility to develop a Millennium Challenge Corporation threshold program – thanks to this government’s commitment to good governance – is also a sign of great progress and can position the country for an eventual MCC compact. We have seen in other countries how the “MCC effect” can work as a force-multiplier by increasing investor confidence. We also have experts working with Sri Lanka’s government to help it become a financial services hub, as well as to improve the environment for foreign investment, increase transparency and accountability in public finances, and seek solutions to help address other difficult fiscal issues like budget deficits.
Regionally, we are looking at regulatory and non-tariff barriers to trade and foreign investment in South Asia, and next month Colombo plans to host a forum to explore ways the region’s governments can advance the efficiency and transparency of reciprocal trade, especially through the use of national trade portals and single windows that serve as “one-stop shops” for importers and exporters.
This brings me to the third area of the action plan I wanted to discuss: developing new markets that take advantage of Sri Lanka’s potential as a regional maritime and services hub, on par with Singapore or Dubai. After all, half of the world’s merchant fleet capacity and about 40 percent of the world’s seaborne oil passes through the two straits that bound the Indian Ocean to Sri Lanka’s east and west. Yesterday I saw first-hand the enormous capacity of the Port of Colombo, South Asia’s busiest port and one of the top 30 ports in the world today.
Just last year, Colombo Port handled over 4,000 ship arrivals and processed 5.1 Million containers. The port also provides jobs for over 9000 people, and I understand there are plans for expansion. In fact we saw very a ambitious plan for Port expansion in the tour and briefing we had yesterday. The U.S government has been helping the Colombo Port operate securely and efficiently by providing training and technical assistance through our Container Security Initiative and Megaports project. We have also brought Sri Lankan port officials to the United States to meet and share expertise with our port authorities and our port infrastructure companies in Louisiana, Maryland, New York, and New Jersey.
It takes just a glance at the map to see the economic advantages of Sri Lanka’s geographic location. But fully leveraging those advantages will require the right infrastructure, including ports, roads, and rails. This can be expensive. There often simply isn’t enough public funding – and I can tell you as I drive across streets in Washington with potholes that public funding isn’t always there no matter how developed the economy. But public-private partnerships are often a great solution for getting capital for infrastructure projects, and we are happy to share some of our experience with Sri Lanka in developing these partnerships in an open and transparent way.
Achieving the vision of becoming the maritime and services hub of South Asia will also require the proper legal and regulatory framework, allowing goods and services to move quickly and efficiently into and out of the country.
Currently, there are obstacles in all of these areas; for example, tariffs and tariff-like import charges are very high – sometimes exceeding 100 percent – and serve as a powerful disincentive for trade and foreign direct investment. Investment, while fairly open, is frequently subject to complex and non-transparent procedures.
There is an even greater obstacle to creating a more attractive enabling environment for foreign investment. It is a problem that deters investors worldwide, but it must be confronted. That is a culture of corruption that had been a hallmark for many years and unfortunately still lingers somewhat today. Fortunately, there is recognition at the highest levels of government of the seriousness of this problem. As President Sirisena declared earlier this year, “the current national unity government considers our prime duty to root out of corruption from the country.”
Better regional connectivity will also be critical. As you may know, South Asia is one of the least economically-integrated regions in the world. While that’s an unhappy data point that has hindered the region’s economic development, it’s also one that we view as an opportunity – because it means that smart, targeted improvements can make a big difference.
As part of the Obama administration’s Rebalance to Asia, we’re working on an initiative we call the Indo-Pacific Economic Corridor, which aims to strengthen economic ties throughout the region by improving energy markets, trade and transportation, customs and borders, and people-to-people links within South Asia and between South Asia and Southeast Asia. Fortunately, we’re not alone in these efforts – the Asian Development Bank and the World Bank have many complementary efforts, and we are strong supporters of their many projects that the multilateral institutions are funding across the region.
As I mentioned earlier, there are several other aspects to the joint action plan, and in the coming weeks other U.S. government officials will travel to Colombo to work on the next steps and other ways to deepen our economic relationship. That will include my colleague Assistant Secretary Charlie Rivkin, who runs our Economic and Business Affairs Bureau, as well as senior officials from the Commerce Department and the U.S. Trade Representative.
Already, the United States purchases nearly three billion dollars worth of Sri Lankan products annually. That is more than any other country; we are your best customer. Our purchases support thousands of jobs, providing livelihoods for many Sri Lankans and their families. We are proud of the role we have played in fostering economic growth and prosperity in Sri Lanka. But we know we can, and will do more.
We have also significantly ramped up our assistance to the people of Sri Lanka, especially when it comes to promoting economic growth and financial stability. The U.S. Agency for International Development (USAID) is working with small- and medium-sized businesses to create new employment opportunities, including in economically lagging regions, and is promoting investment and skills-development. USAID programs are also working in the agricultural, dairy, and poultry sectors, helping to connect local producers with markets. And with USAID’s presence anticipated to expand in the near future, we will see even more kinds of these important projects coming online, spurring new jobs, greater incomes, and more opportunity for all of Sri Lanka’s people.
We are moving full steam ahead, because we believe that this is Sri Lanka’s moment. We believe it can be the fulcrum of a modern and dynamic Indo-Pacific Region: a prosperous and open economy that not only thrives in the global marketplace, but drives it to new levels of connectivity and innovation.
Lee Quan Yew once talked about how he hoped Singapore would become the next Sri Lanka. Decades of conflict reversed Sri Lanka’s fortunes and suppressed its success. But now is the time to make Sri Lanka into the next Singapore.
For that promise to be fulfilled, we must recognize the economic future of Sri Lanka is necessarily and inextricably linked to its political future, which must reflect the needs, aspirations, and diversity of all its people.
And as Sri Lanka seizes on this moment, we the United States will be there as your friend and as your partner. We are invested in Sri Lanka’s success because we know that your future and ours are intertwined. Your prosperity and security is intertwined with us, and that the whole world stands to benefit from a strong, unified, and prosperous Sri Lanka. Thank you very much.
Remarks to Press by Assistant Secretary Nisha Biswal and Assistant Secretary Tom Malinowksi following discussions with Foreign Minister Mangala Samaraweera
July 12, 2016
Assistant Secretary Nisha Biswal
Thank you Mr. Minister for the very warm and gracious welcome, and also for the very productive meeting that we’ve had today. This visit and this meeting builds on a tremendous trajectory of partnership between our two countries and enumerated some of the key touch points of that relationship, including last year’s visit by Secretary Kerry, Ambassador Samantha Power, and the Partnership Dialogue we inaugurated in February this year.
Sri Lanka itself has been on a remarkable trajectory of addressing not only the internal issues that have challenged it, but also engaging with the broader international community in a spirit of partnership and dialogue. The United States has welcomed a deepening of ties between our two countries. The United States and Sri Lanka share common goals as fellow democracies, which are both working to promote and protect human rights and fundamental freedoms. We are partners, and today our relations are at an all-time high.
We have been proud to partner with Sri Lanka over the past 60 years, during which development and humanitarian assistance has improved countless lives, livelihoods, and living conditions all across Sri Lanka. We will continue to make substantial investments in multiple sectors — agriculture, enterprise development, education, health care, energy and natural resources, and humanitarian activities. As the Government of Sri Lanka moves ahead with its plans for constitutional reform, for justice and reconciliation, the United States will continue to partner with the government to foster economic development and encourage foreign investment, to work to advance opportunities for all Sri Lankans.
We continue to support the Government of Sri Lanka as it takes meaningful and concrete steps in response to concerns of its people related to democratic governance and advancing respect for human rights, for reconciliation, for justice and accountability. We can envision a future which brings benefits to both countries, and to peace and prosperity and security across the Indian Ocean as Sri Lanka assumes a greater role as a key partner in this region. As Sri Lanka assumes its great potential as a hub and a gateway to connect to a rising economic societies of South and Southeast Asia.
Much work remains, but the United States is committed to partnering with the Sri Lankan people to address challenges and help this country and its people to realise their true potential.
Assistant Secretary Tom Malinowski
Minister (Samaraweera), I want to thank you for all the work you have done for our relationship, which is better than it has ever been before. I want to say just how much we respect and appreciate the work you have done to help restore and strengthen Sri Lanka’s international position. Sri Lanka’s diplomatic success in the last year and a half has happened in good measure because of your integrity and because of the weight that your word carries in the international community. That is a very tangible benefit to this country.
In the last few months, and in particular the last several weeks, we have seen Sri Lanka take very concrete steps forward in its reform, democratization, and reconciliation agenda: the bill to establish an Office of Missing Persons, ratifying the convention on disappearances, additional land releases by the military, the President’s very important directive on arrests under the PTA, progress in work on the constitution. A lot of this work was foreshadowed in last year’s Human Rights Council resolution. That resolution embodied commitments the Sri Lanka people have made in their own national interests to restore accountability and the rule of law to their country. The United States was a co-sponsor of that resolution, and as such we feel we have a shared responsibility to help see this process through. So we look forward to supporting Sri Lanka as it puts into place the remaining institutions and reforms that the resolution endorsed. We very strongly commend the government for working closely with United Nations and High Commissioner Zeid to advance that progress.
I also want to strongly second my colleague Assistant Secretary Biswal’s comments on economic development and on the opportunity and responsibility we have as a partner of Sri Lanka to help the people of this country achieve the peace dividend that they so deserve. I want to stress that in our minds these two objectives — economic development and reconciliation — go hand-in-hand. Without a peace dividend, it will be harder to pursue reconciliation.
But reconciliation is also advanced, as we have seen in country after country in the world, where people can come together rather than let themselves be split apart. In a larger sense, this reminds us why what is happening in Sri Lanka is so important to people all over the world, because if you look at what’s happening in the world today, there’s obviously not a lot of good news to be found. A lot of the problems that we see are rooted in something that Sri Lanka knows all too well — this contest between the politics of division and the politics of common ground. We’ve seen, unfortunately, in many places around the world that it is easier to win in politics by making simple appeals to racial, religious, or national pride, than by doing the hard work of governing. Easier sometimes to blame others for our problems than to take responsibility ourselves. In that way you can distract people from your own failures and lack of vision.
I think the people Sri Lanka have shown us again and again, that regardless where they come from, or what language they speak, or what faith they belong to, everyone has the same fundamental interests. Everybody has an interest in peace, everyone has an interest in law and order, in accountability, in moving this country forward. The people of Sri Lanka chose a government that seeks to serve all its people rather than setting them against each other. For that reason, the whole world needs Sri Lanka to succeed and to show others the way. We are proud to be your partner in that effort.
Thank you very much.