CENTRAL BANK OF SRI LANKA must seek NON-INTERFERENCE not INDEPENDENCE
Who wants to make Sri Lanka’s Central Bank “independent” & why? Who drafted the clauses? What is the sudden rush to make Sri Lanka’s monetary arm “independent”? Who included “The Central Bank shall be autonomous and accountable as provided for in this Act”. Accountable to whom? Who included “The autonomy of the Central Bank shall be respected at all times and no person or entity shall cause any influence on the Governor of the Central Bank or other members of the Governing Board & Monetary Policy Board or employees of the Central Bank in the exercise, performance and discharge of their powers, duties and functions under this Act or interfere with the activities of the Central Bank” (Clause 5.3). Is the clause implying that even Sri Lanka’s judiciary cannot take action against the Central Bank & its members? So long as the Sri Lankan citizens are paying the salaries of the Central Bank, and so long as sovereignty is inalienable & with the people of Sri Lanka as vested in the Constitution of Sri Lanka, the Central Bank is no supra body and the Governor is certainly not above the President of Sri Lanka to be immune from any accountability. It is therefore, imperative to know who drafted the clauses in this Bill presented to Sri Lanka’s Parliament for obviously none inside Parliament has read a word to realize the gravity of the clauses.
No country is today truly independent – every nation is interdependent. When taking loans, countries have to abide by pre-conditions even though they have to pay the loan as well as the interest. When trading, there are conditions laid out which countries have to fulfil. Nothing happens in black & white & nothing can be judged in black & white either.
In July 2020 the US anti-trust subcommittee heard testimonies of CEOs from Amazon, Apple, Facebook & Google accused of abusing their position & invading user privacy via their surveillance networks. It showed there was nothing much the US Govt could do or would do & in fact Govt intel operatives ended up seeking help of the tech firms for various espionage work. “independence” was a mere word used.
The Cambridge Analytica/Facebook also showed how personal data is compromised without consent. Some 87million FB users were compromised using thisisyourdigitallife app from which psychological profiles were built & the data was used for political campaigns. Again, we are told these platforms are “independent” but they are not.
Even the UN is heavily influenced by powerful nations. Though we are made to believe all countries have one vote – that 5 countries have veto power shows an imbalance, that 500 years of colonial crimes have never been accounted for while the perpetrators of these crimes are today the “watchdogs” for human rights & freedoms highlights the hypocrisies that prevail.
From politics, to technology, to economics/trade, military/weapons industry to cultural hegemony where national cultures & traditions are being unfairly diluted with bizarre values & practices via numerous political programs that nations have to agree to, highlights there is no independence for countries today.
If you have understood this, you will then understand or at least question why the central bank of Sri Lanka wishes to be “independent” & why its Governor & CB should gain immunity that even the President of Sri Lanka does not have. How can the Governor & Central Bank that enjoys salaries paid by the tax payers of Sri Lanka claim to be not answerable to them.
Who tabled the Bill aiming to repeal the existing Monetary Law Act? Susil Premajayantha. Has he read the clauses of this Act before tabling it?
The Central Bank is just another entity within the State of Sri Lanka, if one entity seeks to be “autonomous” does it imply all other statutory bodies within the State of Sri Lanka are next in line to be made “autonomous”? What will happen to the State of Sri Lanka when all state entities claim to be above the law & not answerable to the State of Sri Lanka including the citizens.
The constitution of Sri Lanka clearly bestows powers of sovereignty in the people. The people delegate their powers to the 3 pillars that are elected by election for a term of office. The Executive, Legislative & Judicial policies are delegated by the People to these 3 branches. The Parliament holds legislative powers that is delegated by the people. The Cabinet together with the President carry out executive functions. The Central Bank 5.4 clause therefore cannot be dislocated from this delegated power WITHOUT seeking the mandate of the People by simply getting a Member of Parliament to present a Bill. Article 148 of Sri Lanka’s constitution gives Parliamentary control of public finance. The Central Bank cannot control public finance without being overlooked or held accountable.
The ironical aspect of the Bill is that while clause 5.3 seeks to be immune from Sri Lankan accountability clause 85 claims the Central Bank can function “under the advice of international bodies”. Central Bank wants to be “independent” of the state of Sri Lanka but take advice from international bodies!
The nation’s economic policy encompasses many areas that cannot be ignored & disassociated or delinked. The economic policy of Sri Lanka is simply not “monetary policy” as the pushers of the CB Bill is attempting to do. Moreover the fiscal policy under the purview of the legislature requires the CBSL to function as administrators of governing borrowing. Therefore, CBSL cannot be ‘autonomous’ of this role. While CBSL has to understand that fiscal policy & monetary policy go hand in hand and cannot function as a separate and “autonomous’ “independent” body in a sovereign state. Attempts to dislodge & delink the two is only an insidious attempt to further economically & socially collapse Sri Lanka for geopolitical agendas.
What was the purpose of granting unilateral powers to the CBSL to make monetary policy immune from the state apparatus? If CBSL wishes not to listen to or act with other players within the state, would state apparatus also listen to CBSL? If such a scenario arises, what good does it bring Sri Lanka & its citizens. Why are the CBSL senior management silent regarding these dangers, surely they must understand the greater dangers at play. Why do they want to take advice only from international players & be autonomous from the State of Sri Lanka?
The Bill is like most foreign infused drafts that fall short of study & have been hurriedly pushed & peddled for international political gains. While CBSL wishes to be autonomous there are clauses like 26(1) requiring the Minister to sign an ‘inflation targeting agreement’ though the Minister has no powers except to simply sign on a dotted line as per CBSL instructions. Since when did elected representatives take orders from officials paid by the tax payers?
The CBSL Bill puts elected representatives to the role of peons as seen in Clause 28 there CBSL simply ‘informs’ the Minister through reports about the policies CBSL is adopted. Then Clause 84 of the Bill states that the CBSL can “advise” the Government but there is no provision for the Government to instruct or advise the CBSL. Moreover clauses 10 (1) (13) read with Clause 7(1) allowing CBSL to “determine” & “implement” without directive of the Legislature & Executive is tantamount to usurping the sovereignty of Sri Lanka.
Why should the CBSL & a bunch of taxpayer paid officials become more powerful than all of the 3 pillars of governance?
The manner the bigwigs of the CBSL has been listening to international monetary agencies & even foreign governments in its policy decisions over & above the advice given by the government shows that the CBSL can never be “independent” & “autonomous”. In fact, the Bill is seeking to simply break the existing link to the GoSL & state of Sri Lanka & have the CBSL function as a foreign-guided monetary policy arm. The case of the Latvian Governor of the Central Bank is important to understand the dangers at play.
In recent weeks the news has covered Sri Lanka’s foreign minister, unelected & entering through the backdoor national list seat proudly claiming to use Indian currency in Sri Lanka. The CBSL Clause 47(2) is allowing any currency as legal tender for transactions in Sri Lanka. This is a violation of Sri Lanka’s sovereignty as given to the People in the constitution. How can a team of tax payer paid officials decide what currency is used in Sri Lanka without Cabinet or Parliamentary approval while the citizens cannot file FR cases against such with the Judiciary? Undermining matters further is clause 37 that gives virtual unilateral powers to the CBSL to deal with Sri Lanka’s foreign exchange policy with absolutely no involvement of the Parliament or the Cabinet.
CBSL cannot be a part of Sri Lanka yet by operation not be part of Sri Lanka while making decisions on Sri Lanka without the involvement of the Legislature, the Executive & immune from the Judiciary. While seeking to be “autonomous” the CBSL desires to be the supra body above the 3 pillars that the People of Sri Lanka have delegated their sovereign powers to. CBSL is only a small yet important entity within the state of Sri Lanka, it cannot attempt to disassociate itself yet function as “executive” when the executive & legislature are democratically elected.
However, whoever drafted the Bill are attempting to do some mischief while the CBSL senior staff are faulted for not highlighting the inconsistencies of the Bill for they should know the dangers & the ramifications of the Bill to Sri Lanka if they were patriotic enough to understand.
Shenali D Waduge