An ailing economy, but few are complaining

By Nirupama Subramanian

COLOMBO, DEC. 22. Sri Lanka's economy is ailing, so everyone is wearing sackcloth and ashes and is on a diet of bread and water, right? Wrong.

For sheer living it up, the Sri Lankan capital takes the cake. The rupee has tumbled against the dollar, prices are high, but if the cost of living is pinching anyone, they do not live here perhaps.

While the Government is out on the prowl in the money market, borrowing heavily to pay off oil bills and prop up its escalated defence spending, Christmas-time revellers are packing the streets, malls, restaurants and nightclubs, with some outlets offering late shopping hours to take in the demand.

``We are not complaining,'' said Ms. Otara Chandiram, owner of Odel, Sri Lanka's biggest clothing retailer, that uses the country's export garments manufacturing base to stock world designer labels at throwaway prices. Though exact numbers were not immediately available, sales this festive season had already outstripped last year's performance for the same period, she said.

The buying spree is not confined to clothes. Thirty-one new Volkswagen Beetles, not exactly a snip at Rs 1.9 million each, were snapped up from the dealer even before the car was officially launched here last month.

The austerity drive launched by the Government earlier this year to offset spending on the war seemed but a distant memory as members of parliament, new and old, queued up for their duty-free car import permits.

The main opposition United National Party (UNP) is campaigning against the Government's handling of the economy. Its leader, Mr. Ranil Wickremesinghe, forbade all but first-time MPs of his party from collecting the car permits.

A few UNP parliamentarians abandoned their plush vehicles a couple of days ago and rode to work on bicycles to protest against high fuel prices. Earlier, they had arrived at Parliament in bullock carts.

But while the high cost of living has definitely crippled the lifestyles of the salaried and further impoverished the poor, it seems have to bypassed many in the capital. Every evening, families flock to a multi-lane bowling alley to test their skills for as much as Rs. 275 a game per head, and later dine at one of the eateries offering cuisines from all over the world.

For the more deep-pocketed, five-star hotels are offering New Year eve extravaganzas on a book-now-to-avoid- disappointment- later basis. The Hilton, for instance, will set customers back by Rs. 9,000 a couple on December 31 for dancing in its ballroom, and by Rs. 5,000 per head for a special meal.

One explanation given for the high spending power of a section of Sri Lankans even in these bleak times is ironically, the war economy. While the defence expenditure is a nightmare for planners, it has created massive wealth for a section of the people, and pushed up the lifestyles of even those who are on its fringes.

Sri Lanka's economic growth in 2000 is projected to touch a reasonable 6.3 per cent by the year end, and analysts reckon that while the main factors for this were garment and tea exports, some part of it can also be traced to the war economy.

Inward remittances by the army of Sri Lankan maids and other workers abroad have helped even the rural poor cushion themselves against inflation, and keep their purchasing power from falling drastically. The State-run Daily News has reported that remittances from expatriates have touched a new high of $752 million.

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Section  : International
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