Goodbye, Khema’s Boy! You Left Us But Not Your Ideology

Mangala Samaraweera

By W A Wijewardena –AUGUST 30, 2021

Dr. W.A Wijewardena

Khema’s Boy is no more with us

It is with deep sadness that I learned of the passing away of the liberal politician and former Finance Minister Mangala Samaraweera. He made a heroic battle against COVID-19 that had infected him earlier. Despite the sad news circulating in the social media for some time, we still had the hope that he will eventually defeat his enemy. But like any other mortal human being, finally he had to give up and succumb to the deadly virus. He is not just one among many thousands of fellow Sri Lankans who have done so. He deserves a special appreciation on account of his contribution to Sri Lanka’s politics, economy, and the governance system. I would devote this appreciation to his contribution to economy and economic reforms.

The bold decision maker

I have had a good relationship with him for more than three decades while I was in the Central Bank and since my retirement from the Bank. He was one politician who had a patient ear to listen to others. He also made quick and bold decisions. One such instance was when he became the Minister of Posts and Communications under Chandrika Bandaranaike’s presidency.

As the Minister in charge of the postal department, we brought to his notice the deteriorating situation in the department and the need for improving postal services. But the necessary funds had to be raised by increasing the postal charges since the department could no longer depend on Treasury funding. But the amount involved was a mega increase and we feared that as an up-and-coming politician he would not risk his popularity for a worthy cause. Hence, we suggested to him that it would be advisable to do it in stages.

His response was quick and straight. He said that if it were something that should be done, it should be done immediately. “If people wanted to blame me for a good thing, let them do it once and not every time when I increase the postal rates,” he announced and went for a single mega increase. In his boldness, I found Sri Lanka’s version of Lee Kuan Yew and Goh Keng Swee of Singapore who too made such bold decisions.

Reforming telecom sector

Then came the reform of the telecommunication sector in the country. Since 1858, it had functioned as a government department which had been converted to a public corporation in 1991. With no new investment in fast changing technology in the sector, this outfit was the essence of inefficiency within Sri Lanka’s public sector operations. A Sri Lankan had to wait a minimum of four years in a waiting list to get a telephone connection. Even that would have happened had he known the right people in the corporation.

President Chandrika had decided to invite foreign capital and technology to make it a modern telecom company. This important task fell on Mangala as the Minister of Communications. But it was a hotbed of trade union action that could have paralysed the entire country had it been handled in the wrong way. Hence, it was a suicidal mission for a minister and any other person would have thought twice before agreeing to undertake that task. For Mangala, it was difficult and challenging and not impossible.

The reform-minded animal within him forced him to work day and night, negotiate with prospective foreign investors as well as trade union leaders, and deliver what President Chandrika wanted within years. That was how Japan’s Nippon Telegraph and Telephone Corporation, popularly known as NTT, became a part-owner of the outfit that was known as the Sri Lanka Telecom. The militant trade unions were appeased by offering share ownership in the new foreign-Sri Lanka partnership. In the history of public sector reforms in Sri Lanka, this was a major achievement.

New technology and investment poured into the company, employees who now felt that it was their company began to work hard and smart, and Sri Lanka Telecom was able to expand its capacity beyond the demand for landline telephone services. Within a few years, instead of frustrated customers chasing after the Telecom for a landline connection, the Telecom was going behind citizens to take them as new subscribers. That was the marvel of Mangala’s achievement.

Recently, when I reminded him about it, the humble man within him corrected me quickly saying that it was a teamwork and not an achievement by him alone. But those of us in the Central Bank knew how hard it was for him to get even the support of his Cabinet colleagues to divest a part of telecom to NTT.

A man with hands-on experience in finance

After he became the finance minister in late 2017, there was a group of people who had started a slander campaign targeting him. Their claim was that he, being a fashion designer, was not fit to hold that post which required a knowledge of high finance. But he had a hands-on experience in the finance ministry during Chandrika’s time as her deputy. On top of this, he was a good listener, learner and a man of pragmatic disposition. Hence, I knew that he was the best choice in the previous Good Governance government to hold that post.

When he took over the ministry, Sri Lanka had been undergoing a mini version of the macroeconomic crisis which the country is undergoing today. The budget was in a precarious situation with a low revenue base and a stubborn high overall deficit.

The central government debt had been rising both in absolute terms and relative to the GDP. The country’s foreign reserves were falling, putting pressure for the rupee to depreciate in the market. Only a lip service had been paid by the Government to the needed economic reforms.

Growth was slowing down and it was obvious that the country would descend to the near zero or negative range. Despite the arrangement with IMF for an extended fund facility or EFF, the top Government leaders had not been fully convinced of its necessity. Thus, he had walked into a bed of burning coals and not that of roses. It seemed that he himself would get burned while driving the entire country to rising flames.

A listener willing to learn

It was in this background that he called me to a meeting at the finance ministry. It was a one-on-one meeting except for the presence of his deputy, Eran Wickramaratne. Mangala said that he wanted an independent opinion on the state of the country’s economy. We made an objective assessment of the precarious situation of the economy, the need for implementing the IMF program in all sincerity and not as a duty, and the priority to be given for economic reforms.

It was a fruitful meeting and Mangala showed his willingness to learn anew of the issues involved. We departed agreeing to meet again or contact each other whenever an issue needing his attention arose. He kept to his undertaking dearly.

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