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Reflecting on Middle Income Country status and post-war context

Posted by Priyanthi Fernando

29 Apr 2014

by Priyanthi Fernando

If we leave some of the rhetorical utterances such as the Small Wonder of Asia, aside, there are two frequently used descriptors of the Sri Lankan context.  One,   that Sri Lanka is a Middle Income Country, and two, that Sri Lanka is a post-conflict country.   I would like to examine these descriptions in slightly more depth. 


Let’s take the  Middle Income Country idea.  It has significant impact in terms of Sri Lanka’s relations with the international donor community, and we have ostensibly lost some of our bilateral development partners and international NGO presence because of that.   But being a Middle Income Country merely means we fall into a particular GNI per capita category, and most of us should by now realize that this is not a good enough measure to judge peoples’ well being. It is insufficient on a number of counts.  It does not take into account intra-country inequalities nor does it take into account the multidimensionality of deprivation.   It’s an average, that really means nothing to the tea small holder in Badulla who has not had sufficient income to fertilise the family tea bushes and is faced with declining productivity;  it means nothing to the young widow in Mullaitivu, who is faced with the dilemma of rebuilding her home, looking after her young children, and making ends meet; it means nothing to women in the fisher community in Trincomalee collecting matti to sell on the market.  


We know also that many of the world’s poor actually live in Middle Income Countries but in Sri Lanka we are very proud of our declining poverty statistics.   I am not challenging the statistics.  It is more than likely that income poverty, measured as it is by the Department of Census and Statistics is declining.  Other people have run the same analysis with the same data and got similar results.  But what does this actually mean?  It only means that the number of people who are below  our poverty line is declining.  But what is this poverty line?  How immutable is it?  what happens if we shift it upwards?  a lot more people would be considered ‘poor’  - which means that  there is a lot of people hovering just above the poverty line, and who can fall back into poverty if they have to face any shocks.  Mr Wimal Nanayakkara, former Director General of the Department of Census and Statistics, and now a fellow at the Institute of Policy Studies, says that between 2006/7 and 2009/10 we managed to push about one million people out of poverty, but that 800,000 of them are hovering just about the poverty line, and are vulnerable to lapsing into poverty.  


We (the Centre for Poverty Analysis) also did a study recently looking at food security[1][2] and poverty at a district level using HIES data, which demonstrated some counterintuitive findings – for instance  in districts where poverty incidence was high (Nuwara Eliya), food security was also higher and where poverty incidence was low (Gampaha District) , food security was also low.  Maybe we can hypothesise here that given that the poverty line measurement includes  expenditure on food and non-food items, high non-food spending in districts like Gampaha, pushes the poor out into a non-poor category,  even though their expenditure on food itself will be limited, and therefore increasing food insecurity.   In poorer districts e.g. Nuwara Eliya, there is less money being spent (so that is why they are poor)  but if it is spent it is spent mostly on food items, and this will help households to be food secure.    


So becoming a Middle Income Country does not mean that we have alleviated poverty, or resolved many of the problems relating to inequality and disadvantage.  But we also cannot deny that the country and the people have achieved some level of  ‘prosperity’.  But ‘prosperity’  also brings with it different challenges.  We really do not know enough about the  implications and ramifications of prosperity such as inequalities (i.e. who is benefiting from this prosperity), aspirations (what are people aspiring to? And what is the impact of those aspirations?) indebtedness and issues of conspicuous consumption (some interesting issues coming out of a study we are doing on housing in the north which shows that these programmes have left people in debt, mostly because they wanted to expand their concept of a house and because they did not have the economic opportunities they thought they might have to pay the extra loans), equitable growth, inclusive and sustainable development (i.e. who is it leaving behind, and is it being achieved at the expense of future generation’s access to environment?) 


The second descriptor of the context – is the term ‘post-conflict’.   There is little disagreement that we are not in a post-conflict situation (as Chief Minister Wigneswaran points out in the Sunday leader today, many of the problems that led to the conflict, are not yet completely resolved).  The situation we are in could be described better as post-war, which means that there has been a cessation of fighting and overt violence. And often this descriptor refers to the situation in the North and the East where the fighting was severe.  In my mind we should be describing all of Sri Lanka as being in a post-war situation, because we see that the war has affected all of us,  north and south, Tamils and Sinhala, and all of our institutions and our governance systems and even our way of thinking and behaving. It has polarized communities.  The growing militiarisation and centralization of government, the encroachment of the military into commerce and other spheres,  the disregard for lives and livelihoods of people with no voice, we can see this in Colombo as well as in Jaffna or Mullaitivu.  Every time I pass the area behind TempleTrees where the washerpeople used to hang out their clothes to dry, in a piece of land that was bequeathed to them by the State during Dutch times, and which is now an asphalt car park, I am reminded how people are literally bull dozed in the name of development. 


One of the major issues in our post-war context, for me, working as I do in the knowledge sector,  is  the diminishing space for dialogue and debate (much of it self-censored out of fear) and the lack of any sense that citizens have a right to information.  For instance, the Divineguma act actively prohibits the sharing of information.  Last week I was at a meeting convened by the World Bank on the Metro Colombo project – and there was quite a lot of discussion about the  potentially negative consequences on the overall physical environment of Colombo,  of this lack of openness and the unwillingness of government departments to talk to each other, let alone the public.  In CEPA’s interactions with the citizens of Colombo, especially those from the high density settlements, we learn that they are not informed, much less consulted about the developments that are taking place in their neighbourhood. 


Of course, the post-war situation in the north, does deserve special attention, and will not be resolved purely by building roads and restoring infrastructure.   Attention needs to be paid to what has been described as the “dark matter” of conflict  i.e. things that are not tangible (or easily observable) - mistrust among groups, stereotypes, politicised identities, trauma, standards of masculinity, unexpressed fears, and expectations from the state. 


There are other characteristics of our social context, that are possibly indirect consequences of both of these basic descriptors of the Sri Lankan situation.    The growing gender based violence (no hard data yet to back that up) is the result, in my opinion, of the growing violence in Sri Lankan post-war society and the strengthening of patriarchy, (a result of the standards of masculinity that war engenders), also bolstered by consumerism and the commercialization of sexuality.  A colleague was talking to me about her niece, a young woman medical student in the Colombo Medical Faculty, who is straining against the very sexist attitudes of her University professors (who do not allow women students to do lots of things that the men students do, such as practising resuscitation) and also of patients, who perceive the young women medical students as just girls, and the young men students, as ‘doctors’.  I am reminded of the research CEPA did in Badulla District on different dimensions of poverty,  where we found that women were often more educated than their husbands, but that they were ‘willing’ to stay home without going out to work so as to maintain their husband’s status in the family.   We have also heard several very sexist pronouncements by high level government representatives, including the Speaker of the House of Representatives, and MPs, and senior civil servants.  At a policy level, we are trying to deny women the opportunity to migrate for work because for policy makers a woman's place is in the home, looking after her children.


Another characteristic of our Middle Income Country status and post-war situation is our unrelenting pursuit of economic growth.  After all, one could argue,  it is this pursuit of economic growth that has given us this status, and as economists endlessly keep pointing out economic growth is necessary for everything: for eradicating poverty, for reducing unemployment, for dealing with population growth and environmental degradation.  The challenge is:  how can we distribute more equitably the fruits of this growth, and how can we ensure that growth remains within the natural limits?  


Dr Prashanthi Gunewardene, from the University of Sri Jayewardenepura,  talking at CEPA’s Symposium 2013, observed that unlimited economic growth runs the danger of depleting natural resources and creating waste emissions that are beyond the assimilative capacity of the environment.  Sustainable growth therefore requires that the rate of use of a renewable resource should not be greater than its rate of regeneration;  or the rate of use of a non-renewable resource, should not be greater than the rate at which a renewable resource is substituted for it.  Similarly for a pollutant, the rate of waste emission needs to be within the assimilative capacity of the environment, and where the environment has no absorptive capacity for a pollutant releasing it ought to be banned.  She very rightly observed also that is was not easy to restrict growth within such a framework because some groups in society benefit from unsustainable economic activities, and because markets fail to recognize the costs related to uneconomic growth (e,g, health costs which are reflected as positive gains in national accounts).


Definitely a time to start re-imagining  our Middle Income Country status, and our post-war context, don't you think?



This blog post is derived from a presentation made at the UN Country Team's annual retreat, on February 13, 2014. It was first published here.


[1]  Geetha Mayadunne and K Romeshun (2013) Estimation of prevalence of food security in Sri Lanka, Sri Lanka Journal of Applied Statistics Vol 14:1

[2] Definition: “Food security is a situation that exists when all people, at all times, have economic, physical and social access to sufficient, safe and nutritious food that meets their dietary needs and food preferences for an active and healthy life”.  The State of Food Insecurity in the World 2001 (FAO 2002b)

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