In the backdrop of the Panama Papers leak, economic and minority shareholder activist K.C. Vignarajah in an open letter called on the President and Prime Minister to retrieve the dollars siphoned off in the past in order to address the country’s fiscal deficit. “The shock of the Panama papers leak is yet to be digested. There were many corrupt corporates, controlling interests and allied politicians who had sent the country’s enormous portion of wealth and income abroad as reconfirmed by the latest reports,” he said. Vignarajah said that instead of the tax increases which are set to be implemented on May 2, the retrieval of funds should be given higher priority. “There should be no more taxing of poor people and the genuine enterprise sector as their monies in various forms have been taken away by a few.
Therefore, it is imperative that those stolen monies are brought back to correct the macroeconomic crisis situation, and for repayment of loans, development,” he said. The government is increasing taxes ahead of an International Monetary Fund agreement to help improve the country’s reserve position. The reform requirements—focusing mainly on taxation and revenue—attached to the new facility are said to be even more comprehensive than in the past. Vignarajah said that the funds siphoned off were collected through exchange- rate and interest rate manipulations, stock market pump and dump, reduction of public float, de-listing and various purported investments overseas.
It is interesting to note that the present government had leveled wide accusations of this exact nature at the past regime and its associates, but has up to now not covered much ground in bringing the corrupt individuals to justice. “The mafia seems to be yet powerful enough to thwart all the good intentions and promises made by the Yahapalana government. We don’t need to put them for long periods into jail (people’s cost), provided they bring the wealth and income generation spirited away under various ruses,” Vignarajah remarked.
He noted that a competitive rupee, low interest rate and an efficient financial and administrative infrastructure are essential for vitally needed rapid export growth. “Abundance of dollars siphoned away when brought back will finance a glorious revival and a renaissance. Sri Lanka can once again regain its glorious values and prosperity of the late 1940’s and early 1950’s,” he said. He added that converting Chinese loans of the past government into equity in listed companies is the right step to be taken to improve the country’s debt situation