DEVELOPMENT-SRI LANKA: Economy of War-torn Area in Tatters

By Feizal Samath Reprint | | Print |

Feizal Samath

JAFFNA, Sri Lanka, Jul 24 2001 (IPS) - Workers at the KKS cement factory gather at a temporary office in the northern Sri Lankan capital and sign an attendance register two or three times a week.

But there is no work at the country’s biggest factory in the north, which once employed more than 3,000 workers and helped sustain hundreds of families. “We just go to the office and sign the register a couple of times a week, but there is no work,” said a senior management staffer.

The government has been paying the salaries of about 100 workers for years despite no production or output, as business has been shut down by the conflict stemming from the Tamil Tigers’ armed insurgency.

On Tuesday, Tamil Tiger rebels were blamed for a major attack on an air force base near the Colombo international airport. It is the latest attack in their nearly two-decade quest for a separate state in the north and east of this island nation.

Like many other factories in the north, the KKS cement production facility has been closed since June 1990, after violence escalated in the region. The factory, in the vicinity of a military base, is unlikely to be reopened for a long time, even if Jaffna returns to peaceful times.

Jaffna’s economy, once a major contributor to Sri Lanka’s Gross Domestic Product (GDP), has been in tatters since Tamil separatist rebels began their bloody campaign for a separate homeland nearly two decades ago.

Indeed, Sri Lanka’s north and the eastern regions have been virtually ignored in the official computation of key economic data.

Sri Lanka’s economic growth is calculated minus some sectors in war-torn areas — unfortunate for a city like Jaffna that once supplied 40 percent of the fish needs of the south, where the national capital Colombo is located.

Jaffna’s other produce — rice, vegetables, mangoes — used to go to the south from here, but not anymore. “Before 1983 we had a thriving economy with vegetables, onions and potatoes in plentiful and supplied to the south,” recalls Kandiah Kularatnam, president of the Jaffna Chamber of Commerce.

In addition to the cement facility, dozens of factories — powerloom factories, caustic soda units, glass, aluminium, ice and the entire small and medium industry — have been ruined by war and conflict.

Traders yearn for the peace of the days of the 1950s and 1960s, when contacts between the north and the south were smooth and people were friendly.

“Those days were wonderful. Our southern friends relished Jaffna’s famous ‘palmyrah toddy’ or mangoes” said one trader nostalgically. The main market in Jaffna has its share of foreign apples and pears brought from Colombo, but few buyers.

“Life is difficult and things are costly,” added a young housewife who selects some fish at the nearby market.

The license or pass regime makes life complicated for Jaffna traders. “Apart from the numerous passes that are compulsory for travel in different parts of the city — national ID, army pass and navy pass — we also have to process a lot of documents and spend a lot of time doing this to bring goods from Colombo by ship,” said Kathigesan Nithiyananda, secretary of the Jaffna chamber of commerce.

Speaking in faultless Sinhala, the language of the majority group in Sri Lanka, he says the trade is taxed twice — they pay fees on goods brought by ship and again on turnover.

“We have appealed to the authorities but there has been little response,” Nithiyananda said, arguing that if taxes are reduced they could bring down the prices of goods that are much costlier than in Colombo.

Traders spend hours at civil affairs offices attending to documentation to “import” goods from Colombo. “The way things are run here, Colombo is like another foreign country,” said Kularatnam, citing the travel restrictions in and out of Jaffna.

In recent months, ambassadors and high commissioners from the United States, Britain and Canada have joined other foreign visitors to Jaffna to assess the situation there. Jaffna chamber officials asked them to persuade Sri Lankan authorities to relax the restrictions in Jaffna.

About four ships come to Jaffna from the south bringing food and other items monthly. Sometimes they come together, causing congestion, or come after long periods, causing shortages and a sharp increase in prices.

“There is no system or proper schedules in ship arrivals. We are at the mercy of others,” said Kularatnam. The traders have also requested authorities to open or clear the road to Jaffna from the south to enable uninterrupted distribution of supplies.

But that is wishful thinking given the security situation in the north, parts of which are controlled by the LTTE, particularly stretches of road from Vavuniya to Elephant Pass on the Kandy- Jaffna main highway.

Fishermen are the worst hit by the situation. At a fish market at Gurunagar near Jaffna, a few traders gather round and bargain with fishermen trying to sell their meagre catch. On this day, there are few crabs and small fish up for grabs.

Fishing is restricted to a few hours and fishermen are permitted to use only row or sail boats and go up to three miles offshore, compared to 22 miles many years ago.

At the Gurunagar jetty, a few or fishing craft come ashore with the daily catch. “Not good today,” grumbled one man as he pulls his boat. In the distance, one can spot the Pooneryn lagoon, much of which comes under the control of the rebels.

The number of fishermen has fallen to 1,200 from 1,800 as some take up other, as fishing is unproductive and earnings low. The fishermen’s daily catch is five to six kilogrammes compared to 500- 600 kg in the past.

Much of the city’s economy revolves around foreign remittances. A sizable portion of Jaffna’s population is abroad — up to 30 percent by some estimates — and most of their earnings are sent back to sustain families here in the absence of proper jobs and incomes.

Jaffna is also suffering a brain drain due to the conflict, and losing much of its youth to jobs in Colombo or abroad.

The going rate for a ticket and visa to “freedom” in the west, through illegal channels, is 1.3 million rupees (15,000 U.S. dollars). “When my children grow up and leave school, I intend to sent them abroad with the help of relatives there. There is no future here. Either you suffer without a proper job or join the Tigers,” said a teacher.

Most youngsters who go abroad — Canada is the preferred destination now — are able to earn sufficient money in a year to pay back a relative who sponsored them on often, dangerous trips across many countries, either by air or by sea.