Sri Lanka losing to Africa due to ‘political market failure’: economist

Sep 12, 2009 (LBO) – Sri Lanka’s tendency to follow policies that hurt the average voter and makes the country lag behind other countries is due to ‘political market failure’ where small groups push policy without evidence, a senior economist said. “This is one of the most literate and educated populations in the world,” Shantanayan Devaranjan, World Bank’s chief economist for the Africa region said at the 2009 annual session of the Sri Lanka Association of Economists.

“But when you compare it with the evidence-based policy debate in Ghana or India or Bangladesh it is much more than in Sri Lanka.”

Evidence Based

When Ghana embarked on a reform program the government had gone on TV and debated with economists, challenging and debating policies.

People had argued policies through newspaper articles. But in Sri Lanka there was very little evidence based debate in newspapers.

He said Sri Lankans wish for natural resources such as oil, but many African countries which were rich in natural resources had also lagged behind nations such as Korea which were not rich in natural resources.

Natural resources exports had sometimes appreciated exchange rates, hurting manufactured industry. In many African countries a conte