US resolution: What will the impact on Sri Lanka be? Brief insights from Asia Wealth

With the country abuzz with the contentious US resolution on Sri Lanka at the ongoing UNHRC sessions Asia Wealth Management Research team has come up with a brief analysis of the move’s impact if any.

Here are excerpts from Asia Wealth’s analysis:
The US proposed resolution on Sri Lanka in the current session of the UNHRC calls on the Sri Lankan Government to implement recommendations of its own Lessons Learnt and Reconciliation Commission (LLRC) and initiate credible investigations into allegations of human rights breaches not addressed by the LLRC report. It calls for the regime to “accept advice and technical assistance” in implementing these steps and present a “concrete and comprehensive action plan” before the next UNHRC session scheduled to be held end of this year.

This is to say that the impact US resolution could bear on Sri Lanka’s economy and capital markets is not entirely benign.

The Sri Lankan Government is assisted with a ‘grace period’ to bring about the developments proposed by the resolution which calls for independent inquiry of extra judicial killings during war and enforced disappearances, initiate a political settlement to the ethnic issue focusing on power devolution and demilitarisation of the north and east.

These measures proposed by the LLRC go far beyond the general conduct of the Sri Lankan Government.

Failure by the Government to implement these recommendations before the next UNHCR session could result in United States adopting an unfavourable measure on Sri Lanka in the form of imposing bilateral trade sanctions. However, currently, any immediate measure against Sri Lanka is ruled out and Colombo is offered a way of ending international criticism and the danger of Government leaders facing war crimes trials.

For the Obama administration, the issue is a device to put pressure on Colombo to shift away from the closer diplomatic and economic ties established with Beijing. At the same time, Sri Lanka is lobbying against the US-backed resolution and appears to have the support of China and Russia, but India has not declared its hand.

New Delhi is seeking to boost its influence in Sri Lanka, but is also concerned about the political impact in Tamil Nadu of rejecting the resolution. Clearly, the fact that India and China supply over 30% of Sri Lanka’s imports-led consumption as against 1.2% by the US suggests that it’s in the national interest of these two nations to stand against the US backed resolution.

On the other hand, the US and the EU account for over 56% of Sri Lanka’s exports receipts as opposed to China and India accounting for only 0.9 and 5.6%, respectively. This reflects the degree of Sri Lanka’s export dependency on Western markets and the impact of any US led bilateral trade sanction on overall economic welfare of Sri Lanka. As of 2009, there are several United States embargoes and sanctions enforced against several countries.

Some sanctions imposed by the United States Government are:
Requiring the United States to oppose loans by the World Bank and other international financial institutions.

Tax credits for companies and individuals denied for income earned in listed countries.

Duty-free goods exemption suspended for imports from those countries.

Authority to prohibit a US citizen from engaging in financial transactions with the Government without a license from the US Government
http://www.ft.lk/2012/03/12/us-resolution-what-will-the-impact-on-sri-lanka-be-brief-insights-from-asia-wealth/

http://forum.srilankaequity.com/t16337p125-un-resolution-against-our-country#110168

In this article Asia wealth talks about economic sanctions. I believe it is very unfair to talk about sanctions at this stage and spread fearful matters among the citizens of the country. USA resolution says Srilanka goverment should implement LLRC recommendations without further delay.And also they want us to submit a proper action plan at the next session. Government has clearly expressed it's decission and assure implementation of LLRC recommendations. So no difference. Only problem is even after Reps. of the Srilanka Govt. assure that SL will implement all recommendations of LLRC stilll they came up with this resolution. However finaly either resolution is passed or not we will have to implement the recommandations of LLRC. So end result is same.Is that not good? End result is good governance, Democracy etc. Implementation of LLRC recommendations would help to uplift our position and encourage both local and foreign investors to invest more here. So why we are worried and why we need to talk about sanctions at this stage when the Govt say they will implement all recommendations of LLRC.. All bullshits.

Dear Sri, Pl. consider all my criticisms are on the above statement only. Not for the publishers.

Rajaraam wrote:In this article Asia wealth talks about economic sanctions. I believe it is very unfair to talk about sanctions at this stage and spread fearful matters among the citizens of the country. USA resolution says Srilanka goverment should implement LLRC recommendations without further delay.And also they want us to submit a proper action plan at the next session. Government has clearly expressed it's decission and assure implementation of LLRC recommendations. So no difference. Only problem is even after Reps. of the Srilanka Govt. assure that SL will implement all recommendations of LLRC stilll they came up with this resolution. However finaly either resolution is passed or not we will have to implement the recommandations of LLRC. So end result is same.Is that not good? End result is good governance, Democracy etc. Implementation of LLRC recommendations would help to uplift our position and encourage both local and foreign investors to invest more here. So why we are worried and why we need to talk about sanctions at this stage when the Govt say they will implement all recommendations of LLRC.. All bullshits.

Dear Sri, Pl. consider all my criticisms are on the above statement only. Not for the publishers.

I understood your point, just I posted the FT article for more discussion.

50% export to Western countries. Resolution passed or not bad time ahead if we don't change our actions

Pls only discuss what is the impact of this resolution, anything out of the subject and arouse racism or national issue may force us to lock this thread..

This resolution will never pass in UNHRC because there wont be enough support from the world to pass it.,It is a fact that 2/3rd majority should support to such resolution to go ahead.,

There are few countries where Tamil population is influential for political purpose,for instance like in Norway,Canada,UK,France,. in those countries Tamil votes are proportionately high,which is considerable amount of votes to any political party and to stay in power,current governments in those countries will support Tamils so as the support for them in return when it comes to election time and which is the case in Australia too.,But Australia is more vigilant than other countries because Sinhala population is also high and many of them hold higher and influential positions.,(eg.,Governor in Victoria is a sri lankan born prof.David de crester).
Some countries like US may have some other hidden purposes.
To some countries, it doesnt matter what happened in sri lanka.,
My understanding is this resolution will end out of puff sooner than we expected.,Lets.,Wait and see.,,

dindon1 wrote:This resolution will never pass in UNHRC because there wont be enough support from the world to pass it.,It is a fact that 2/3rd majority should support to such resolution to go ahead.,

There are few countries where Tamil population is influential for political purpose,for instance like in Norway,Canada,UK,France,. in those countries Tamil votes are proportionately high,which is considerable amount of votes to any political party and to stay in power,current governments in those countries will support Tamils so as the support for them in return when it comes to election time and which is the case in Australia too.,But Australia is more vigilant than other countries because Sinhala population is also high and many of them hold higher and influential positions.,(eg.,Governor in Victoria is a sri lankan born prof.David de crester).
Some countries like US may have some other hidden purposes.
To some countries, it doesnt matter what happened in sri lanka.,
My understanding is this resolution will end out of puff sooner than we expected.,Lets.,Wait and see.,,

Happy to read your nice words above dindon1

No need to have 2/3 majority. But simple majority is enough
I feel now Malaysia will not vote with USA

This is not about the politics, but to be honest I cannot see any good signs. Specially the statement from India. This is not good for the market, Sri Lanka economy, Finally for Sri Lankans. As my knowledge everything going wrong. Every economic factor.

You are rite mate.

Moved to news section to merge with
http://forum.srilankaequity.com/t16755-us-resolution-what-will-the-impact-on-sri-lanka-be-brief-insights-from-asia-wealth?highlight=resolution