e-Con e-News July 2023 Part 2
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‘When the trumpet sounded
everything was prepared on earth,
and Jehovah gave the world
to Coca-Cola Inc, Anaconda,
Ford Motors, and other corporations.
The United Fruit Company
reserved for itself the most juicy
piece, the central coast of my world,
the delicate waist of America…’
– Pablo Neruda, Document #35: United Fruit Co, Canto General, 1950
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‘At President Ranil Wickremesinghe’s reception for the diplomatic community at his Nuwara Eliya official residence last week, US Ambassador Julie Chung: ‘spotted a centuries-old telephone system at the residence and pretended to be calling President Joe Biden. Given the age of the telephone system, President Wickremesinghe laughingly said the Ambassador’s call might be answered by John Foster Dulles, who served as US Secretary of State in the 1950s.’ – see ee Sovereignty, US envoy’s trunk call to Biden: Ranil diverts it to Foster Dulles
‘According to US State Department papers released recently,
US State Secretary Foster Dulles had spent $5 million
to defeat [SWRD] Bandaranaike at the elections in 1956.
Bandaranaike was assassinated in 1959.
That the hidden hand of the CIA was behind this
assassination came out at the Commission
investigating this assassination. Sirima Bandaranaike
who came to continue the Bandaranaike legacy
had to face a military coup to dislodge her,
by anti-Sinhala & anti-Buddhist elements’
John Foster Dulles’ involvement in the SWRD assassination was recalled by the novelist Gunadasa Amarasekera at the launch of Sena Thoradeniya’s latest book, Galle Face Protest: System Change or Anarchy. (US consul Bernard Anthony Gufler met SWRD Bandaranaike on the very day he was assassinated – see ee 12 October 2019, Exposing the Real Assassins).
Amarasekera went on to note:
‘The Rajapaksas were put in power by the people to carry on this Bandaranaike legacy. With the help of Sinhala nationalist Buddhist forces Mahinda Rajapaksa was able to destroy Prabhakaran and his terrorist outfit. This was an unbearable humiliation for the Western powers (Defence Ministers of England & France flew down to take away Prabhakaran). In 2015 Mahinda Rajapaksa was defeated at the elections for which $30mn were spent, as admitted by John Kerry.
In 2019 when the entire Sinhala Buddhist people voted to bring Gotabhaya back to power, it would have been a shock to these Western powers. The only way to prevent a repetition in the future was to alienate the youth who were destined to continue the traditional role as bearers of that civilisation, and also, to get them to despise and disown their inheritance.’ – see ee Sovereignty, Taking the lid off the Golden Bowl.
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‘In 1948, George Kennan helped craft the infamous
National Security Council Directive 10/2,
which officially authorized the CIA –
with consultation & oversight from the State Department
– to engage in ‘covert operations’ in the fight against the communist menace.
The directive gave the CIA carte blanche to do
whatever was required: everything from economic warfare
to assassinations, sabotage, propaganda, subversion,
and support for armed guerrillas.’
– ee Media, A Portrait of a Soviet CIA Propagandist
• John Foster Dulles was once an attorney for the eponymous United Fruit Company of Neruda’s ode, a company whose role is played out in Sri Lanka by England’s Unilever. John’s brother Allen, also a lawyer, rose to become head of the CIA (1953-61), and is also held responsible for the escalating the US policy of assassinating Asian, African & American leaders. Where there was no ‘communism’, the US would help create a caricature of it.
The CIA’s Allen Dulles and later US National Security Advisor & Ford Foundation President McGeorge Bundy had analysed in 1949 the role of the Marshall Plan in the CIA’s intellectual world war on communism. An annual $200mn of Marshall Plan funds ‘financed the work of anticommunist intellectuals, journalists, union leaders, politicians, and other leading figures in Western Europe’. The ‘classic’ US media campaign with the UFC to overthrow Jacobo Arbenz in Guatemala was conducted by General Electric shill Edward Bernays, the so-called ‘father of corporate public relations’, ‘double-nephew’ of the Freuds, and muse of the Nazi propagandist Joseph Goebbels.
At the Thoradeniya launch, Amarasekera also noted:
‘Julie Chang is the guiding spirit behind the Aragalaya;
she is really a remarkable woman, an ambassador,
the likes of whom we have never witnessed before.
She not only gives garden parties,
but also advises both Gotabaya Rajapakse
and the Aragalaya protesters. She patronizes the JVP.
She gives hope and succour to the Red Sahodarayas
in their pursuit of the armed struggle, knowing too well
that it would provide an opportunity for Ranil Wickremasinghe
to accede to the fourth request of the CIA chief
to bring in his troops to the country…’
– ee Sovereignty, Taking the lid off the Golden Bowl
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There is no surprise therefore at the news that the US government’s envoys were involved in the bribing (‘threats & incentives’) of Sri Lanka Telecom to sabotage a bid by a more capable China to build oceanic internet cables. And it turns out that all cables lead to Washington via another giant blob sucking on the eyes, ears and other orifices of this world – the Texan multinational AT&T, which claims lineage all the way back to Alexander Graham Bell.
‘On the sweetener side, the US Trade & Development Agency (USTDA)
told Reuters it offered training grants valued at a total of $3.8mn
to 5 telecom companies in countries on the cable’s route in return
for them choosing SubCom as the supplier. Telecom Egypt & Network i2i,
a company owned by India’s Bharti Airtel, got $1mn apiece…
Djibouti Telecom, Sri Lanka Telecom & Dhivehi Raajjeyge Gulhun
of the Maldives each received $600,000.’ (see ee Focus)
• ee is unclear why Thomson-Reuters has chosen to supposedly ‘expose’ these ‘threats & incentives’ – perhaps to imbue a cachet of intrigue, their articles are peppered with ‘No Comment’ by almost everyone from officials in the US government to those from Alphabet’s Google, Amazon, Microsoft & Meta. The lesson Thomson–Reuters – itself very much part of the US’ military strategy – wishes to teach us, is that the US will visit war, chaos & other economic sanctions on any country that dares not do its will.
‘General, your tank is a powerful vehicle
It smashes down forests and crushes 100 men.
But it has one defect:
It needs a driver.
General, your bomber is powerful.
It flies faster than a storm and carries more than an elephant.
But it has one defect:
It needs a mechanic.
General, man is very useful.
He can fly and he can kill.
But he has one defect:
He can think.’
– Bertolt Brecht
As the hype around AI & ChatGPT reveals, the US simply cannot deliver – all it does like that famous dog who does not eat hay but refuses to let others who do, do so – that dog in a manger – is to bark create chaos and prevent others from getting on in this world. This ee therefore demystifies the torrential hype around AI, ChatGPT etc, as well as the USA’s inability to compete on what even they call a ‘level playing field’.
This ee also looks at the accusations of unfair industrial practices made against China. It turns out that the USA is accusing China of doing exactly what they and Europe themselves have done (and still do) to develop their own countries.
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‘India has been engaged in licensed manufacture
of Soviet/Russian, French and English aircraft and engines for many decades,
but knows this cannot be considered technology transfer
which involves not merely manufacture but also design-development’.
– ee Random Notes, US-India Drone, Jet Engine Deals Impact Indigenous Development
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• How unique is China’s industrial policy strategy? US President Eisenhower’s 1961 farewell address called attention to the USA’s powerful military-industrial complex ‘as the linchpin of far-flung US efforts at state-sponsored, taxpayer-funded innovation’. The US’ massive military budget developed many major US technological advances, such as the internet, the global positioning system (GPS), semiconductors, etc. Japan’s ‘plan rational development state’, had their Ministry of International Trade & Industry perfect the art of ‘state-subsidized credit allocation & tariffs to protect Japan’s sunrise industries’.
Germany’s Wirtschaftswunder had strong state support for the Mittelstand of small & medium-size enterprises. Their recent Industrie 4.0 (2013) compares to China’s Internet Plus plan. France’s famed model of ‘indicative planning’, dates back to President Charles de Gaulle’s 5th Plan of 1966-70, with its ‘fusion of economic & political power’ that merged the French industrial system with the state… The attack on China turns out to be an attack on and a warning to any country that makes its own plans for modern industry-based independence (see ee Focus).
In Sri Lanka, the English media almost with one voice demands the destruction of a strong state. Discussion of what modern industrialization really is – is not allowed…
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Contents:
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A1. Reader Comments –
• Good Stuff • BBC’s Fixed Balance • Nicholas’ Bill
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A2. Quotes of the Week
• Sir Jennings & Free Kannangara • Nehru & USSR’s Magical Plans • China’s Hoodies • US SOFA & Rape of Okinawa • Ainu Indigenes & Salmon • USSR First Affirmative Action Empire • Lenin’s Rural Class Analysis • US Council on Foreign Relations (CFR) & Liberal Invasions
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A3. Random Notes –
• Communist Party of Sri Lanka’s The Way Forward Manifesto • EPF’s 40% fall • Cardinal’s Economics • Deny USA SL Info Space • US-India Weapons Sales Setback • 6 largest producers of machine tools • Paris Unrest Spreads to Colonial French Territories • US & Australia Call Pacific ‘Our Backyard’ • Hawai: USA’s First External Invasion • AUKUS Plans Attacks on Asian Shipping • USA Turns Somalia Lawless
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B. ee Focus
B1. CP Chief calls for Realignment of Political Forces to Thwart Ranil – Shamindra Ferdinando
B2. US & China wage war beneath the waves – over Internet Cables – Joe Brock (Singapore)
B3. Inside the Subsea Cable Firm Secretly Helping the USA Take on China – Joe Brock
B4. The Great Chatbot Bubble – David P Goldman
B5. Industrial Policy & the Tech Predator – Stephen Roach
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C. Building Blocks
• Guaranteed Rice Price for Industrialization • Creation of a Home Market for Industry • Japan’s Limits on Industrial Exports • Smallholding & Science • Extraordinary Culture of Machine Tools • Making Central Banks Independent of the People? • On State-owned Enterprises & Privatization
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D. News Index
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A1. Reader Comments
ee thanks Readers who send articles of interest. Please excerpt or summarize what is important about any news sent, or your comments, and place any e-link at the end. Email: econenews@gmail.com
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• ‘All good stuff – well received.’
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• ‘ee might like to see the objective & balanced accounts seen steadily increasing on some channels like the BBC, or so they claim…’
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• The Nicholas argument supports ‘the lumpen capitalist bondholders’ of domestic debt. We shouldn’t let them hide behind EPF/ETF to get paid in full….The Nicholases have an investment firm buying treasury bonds & bills….’
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A2. Quotes of the Week_
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• ‘Ivor Jennings did not sign the Kannangara Committee Report on Free Education… His stance on the country not being able to absorb commercial and technical qualified products was perhaps one of the reasons that practical education was neglected. Jennings:
‘Though there is much in the Report with which I agree, I regret that I am unable to sign If, however, education really became compulsory and if pupils of all classes were encouraged by free education to remain at school up to the age of 16, there might be as many as 22,500 (15% of 150,000) leaving school every year with commercial and technical qualifications. I see no evidence that the Island is likely to be able to absorb even half that number. I appreciate the difficulty (which perhaps weighed with the Committee) that many pupils are receiving a wholly inappropriate ‘academic’ education in secondary schools. I think the solution is partly to alter the bias of secondary education and partly to improve the quality of the other schools and to encourage them to specialize.’’
– see ee Workers, Free Education & Sir Ivor
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• ‘The USSR’s 5-Year Plan has impressed itself on the imagination of the world. Everybody talks of ‘planning’ now, and of 5-Year and 10-Year and 3-Year Plans. The Soviets have put magic into the word.’ – J Nehru wrote to Indira Gandhi on 9 July 1933, from Glimpses of World History
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• ‘China’s manufacturing industry has access to a high level of agglomeration economies — or ecosystem. Take the example of producing a hoodie. It’s not just about the textiles needed to cut and sew into a hoodie. It is also about the trims, dyes, zippers, cords and other necessary pieces that are required for assembling the product…
China has deployed a strategy that ensures the entire manufacturing supply chain is located there, and has mastered each step of the process. China even imports and processes much of the world’s wool and cotton, including a significant amount of US-grown cotton that comprises approximately 35% of the world total.
This cotton is then processed, made into fabric, dyed and sewn into clothing and other products. They are then exported globally, including back to the US as finished goods. The entire textile ecosystem for production is located in China. And this is not just the case for fabric, it’s also the case for all of the components.’
– see ee Industry, Why does so much of the world’s manufacturing still take place in China?
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• ‘The US invaded Okinawa in 1945, mounting a savage attack that wiped out close to a third of the local population and left 50,000 US troops killed or injured. They never left… in 1995 when 2 Marines & a sailor kidnapped & raped a 12-year-old girl and left her for dead, a crime that capped years of brutal sex crimes and gave rise to the largest protests in Okinawan history. This is what happens, said the thousands who came out in Okinawa’s largest protest, when you train young men barely out of their teens to kill like machines on a crowded island that does not want them. The gang rapists knew that if they made it back to base before the police found out, they were safe under the Status of Forces Agreement that protects US forces here, which is why most of the rage was directed at the Japanese government that foists 75% of all US military bases in Japan on this little speck in the Pacific. Islanders believe they are bearing the burden of Japan’s military alliance with the US and, with it, the USA’s military strategy for East Asia. The soldiers get drunk and crash their cars. There are 4 accidents a day; 2 rapes a month. Almost every person on Okinawa has a family member who has been assaulted. Then the soldiers go off to kill poor people in Iraq & Afghanistan…’ – ee Sovereignty, The Island Idyll & the US Occupation of Okinawa
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• ‘When the government banned all river fishing during the Meiji era, which ran from 1868-1912, the main justification was to protect stocks of salmon as they spawn on their way to the Pacific Ocean. The move coincided with a government policy to push the Ainu away from fishing as their livelihood, to give an advantage to Japanese fishermen who would take salmon from the sea.’ – ee Sovereignty, Japan’s Native Ainu Fight to Restore a Last Vestige of Their Identity (2019 law recognized the Ainu as an Indigenous people)
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• ‘The Soviet Union was the first of Europe’s multiethnic states to confront the rising tide of nationalism by systematically promoting the national consciousness of its ethnic minorities and establishing for them many of the institutional forms characteristic of the modern nation-state. In the 1920s, the Bolshevik government, seeking to defuse nationalist sentiment, created 10,000s of national territories. It trained new national leaders, established national languages, and financed the production of national-language cultural products. This was a massive and fascinating historical experiment in governing a multiethnic state… The Affirmative Action Empire was never an independent Bolshevik goal. It was instead a strategy to prevent the emergence of a potentially dangerous obstacle, non-Russian nationalism, to the accomplishment of other core Bolshevik goals: industrialization, nationalization of the means of production, abolition of the market, collectivization of agriculture, & the creation of socialism & its export abroad.’
– Terry Martin, The Affirmative Action Empire: Nations & Nationalism in the Soviet Union, 1923-39
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• ‘According to him, Lenin was the first Marxist to provide a full-blown analysis of the class structure of agrarian economies. He pointed out that there were, however, ambiguities in Lenin’s definition. If the difference between small & middle or rich peasants is determined by the number of horses owned, we get one classification. The addition of the criterion of wealth which Lenin brings in when he demonstrates that rich peasants also engage in non-agricultural activities such as trade, usury or manufacture, the classification becomes even more complicated… Lenin was one of the first to recognize how peasants’ choices are blocked by the inter-linkage of markets in labour power, land, peasant produce & loans.’ – Amiya K Bagchi on Nirmal K Chandra, EPW 2014
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• ‘The Council on Foreign Relations (CFR) is arguably the oldest of US proto-globalist institutions. It partly had its start in the days of WW1 as the brainchild of Woodrow Wilson called ‘The Inquiry’, which was tasked with coming up with ways of favorably redrawing the map of post-WW1 Europe and the world. The first members were open internationalists – the precursor to globalism – and worked under the stated banner of ‘engineering government policy’. The CFR took off when large organizations like the Ford and Carnegie Corporations, as well as the Rockefeller Foundation, began lavishing it with large yearly sums of money.’ – ee Sovereignty, The Sun Sets on Richard N. Haass’ CFR Career
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A3. Random Notes (‘Seeing Number in Chaos’)_
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• ‘Red (& well-read) alternatives – The Way Forward (Idiri Maga) was the visionary 1955 economic manifesto that proposed the Mahaweli scheme, authored by SA Wickremasingha with the brilliant GVS de Silva as co-author.
On the 80th anniversary of the Communist Party of Sri Lanka, comes the 250-page Forward from The Way Forward (Idirimagen Idiriyata). Ranking delegates from the Communist Parties of China, India, Nepal and Bangladesh attended the anniversary celebration at Maharagama on July 3.
Initially prepared by the Asian Progress Forum, a collective of independent economists, the 25-member team convened by the CPSL included 5 professors & 6 PhDs and ranged from the young Shiran Ilanperuma to Dr Lloyd Fernando, Dr Jagath Munasinghe, Dr Ranjana Senasinghe, Vinod Moonesinghe, and Kasun Kariyawasam.
The ‘productivism plus human development’ doctrine of the policy dossier calls for a Green, Blue & Red (‘industrial’) economy with a state component & a planning element.’ – see ee Economists, Pilfering Pensions
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• ‘Along with Sri Lanka Bankers Association, the Ceylon Chamber of Commerce (CCC) and the Joint Apparel Association Forum (JAAF) also joined in applauding the 2 chiefs [President Ranil Wickremesinghe & Central Bank governor Nandalal Weerasinghe]… It is a different story with superannuation funds on which depends the economic wellbeing of 2.5 million working men & women. Their benefits according to one source had received an estimated 40% fall in recent years, because of currency depreciation and price hikes. These funds including EPF & ETF had invested heavily on treasury bills &-bonds issued by CBSL. Currently they enjoy a 9% return and contribute about 14% to income tax revenue. In comparison, the banking sector contributes 50% insurance which is equivalent to 50% of total tax revenue. Overall, nearly 30% of the corporate sector is said to be paying 30% of tax revenue. Now, NW is offering these EPF & ETF a hard choice and calls that voluntary debt optimisation. Treasury Bills under DDO would be restructured and new bonds would be issued with less attractive terms and conditions, but the funds would continue to enjoy their 9% return. The choice for these funds is therefore to exchange the current bonds for the new ones or pay higher income tax. How could anyone call this a voluntary exchange when a higher tax threat is being imposed over EPF & ETF if they don’t agree to the new arrangement?’– see ee Economists, Involuntary & Inequitable DDO
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• Cardinal Malcolm Ranjith speaking at a SEDEC (Socioeconomic Development arm of the Catholic Bishops’ Conference of Sri Lanka) event to mark 200 years of Tamil workers brought to the plantations: ‘There is no point unless we solve the basic question, instead apply band-aid. What is the basic question? The basic problem here is that we have become a country with no working program for justice and fair-play, the protection of the wealth and resources of our country, employment opportunities for our people and chances for them to become partners in the development of our country. Instead, we have become a country which begs and we are being dragged still more into indebtedness by the IMF and all these leaders. That’s what they are doing. Pardon me for having said this but I thought we must not merely revolve around the topic…
The free-market system has been introduced from the global North to the global South. The International Monetary Fund (IMF) has been founded to perpetuate that system. It is an organisation which maintains the economic power of the global North and encourages the use of only that free-market system and method…
What has happened is the maximum possible povertisation of the country through the neoliberal economic system. Under this neocolonial, neoliberal system we have all become an enslaved nation…
Under neoliberalism the people do not develop self-respect or obtain their rights. Our country’s economy becomes dependent upon the economy of other countries. For instance, we import eggs, but if we had supported local producers these would have been supplied locally. Similarly, we buy rice from Vietnam and Thailand. Our farmers are not provided with subsidised fertiliser. How much of the first tranche from the IMF was used to develop national productive capacity, and how much was used to reduce the list of banned imports?
The situation in our country is this: 20% of the citizenry has all the money, which some of them have placed overseas, in foreign banks, while 80% live in poverty or the margin of poverty. Some eat only a single meal a day… There is no medicine in hospitals… A young couple told me they have 2 children whom they send to school on alternate days because they cannot afford the Rs200 per child, per day on transport.
The leaders of this country just do not understand these realities! They dwell in a neoliberal dreamland! The current leader in particular proclaims openly and publicly that he has embraced the neoliberal outlook… Having borrowed heavily from foreign banks, now there is some crooked program underway, calling it debt restructuring or whatever.’ – see ee Economists, Pilfering Pensions
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• The Importance of a Safe & Healthy National Information Space – ‘A nation’s information space shapes a people, their culture, and their collective cohesion and capabilities – similar to how your diet shapes your health. Eat a good diet & you will be mentally and physically strong, resilient, and productive. Eat rat poison, and you will foam from the mouth while dying in the gutter. Abuse drugs, and your mind will be clouded, your ability to make rational decisions impaired, and the likelihood of you hurting yourself or others increases.
The West reaches into other nations and their information space specifically to poison people, divide them, and to harm a nation’s unity and productivity. Nations must protect their information space from foreign interference as seriously as they protect their airspace, shores & borders from invaders. A nation regulates its food supply to avoid physically poisoning the public, what about avoiding the poisoning of their minds? Watching Russians act in relative unity this week vs here in Thailand where the public is increasingly divided because of US interference and control over Thai information space illustrates the difference between a healthy and toxic/compromised information space… The US and its meddling has been reduced if not removed from Russian information space. It thrives and dominates Thailand‘s because the establishment appears afraid/paralyzed to challenge US meddling. Russia & China help nations secure their physical domains through the sale of weapons. What about a means to help nations secure their information space?’ – see ee Security, Ukraine’s Offensive
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• US-India Drone, Jet Engine Deals Impact Indigenous Development – Two major headline-grabbing war equipment deals were signed during the Indian Prime Minister’s recent State visit to the US. The US is to sell 31 unmanned armed Reaper MQ-9B drones to India, 15 for the Navy and 8 each for the Army & Air Force…
The deal includes assembly in India and setting up of a global MRO (maintenance, repair & overhaul) facility to cater to other Reaper users. The deal also envisages procuring 8-10% of components from within India, with negotiations on to try & increase this to 15-20%.
The US has also consented to a far-reaching agreement between General Electric (GE) Aerospace and Hindustan Aeronautics Ltd (HAL) for licensed production in India of the proven, high-performance F-414 jet engine to power the upcoming indigenous Light Combat Aircraft (LCA) Tejas Mk2, while its predecessor F-404 engines are already being used in the earlier LCA Tejas Mk1 and Mk1A versions.
This is indeed a rare arrangement by the US with a country which is not a formal US military ally and would be the first time a major US-origin military platform is manufactured in India.
Jet engines are the most complex and advanced element of jet aircraft (whether civilian or military) technology, developed and used by only a handful of countries, namely the US, England, France & Russia, with Germany & South Korea having capabilities in some niche areas and China arduously pursuing this goal and being reportedly close to but yet to achieve self-reliant design-development capability. The actual weapons systems India wants, have not been spelt out yet. It is also not known if the Indian Reapers will come with protective pods with defences against electronic warfare & anti-aircraft systems. The Reapers can also be disassembled & easily transported in India’s large transport aircraft say, to the Andamans, further extending their operational coverage.
India has long been interested in unmanned aerial vehicles (UAVs) of different capabilities but, as so often happens in India, has been caught between conflicting demands for urgent induction and deployment, and a desire for indigenous development which, even if less expensive, may take longer…
With India signing up in 2020 to the 4th (Basic Exchange & Cooperation Agreement for Geospatial Intelligence or BECA) and last of the so-called foundational agreements which are required by the US to supply sensitive military equipment even to allies, the door was finally open for the US to consider supplying armed drones to India.
Some commentators in India have praised the US for its persistence in partnering with India despite not having landed big-ticket contracts such as for nuclear power stations or mega fighter-jet deals. At the same time, $20bn worth of military equipment sales to India, covering a wide range of large transporters, helicopters & maritime reconnaissance aircraft, is good business!
There are 2 major downsides to the deal. 1) India having spent $3bn on buying armed HALE Reapers, the indigenous development of UAVs is very likely to suffer setbacks. Defence Research & Development Organisation would do well to push for a clear strategic vision in this regard from both the government & the armed forces. DRDO may also think seriously about re-prioritising drone development toward lower-cost MALE & kamikaze drones.
2) The Reapers make India even more interlinked with, and dependent on, US military systems especially its encrypted satellite communication systems essential for beyond-visual-range guidance of the drones. Some commentators have noted that the Reapers would be able to seamlessly integrate with other US-supplied airborne assets such as the Apache attack helicopters, P8i reconnaissance aircraft and so on, further underlining the interlinking and inter-operability with US military systems. India’s strategic autonomy will inevitably come under greater pressure.
GE Engines – Another long-awaited deal was for the acquisition and domestic manufacture of GE F-414 aero-engines for the forthcoming indigenous Tejas Mk2 fighter, expected to enter into service at the end of the decade, with rollout & flight testing scheduled for 2024 & 2027, respectively. GE F-414 is a contemporary engine but not new by any means. It is built on the platform of its predecessor, F-404… Ironically, the F-404 engine also powered by the Swedish Saab Viggen which India wanted to buy in the 1970s, but the US banned the supply of US engines!
…The F-414 had first been selected for the LCA Mk2 way back in 2012, envisaging ‘technology transfer’ of around 58%, meaning that around 58% of the engine cost would be met from local components, labour and other services. Since the US rarely engages in offshore production of military equipment, it considers all such manufacture as ‘technology transfer’.
On the other hand, India has been engaged in licensed manufacture of Soviet/Russian, French and English aircraft and engines for many decades, but knows this cannot be considered technology transfer which involves not merely manufacture but also design-development.
The present deal has sharply increased the domestic component of production costs to 80%, which is significant but, going by the history of earlier licensed production of English or French aircraft and engines, many critical components and materials, without which the engine cannot operate, would still come from GE…
India’s efforts at indigenous development of the ‘Kaveri’ engine for fighter aircraft starting in 1989 (albeit with much work earlier since the 1970s), long been in trouble, over-running both cost and time targets, was finally scrapped. Instead, foreign engine manufacturers GE, French SNECMA and England’s Rolls Royce, have been invited to help design and develop in India, possibly building on the ‘core’ of the Kaveri engine, a 110 kN thrust engine for the proposed 5th generation Advanced Medium Combat Aircraft (AMCA) expected to enter service in the next decade. While the proposals are under submission, the finalisation of the GE F-414 engine for the LCA Mk2 with domestic manufacture, clearly marks it out as a front-runner for an uprated version.
This also raises the question as to what will happen to SNECMA’s offsets worth about Rs7,000 crore, which it was expected to defray in India as offsets under the Rafale deal, and which were widely believed to be going into design-development or uprating of the Kaveri engine.
The Indian Navy is also considering aircraft for its new aircraft carriers, and again the Boeing F/A-18 Hornet with GE F-414 engines is one of the leaders in the race. With this engine being manufactured in India, it does not take a genius to figure out that the F/A-18 has a clear edge.
Therefore, what the GE jet engine deal means is a major setback to the indigenous engine development program or, at best, a dominant position for the GE F-414 as the power plant of choice in major Indian fighter aircraft well into the next decade or more. Well played, USA!
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• ‘The 6 largest producers of machine tools – China, Germany, Italy, Japan, South Korea, the USA – are also the 6 largest consumers… A machine tool is usually defined as a power-driven machine, not portable by hand, and powered by an external source of energy. It is designed specifically for metalworking either by cutting, forming, physical-chemical processing or a combination of these techniques.
Machine tools traditionally are broken down into 2 categories: metalcutting and metal forming. Metalcutting machines typically cut away chips or swarf and include (but are not limited to) broaching machines, drilling machines, EDM units, lasers, gear-cutting machines, grinders, machining centers, milling machines, transfer machines, and turning machines, such as lathes. Metal-forming machines typically squeeze metal into shape and include (but are not limited to) bending machines, cold-heading machines, presses, shears, coil slitters, and stamping machines.’ – ee Industry, Breaking News from 2021 World Machine Tool Survey
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• Unrest Spreads to Colonial French Territories – ‘Protests erupted in France after police killed a teenager of Algerian and Moroccan ancestry… France maintains colonial control over several Caribbean islands… There have been reports of demonstrations and rebellions most notably in the French Guiana capital of Cayenne where on June 30 a government worker was killed… At least 5 people have been arrested… Demonstrations were reported as well in Martinique and Guadeloupe…
Another French overseas territory in the Indian Ocean off the coast of East Africa, Reunion, erupted in demonstrations and rebellions in solidarity with the resistance efforts in France… officials maintain a heightened security posture across urban centers, including in Saint-Pierre, Saint-Denis, and the Port… localized curfews, suspension of public transport services, and bans on gatherings.’ – ee Workers, Protests erupted in France
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• The US and Australia accused China in 2022 of ‘courting’ South Pacific nations – which Australia and New Zealand claim as‘our backyard’ – as in the Solomon Islands, where the US had closed its Embassy in 1993,subcontracting its ‘property management’ to Australia and New Zealand.
The US then recently reopened its Embassy in the Solomons. In May 2023, the US signed a new security pact with Papua New Guinea, before Australia concluded its own Bilateral Security Treaty. The US warned PNG that a China-Solomon Islands Security Agreement would lead to the Solomon Islands surpassing PNG’s ‘dominant position’ in Melanesia. The US also signed an agreement with the Philippines to access 4 more military bases. They have also strengthened military in both Japan and South Korea.
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• Hawaii, centrally located in the Pacific is 3,200km away from the US mainland. The US decided that US control of Pu’uloa, Pearl Harbour in Hawaii, was vital for the defence of its west coast. In 1873 a US military commission called for controlling Ford Island in the Hawaiian kingdom in exchange for the tax-free importation of sugar to the US.Two years later, the US Congress and the Hawaiian kingdom agreed to a 7-year Reciprocity Treaty in exchange for Ford Island and the lease of Pearl Harbour..he Hawaiian monarchy and its Polynesian people were however seen as blocking plans for a US military outpost. From the late 1880s, the US also exacerbated Samoan civil wars. Violating the Reciprocity Treaty, on 17 January 1893, the US backed a coup d’état against Queen Lili’uokalani.A ‘Committee of Safety’ – 7 foreign residents and 6 Hawaiian subjects of US descent – were set up to call on the US government to invade, sending the Marines to ‘protect the national interest’ of the US. The Republic of Hawaii was set up but the US annexed country in 1898 – see ee Sovereignty, PNG is our country. We must not give it away
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• The AUKUS Pact (between Australia, England & US) in 2021 was announced after Australia broke a $A90bn contract to buy French submarines. France recalled its ambassadors from both Australia and the USA. AUKUS will build nuclear-powered (but not nuclear-armed) submarines for Australia. AUKUS was launched in March 2023 in front of a US nuclear submarine at a San Diego Navy base. Australia will build 8 nuclear-powered subs in Adelaide, with English design and US technology. The 8 subs will not be ready for more than 30 years, and will be probably be obsolete when built.
The AUKUS submarine deal also revealed that the US would sell Australia up to 220 Tomahawk cruise missiles. In January 2023 Australia’s bought ‘high mobility artillery rocket systems’ (HIMARS). In 2020, the US approved sale of up to 200 long-range anti-shipping missiles (LRASM) to Australia. LRASM can strike shipping in the South China Sea, and block strategic chokepoints and navigation routes to Australia’s north, such as the Malacca Strait. The Tomahawks will be deployed on 3 Australian warships (Hobart class destroyers). As part of AUKUS, Western Australia will host US and English nuclear submarines from 2027. Nuclear-capable US B52 bombers and thousands of US marines will also rotate through Northern Territory, Australia.
New Zealand also invaded Afghanistan & Iraq… and NZ is in the intelligence inner circle as a 5 Eyes nation. New Zealand Navy vessels takes part in exercises off Guam and Okinawa and in the South China Sea. – ee Sovereignty, Military Initiative
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• ‘Last week the UN Security Council adopted a resolution to extend the UN peacekeeping mission in Somalia until the end of December 2023, but the troops are supposed to withdraw entirely by the end of Dec 2024. The mission’s name is the African Union Transition Mission in Somalia (ATMIS) , but although the troops are African, it’s actually a Security Council mission funded by the US/EU/NATO nations…There are more than 30 foreign security companies stationed in the Halane compound in Mogadishu, the equivalent of the Green Zone in Iraq… [doing] Illegal mining, illegal fishing, targeted assassination, illegal trade such as buying and selling weapons, guarding foreign embassies, escorting Western dignitaries, etc… Their excuse for being there might be guarding foreign embassies, escorting Western dignitaries, etc, and then they get up to all this extra stuff on the side.’
– ee Sovereignty, Somalia: The Lawless Frontier
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B. Special Focus____
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B1. CP Chief Calls for Realignment of Political Forces to Thwart Ranil – Shamindra Ferdinando
CP Chairman DEW G says lawmakers here should be aware of what is going on in the world. The Parliament cannot turn a blind eye to global developments, the former MP said, pointing out that the ongoing Ukrainian crisis underscored the need for greater understanding of international affairs as the rapid developments taking place with the US hegemony under threat. The crisis reflects the global power struggle.
Veteran politician Don Edwin Weerasinghe Gunasekara or DEW G, 88, wants Left-wing political parties, including his Communist Party (CP), to join forces with centrist political elements to meet the growing future Right-wing challenge posed by ‘Pohottuwa,’ backed incumbent President Ranil Wickremesinghe.
The former CP General Secretary warned those opposed to the Wickremesinghe-Rajapaksa juggernaut to reach consensus on a tangible political strategy soon or be prepared to face the consequences.
As things stand, Gunasekara declared that UNP leader Wickremesinghe would be the SLPP’s candidate at the next presidential election, therefore urged, what he called, the genuine Opposition to take a stand.
The CP is represented in Parliament by just one MP Weerasinghe Weerasumana from Matara. The first-time entrant to Parliament contested the last general election on the Sri Lanka Podujana Peremauna (SLPP) ticket.
Having parted company with the SLPP, or the Pohottuwa party, the CP is now a constituent of the Uththara Lanka Sabhagaya (ULS).
DEW G acknowledged that Leftwing parties, including the CP, couldn’t anticipate any future political alliance with the Rajapaksas’-led party, especially with Basil, an arch rightwinger, like Ranil, playing such a pivotal role in the family and the party they lead. ‘Therefore, a realignment of political forces, opposed to the incumbent administration, is a must’, he said.
Gunasekara didn’t mince his words when he admitted that Left parties lacked the wherewithal to take on the government, though the ground situation has changed quite drastically, owing to unprecedented public protests, engineered or not by the West, as in the case of the Maidan rebellion in Ukraine in 2014, forced Gotabaya Rajapaksa elected with 6.9 mn votes, to flee.
A smiling Gunasekara asserted that the emerging world environment could be quite advantageous to Sri Lanka with the US and its fiat currency dollar likely to lose world dominant position, if proper repositioning of political parties and groups takes place here to ensure a Left and Centre combination surging ahead with the best global economic environment after 1945, Gunasekara assured.
In an interview with the writer at the CP’s recently refurbished office at No 91, Dr. N.M. Perera Mawatha, Colombo 08, last week, DEW G discussed a range of issues, both domestic and international, with the focus on the deteriorating economic-political and social crisis against the growing uncertainty caused by restructuring of domestic debt.
Unless Left parties reached a consensus with those in the centre, the latter would move to the right to the advantage of Ranil Wickremesinghe, Gunasekera said. ‘At least 90% of the country’s capitalist class is with Wickremesinghe and unless something goes awry, the UNP leader is certain to be SLPP’s nominee with or without machinations by the West.’
The Island sought the much-respected politician’s views on current issues against the backdrop of the CP preparing to celebrate its 80th anniversary this week.
At the onset of the interview, one-time Rehabilitation and Prisons Reforms Minister, an Octogenarian himself, emphasized that what the country experienced was an unprecedented critical situation. ‘We are at a crossroads. We experienced crises in 1952 and in the ’70s, primarily due to external factors. However, though there were certainly foreign influences and interventions, we created the current catastrophe,’ the former lawmaker said.
Gunasekara identified what he called an explosive combination of factors that plunged the country into its worst ever post-independence crisis, namely dearth of foreign exchange even to buy basics, like fuel, drastic drop in government revenue, coupled with a crippling debt due to borrowings at high interest from international bond markets, especially by the previous Yahapalana regime.
Referring to the times of JRJ’s Finance Minister Ronnie de Mel (1977-1988) who presided over Sri Lanka embracing a free market economy in the late ’70s, and his successor M.H.M. Naina Marikkar (1988-1989) at the height of the JVP-led second insurrection (1987-1990), the CP veteran pointed out that the erosion of government revenue began after 1978.
A calamity of unimaginable proportions – Pointing out that in 1978 the government revenue had been 24% of the GDP (Gross Domestic Product) a gradual decrease began during JRJ’s reign and by the time Gotabaya Rajapaksa, in his capacity as the President, brought in his brother Basil Rajapaksa as the Minister of Finance, in July 2021, the state revenue had dropped to a poor 6% of the GDP. That the Rajapaksa family compelled Gotabaya Rajapaksa to accommodate BR in the Cabinet, even at the expense of the coalition, is a matter that should be addressed separately, the outspoken politician said. President Gotabaya Rajapaksa paid a very heavy price for exploiting the 20th Amendment to the Constitution to appease the family to bring in Basil Rajapaksa, he added.
The drastic drop of the state revenue to just 6% of the GDP meant that the government didn’t have sufficient funding in Rupees, especially due to a drastic cut in vital taxes, no sooner Gotabaya assumed office. ‘I have never heard of a disruption of an economy in a particular country for want of whatever local currency, though foreign exchange crisis is certainly not a new occurrence. We ran into trouble at a time when the then government was on a money printing spree.’
Gunasekara attributed the developing crisis to neoliberalist policies adopted in the wake of JRJ’s victory at the 1977 general election. ‘The change of tax policy in line with neoliberalist strategy brought about the crisis. The gradual change in direct and indirect taxes was nothing but a disaster. At the time of the late Premier Mrs. Sirimavo Bandaranaike, the direct and indirect tax ratio was 70 to 30 percent. JR reduced direct taxes to 55 percent, Ranasinghe Premadasa to 45 percent, Chandrika Bandaranaike Kumaratunga to 35 percent, Mahinda Rajapaksa to 28 percent (during his first tenure as the President), then to 24 percent and subsequently to 18 percent and Basil Rajapaksa brought it down to 14 percent.’
The increasing loss of income, due to a sharp drop in direct taxes, was compensated by corresponding increase in indirect taxes, the former Minister said, added that finally the direct and indirect tax ratio stood at 10% and 90%, respectively. Instead of taxing the affluent, those struggling to make ends meet were further burdened, Gunasekara said, alleging that tax evasion at the moment was at its zenith. ‘There is no point in denying successive governments facilitated the tax fraud. The fraudulent process over the years became part of the system in place,’ the ex-MP said.
Asked whether Parliament, as the supreme institution responsible for public finance, should be held responsible for the current predicament, a smiling Gunasekara said that was the position constitutionally.
‘However, the actual situation is different or in other words Parliament is irrelevant. The Finance Minister takes decisions on behalf of the Cabinet of Ministers which exercises executive powers in Parliament. Whoever at the helm, exercises political authority thereby implements a strategy that may not be in the best interests of the country though appropriate as a political tool. That is the reality.’
Neoliberalism, or market-oriented reform policies, such as doing away with price controls, freeing of capital markets, and reckless lowering of trade barriers, as well as privatization, brought us to this pathetic situation, the former CP leader said.
Regardless of the recent crash, the Wickremesinghe-Rajapaksa government seemed to be hell-bent on following the same wretched policies. ‘If not, President Wickremesinghe and his acolytes wouldn’t have considered USD 2.9 bn IMF loan facility as the panacea for our economic ills. In a way we are now in an irreversible situation,’ Gunasekara said.
The one-time Chairman of the parliamentary watchdog COPE sarcastically declared without hesitation that he was too optimistic of the much-touted economic recovery plan, based on the much-debated agreement with the IMF.
‘Don’t forget we sought IMF intervention on 16 occasions previously. And the worst IMF intervention is now underway’, the still crisp thinking octogenarian said.
Parliament has deteriorated to such an extent that it no longer commanded the respect of the public. That, too, contributed to the overall decline, Gunasekara said, explaining how the Ranil-Maithree-led Yahapalana government borrowed heavily from international money markets during the 2015-2019 period, though they have conveniently forgotten their own role in the economic ruin. In foreign money markets, minimum interest was six percent and out of the USD 15 bn taken at such high interest rates as much as USD 12.5 bn was obtained by the Yahapalana rule within a short period of time, Gunasekara pointed out.
Perhaps if Mahinda Rajapaksa won the 2015 presidential election, he, as the Finance Minister, too, would have sought more loans from international money markets, Gunasekara said, asserting that the then Secretary to the Treasury P.B. Jayasundera may have pushed for early presidential elections as he was aware of the impending financial crisis. ‘But I tried unsuccessfully to convince President Rajapaksa not to face the electorate as he couldn’t have won under any circumstances,’ Gunasekara said.
Bid to save Gotabaya – The former Minister recalled how representatives of political parties met at the residence of lawmaker Tiran Alles in the wake of the violent Mirihana protest, in March 2022, to discuss ways and means of saving Gotabaya Rajapaksa’s mandate. According to him, there had been a general agreement of an interim national government for at least a period of one year until some sort of stability could be restored. Among those who had been present were Dullas Alahapperuma and Maithripala Sirisena and other rebel SLPP MPs, Gunasekara said, adding that consensus couldn’t be reached as the President was not free to act as he desired.
‘The President somewhat struggled to address never ending concerns of the Rajapaksa family,’ the ex-CP boss said, expressing disbelief that the premiership was first offered to Field Marshal Sarath Fonseka and then SJB leader Sajith Premadasa before beleaguered UNP leader accepted the proposal in the second week of May 2022.
Gunasekara acknowledged the writer’s suggestion perhaps the UNP leader was the best choice, politically, at the time though he personally didn’t agree at all with the destructive market-oriented reform policies agenda pursued by the incumbent President to please the IMF.
In the run-up to the July 2022 calamity, Gunasekara had advised and warned Gotabaya Rajapaksa of the impending economic crisis but was ignored. ‘Obviously PBJ and Basil Rajapaksa were at the helm of economic matters. They shaped the damaging policy,’ Gunasekara said, recalling him warning Gotabaya Rajapaksa regarding the impending economic crisis at the first public meeting held in Matara following the handing over of nominations for the 2019 presidential election. ‘The CP organized the Matara meeting where over 5,000 attended. Mahinda Rajapaksa and Mahinda Yapa Abeywardena were among those present. I handed over a printed booklet that dealt with the impending crisis and measures to be taken to Gotabaya. Obviously, he didn’t bother with it.’
Responding to another query, the one-time Prison Reforms Minister said that Gotabaya Rajapaksa was overwhelmed by the Rajapaksa family. ‘That is the ugly truth. The family didn’t allow the President to proceed on his own path,’ Gunasekara said, explaining how the ill-advised Cabinet decision to abolish a range of taxes at the first Cabinet meeting chaired by President Gotabaya Rajapaksa, enactment of the 20th Amendment to pave the way for Basil Rajapaksa’s re-entry into Parliament, chemical fertiliser ban and cancellation of the Japanese-funded Light Rail Project, without consulting the donor, caused immense damage.
The former Minister said that the unveiling of a comprehensive and far reaching alternative economic development programme that dealt with repositioning of Sri Lanka’s foreign trade and economic relations by the CP coincided with their 80th anniversary. Gunasekara emphasized the responsibility on the part of the decision-makers to focus on human resources development, especially against the backdrop of the brain drain and the general perception that there was absolutely no hope of an economic recovery.
Gunasekara said that the vast majority of those who now represented the Parliament, as well as the executive, refused to accept the heavy impact the restructuring of domestic debt was having on the public. Whatever the economic recovery plans under discussion or at the onset of implementation, we lacked the wherewithal and political consensus, Gunasekera said, adding that the issues at hand should be addressed accordingly.
Gunasekara also discussed the continuing failure of Parliament to respond to the growing threats, with quite formidable external interventions taking place right under the noses of the political leadership. References were made to USAID and UNDP interventions at the highest level.
Need for urgent reforms – Gunasekera urged political parties to give sufficient time for new entrants. The ex-lawmaker said that sufficient time should be allocated for new MPs to address Parliament on important issues. How could they deal with a particular issue within three minutes, Gunasekara asked, acknowledging that he wouldn’t have achieved current status if he was denied adequate time.
Gunasekera recalled how he entered Parliament in 1986 in the wake of the death of Sarath Muttetuwegama, 51, lawyer, killed in a car crash at Ratnapura. At the time of his death, Muttetuwegama, married to Manouri, daughter of Dr. Colvin R. de Silva, represented the Kalawana electorate.
Gunasekera said that the decision-making Central Committee of the CP nominated him to fill the vacancy created by Muttetuwegama’s untimely death. There had been provision for a political party to nominate a person to Parliament, within a month, following the creation of a vacancy, and Dew Gunasekera was the CP’s choice though not unanimous. One member of the decision-making body had voted to appoint Manouri Muttetuwegama. In case, a particular political party failed to reach a consensus within a stipulated period of time, the then Election Commission would have called a by-election.
Touching the table, at where he sat, Gunasekara said on the day he took oaths as an MP, the then CP Chairman Pieter Keuneman advised him how to conduct himself in Parliament right here. ‘We were in this room. I was told to address Parliament while looking at the direction of the Speaker to prevent being disturbed and distracted by opposing MPs. Keuneman stressed the need to be fully prepared to address Parliament. I was also told the importance of having the address in point form and being logical. Perhaps the most important advice was to keep in mind that as an MP he should address the electorate not members of Parliament.’
Towards the end of the interview Gunasekera said that he was not sure whether Gotabaya Rajapaksa wanted to contest the 2019 presidential election or the family fielded him due to Mahinda Rajapaksa being disqualified by the 19th Amendment barring a third term. Gotabaya was not like other Rajapaksas and his wife a humble and gracious lady who never stepped on the toes of anyone. They were never extravagant and basically lived a simple life but Gotabaya Rajapaksa never realized the pitfalls in the political party system here.
Referring to the Matara meeting, immediately after presidential nominations where he advised SLPP candidate Gotabaya Rajapaksa, ex-MP Gunasekera said that the President’s response to concerns raised by the CP at a meeting he chaired on 20 December, 2020, deeply disappointed him.
The meeting had been called to discuss the government response to the Covid-19 threat. ‘On behalf of the CP, our General Secretary Dr. G. Weerasinghe urged President Rajapaksa not to force Muslims to cremate Covid-19 victims as the decision was not backed by scientific reasons nor by the World Health Organization. The President and others present there were warned of dire consequences of such a drastic decision. But Dr. Weerasinghe’s plea was ignored.’
Gunasekera said that he took advantage of the opportunity to warn the President of the impending economic crisis again. The ex-MP recalled him telling the President that unless he addressed the issue at hand none of those 6.9 mn voted for him would remain when the troubles erupted. ‘The President didn’t say anything but smiled nicely.’
Gunasekera criticized the Mahanayake Theras’ response to the developing crisis. Underscoring the responsibility on their part to rein in politicians, Gunasekera said that the emergence of the likes of ‘Pastor’ Jerome Fernando and Natasha Edirisuriya should be examined against the backdrop of the pathetic conduct of politicians and most religious leaders.
Commenting on the Aragalaya and related developments, Gunasekera confirmed that the US Ambassador Julie Chung advised Speaker Mahinda Yapa Abeywardena to succeed President Gotabaya Rajapaksa.
He said that National Freedom Front (NFF) leader Wimal Weerawansa’s recent declaration to that effect was based on what he told the MP.
Wickremesinghe’s emergence as the President, an Office he couldn’t have won at an election, highlighted the ruination of the political party system and the dearth of leaders. The UNP, being restricted to just one National List seat, and the SLFP down to one elected MP (other 13 elected on the Pohottuwa ticket) highlighted the collapse of the political party system, as hitherto known, and further deterioration of the situation.– ee Sovereignty, CP Chief calls for re-alignment of political forces
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B2. US & China wage war beneath the waves – over Internet Cables – Joe Brock (Singapore)
Subsea cables, which carry the world’s data, are now central to the US-China tech war. Washington, fearful of Beijing’s spies, has thwarted Chinese projects abroad and choked Big Tech’s cable routes to Hong Kong, Reuters has learned.
It started out as strictly business: a huge private contract for one of the world’s most advanced undersea fiber-optic cables. It became a trophy in a growing proxy war between the USA and China over technologies that could determine who achieves economic and military dominance for decades to come.
In February, US subsea cable company SubCom began laying a $600-million cable to transport data from Asia to Europe, via Africa & Middle East, at super-fast speeds over 12,000 miles of fiber running along the seafloor.
That cable is known as SouthEast Asia–Middle East–Western Europe 6, or SeaMeWe-6 for short. It will connect a dozen countries as it snakes its way from Singapore to France, crossing 3 seas and the Indian Ocean on the way. It is slated to be finished in 2025. It was a project that slipped through China’s fingers.
A Chinese company that has quickly emerged as a force in the subsea cable-building industry – HMN Technologies Co – was on the brink of snagging that contract 3 years ago. The client for the cable was a consortium of more than a dozen global firms. Three of China’s state-owned carriers – China Telecommunications Corporation (China Telecom), China Mobile & China United Network Communications Group Co (China Unicom) – had committed funding as members of the consortium, which also included US-based Microsoft Corp and French telecom firm Orange SA…
HMN Tech, whose predecessor company was majority-owned by Chinese telecom giant Huawei Technologies Co, was selected in early 2020 to manufacture & lay the cable, the people said, due in part to hefty subsidies from Beijing that lowered the cost. HMN Tech’s bid of $500million was roughly a third cheaper than the initial proposal submitted to the cable consortium by New Jersey-based SubCom, the people said.
The Singapore-to-France cable would have been HMN Tech’s biggest such project to date, cementing it as the world’s fastest-rising subsea cable builder, and extending the global reach of the 3 Chinese telecom firms that had intended to invest in it. But the US government, concerned about the potential for Chinese spying on these sensitive communications cables, ran a successful campaign to flip the contract to SubCom through incentives & pressure on consortium members.
Reuters has detailed that effort here for the first time. It’s one of at least 6 private undersea cable deals in the Asia-Pacific region over the past 4 years where the US government either intervened to keep HMN Tech from winning that business, or forced the rerouting or abandonment of cables that would have directly linked US and Chinese territories…
SubCom had no comment on the SeaMeWe-6 battle… the White House briefly noted that the US government helped SubCom to win the Singapore-to-France cable contract, without giving details.
China’s foreign ministry did not respond to requests for comment. China Telecom, China Mobile, China Unicom and Orange did not respond to requests for comment. Microsoft declined to comment.
Undersea cables are central to US-China technology competition.
Across the globe, there are more than 400 cables running along the seafloor, carrying over 95% of all international internet traffic, according to TeleGeography, a Washington-based telecommunications research firm. These data conduits, which transmit everything from emails & banking transactions to military secrets, are vulnerable to sabotage attacks and espionage…
The potential for undersea cables to be drawn into a conflict between China and self-ruled Taiwan was thrown into sharp relief last month. Two communications cables were cut that connected Taiwan with its Matsu islands, which sit close to the Chinese coast. The islands’ 14,000 residents were disconnected from the internet… there was no direct evidence showing the Chinese ships were to blame…
Eavesdropping is a worry too. Spy agencies can readily tap into cables landing on their territory. Justin Sherman, a fellow at the Cyber Statecraft Initiative of the Atlantic Council, a Washington-based think tank, told Reuters that undersea cables were ‘a surveillance gold mine’ for the world’s intelligence agencies…
Two of the projects upended by the US government involved cables that had already been manufactured and laid thousands of miles across the Pacific Ocean. US tech behemoths Google, Meta Platforms and Amazon.com were major investors in at least one, or in Meta’s case both, of those cables… The delays and rerouting of the cables cost each of those companies tens of millions of dollars in lost revenue and additional costs… Amazon, Meta and Google declined to comment…
SubCom’s cable coup is part of a wider effort in Washington aimed at reining in China as Beijing strives to become the world’s dominant producer of advanced technologies, be it submarines, semiconductor chips, artificial intelligence or drones. China is bulking up its military arsenal with sophisticated armaments. And Beijing has become increasingly assertive about countering US influence worldwide through trade, weapons & infrastructure deals that are drawing wide swaths of the globe into its orbit.
The US cable effort has been anchored by a 3-year-old interagency taskforce informally known as Team Telecom.
To oust the Chinese builder from the Singapore-to-France cable, the USA proffered sweeteners – & warnings – to the project’s investors.
On the sweetener side, the US Trade & Development Agency (USTDA) told Reuters it offered training grants valued at a total of $3.8mn to 5 telecom companies in countries on the cable’s route in return for them choosing SubCom as the supplier. Telecom Egypt and Network i2i, a company owned by India’s Bharti Airtel, got $1mn apiece, USTDA said. Djibouti Telecom, Sri Lanka Telecom and Dhivehi Raajjeyge Gulhun of the Maldives each received $600,000. None of the 5 responded to questions from Reuters.
…Meanwhile, US diplomats cautioned participating foreign telecom carriers that Washington planned to impose crippling sanctions on HMN Tech, a development that could put their investment in the cable project at risk. The US Commerce Department made good on that threat in December 2021, citing HMN Tech’s intention to acquire US technology to help modernize China’s People’s Liberation Army.
A senior US State Department official confirmed that the department had advocated through its embassies to help SubCom win the contract, including warning other countries about the security risks posed by HMN Tech. Though the cable won’t come ashore in Chinese territory, the US government believed HMN Tech could insert remote surveillance equipment inside the cable, the official said without providing evidence. The Commerce Department declined to comment.
Two months later, in February 2022, SubCom announced that the cable consortium had awarded it the contract to build the SeaMeWe-6 cable. China Telecom and China Mobile, which were due to own a combined 20% of the cable, pulled out because the Chinese government wouldn’t approve their involvement in the project with SubCom as the cable contractor… China Unicom remained.
China’s foreign ministry and its defense ministry, which handles questions for the People’s Liberation Army, did not respond to Reuters’ questions.
On June 26, 2022, the White House published a factsheet citing various upcoming infrastructure projects, including the SubCom undersea cable deal. The document said the US government had ‘collectively helped secure’ the award of that contract for SubCom…
Tensions rising – US-China relations are at the lowest they’ve been in decades. The 2 countries have clashed on a host of issues, including China’s tacit support for Russia’s invasion of ‘democratic’ Ukraine, its crackdown on Hong Kong, and the future of Taiwan, which Chinese President Xi Jinping has pledged to bring under Beijing’s control. In February, the US shot down a Chinese ‘spy’ balloon that floated into American airspace. China has claimed it was a weather balloon that got blown off course and accused the US of overreacting.
President Joe Biden’s policies are increasingly isolating China’s high-tech sector with the aim of bringing some technology manufacturing back to US while keeping cutting-edge US innovation out of Chinese hands.
Over the last year, the Biden administration has pushed through a landmark bill to provide $52.7 billion in subsidies for US semiconductor production and research. The Commerce Department in December added dozens of Chinese firms producing technology such as drones and artificial intelligence chips to its so-called Entity List, which severely restricts their access to US technology.
(Workers toil on the 2Africa undersea cable project in Amanzimtoti, South Africa in Feb. France’s Alcatel Submarine Networks is building the cable, which will connect more than 30 countries in Africa, Asia & Europe. Subsea cables are the backbone of international internet traffic, but they’re vulnerable to sabotage & espionage.)
Chinese Foreign Minister Qin Gang, speaking in Beijing this month, said the 2 superpowers are destined for ‘conflict & confrontation’ unless Washington abandons its policy of ‘containment & suppression’ towards China.
Three companies have dominated the construction and laying of fiber-optic subsea cables for decades: USA’s SubCom, Japan’s NEC Corporation, and France’s Alcatel Submarine Networks.
But a seismic shift occurred in 2008 when Huawei Marine Networks Co entered the fray. Owned by Chinese telecom Huawei Technologies, the Tianjin-based company initially built small cable systems in underserved markets such as Papua New Guinea and the Caribbean.
Fast-forward 15 years and the firm, now known as HMN Tech, has become the world’s fastest-growing manufacturer and layer of subsea cables, according to TeleGeography data.
But the company’s short history has been shaped by deteriorating US-China relations.
In 2019 Huawei Technologies came under fire from the administration of then US President Donald Trump. The Commerce Department banned Huawei & 70 affiliates from buying parts & components from US companies without government approval.
That move was part of a global campaign by Washington and its allies to stop Huawei Technologies from building 5th-generation, or 5G, communications networks around the world due to concerns that host nations would be vulnerable to Chinese eavesdropping or cyberattacks, the details of which were revealed in a previous Reuters investigation.
Huawei Technologies said at the time that it was a private company that is not controlled by the Chinese government. Contacted for this story, Huawei Technologies said it fully divested its stake in Huawei Marine in 2020 and is no longer connected with the cable-laying company, which rebranded as HMN Tech under new Chinese ownership.
HMN Tech expanded its ambitions with the PEACE cable, which came online last year and connects Asia, Africa & Europe. The firm was poised to make another great leap with the Singapore-to-France project before SubCom snatched it away.
The following account of how that deal fell apart for the Chinese players is based on interviews with 6 people directly involved in the SeaMeWe-6 contract. They all asked not to be named as they were not authorized to discuss potential trade secrets or matters of national security.
Backroom brawl – Large undersea cables cost several hundreds of millions of dollars. They are usually paid for by a consortium of tech or telecom companies that can spread the cost and risks, as well as take responsibility for any cable landing that ends up in their countries. In the case of SeaMeWe-6, there were more than a dozen companies funding the cable, and there was immediately a split in the group, which would need to reach a consensus to select a contractor for the project, the people said.
China Telecom, China Mobile & China Unicom were resolutely behind HMN Tech, which had come in with a bid of around $500mn. Microsoft, Orange & India’s Bharti Airtel expressed concerns about the risk of potential US pushback on HMN Tech’s involvement. Still, it was hard to argue with the price. SubCom’s bid was closer to $750mn.
On a series of video calls in mid-2020, the consortium members verbally agreed that HMN Tech would build the cable. SubCom would be the reserve in case the Chinese firm pulled out or failed to deliver on the terms of its proposal. But behind the scenes, SubCom and the US government were sowing seeds of doubt about whether HMN Tech was the best company for the job.
SubCom had already successfully applied for loans from the US federal Export-Import Bank to support its bid. It also secured advocacy assistance from the Department of Commerce, which quickly mobilized US embassies around the world to lean on consortium members in their host nations.
US ambassadors in at least 6 of those countries, including Singapore, Bangladesh & Sri Lanka, wrote letters to local telecom carriers participating in the deal, according to people involved. One of these letters, seen by Reuters, said picking SubCom is ‘an important opportunity to enhance commercial & security cooperation with the US.’
Separately, ambassadors & senior diplomats met with executives at foreign telecom companies in at least 5 countries. The message: HMN Tech could be subject to US sanctions in the near future. That in turn would make it difficult for the telecoms to sell bandwidth because their biggest likely customers – US tech firms – wouldn’t be allowed to use the cable.
One senior Asian telecom executive recalled a meeting in mid-2020 with a top US diplomat and a US digital trade attaché. The US officials explained how sanctions on HMN Tech would render the cable virtually worthless, providing him a printed spreadsheet with an economic analysis showing just that.
‘They said we’d go bankrupt. It was a persuasive argument,’ the executive told Reuters.
Two other Asian telecom executives in the consortium told Reuters they met with both Chinese and US diplomats, who urged them to back HMN Tech and SubCom, respectively.
By the end of 2020 several consortium members, including Bangladesh Submarine Cable Co, India’s Bharti Airtel, Sri Lanka Telecom, France’s Orange and Telecom Egypt, told their partners they were having second thoughts about choosing HMN Tech as a supplier, mostly over the fear of sanctions.
None of these companies responded to requests for comment.
(China’s HMN Tech was the low bidder for a contract to lay an undersea cable known as the SeaMeWe-6, but pressure from Washington on the project’s investors swung the deal to US-based SubCom.)
In February 2021, with the consortium partners at loggerheads, SubCom and HMN Tech were given a chance by the group to submit a ‘best and final offer.’ SubCom lowered its bid to close to $600mn. But HMN Tech was now offering to build the cable for $475mn.
Several consortium members, including Microsoft, Singapore Telecommunications Ltd (Singtel) and Orange, argued to the other participants that when the risk of sanctions was factored into the bids, SubCom was offering a better deal. The 3 state-owned Chinese companies strongly disagreed. The companies all declined comment.
On a tense final video call in late 2021, an executive from Singtel, the cable committee chair, urged the companies to vote on a final decision before the whole deal collapsed, two people on that call told Reuters.
China Telecom & China Mobile threatened to walk off the project, taking tens of millions of dollars of investment with them. But the majority of the consortium picked SubCom, and the 2 Chinese state-owned firms departed. 2 new investors – Telekom Malaysia Berhad & PT Telekomunikasi Indonesia International (Telin) – joined the deal, and some of the original members raised their stakes to make up the shortfall, the people said…
In addition to the successful campaign to freeze out HMT Tech from the Singapore-to-France cable, teams across the US state and commerce departments and the Office of the US Trade Representative once again coordinated with the White House to use diplomatic pressure to boot the Chinese firm from a project. This time it was a cable connecting the 3 Pacific-island nations of Nauru, the Federated States of Micronesia and Kiribati, according to 2 sources involved in that deal.
The US, Australia & Japan announced in December 2021 that they would jointly fund a cable on the same route, known as the East Micronesia Cable. In a joint statement this month, the 3 said they had met on March 8 to help ‘push forward’ on this cable, without giving a time frame…
Team Telecom – At the heart of Washington’s newly aggressive strategy is Team Telecom. That’s the informal name for an interagency committee set up through an Executive Order signed by Trump in April 2020. The mission: safeguarding US telecommunication networks from spies and cyberattacks.
Team Telecom is run by the National Security Division of the Department of Justice (DOJ). That division is headed by Assistant Attorney General Matthew Olsen. Nominated to that position by Biden in May 2021, Olsen has worked in a string of intel posts. He served as director of the National Counterterrorism Center under former President Barack Obama from 2011-14, and before that as general counsel for the National Security Agency, the US spy nerve center. The DOJ declined to make Olsen available for an interview.
While the State Department & its partners have helped to prevent China from obtaining new subsea contracts in foreign places of US strategic interest, Team Telecom has focused on a purely domestic concern: stopping any cable from directly connecting US territory with mainland China or Hong Kong due to worries about Chinese espionage.
To that end, the team makes cable licensing recommendations to the US telecom regulator, the Federal Communications Commission (FCC). Since 2020 the team has been instrumental in the cancellation of 4 cables whose backers had wanted to link the US with Hong Kong, Devin DeBacker, a DOJ official and senior member of Team Telecom, told Reuters in an interview.
Hong Kong, a former British colony that transitioned to self-rule and is dubbed a ‘special administrative region’ by China, has long been the investment gateway to the communist mainland because of its well-developed financial sector, open economy and highly-educated workforce…
Washington’s decision to nix any Hong Kong terminus for the 4 planned subsea cable deals upended the plans of Google, Meta and Amazon. These tech titans have been among the biggest investors in new cables over the last decade as they seek to link up a network of data centers in the US and Asia that underpin their fast-growing Cloud computing businesses, according to TeleGeography.
The first, a project owned by Google and Meta known as the Pacific Light Cable Network, will now only transmit data from the US to Taiwan & the Philippines, after Team Telecom recommended that the FCC reject the Hong Kong leg. The section of the cable going to Hong Kong, spanning hundreds of miles, is currently lying abandoned on the ocean floor…
In an unsuccessful appeal to the FCC, Google and Meta said Team Telecom’s argument that China might intercept data on the cable was ‘unsupported and speculative,’ and that its decision was ‘a referendum on China, rather than the assertion of any real specific concern,’ according to an Aug 20, 2020, submission by the companies that is available on the FCC website.
Similarly, the Bay to Bay Express Cable System, developed by Amazon, Meta and China Mobile, will not run as planned from Singapore to Hong Kong to California. As part of a deal struck between Amazon, Meta and Team Telecom, China Mobile left the consortium and the cable was rebranded as CAP-1, with a new route from Grover Beach, California, to the Philippines… The cable had already been almost entirely laid along the original route, and the section to Hong Kong now sits unused in the depths, the people said.
Google, Meta and Amazon declined to comment. China Mobile did not respond to requests for comment.
…There is evidence the US campaign has slowed China’s subsea cable juggernaut.
HMN Tech supplied 18% of the subsea cables to have come online in the last 4 years, but the Chinese firm is only due to build 7% of cables currently under development worldwide, according to TeleGeography. These figures are based on the total length of cable laid, not the number of projects.
In a tit-for-tat maneuver, China has thrown up a roadblock on a cable in which Meta is an investor, according to 2 cable consultants with direct knowledge of the project.
That cable, known as the SE Asia-Japan 2 cable, was planned to run from Singapore through Southeast Asia and touch down in Hong Kong & mainland China before going on to South Korea & Japan. China has delayed giving a license for the cable to pass through the South China Sea, citing concerns about the potential for the cable manufacturer – Japan’s NEC – to insert spy equipment on the line, the consultants said… – ee Sovereignty, US & China wage war beneath the waves
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B3. Inside the Subsea Cable Firm Secretly Helping the USA Take on China – Joe Brock
SubCom, a New Jersey company born out of a Cold War spy project, has become a key player in the US-China tech war. It’s laying internet cables on the ocean floor to boost Washington’s economic and military might, including a clandestine mission to a remote island naval base, Reuters can reveal.
On Feb 10 last year, the cable ship CS Dependable appeared off the coast of the island of Diego Garcia, an Indian Ocean atoll that’s home to a discreet US naval base.
Over the next month, the ship’s crew covertly laid an underwater fiber-optic cable to the military base, an operation code-named ‘Big Wave,’ according to 4 people with direct knowledge of the mission, as well as a Reuters analysis of satellite imagery and ship-tracking data.
The new super-fast internet link to Diego Garcia, which has not previously been reported, will boost US military readiness in the Indian Ocean, a region where China has expanded its naval influence over the last decade.
The CS Dependable is owned by SubCom, a small-town New Jersey cable manufacturer that’s playing an outsized role in a race between the USA and China to control advanced military and digital technologies that could decide which country emerges as the world’s preeminent superpower.
SubCom, a company born out of a US Cold War project to spy on Soviet submarines, is living a double life. Publicly, it is one of the world’s biggest developers of undersea fiber-optic cables for telecom firms and tech giants like Alphabet’s Google, Amazon, Microsoft & Meta Platforms.
Behind the scenes, SubCom is the exclusive undersea cable contractor to the US military, laying a web of internet and surveillance cables across the ocean floor, according to the 4 people with knowledge of the matter: 2 SubCom employees and 2 US Navy staffers. The individuals asked not to be named because they were not authorized to discuss the operations.
The cable-laying vessel CS Dependable is shown docked at Taiwan’s Port of Taichung on April 18, 2023. The ship’s private-sector owner, New Jersey-based SubCom, is central to Washington’s efforts to deter foreign spying on international internet traffic moving through undersea fiber-optic cables.
This dual role has made SubCom increasingly valuable to Washington as global internet infrastructure – from undersea cables to data centers and 5G mobile networks – risks fracturing into 2 systems, one backed by the US, the other controlled by China.
SubCom is owned by Cerberus Capital Management, a New York-based private equity firm that has invested in war contractors and national security assets. Last year Cerberus paid $300 million for a Philippine shipyard on a former US Navy base close to the South China Sea, beating out Chinese competitors for control of a strategic site in a region where Beijing has been flexing its military muscle.
Cerberus is headed by Stephen Feinberg, a billionaire political donor whom former President Trump drafted onto the President’s Intelligence Advisory Board, which counsels the commander-in-chief on US foreign intelligence matters. SubCom, Cerberus and Feinberg did not respond to requests for comment.
Presented with Reuters’ findings, a spokesperson for the US Navy’s Pacific Fleet confirmed the existence of a new high-speed undersea internet cable to Diego Garcia. It was the first official acknowledgement of that cable.
‘The resiliency, redundancy, and security of our communication infrastructure represents a top priority for US Pacific Fleet,’ the spokesperson said in an emailed statement.
The statement said the Navy could not discuss specifics for operational security reasons. The Navy did not respond to Reuters’ questions about SubCom or name the company in its statement.
SubCom’s journey from Cold War experiment to global cable constructor and now a shadowy player in the US-China tech war, is detailed in this story for the first time.
Reuters is revealing details of the Diego Garcia project and SubCom’s deepening ties with the Pentagon. The news agency is also the first to report on a confidential contract the company secured from tech giant Google to build the world’s largest private undersea internet network.
That partnership is the kind of America Inc project that President Joe Biden has been calling for in his drive to promote US advanced technologies. Google did not respond to requests for comment.
Undersea cables transmit 99% of all transcontinental internet traffic, including instant messenger chats, stock market transactions, and military secrets. This underwater network has become one of the key weapons in the US-China tech war, as detailed in a Reuters investigation published in March. Subsea cables are vulnerable to sabotage & espionage, and Beijing and Washington have accused each other of tapping cables to spy on data or carry out cyberattacks.
SubCom’s increasing importance to the USA can be split into 2 categories, one military and one economic, according to 2 subsea cable industry officials who have worked on US government projects.
Based in the small borough of Eatontown, New Jersey, undersea internet cable firm SubCom is playing an outsized role in the race between the USA and China to dominate advanced technologies.
First, Washington needs SubCom to expand the Navy’s undersea cable network so that it can better coordinate military operations and enhance surveillance on China’s expanding fleet of submarines & warships, the people said. Second, the Biden administration wants SubCom to build more commercial subsea internet cables controlled by US companies, a strategy aimed at ensuring that the USA remains the primary custodian of the internet, according to the 2 industry officials.
SubCom operates 6 cable-laying ships: bespoke deep-sea vessels fitted with vast storage drums to hold sheaves of fiber-optic cable. The Navy has only one such ship – 40-year-old USNS Zeus – a vessel so old that it is limited to carrying out repairs, according to Eckhard Bruckschen, director of the England-based Undersea Cable Consultancy: ‘SubCom is indispensable to America if it wants to control subsea cables. They’ve got no one else.’
There are only 4 major companies in the world that manufacture and lay subsea cables: USA’s SubCom, Japan’s NEC Corporation, France’s Alcatel Submarine Networks, and China’s HMN Tech.
For sensitive US projects, Washington only works with SubCom, according to 5 industry sources who have worked on projects with the cable company.
The US Department of Defense and the White House did not respond to requests for comment.
Picking sides – Until a US crackdown on Chinese tech companies ramped up 5 years ago, SubCom laid cables for telecom and tech companies worldwide, including the big state-owned Chinese carriers.
Not anymore. The cable firm now works almost exclusively for the US military and big US tech firms, two SubCom employees told Reuters.
SubCom’s pivot reflects a sea change underway in the internet infrastructure industry, which has long seen choosing sides in great-power politics as bad for business. But US sanctions on Chinese tech companies and an increase in trade-protectionist policies under Biden and his predecessor Trump have forced US tech firms to work mainly with companies and countries viewed as friendly to the USA.
The US Department of Justice in 2020 blocked Google, Meta and Amazon from building fiber-optic cables from the US to Hong Kong due to concerns about Chinese spying.
Microsoft – whose President Brad Smith said in 2017 that the tech sector needed to be a ‘neutral digital Switzerland’ – announced in May that it had discovered Chinese state-sponsored hackers targeting US critical infrastructure, a rare example of a big tech firm calling out Beijing for espionage. China’s Foreign Ministry spokesperson Mao Ning said at the time that the accusations were part of a US disinformation campaign, describing the USA as the ‘empire of hacking.’
In December of last year, the Pentagon awarded $9billion worth of Cloud computing contracts to Google, Amazon, Microsoft and Oracle, entrusting these companies to keep the USA’s most closely held secrets under digital lock and key.
[SubCom last year delivered super-fast internet service to the atoll via a secret spur off a commercial undersea fiber-optic cable it was laying nearby. US Navy via Reuters]
‘Silicon Valley is waking up to the reality that it has to pick a side,’ said Jacob Helberg, former head of Google’s news policy and a member of the US-China Economic & Security Review Commission, a government agency.
Google did not respond to a request for comment. Amazon, Microsoft and Oracle declined to comment.
SubCom’s loyalty is especially important because it is the only major US subsea cable company. Headquartered in the quiet borough of Eatontown, New Jersey, SubCom secured a $10mn-a-year contract in 2021 from the US Department of Transportation (DOT) to run a 2-vessel fleet to provide undersea cable security, according to one SubCom employee and one Navy staffer with knowledge of the deal. A 2020 DOT notice to prospective applicants said winners would be responsible for laying, maintaining and repairing subsea cables to support US national security and economic interests, in partnership with the Department of War.
The SubCom ships CS Dependable & CS Decisive now make up the US government’s first Cable Security Fleet, the people said. The DOT and SubCom did not respond to requests for comment.
Operation ‘Big Wave’ – One of CS Dependable’s destinations was Diego Garcia, a horseshoe-shaped atoll which hosts US aircraft carriers & submarines, and has an airfield capable of landing long-range bombers.
Located in the heart of the Indian Ocean, Diego Garcia is an English colony. Since the 1970s, England has allowed the USA to operate a naval base there. The island is currently home to around 3,000 people, including Navy sailors, family members and support staff, 2 people who worked on the atoll told Reuters, speaking on condition of anonymity. Diego Garcia boasts shops, restaurants, bars and pristine beaches. Prior to the laying of the new subsea cable, the island base accessed the internet via satellites, which are slower and less reliable than cables, the 2 said.
The CS Dependable’s clandestine underwater operation on Diego Garcia was never mentioned publicly by participants in the business deal that made it happen. Rather, they carefully obscured the US military component within a larger private-sector cable project, according to 4 subsea cable industry sources with knowledge of the arrangement.
In 2020 SubCom announced that it had been commissioned by an Australian tech mogul to lay a $300million commercial internet cable from Australia to the Sultanate of Oman on the Arabian Peninsula, a route that traverses the Indian Ocean.
That project, known as the Oman Australia Cable, was spearheaded by Subco, a Brisbane-based subsea cable investment company owned by Australian entrepreneur Bevan Slattery.
The industry was skeptical about the commercial viability of the route, given it would mostly serve a small pool of Australian telecom firms that already had access to multiple cables running through Southeast Asia to the Middle East, 5 industry sources told Reuters.
The Secret Splice – SubCom announced in 2020 that it was building a commercial subsea internet cable from Australia to Oman. The $300mn project included a clandestine link to a US Navy base on the remote Indian Ocean island of Diego Garcia, which was funded by the Pentagon.
What many of them didn’t know was that the Pentagon had paid for around a third of the entire cable on the condition that it include a splice connecting its commercial trunkto Diego Garcia, 2 of the people with knowledge of the project told Reuters.
The US Pacific Fleet, in its statement to Reuters, said Subco’s Oman Australia Cable offered ‘a unique opportunity’ to connect the remote island with an undersea fiber-optic internet cable; the US Pacific Fleet partnered with companies laying the Oman Australia Cable to extend a branch to Diego Garcia, but did not disclose how much it paid for the spur. ‘This partnership has increased the digital resiliency and security of our communication infrastructure in the Indo-Pacific,’ the statement said.
While the Navy had said nothing officially about the cable until now, sailors on Diego Garcia were tipped off last year. Captain Richard Payne, then-commander on Diego Garcia, mentioned the cable during a Feb 9 guest appearance on the base’s local radio station, 99.1 The Eagle, a recording of which was posted on the Navy radio station’s Facebook page.
Payne, who was fielding questions submitted by listeners, volunteered that an unusual vessel could be sighted off the western shore of Diego Garcia. ‘We’re going to have fiber optics here on the island very soon,’ Payne told the program’s host, Alex Kerska or ‘DJ Special K,’ during the segment in which he also addressed complaints about high beer prices on the atoll and called on island residents to attend a kickball tournament.
‘Starting today (or) tomorrow, we have the cable-laying ship that is out there off the coast now. It’s a commercial company doing that… It’s a very interesting ship,’ Payne continued, without naming the company or the ship.
Payne, who now works in the office of the Under Secretary of Defense for Intelligence & Security, did not respond to a request for comment. The ship Payne was referring to was the CS Dependable, according to the SubCom and Navy sources with knowledge of the operation.
SubCom’s CS Reliance vessel laid the first half of the commercial cable from Perth, Australia, to the middle of the Indian Ocean. From there, the CS Dependable took over, running the splice to Diego Garcia and laying the rest of the main trunk up to Oman, the people said.
Reuters analyzed satellite images and ship tracking data on Eikon, the financial analysis platform owned by the London Stock Exchange Group. That information showed the CS Dependable operating around Diego Garcia in February and March of 2022, then sailing on to Oman.
The delicate operation was made possible by a decades-long friendship between 3 veterans of the subsea cable industry, according to 2 people with knowledge of the dealings.
SubCom CEO David Coughlan talks about undersea cable technology on YouTube on July 15, 2021. He coordinated the laying of the secret cable to a US Navy base on the remote island of Diego Garcia, according to Navy and SubCom sources.
Helping Coughlan in that effort, sources said, was Catherine Creese, director of the US Naval Seafloor Cable Protection Office, shown here speaking at an April 8, 2021, virtual forum about Asia’s evolving subsea cable networks. She previously worked with Coughlan at the company now known as SubCom Coordinating the Pentagon’s end was Catherine Creese, a former US Coast Guard officer who is now Director of the US Naval Seafloor Cable Protection Office, the unit that oversees the Navy’s subsea cables.
Prior to joining the Navy in 2006, Creese worked at SubCom for 11 years, a time when it was known as Tyco Telecommunications. There she worked closely alongside the man who is now SubCom’s CEO, David Coughlan, according to 2 former SubCom employees who worked with Coughlan and Creese.
Coughlan and Creese planned and executed the Diego Garcia operation, according to one current SubCom employee and one Navy staffer.Creese and Coughlan did not respond to requests for comment. The US Navy did not respond to questions about Creese’s involvement.
‘Dreams come true’ – Selling the cable to investors, meanwhile, was the purview of Slattery, the Australian entrepreneur, who has made a fortune building & selling private undersea cables. In a conservative industry, the businessman stands out as a gregarious and outspoken character who is willing to take on risky projects, according to 3 industry sources who have worked with Slattery. Slattery did not respond to requests for comment.
SubCom’s Coughlan helped Slattery pull off his first major cable deal in the late 2000s, setting him on course to become one of Australia’s wealthiest tech moguls, according to 2 industry sources with knowledge of the matter.
That project, a SubCom-built cable running between Brisbane & Guam, US Pacific island territory, also home to a naval base, almost bankrupted Slattery, the businessman told Australian Financial Review in a 2016 interview.
Thanks to sympathetic suppliers, Slattery got that cable, known as PIPE, over the line, according to the Financial Review article. Crucially, SubCom, the main supplier on the project, extended Slattery credit to get the cable finished, the 2 industry sources said.
Slattery sold the company that owned the PIPE cable for $248mn in 2010, the first of a string of successful tech infrastructure bets. Slattery has a personal net worth of $375 million (Financial Review 2020 ‘Rich List’). The entrepreneur pitched the Oman Australia Cable in public statements as an alternative to the traditional route between Australia & Middle East that passes through SE Asia. The spur to Diego Garcia was never mentioned.
A blueprint for such a project already existed. Slattery’s cable was essentially a revival and rerouting of a 2017 plan to build a cable between Australia & Republic of Djibouti on the Horn of Africa, with a secret link to Diego Garcia funded by the Pentagon, according to a person directly involved in that deal. Djibouti is the site of China’s first-ever overseas military base, which opened in 2017.
The earlier proposed cable – known as the Australia West Express – was never built because the US company behind the project, GoTo Networks, couldn’t secure the private investment needed to cover the portion not funded by the Pentagon, the person said.
(SubCom’s cable ship CS Dependable spent weeks in the waters around Diego Garcia in Feb-March 2022, ship tracking data shows. In this period the ship’s crew laid a secret subsea fiber-optic internet cable to a US Navy base on the atoll, according to SubCom and Navy sources. Source: Refinitiv Eikon)
John Mariano, the CEO of the now-defunct GoTo Networks, declined to comment. The US Department of Defense did not respond to a request for comment. An official from Djibouti president’s office declined to comment.
Cables are typically owned by a consortium of telecom & tech companies that spread the cost & risk. Occasionally entrepreneurs or private equity firms build a cable on spec with the aim of selling bandwidth to carriers and tech companies before flipping the cable for a profit.
Slattery is a master of such deals, 2 people who worked with him told Reuters: He used his experience and contacts to attract enough investors to supplement the Pentagon funding to get the Oman Australia Cable built.
The 10,000km cable was officially opened by Australian PM Anthony Albanese in October 2022. It includes a splice to the Cocos Islands, an Australian territory which comprises a cluster of tiny islands between Sri Lanka & Australia. Australia’s military has been seeking parliamentary approval for funds to upgrade an airfield there and make other improvements aimed at strengthening its maritime surveillance capabilities in the region.
Slattery on Nov 19, 2022, tweeted a group photo that included himself and Albanese, both with broad grins, celebrating the cable and the team that made ‘dreams come true.’ Albanese’s office did not respond to a request for comment about the project, its funding or potential military uses. An Oct 22, 2022, tweet sent from his account lauded the cable’s speed, security and reliability, and boasted that it could stream ‘over 65 million Netflix shows simultaneously.’ The government of Oman did not respond to a request for comment.
Levers of power – SubCom’s role in the project marked a return to its Cold War roots. The company was founded in 1955, according to its website, the year the first subsea transatlantic telephone cable system was laid between Scotland and Newfoundland. That cable was deployed by AT&T’s submarine cable unit, which would eventually become SubCom.
The true origins of AT&T’s subsea cable business go back 5 years earlier, when the company was commissioned by the US Navy to build a network of undersea surveillance cables to listen for Soviet submarines, according to 3 former employees with knowledge of the matter.The project was known as the Sound Surveillance System, or ‘Project Caesar,’ according to a declassified document about the program available on the US Navy’s website. The document does not mention AT&T’s involvement.
Once the Navy project was complete, AT&T’s submarine cable project morphed into a commercial business, the former employees said. AT&T did not respond to a request for comment.
In 1997 AT&T sold its cable-laying operation, including a fleet of ships, to Tyco International, a security company based in New Jersey. In 2018 Tyco sold the cable unit, by this time dubbed TE SubCom, for $325mn to Cerberus, the New York private equity firm.SubCom doesn’t make public many details about its business. The company has more than 1,300 employees and aannual revenue of $344mn, according to data on Eikon.
Last year SubCom signed a ‘master service agreement’ with Google, one of the world’s biggest investors in subsea internet cables, according to 2 people with knowledge of the deal.That contract, said to be worth hundreds of millions of dollars, could help Google build the world’s largest-ever private data network, connecting Cloud data centers around the world with a web of SubCom-manufactured undersea cables. Google did not comment.
More undersea cables and data centers in the hands of US companies like Google and SubCom is a win for Washington as it seeks to keep Chinese firms away from the internet hardware that will underpin global economic and military progress for decades to come, said Kellee Wicker, director of the Science & Technology Innovation Program at the Wilson Center, a Washington-based thinktank. ‘Cables are an enormous lever of power,’ Wicker said. ‘If you can’t control these networks directly, you want a company you can trust to control them.’
– Reuters.com/investigates/special-report/us-china-tech-subcom/
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B4. The Great Chatbot Bubble – David P Goldman
Microsoft has added about US$1.5trillion to its market capitalization this year after the launch of ChatGPT. Nvidia has added about $640billion. Overall, the market value of generative AI models has increased by several trillions of dollars. What is supposed to justify this kind of valuation?
Market research firms claim that the market for generative AI will reach $126.5bn by 2031. That’s not a lot of revenue compared to the market valuation. Microsoft now sells at about 12 times sales, a natural monopoly.
Even if that estimate were correct, market valuations are 3-5 times higher than $126bn of revenue would justify. And I don’t see how generative AI can throw off that level of revenue, not by an order of magnitude.
Just what is generative AI supposed to do? Supposedly it can answer customer queries, replace low-level programmers and produce better online search results. But how much revenue can that bring in?
Let’s do some back-of-envelope calculations. Suppose that chatbots replaced every employee of every help desk in the USA. There are 38,808 help desk employees who earn on average $43,275 a year. Replace them all, and you save $1.68bn a year. Of course, you can’t replace all of them, and chatbots cost something, so I’ll guess that potential savings are $1bn a year, provided that the gizmo actually works.
‘Markets are bumping up chatbot valuations on faulty projections.’
Then there are computer programmers. ChatGPT can write basic code. There are 132,740 programmers in the US, so lets guesstimate that generative AI can replace the bottom quarter of them, or 33,185 programmers. The bottom quartile of programmers makes $34.84 an hour, according to the Bureau of Labor Statistics. that would save $2.312bn, minus the cost of the AI program.
So far we’ve wiped out 2 major areas of employment, and saved a bit over $3bn in paychecks. I don’t know where the marketing surveys came up with a $125bn number, but it seems as if they are off by an order of magnitude.
There are plenty of other generative AI applications, eg, for medical diagnostics. But we’ve heard that story before. AI was supposed to read x-rays faster and more accurately than a human radiologist, but that turned out to be a bust. ‘Radiologists have more reason than most to be disappointed, because CAD [computer-aided detection] in medical imaging was more than an unrealized promise. Almost uniquely across the world of technology, medical or otherwise, the hype & optimism around second-era AI led to the widespread utilization of CAD in clinical imaging. This use was most obvious in screening mammography, where it has been estimated that by 2010 more than 74% of mammograms in the US were read with CAD assistance. Unfortunately, CAD’s benefit has been questionable. Several large trials came to the conclusion that CAD has at best delivered no benefit and at worst has actually reduced radiologist accuracy, resulting in higher recall and biopsy rates,’ according to one study.
This isn’t the first instance of AI hype ballooning stock valuations
Remember autonomous vehicles? Ford put $1billion into an AV startup called Argo AI, valued at $12.4bn in 2021, and at zero in October 2022, when it shut down. Driverless cars are the technology of a future that won’t come anytime soon, at least not in the USA.
The dirty little secret of AVs is that they require an enormous amount of data with a very short transmission time (low latency). America’s so-called 5G network doesn’t have the low latency required for AVs. It’s only a hyped-up 4G with a slow response time. China already has autonomous taxi services in some cities. China’s 5G network is not only the world’s largest, but also offers a nearly instantaneous response time made possible by the new technology. AVs are a great idea when you have broad & straight roads (as in some Chinese cities), but not in the jumble of US urban landscapes.
Mark Zuckerberg’s Meta put $100bn into a virtual reality world that couldn’t find enough visitors willing to wear heavy and expensive headsets. Meta’s stock price collapsed in the wake of the Metaverse fiasco, but soared along with other tech companies in the AI bubble.
The hypothetical calculations above really are beside the point. ChatGPT interacts very badly with real human beings. By the standards of a human 10-year-old, it’s really, really dumb. It can’t make the kind of mental connections that make humor possible. In a recent essay for Law & Liberty, I reported some less-than-satisfactory exchanges with OpenAI‘s chatbot on the subject of self-referential humor.
Joking aside, generative AI simply can’t fathom how human beings think & talk. Mental associations that come naturally to human beings are incomprehensible to generative AI models, unless the models happen to have been trained on an identical case in the past.
They won’t replace help desk representatives any time soon, let alone radiologists. & the trillions of stock market valuations that mushroomed in anticipation of generative AI will vanish like the other AI bubbles of the past few years.
AI, to be sure, works wonders when it is applied to routine tasks, eg, picking defective items off a conveyor belt, or manipulating autonomous cranes and trucks at a port. The US’ largest port at Long Beach, California, is one of the world’s least efficient (ranks 300 on the World Bank list). It takes roughly 48 hours to unload a large container ship. At China’s most modern port, Tianjin, a 5G network using AI systems designed by Huawei can unload the same ship in 15 minutes. Smart cranes find bar codes on containers, move them to autonomous trucks and go on to the next. AI is there to free humans from mechanical tasks, not to make machines imitate humans. That’s where AI will add economic value. – ee Industry, Inside the Chatbot
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B5. Industrial Policy & the Tech Predator – Stephen Roach
US Trade Representative (USTR) determines that the Chinese government directs and unfairly facilitates the systematic investment in, and acquisition of, US companies and assets by Chinese companies, to obtain cutting-edge technologies and intellectual property (IP) and generate large-scale technology transfer in industries deemed important by state industrial plans. – March 2018 USTR Section 301 report (p65)
The USTR’s Section 301 complaint also indicts China’s seemingly unique approach to industrial policy: state-directed subsidized support to targeted industries. Not only does this aspect of the narrative allege unfair government support of advanced-technology industries – implying that China does something other responsible nations do not – it also accuses China of an unusually aggressive outbound investment campaign (‘going out’ in the Chinese vernacular) aimed at acquisitions of leading US technology companies. What China can’t do at home, goes the argument, it will accomplish through predatory activity abroad – especially in the US. China was accused by the USTR of using state support to snatch competitive supremacy from free and open market-based systems that are supposedly playing by very different, and of course fair, rules.
China makes no bones about its long-standing support of industrial policy. Since the era of Soviet-style central planning in the 1950s, state-directed support of industrial development – especially targeting those areas the government wants to champion and then providing funding mechanisms to hit those target – has long been an active element of China’s economic strategy. In the past decade, several high-profile industrial policy initiatives have been prominently featured in its various 5-year plans. In the technology area they include an early focus on ‘strategic emerging industries’ (2010), followed by more formal plans such as Made in China 2025 & Internet Plus Action Plan (2015), and the New Generation AI Development Plan (2017); there are also a profusion of industry-specific plans covering government support for advanced industries such as electric vehicles, renewable energy, robotics, biotechnology, information technology, integrated circuits, and aviation. Other efforts, especially the pan-regional Belt & Road Initiative (BRI), also smack of industrial policy, but they are less germane to the debate over Chinese technology strategy raised by the USTR’s Section 301 complaint.
The Made in China 2025 campaign struck an especially raw nerve when it was rolled out. It was seen in the US as prima facie evidence of China’s devious plot to attain global dominance in the great industries of the future: autonomous vehicles, high-speed rail, advanced information technologies & machine tools, exotic new materials, biopharma & sophisticated medical products, as well as new power sources & advanced agricultural equipment. Implicit in the US response is the accusation that China is taking aim at future industries that the USA has claimed as its own. Peter Navarro, former Trump administration trade advisor, famously claimed ‘China has targeted America’s industries of the future… if China successfully captures these emerging industries, America will have no economic future’ (CNBC interview with Peter Navarro, June 19, 2018; also see White House Office of Trade & Manufacturing Policy, June 2018. For a critique of USA’s bilateral fixation on China expressed by the since criminally indicted Navarro, see Klein & Pettis, Trade Wars Are Class Wars).
Several questions arise: How unique is China’s industrial policy strategy? The USTR makes it sound as if China alone engages in such efforts. What is China trying to accomplish with industrial policy? The Chinese make it clear that their industrial policies are focused on enhancing indigenous innovation by developing domestic capacity in the design & production of new technologies. The USTR, along with Navarro & Trump, characterize this as an existential threat of the same magnitude as earlier threats by the former Soviet Union. The Chinese see it as a critical development imperative. Is there a right and wrong here?
The Section 301 report throws down the gauntlet in addressing the first of these questions, stating unequivocally that ‘Unlike China, the US does not have a broad-based industrial policy’ (see USTR Section 301 report, 152). Because of that, the USTR concludes, China has a distinct and unfair advantage over the US. Yet contrary to USTR assertions, China is hardly alone in the art & practice of industrial policy. At one time or another, most major advanced economies have deployed similar tactics with similar objectives. That includes the USA. President Eisenhower, in his 1961 farewell address, first drew attention to America’s powerful military-industrial complex as the linchpin of far-flung US efforts at state-sponsored, taxpayer-funded innovation (Dwight D Eisenhower’s Farewell Address to the Nation, ‘The Military-Industrial Complex,’ Jan 17, 1961; for a comprehensive assessment of US follow-up industrial policies of the 1970s, see Michael & Susan Wachter, eds, Toward a New US Industrial Policy?, 1981). The USA does it through the Defense Advanced Research Projects Agency (DARPA), housed in the Pentagon and created by Eisenhower in 1958 following the 1957 launch of the Sputnik satellite by the USSR.
With the USA’s total military budget now in excess of $700bn – more than the defense budgets of China, Russia, England, India, France, Japan, Saudi Arabia & Germany combined – DARPA and related science & technology efforts by the Defense Department enjoy sizable public funding (see Aaron Mehta and Joe Gould, ‘Biden Requests $715B for Pentagon, Hinting at Administration’s Future Priorities,’ Defense News, April 9, 2021; and Daniel Cebul, ‘US Remains Top Military Spender,’ Defense News, May 2, 2018. Funding levels for DARPA have remained relatively steady at just under $4bn in real terms through 2021, holding at a little over 20% of the US Defense Department’s overall budget for science & technology; see Marcy E Gallo, DARPA: Overview & Issues for Congress, 2021).
This [military funding] support has played an important role in the development of many major US technological advances, such as NASA-related spinoffs, the internet, the global positioning system (GPS), breakthroughs in semiconductors, nuclear power, imaging technology, and a broad array of pharmaceutical innovations including ‘operation warp speed,’ which led to spectacular innovations in Covid-19 vaccine development (Department of Defense, ‘DOD Awards $69.3mn Contract to CONTINUS Pharmaceuticals to Develop US-Based Continuous Manufacturing Capability for Critical Medicines,’ 2021).
These breakthroughs have come largely from proactive government support to defend the USA’s innovation leadership. As this book goes to press, the US Senate and the House of Representatives have passed separate versions of targeted assistance to the domestic semiconductor industry and to other US companies that are thought to be feeling the heat of Chinese competition. And tightened regulatory oversight of alleged foreign technology threats – through expanded powers of the multi-agency Committee on Foreign Investments in the US (CFIUS) as well as through multilateral efforts like the recently proposed joint US & European Trade & Technology Council – are further highly visible manifestations of US industrial policy (June 8, 2021, the Senate passed the $250bn ‘US Innovation & Competition Act’ (S1260), while on Feb 4, 2022, the House passed $335bn ‘America COMPETES Act of 2022’ (HR4521); congressional reconciliation is pending as this book goes to press. Budgetary cost estimates for both pieces of legislation are based on assessments by the Congressional Budget Office, available at cbo.gov/. Both bills feature $52bn in targeted support for the US semiconductor industry; see Catie Edmondson, ‘Democrats Renew Push to Pass Industrial Policy Bill to Counter China,’ NYTimes, Jan 26, 2022. New regulations implementing the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) that were aimed at strengthening oversight and jurisdictional reach of CFIUS went into effect in Feb 2020. For a discussion of recent multilateral US-European industrial policy collaboration see Frances Burwell, ‘The US-EU Trade & Technology Council: 7 Steps toward Success,’ Atlantic Council, Sept 24, 2021).
Nor has the USA been alone in embracing industrial policy as a linchpin of national economic strategy. It was central to Japan’s so-called plan rational development state, which underlaid the country’s rapid growth in the 1970-80s (Chalmers Johnson, MITI & the Japanese Miracle: Growth of Industrial Policy, 1925-75, 1982). The Ministry of International Trade & Industry perfected the art of state-subsidized credit allocation & tariffs to protect Japan’s sunrise industries; in 2021 its successor, the Ministry of Economy, Trade & Industry, proposed a ‘new axis in economic and industrial policy’ featuring targeted efforts in new technologies, strategic goods, regulations & systems aligned with societal goals such as climate change, security, inequality (Takeshi Yamaguchi &Hiromu Uezato, Era of New Industrial Policy?, 2021).
Germany took a similar route with its impressive Wirtschaftswunder, augmented by strong state-directed support for the Mittelstand of small and medium-size enterprises; its more recent Industrie 4.0 (2013) is comparable in focus and scope to China’s Internet Plus plan (Federation of German Industries, The Mittelstand: The Heart of the German Economy, english.bdi.eu/topics/germany/the-mittel stand/; and Asha-Maria Sharma & Claudia Grüne, Industrie 4.0: From Concept to New Reality, Germany Trade & Investment, 2018). And France’s well-known model of ‘indicative planning,’ which dates back to President Charles de Gaulle’s 5th Plan of 1966–70, specifically emphasized a ‘fusion of economic & political power’ that merged the French industrial system with the state (Niles Hansen,’ French Indicative Planning & New Industrial State,’ Journal of Economic Issues 3, 1969).
Yet the USTR goes even further, indicting Chinese industrial policy as the instrument of predatory acquisitions of US technology companies through its ‘going out’ campaign of foreign direct investment in the US. These efforts are depicted as a unique state-directed & -funded plan aimed at gobbling up innocent and unprotected newly emerging US companies and their proprietary technologies. Section 301 report devotes more than twice as many pages to charges concerning China’s supposed external technology theft via offshore acquisitions as it does to internal transfers through JVs & alleged unfair licensing practices. This accusation is framed as a blatant grab by China for the US’ most precious assets as the world’s leading innovator. Based mainly on a case-by-case assessment of several Chinese acquisitions of US technology companies, the report concludes, ‘USTR determines that the Chinese government directs & unfairly facilitates the systematic investment in, and acquisition of, US companies & assets by Chinese companies, to obtain cutting-edge technologies & intellectual property (USTR 301 report, 65).
Here again, a strong and unequivocal accusation is not well supported by fact. An annual tally of outbound mergers and acquisitions activity from China into the USA conducted by the American Enterprise Institute reveals that there were only 17 such transactions in the technology sector between 2005-17, the years immediately preceding Lighthizer’s Section 301 investigation (American Enterprise Institute & Heritage Foundation, Chinese Investment in the US Dataset, aei.org/china-global-investment-tracker). By contrast, there were 52 deals in the real estate sector. Moreover, the deal count of Chinese acquisitions of US technology companies over this period also lagged transactions in finance, energy, transportation & entertainment. These are not exactly the footprints of an aggressive predator, fixated on stalking Silicon Valley in search of juicy, vulnerable technology targets.
The conclusion that emerges is that China’s industrial policy efforts are neither unique nor unusually focused on leading-edge US technology companies. That brings up the deeper question of intent: What does China hope to accomplish with its technology-focused industrial policies? And does the US, specifically the USTR, have a legitimate basis for questioning that intent?
The answer to these questions hinges on the key role that technological breakthroughs and innovation play in economic development. In early-stage development, poor, backward countries typically rely on imports of technologies developed by more advanced nations. Over time, as developing nations adapt these technologies to the growing needs of their companies and people, they usually make a transition from imported to indigenous innovation. This entails a shift in focus from importing technologies to breakthroughs developed at home – in research labs, companies, entrepreneurial start-ups, and universities.
Many believe that this shift from imported to indigenous innovation marks a critical transition in economic development. As a developing economy approaches the frontier of innovation established by advanced economies, making that shift becomes all the more important. Failure to do so is often associated with the middle-income trap, the tendency of developing nations to slow down when they reach the middle-income threshold (Eichengreen, Park & Shin, ‘When Fast Growing Economies Slow Down: International Evidence & Implications for China,’ NBER, 2011; and ‘Growth Slowdowns Redux: New Evidence on the Middle-income Trap,’ NBER, 2013).
While there is intense debate over the empirical validity of this argument, there can be no doubt that indigenous innovation is ultimately a significant objective for any nation (The critical linkage between economic growth and indigenous innovation is discussed [later]; for an assessment of the empirical validity of the middle-income trap, see Lant Pritchett and Lawrence H. Summers, ‘Asiaphoria Meets Regression to the Mean,’ NBER Working Paper No. 20573, October 2014). And as the following chapter of this book argues, it certainly makes great sense to view China as being on the cusp of this critical transition (see Fabrizio Zilibotti, ‘Growing and Slowing Down Like China,’ Journal of the European Economic Association 15, no. 5, October 2017).]
Yet the USTR’s Section 301 report repeatedly depicts China’s emphasis on indigenous innovation as a dire threat to the US. This accusation is less about allegations of theft and more about an audacious sense of entitlement. From Robert Lighthizer to Peter Navarro to Donald Trump, the inference is that China is not entitled to develop its own organic system of technological change and innovation. Its success is viewed as equivalent to a claim on the same future that the US sees as its own. While the USTR had every right to question the legal and moral integrity of the means to China’s push for indigenous innovation – and, unfortunately, did a poor job of making that case – it has no place questioning the right of any nation to aspire to innovation-based prosperity. Notwithstanding the USTR’s anti- China bluster, the US does not have a monopoly on indigenous innovation. (From: Accidental Conflict, America, China, & the Clash of False Narratives, Chapter 4, ‘Bilateral Bluster’)
*
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C. Building Blocks
*
Every ee carries these extracts below to counter: 1) The constant harangue about exports, when they must at all times serve to advance or recapture and control of our home markets to develop modern industry. 2) We need to learn about machine industry versus handicraft, assembly and manufacture 3) The rules of the Sangha require constant interaction between people.
*
• ‘The biggest handicap to industrial development is not the lack of capital but the absence of external economics, such as cheap power, cheap transport, technical and managerial ability, and above all the lack of a home market. The home market in an agricultural country is essentially the rural market. It is only a prosperous peasantry that can provide the home market for our industry. This is the connection between a guaranteed price for paddy and the industrialization of our country’ – Philip Gunawardena
*
• ‘The Creation of a Home Market for our Industry is the pivot on which the future industrialisation of our country rests. In Ceylon’s context The Home Market essentially means The Peasant Market. To create the home market therefore we must substantially raise the living standards of the mass of the peasants so that they will be able to buy the goods produced by our industry. This demonstrates clearly the necessary connection between Industrialization & Agrarian Reform.’ – Policy Statement of the Ministry of Industries, 1956
*
• ‘Their field of production, the smallholding, admits of no division of labor in its cultivation, no application of science and, therefore, no diversity of development, no variety of talent, no wealth of social relationships. Each individual peasant family is almost self-sufficient; it itself directly produces the major part of its consumption and thus acquires its means of life more through exchange with nature than in intercourse with society.’ – Karl Marx, The 18th Brumaire of Louis Bonaparte, p124
*
• ‘Japan will retain and encourage the branches of the machine industry that yield high added value, but production facilities that involve a low degree of processing and generate low added value should be moved to developing countries… so that Japan can concentrate on high technology & knowledge-intensive industry.’– Japan’s Council on Industrial Structure, 1977 (in SBD de Silva, The Political Economy of Underdevelopment)
*
• Economics Not Taught
The Machines Nobody Knows – The Extraordinary Culture of Machine Tools – If we were a truly ‘developing’ country, here are the questions a national media would need to ask: A plan requires a political, economic & military strategy, which will first assess peasant & worker power, land (including natural resources), & capital, that the nation possesses, and the time needed to transform these powers into material reality:
Here’s ee’s Index of a Real Economy or, at least, how a real economy would be measured:
1. The index of a strong economy is modern industry.
2. The index of modern industry is the production of machines.
3. Machine tools (MT) are the most important of all machines.
4. MT is needed for huge diversified metal fabricating industries (auto, electrical, etc.)
5. MT is essential for production of machines for all other industries.
6. Full data on machinery production is needed:
7. What portion of our machinery needs are supplied by machines built in Sri Lanka?
8. What is the trend? Are we producing more or less machines than we did before?
9. Data on imports & exports of machinery is needed (esp shipments of MTs & other Industrial Machinery)
10. MT production vs imports, must include: Mining & Metallurgical Machinery, Pulp & Paper Machinery, Textile Machinery, Woodworking Machinery, Logging Machinery, Sawmill Machinery, Office & Business Machines (adapted from: ee 20-26 Sept 2020).
*
• Making Central Banks Independent of the People?
– anchor.fm/shiran-illanperuma/episodes
– youtube.com/watch?v=_AWg6VvTj9g
– eesrilanka.wordpress.com/2019/08/10/imf-independence-the-central-bank/
– eesrilanka.wordpress.com/2020/06/27/make-the-central-bank-independent-of-capitalism/
*
• On State-Owned Enterprises and Privatization
– anchor.fm/shiran-illanperuma/episodes/On-State-Owned-Enterprises-and-the-Privatization-Debate-w-Vinod-Moonesinghe-e1vric4
*
__________________________________________________________
D. News Index______________________________________________
• ee News Index provides headlines & links to make sense of the weekly focus of published English ‘business news’ to expose the backwardness of multinational, corporate controlled ‘local media’:
*
___________________
D1. Sovereignty
(ee is pro-politics, pro-politician, pro-nation-state, anti-corporatist, anti-expert, anti-NGO)
ee Sovereignty news emphasizes sovereignty as economic sovereignty – a strong nation is built on modern (machine-making) industrialization fueled by a producer culture.
• CP Chief calls for re-alignment of political forces to thwart Ranil
– island.lk/cp-chief-calls-for-re-alignment-of-political-forces-to-thwart-ranil/
• Taking the lid off the Golden Bowl – Gundasa Amarasekera
– island.lk/taking-the-lid-off-the-golden-bowl/
– island.lk/taking-lid-off-golden-bowl/
• US & China wage war beneath the waves
– reuters.com/investigates/special-report/us-china-tech-cables/
• Inside the subsea cable firm secretly helping USA wage war in the ocean
– reuters.com/investigates/special-report/us-china-tech-subcom/
• Ceylon achieved Independence but, still, colonial masters owned & wrote the rule book
– island.lk/getting-a-break-into-tea-tasting-a-short-stint-at-mobil-and-then-back-to-tea/
• Chinese Ambassador tells Lanka to stand up for its rights to gain respect and end bullying
– island.lk/chinese-ambassador-tells-lanka-to-stand-up-for-its-rights-to-gain-respect-and-end-bullying/
• Senthil Thondaman meets India’s External Affairs Minister in Delhi
– sundaytimes.lk/230702/columns/sophisticated-vehicle-racket-at-presidential-secretariat-524408.html
• Indian Foreign Secretary to visit Sri Lanka next week
– adaderana.lk/news.php?nid=91810
• President Ranil Wickremesinghe’s visit to New Delhi, scheduled for 20 July
– adaderana.lk/news.php?nid=91810
• ‘You Saved Us’: Lanka Speaker Thanks India for Providing Aid Amid Crisis
– lankaweb.com/news/items/2023/07/07/you-saved-us-lanka-speaker-thanks-india-for-providing-aid-amid-crisis/
• Sumanthiran: Excavation of supposed mass grave site doesn’t conform to international standards
– island.lk/sumanthiran-excavation-of-supposed-mass-grave-site-doesnt-conform-to-international-standards/
• Tamil Buddhist ලු
– lankaweb.com/news/items/2023/07/07/tamil-buddhist-%e0%b6%bd%e0%b7%94/
• India’s rich Buddhist heritage showcased at Gangaramaya Temple on Esala Poya
– island.lk/indias-rich-buddhist-heritage-showcased-at-gangaramaya-temple-on-esala-poya/
• Navy takes hold of Kerala cannabis with gross street value of over Rs. 30 Mn in Mannar
– island.lk/navy-takes-hold-of-kerala-cannabis-with-gross-street-value-of-over-rs-30-mn-in-mannar/
• Navy apprehends a suspect with 1947kg of smuggled Kendu leaves in Puttalam
– island.lk/navy-apprehends-a-suspect-with-1947kg-of-smuggled-kendu-leaves-in-puttalam/
• MP Weerasumana Weerasinghe appointed President of Sri Lanka – Vietnam Parliamentary Friendship Association
– island.lk/mp-weerasumana-weerasinghe-appointed-president-of-sri-lanka-vietnam-parliamentary-friendship-association/
• Israel to have direct flights to BIA in Oct.
– island.lk/israel-to-have-direct-flights-to-bia-in-oct/
• Netherlands to return looted colonial-era treasures to Sri Lanka, Indonesia
– themorning.lk/articles/VR0ygiFeYIRA916lcXKA
– lankaweb.com/news/items/2023/07/07/netherlands-to-return-nearly-500-looted-objects-to-indonesia-and-sri-lanka/
• Truth about Sihela ambassadors to court of Roman Emperor Claudius
‘Now to deal with the crass lie that Devapriya reproduces from some distortionist source about the historic delegation of four Sinhalese ambassadors sent to the court of the Roman emperor Claudius by king Bhatikabhaya Tissa of Sihela’
– island.lk/truth-about-sihela-ambassadors-to-court-of-roman-emperor-claudius/
• US envoy’s trunk call to Biden: Ranil diverts it to Foster Dulles
– sundaytimes.lk/230702/columns/sophisticated-vehicle-racket-at-presidential-secretariat-524408.html
• To US Foreign Policy Veteran Haass, the Real Danger Is at Home
– nytimes.com/2023/07/01/us/politics/richard-haass-biden-trump-foreign-policy.html
• The Sun Sets on Richard N. Haass’ CFR Career
– simplicius76.substack.com/p/the-sun-sets-on-richard-n-haasss/comments
• State sovereignty must be altered in globalized era – Richard Haass (2006)
‘In the age of globalization, states should give up some sovereignty to world bodies in order to protect their own interests…’
– taipeitimes.com/News/editorials/archives/2006/02/21/2003294021
• India and the global balance of power
– sundaytimes.lk/230702/sunday-times-2/india-and-the-global-balance-of-power-524341.html
• India’s discontent with the SCO
‘Delhi increasingly frustrated that more countries from South Asia (eg., Maldives, Bangladesh, Nepal, Pakistan) are finding SCO to be an alternative to the SAARC, which India is subjecting to slow death.’
– indianpunchline.com/indias-discontent-with-the-sco/
• The Mirage of the ‘United Front’ in Myanmar – The Irrawaddy (CIA)
– irrawaddy.com/opinion/guest-column/the-mirage-of-the-united-front-in-myanmar.html
• China’s top-ranking diplomat told Japan & South Korea their people can dye their hair blonde and make their noses sharper but that they’ll ‘never become Westerners,’ urging them to work with Beijing instead
– businessinsider.com/china-diplomat-tells-japan-south-korea-theyll-never-become-westerners-2023-7
• US & England agree ‘Atlantic Declaration,’ pledge economic warfare against Russia and China
– wsws.org/en/articles/2023/06/09/rqwy-j09.html
• Bashing China Has Replaced the US Diplomatic Dialogue
– moonofalabama.org/2023/07/bashing-china-has-replaced-the-diplomatic-dialogue.html
• Last Colonial Governor of Hong Kong on Truth and Democracy
– sundaytimes.lk/230702/sunday-times-2/truth-and-democracy-the-rot-within-liberal-nations-524377.html
• IAEA gives go-ahead to Japanese plan to dump Fukushima radioactive waste water into Pacific
– radiohc.cu/en/noticias/internacionales/327760-iaea-gives-go-ahead-to-japanese-plan-to-dump-fukushima-radioactive-waste-water-into-pacific
• The Island Idyll and the US Occupation of Okinawa
– apjjf.org/-David-McNeill/1768/article.html
• Japan’s Native Ainu Fight to Restore a Last Vestige of Their Identity
– nytimes.com/2023/07/02/world/asia/japan-ainu-fishing.html
• PNG is our country. We must not give it away
– pngattitude.com/2023/06/png-is-our-country-we-must-not-give-it-away.html#more
• US gazumps Australia for control of Pacific region
– pngattitude.com/2023/06/us-gazumps-australia-for-control-of-region.html
• Military Initiative by Australia, England and US (AUKUS) is Another Major Step in Prospective War on China
– covertactionmagazine.com/2023/06/29/military-initiative-by-australia-the-united-kingdom-and-the-united-states-aukus-is-another-major-step-in-prospective-war-on-china/
• The courage to end the AUKUS partnership
– johnmenadue.com/the-courage-to-end-the-alliance/
• Israel’s bloodcurdling ‘poison policy’ to replace Palestinians with Jewish settlers
‘during the 1948 Nakba, Zionist militias engaged in a chemical and biological warfare campaign’
– thecradle.co/article-view/26684/israels-bloodcurdling-poison-policy-to-replace-palestinians-with-jewish-settlers
• Jenin Massacre: never ending torture to Palestinian Muslims
– lankaweb.com/news/items/2023/07/07/jenin-massacre-never-ending-torture-to-palestinian-muslims/
• UN agencies express alarm at scale of Israeli assault on Jenin
– radiohc.cu/en/noticias/internacionales/327570-un-agencies-express-alarm-at-scale-of-israeli-assault-on-jenin
• Iran Cautiously Examines Suspension of Bob Malley
‘The government-run Mehr Agency asked whether Malley’s suspension was a ‘tactical change’ in the negotiating team, but underestimated the impact of his absence on the course of the negotiations.’
– english.aawsat.com/world/4411406-iran-cautiously-examines-suspension-bob-malley
• Somalia: The Lawless Frontier
– blackagendareport.com/somalia-lawless-frontier
• A Brutal Colonial Legacy is Tinder for Fires Sweeping Across France
– newsclick.in/brutal-colonial-legacy-tinder-fires-sweeping-across-france
• Resisting French Imperialism: 60 Years Since The 1961 Massacre of 200 Algerians in Paris
– youtube.com/watch?v=rI6e9rWQJw8
• Poisonous legacy of 8-year Algerian war of independence ended in 1962 never been overcome
– nytimes.com/2023/07/01/world/europe/nahel-funeral-france-protests.html
• France’s Social Divide
‘5.4 million inhabitants, or 8% of the French population….the unemployment rate is 2.5 times higher than the national average …’
– statista.com/chart/30322/comparison-socio-economic-indicators-disadvantaged-areas-and-france-as-whole/
• US State Department-Trained French Activist/Arsonist Pouring Fuel on the Fire
– niccolo.substack.com/p/us-state-department-trained-french
• Silence of the Lambs – How the Russian Communists have Responded to the Wagner Mutiny & Prigozhin’s Empire
‘In the organized Russian political opposition, only the communist parties think differently and say so in public… they have publicly repudiated the pro-NATO line of the communist parties in Europe.’
– johnhelmer.net/silence-of-the-lambs-how-the-russian-communists-have-responded-to-the-wagner-mutiny-and-prigozhins-empire
• What’s the Score Now in the Russian Regime-Changing Game?
– johnhelmer.net/whats-the-score-now-in-the-russian-regime-changing-game/#more-88281
• Russia’s Time of Troubles
– johnhelmer.net/russias-time-of-troubles/#more-88271
• More Lavrov: Interview with Radio and TV Portugal 30 June 2023
– vk.com/@580896205-more-lavrov-interview-with-radio-and-tv-portugal-30-june-202
• Prigozhin’s Rebellion: What Just Happened in Russia?
– libertarianinstitute.org/articles/prigozhins-rebellion-what-just-happened-in-russia/
• The Darkness Ahead: Where the Ukraine War is Headed
– mearsheimer.substack.com/p/the-darkness-ahead-where-the-ukraine/comments
• Ukraine Changes War Tactic To One That Will Cause It More Losses
– moonofalabama.org/2023/07/ukraine-changes-wartactic-to-one-that-will-cause-it-more-losses.html
• Ukraine – Biden Again Escalates
– moonofalabama.org/2023/07/ukraine-biden-again-escalates-war/comments/page/2/#comments
• Newsweek reveals CIA role in Ukraine
– radiohc.cu/en/noticias/internacionales/327665-newsweek-reveals-cia-role-in-ukraine
• There’s No Such Thing as a Great Power: How a Dated Concept Distorts Geopolitics
– foreignaffairs.com/ukraine/theres-no-such-thing-great-power
• Belgium as buffer between post-Napoleonic France and England’s Euro maritime hubs
– newleftreview.org/sidecar/posts/middling-kingdom
• Is Ireland Getting Ready to Unite?
‘Sinn Féin looks set to win the general election in Norther Ireland…’
– nakedcapitalism.com/2023/06/is-ireland-getting-ready-to-unite.html
• Russia and China reject deployment of foreign force in Haiti
– radiohc.cu/en/noticias/internacionales/327812-russia-and-china-reject-deployment-of-foreign-force-in-haiti
• United Nations pushes for international security force in Haiti
– radiohc.cu/en/noticias/internacionales/327796-united-nations-pushes-for-international-security-force-in-haiti
• US Legally Owes Nicaragua Reparations, Still Refuses to Honor 1986 International Court of Justice Ruling
– blackagendareport.com/us-legally-owes-nicaragua-reparations-still-refuses-honor-1986-international-court-justice-ruling
• Peru orders seizure of assets of former President Pedro Castillo
– radiohc.cu/en/noticias/internacionales/327661-peru-orders-seizure-of-assets-of-former-president-pedro-castillo
• Republicans’ New Border Plan: Send Military into Mexico
– wsj.com/amp/articles/republicans-new-border-plan-send-military-into-mexico-42121a5e
• Frederick Douglass on 4th of July: There is not a nation of the earth guilty of practices more shocking and bloody
– radiohc.cu/en/noticias/internacionales/327342-frederick-douglass-on-4th-of-july-there-is-not-a-nation-of-the-earth-guilty-of-practices-more-shocking-and-bloody
• Biden nominates Elliott Abrams, ultra-right-wing death squad supporter, to US Advisory Commission on Public Diplomacy
– radiohc.cu/en/noticias/internacionales/327663-biden-nominates-elliott-abrams-ultra-right-wing-death-squad-supporter-to-us-government-commission
*
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D2. Security (the state beyond ‘a pair of handcuffs’, monopolies of legitimate violence)
ee Security section focuses on the state (a pair of handcuffs, which sposedly has the monopoly of legitimate violence), and how the ‘national security’ doctrine is undermined by private interests, with no interest in divulging or fighting the real enemy, whose chief aim is to prevent an industrial renaissance as the basis of a truly independent nation.
• All Grama Sevakas given JP powers
– sundaytimes.lk/online/news-online/All-Grama-Sevakas-given-JP-powers/2-1142400
• Post of IGP vacant since 26 June
– island.lk/post-of-igp-vacant-since-26-june/
• The Cardinal and the Inspector General of Police
‘Why is the appointment of the IGP being delayed? Why does the Cardinal intervene?
– kalaya.org/2023/07/blog-post_34.html
• Dismissal of Katana Cop over Easter Sunday negligence
‘a pointer to the present trend in trying to get rid of intelligence officials doing the right thing and keeping those officials who toe the line of the political bosses.’
– island.lk/dismissal-of-katana-cop-over-easter-sunday-negligence/
• AG’s Dept. lawyers rebut Judicial Services Association stand on new HC judge
– island.lk/ags-dept-officers-take-exception-to-jsa-objections-to-one-of-them-being-appointed-to-high-court/
• Eran claims Govt. only brings laws to curb corruption but does not enforce
– ft.lk/front-page/Eran-claims-Govt-only-brings-laws-to-curb-corruption-but-does-not-enforce/44-750373
• Go to the law, not another ‘truth and reconciliation’ charade
– sundaytimes.lk/230702/columns/go-to-the-law-not-another-truth-and-reconciliation-charade-524379.html
• Territorial policing in Ratnapura and a dreaded transfer to Jaffna
– island.lk/territorial-policing-in-ratnapura-and-a-dreaded-transfer-to-jaffna/
• NATO members’ failure in reaching consensus on new successor reflects growing divergence
– globaltimes.cn/page/202307/1293793.shtml
• English Police Raid Leaves Russian Billionaire’s Domestic Staff in Sanctions Limbo
– bloomberg.com/news/articles/2023-07-06/russian-oligarch-mikhail-fridman-police-raid-consequences-for-domestic-staff
• The failed coup in Russia through American looking glass
– indianpunchline.com/the-failed-coup-in-russia-through-american-looking-glass/
• 25 Tanks And Fighting Vehicles, Gone In A Blink: The Ukrainian Defeat near Mala Tokmachka was Worst than We Thought
– forbes.com/sites/davidaxe/2023/06/27/25-tanks-and-fighting-vehicles-gone-in-a-blink-the-ukrainian-defeat-near-mala-tokmachka-was-worst-than-we-thought
• Ukraine’s Offensive at 1 Month – Losing the War of Attrition
– youtube.com/watch?v=-a2lOuAfYsc
• Russo-Ukrainian War: The Wagner Uprising
– blackagendareport.com/index.php/russo-ukrainian-war-wagner-uprising
• Ukraine’s Implausible Theories of Victory
– foreignaffairs.com/articles/ukraine/2022-07-08/ukraines-implausible-theories-victory
• SITREP 7/4/23: Final Hour of Zelensky’s Terror Ploy
– simplicius76.substack.com/p/sitrep-7423-final-hour-of-zelenskys
• White House will arm Ukraine with banned cluster munitions
– radiohc.cu/en/noticias/internacionales/327712-white-house-will-arm-ukraine-with-banned-cluster-munitions
• Police Brutality, Racism and Poverty Underlines Youth Rebellion in France
– blackagendareport.com/police-brutality-racism-and-poverty-underlines-youth-rebellion-france
• French police gain remote and repressive spying powers
– radiohc.cu/en/noticias/internacionales/327791-french-police-gain-remote-and-repressive-spying-powers
• In Brutal Summer Heat, US Prisoners Say Their Cells Are Like ‘Stifling Hot Coffins’
– blackagendareport.com/brutal-summer-heat-prisoners-say-their-cells-are-stifling-hot-coffins
• Ben & Jerry’s co-founder Ben Cohen arrested protesting Julian Assange prosecution
– radiohc.cu/en/noticias/internacionales/327668-ben-jerrys-co-founder-ben-cohen-arrested-protesting-julian-assange-prosecution
*
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D3. Economists (Study the Economists before you study the Economics)
ee Economists shows how paid capitalist/academic ‘professionals’ confuse (misdefinitions, etc) and divert (with false indices, etc) from the steps needed to achieve a modern industrial country.
• Involuntary and inequitable DDO
– ft.lk/columns/Involuntary-and-inequitable-DDO/4-750228
• How the IMF took our leaders for a ride: What can be done today – Karunaratne
– lankaweb.com/news/items/2023/07/01/how-the-imf-took-our-leaders-for-a-ride-what-can-be-done-today/
• Crisis in Sri Lanka and the World – Asoka Bandarage
– lankaweb.com/news/items/2023/07/02/crisis-in-sri-lanka-and-the-world-by-asoka-bandarage/
• Pilfering pensions: The moral-ethical rockslide begins – Jayatillake
– ft.lk/columns/Pilfering-pensions-The-moral-ethical-rockslide-begins/4-750251
• ‘Hijacked State’ needs ‘reforms’ before DDO – Kusal Perera
‘this hybrid government has established an elite bureaucratic core group including the Governor of the CBSL, in taking decisions for the benefit of the filthy rich.’
– ft.lk/columns/Hijacked-State-needs-reforms-before-DDO/4-750256
• Economic crisis: Patali calls for punitive action against errant politicians, officials
– island.lk/economic-crisis-patali-calls-for-punitive-action-against-errant-politicians-officials/
• LIRNEasia estimates are based on a unidimensional approach to poverty
– ft.lk/columns/Aswesuma-v-Samurdhi-What-does-the-evidence-say/4-750167
• Lanka Democratic Movement (LDM) champions a competitive, market-based economy
– ft.lk/columns/Call-for-a-new-political-force-in-Sri-Lanka-Building-a-country-that-makes-sense/4-750121
• Revival of apparel exports is not likely until the global recession ends – Sanderatne
– sundaytimes.lk/230702/columns/economic-turnaround-likely-in-the-second-half-of-this-year-524382.html
• Domestic Debt Optimisation & Risking Employees Provident Fund (EPF) Benefits – Abeyratne
– sundaytimes.lk/230702/business-times/domestic-debt-optimisation-524004.html
• Sri Lanka can cut rates now, keeping them down as credit picks up will hit rupee – Bellwether
– economynext.com/sri-lanka-can-cut-rates-now-keeping-them-down-as-credit-picks-up-will-hit-rupee-125232/
• The abject reality of domestic debt restructuring
‘EPF would lose about Rs.12 trillion by 2038…several trade unions filed Fundamental Rights petitions’
– themorning.lk/articles/xSB7hLrdj0beOTW2j0ss
• Sri Lanka’s one final opportunity to rescue itself from a cycle of economic shocks that stretches back decades.
– lankaweb.com/news/items/2023/07/07/sri-lanks-one-final-opportunity-to-rescue-itself-from-a-cycle-of-economic-shocks-that-stretches-back-decades/
• China’s demographic doomsayers cite the wrong data
‘More important than aggregate Chinese population is the technically proficient Chinese population.’
– asiatimes.com/2023/07/chinas-demographic-doomsayers-cite-the-wrong-data/
• China Punishing Sanctions
– moonofalabama.org/2023/07/punishing-sanctions.html#comments
• The USA Has Just Destroyed a Great Empire – Hudson
– lankaweb.com/news/items/2023/07/01/america-has-just-destroyed-a-great-empire/
• From greedflation to stagflation and then slumpflation – Roberts
– thenextrecession.wordpress.com/2023/07/05/from-greedflation-to-stagflation-and-then-slumpflation/
• Should there really be a US Supreme Court? – Hudson
– michael-hudson.com/2023/07/should-there-really-be-a-supreme-court/
• The Supreme Court and Political Corruption –
‘Billionaire and republican donor Harlan Crow has paid for luxury vacations for Supreme Court Justice Clarence Thomas for more than 20 years…’
– blackagendareport.com/supreme-court-and-political-corruption
• What Local Governments Need to Lead – Mariana Mazzucato & James Anderson
‘Cities account for over half the world’s population…But owing to longstanding false narratives about the proper role of the state, many lack the capacity to tackle big challenges’
– project-syndicate.org/commentary/local-government-capabilities-index-by-mariana-mazzucato-and-james-anderson-2-2023-07
• How George Soros Broke the Bank of England
– youtube.com/watch?v=q4k8SGmJqIA
*
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D4. Economy (Usually reported in monetary terms)
ee Economy section shows how media usually measures economy by false indices like GDP, etc., in monetary terms, confusing money and capital, constantly calling for privatization, deregulation, moaning about debt & balance of payments, without stating the need for modern industrial production.
• Sri Lanka’s domestic debt plan a significant step for resolving bank uncertainty – US Fitch
– lankaweb.com/news/items/2023/07/04/sri-lankas-domestic-debt-plan-a-significant-step-for-resolving-bank-uncertainty-fitch/
• India may allow Sri Lanka to repay debt over 12 years: report
– sundaytimes.lk/online/news-online/India-may-allow-Sri-Lanka-to-repay-debt-over-12-years-report/2-1142406
• Sri Lanka motorists pay Rs.50 tax for Indian credit line, local tea producers on Iran dues
– economynext.com/sri-lanka-motorists-pay-rs-50-tax-for-indian-credit-line-local-tea-producers-on-iran-dues-125101/
• China to stay out of official creditors’ platform, but Sri Lanka ‘very confident’ of bilateral support – The Hindu
– lankaweb.com/news/items/2023/07/03/china-to-stay-out-of-official-creditors-platform-but-sri-lanka-very-confident-of-bilateral-support/
• Monetary Board cuts policy rates further; flags off administrative moves for banks to comply
– ft.lk/front-page/Monetary-Board-cuts-policy-rates-further-flags-off-administrative-moves-for-banks-to-comply/44-750306
• Interest rates drop by 2 % by Central Bank
– sundaytimes.lk/online/news-online/Interest-rates-drop-by-2-by-Central-Bank/2-1142381
• More interest rate cuts needed for economy to recover, says CB Governor
– english.newsfirst.lk/2023/7/8/more-interest-rate-cuts-needed-for-economy-to-recover-says-cb-governor
• CB urges banks to bring down interest rates or face consequences
– lankaweb.com/news/items/2023/07/06/cb-urges-banks-to-bring-down-interest-rates-or-face-consequences/
– themorning.lk/articles/bzHA3kgY1w0b28DxWnyy
• Govt. vigilant on banks and financial institutions reluctant to cut interest rate: Siyambalapitiya
– ft.lk/front-page/Govt-vigilant-on-banks-and-financial-institutions-reluctant-to-cut-interest-rate-Siyambalapitiya/44-750377
• Sri Lanka budget deficit to April 2023 widens amid external stability: analysis
– economynext.com/sri-lanka-budget-deficit-to-april-2023-widens-amid-external-stability-analysis-125016/
• Sri Lankan central bank expects inflation to drop to 7pc in July
– lankaweb.com/news/items/2023/07/07/sri-lankan-central-bank-expects-inflation-to-drop-to-7pc-in-july/
• Asian Development Bank (ADB) appoints Takafumi Kadono new Country Director Sri Lanka
– island.lk/adb-appoints-takafumi-kadono-as-new-country-director-for-sri-lanka/
• ADB to support Sri Lanka water sector reforms
– economynext.com/adb-to-support-sri-lanka-water-sector-reforms-125418/
• Sri Lanka receives first 250 mln USD from World Bank loan
– economynext.com/sri-lanka-receives-first-250-mln-usd-from-world-bank-loan-125072/
• New Central Bank Act Amendment not been made yet
‘online fiscal transparency platform still to be met’
– sundaytimes.lk/230702/business-times/sri-lanka-meeting-imf-commitments-524013.html
• Central Bank threatens Pension Funds to Comply with DDR or Face Higher Taxes
– sundaytimes.lk/230702/columns/govt-focuses-on-economic-revival-early-polls-unlikely-524401.html
• EPF opportunity loss only 4% if opted for DDO-CBSL
– themorning.lk/articles/wascK22RwkjyJKvUGkTc
• ‘Presidential control over DDO undermines power of Parliament’
– island.lk/presidential-control-over-ddo-undermines-power-of-parliament/
• Parliament approves Domestic Debt Optimisation plan by majority of 60 votes
– sundaytimes.lk/230702/news/parliament-approves-domestic-debt-optimisation-plan-by-majority-of-60-votes-524457.html
• Three new laws soon for Domestic Debt Optimisation (DDO)
‘Amendments to the Banking Act, Appropriation Act, and the Inland Revenue Act will be issued’
– sundaytimes.lk/230702/business-times/three-new-laws-soon-for-ddo-524025.html
• 10 debtors haven’t settled multiple billion loans from local banks – Sunday Times Editorial
– sundaytimes.lk/230702/editorial/sharing-the-pain-524393.html
• COPF discusses effect of domestic debt restructuring on EPF
– island.lk/copf-discusses-effect-of-domestic-debt-restructuring-on-epf/
• Sri Lanka DDR will not trigger loss of depositor confidence: Fitch
– economynext.com/sri-lanka-ddr-will-not-trigger-loss-of-depositor-confidence-fitch-125346/
• Fitch Downgrades Sri Lanka’s local rating to ‘C’ after DDR
– economynext.com/fitch-downgrades-sri-lankas-local-rating-to-c-after-ddr-125396/
• Sri Lanka govt defends DDO, reassures EPF, ETF holders
– economynext.com/sri-lanka-govt-defends-ddo-reassures-epf-etf-holders-125407/
• Sri Lanka meets IMF quantitative targets for June, revenues lower: CB Governor
– economynext.com/sri-lanka-meets-imf-quantitative-targets-for-june-revenues-lower-cb-governor-125442/
• No second chance to save Sri Lanka: central bank chief warns
– economynext.com/no-second-chance-to-save-sri-lanka-central-bank-chief-warns-125544/
• Sri Lanka central bank, EPF slammed over governance, mis-disclosure amid DDR
– economynext.com/sri-lanka-central-bank-epf-slammed-over-governance-mis-disclosure-amid-ddr-124914/
• Sri Lanka legislators question NPV hit on EPF from DDR
– economynext.com/sri-lanka-legislators-question-npv-hit-on-epf-from-ddr-124959/
• Sri Lanka will discuss debt restructuring separately with China-minister
– economynext.com/sri-lanka-will-discuss-debt-restructuring-separately-with-china-minister-125004/
• Sri Lanka makes offer to restructure domestic debt
– economynext.com/sri-lanka-makes-offer-to-restructure-domestic-debt-125011/
• Sri Lanka meets IMF quantitative targets for June, revenues lower: CB Governor
– economynext.com/sri-lanka-meets-imf-quantitative-targets-for-june-revenues-lower-cb-governor-125442/
• Sri Lanka central bank chief defends DDR, disputes projected losses for EPF
– economynext.com/sri-lanka-central-bank-chief-defends-ddr-disputes-projected-losses-for-epf-125526/
• Fitch downgrades Sri Lanka’s Long-Term Local-Currency IDR to ‘C’
– ft.lk/front-page/Fitch-downgrades-Sri-Lanka-s-Long-Term-Local-Currency-IDR-to-C/44-750308
• Fitch says Govt.’s debt plan tempers funding risk for NBFIs
– ft.lk/front-page/Fitch-says-Govt-s-debt-plan-tempers-funding-risk-for-NBFIs/44-750376
• Domestic Debt Restructuring plan should reduce funding and liquidity risk for non-bank financial institutions – Fitch
– island.lk/domestic-debt-restructuring-plan-should-reduce-funding-and-liquidity-risk-for-non-bank-financial-institutions-fitch/
• Powerful new committee to vet all big projects
– sundaytimes.lk/230702/news/powerful-new-committee-to-vet-all-big-projects-524444.html
• Inland Revenue and Appropriation Acts to be amended in line with debt restructuring
– island.lk/inland-revenue-and-appropriation-acts-to-be-amended-in-line-with-debt-restructuring
• China in default on a trillion dollars in debt to US bondholders. Will the US force repayment?
– thehill.com/opinion/international/4075341-china-is-in-default-on-a-trillion-dollars-in-debt-to-us-bondholders-will-the-us-force-repayment/
• Yellen, in Beijing, Criticizes China’s Treatment of U.S. Companies
– nytimes.com/2023/07/07/business/yellen-china-companies-meetings.html
• Yellen says US not seeking ‘winner-take-all’ competition with China
– ft.lk/front-page/Yellen-says-US-not-seeking-winner-take-all-competition-with-China/44-750372
*
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D5. Workers (Inadequate Stats, Wasteful Transport, Unmodern Plantations, Services)
ee Workers attempts to correct the massive gaps and disinformation about workers, urban and rural and their representatives (trade unions, etc), and to highlight the need for organized worker power
• Health workers stage protest demanding allowance increase
– sundaytimes.lk/online/news-online/In-Pix-Health-workers-stage-protest-demanding-allowance-increase/2-1142405
• Tense situation in State Engineering Corporation as only half salary paid for June.
– english.newsfirst.lk/2023/7/8/1-100-employees-of-state-engineering-corporation-to-retire-voluntarily
• UL attempt to recruit foreign pilots flops due to low pay, high taxes – Dayasiri
‘‘We had 316 pilots when we had 26 planes, and there was no problem. Now there are 15 planes and 266 pilots. There is no shortage of pilots…’
– island.lk/ul-attempt-to-recruit-foreign-pilots-flops-due-to-low-pay-high-taxes-dayasiri/
• Labour Minister unveils new Employment Draft Bill
– ft.lk/front-page/Labour-Minister-unveils-new-Employment-Draft-Bill/44-750303
• Labour law reforms are brought to suppress people – Kadirgamar
– english.newsfirst.lk/2023/7/8/labour-law-reforms-are-brought-to-suppress-people-dr-ahilan-kadirgamar
• JVP asks those who voted for DDO to apologise to workers
– island.lk/jvp-asks-those-who-voted-for-ddo-to-apologise-to-workers/
• EPF Superintendent only knows restructuring plan from Facebook
– sundaytimes.lk/230702/columns/opposition-casts-doubt-over-govt-s-claim-that-ddo-wont-hurt-lankas-working-class-524364.html
• EPF opportunity loss only 4% if opted for DDO-CBSL
– themorning.lk/articles/wascK22RwkjyJKvUGkTc
• COPF discusses effect of domestic debt restructuring on EPF
– island.lk/copf-discusses-effect-of-domestic-debt-restructuring-on-epf/
• Urgent reforms needed for Sri Lanka’s century-old labour laws – Ministry of Labour Advisor
– ft.lk/columns/Urgent-reforms-needed-for-Sri-Lanka-s-century-old-labour-laws/4-750255
• ‘Highly awaited’ National Human Resource Conference (NHRC) 2023 organized by Chartered Institute of Personnel Management (CIPM)
‘Rolf Blaser, CEO, A. Baur & Co., delivered the keynote speech’
– island.lk/navigating-dire-straits-the-national-hr-conference-2023/
• Sri Lanka govt defends DDO, reassures EPF, ETF holders
– economynext.com/sri-lanka-govt-defends-ddo-reassures-epf-etf-holders-125407/
• Why should the EPF pay for mismanagement? – Kennedy Gunawardana
– english.newsfirst.lk/2023/7/8/newsline-why-should-the-epf-pay-for-mismanagement-prof-kennedy-gunawardana-7th-july-2023
• Sri Lanka accidents kill two people every 90 minutes
– economynext.com/sri-lanka-accidents-kill-two-people-every-90-minutes-125229/
• German Centre for Poverty Analysis (CEPA) say 40% of Samurdhi goes to underserving
– sundaytimes.lk/230702/business-times/living-off-welfare-524009.html
• IPS Policy Dialogue highlights strategies to address NCD risk factors and malnutrition
– island.lk/ips-policy-dialogue-highlights-strategies-to-address-ncd-risk-factors-and-malnutrition-in-sri-lanka-2/
• The injustice meted out to Hill Country Tamils after independence – Jeyaraj
– ft.lk/columns/The-injustice-meted-out-to-Hill-Country-Tamils-after-independence/4-750229
• Several government-owned housing complexes unsafe for residents
– sundaytimes.lk/230702/news/several-housing-complexes-unsafe-for-residents-524431.html
• Maliban Gold Marie and Dept. of Labour unite on International Day Against Child Labour
– island.lk/maliban-gold-marie-and-dept-of-labour-unite-to-champion-international-day-against-child-labour/
• Free Education & Sir Ivor
– lankaweb.com/news/items/2023/07/04/free-education/
• Educational reforms: Urgent national need
‘Make Mathematics compulsory for all students at the GCE A.L’
– island.lk/educational-reforms-urgent-national-need/
• Discrimination & Oppression Suffered by an Engineer at Kankesan Cement Works (KCW)
– lankaweb.com/news/items/2023/07/01/discrimination-oppression-by-tamils-suffered-by-an-engineer-at-kankesan-cement-works-kcw/
• Sri Lanka official remittances up 73.4% in June; First half inflows up to $2.8 bln
– economynext.com/sri-lanka-official-remittances-up-73-4-pct-in-june-first-half-inflows-up-to-2-8-bln-125549/
• Workers’ remittances improve in first half of 2023
– adaderana.lk/news.php?nid=91803
• At least 951 people (incl. Sri Lankans) have died trying to reach Spain by sea so far this year
– radiohc.cu/en/noticias/internacionales/327721-at-least-951-have-died-trying-to-reach-spain-by-sea-so-far-this-year
• SLBFE expects to send nearly 300,000 migrant workers in 2023
– adaderana.lk/news.php?nid=91806
• A people’s university and a national crisis
– island.lk/a-peoples-university-and-a-national-crisis/
• US-India Drone, Jet Engine Deals to Impact Indigenous Development
– newsclick.in/us-india-drone-jet-engine-deals-impact-indigenous-development
• Doing some reading: ‘The Affirmative Action Empire
– yasha.substack.com/p/doing-some-reading-the-affirmative?
• An Address to Anarchists – Gramsci, 1920
– redsails.org/discorso-agli-anarchici/
• What to the Exploited Working Class & Poor in a Capitalist Dictatorship Is the Fourth of July?
– blackagendareport.com/what-exploited-working-class-and-poor-capitalist-dictatorship-fourth-july
• Glen Ford on the End of Affirmative Action
– blackagendareport.com/glen-ford-end-affirmative-action
• The US Military, White Supremacy, and Affirmative Action
‘16 schools colluded to set financial aid packages, while some colleges are also accused of discriminating against low-income applicants’
– blackagendareport.com/united-states-military-white-supremacy-and-affirmative-action
• Misogyny and Sexual Violence in the White Music Industry
– newsclick.in/misogyny-and-sexual-violence-music-industry
*
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D6. Agriculture (Robbery of rural home market; Machines, if used, mainly imported)
ee Agriculture emphasizes the failure to industrialize an agriculture that keeps the cultivator impoverished under moneylender and merchant, and the need to develop the rural home market, monetization and commercialization, to produce, rather than import, agricultural machinery.
• ADB to support Sri Lanka water sector reforms
– economynext.com/adb-to-support-sri-lanka-water-sector-reforms-125418/
• Allianz Lanka donates clean drinking water system to Ra/Higgaswatta Primary School
– island.lk/allianz-lanka-donates-clean-drinking-water-system-to-ra-higgaswatta-primary-school/
• Government Initiates Grass Cultivation Program, Offers Stipend to Farmers
– english.newsfirst.lk/2023/7/8/government-initiates-grass-cultivation-program-offers-stipend-to-farmers
• Draft Animal Welfare Act of 2022
– lankaweb.com/news/items/2023/07/07/draft-animal-welfare-act-of-2022-we-seek-an-urgent-meeting-with-you-an-open-letter-hon-mr-udaya-gammanpila/
• Locals did not have palate to make good tea tasters, as they ate too much spicy food!
‘Heath & Co, which was the largest exporter of tea…’
– island.lk/getting-a-break-into-tea-tasting-a-short-stint-at-mobil-and-then-back-to-tea/
• Organic fertiliser issue: Talks with China to recover USD 6.2mn
– sundaytimes.lk/230702/news/organic-fertiliser-issue-talks-with-china-to-recover-usd-6-2mn-524447.html
• 80 meters long Indian cargo barge grounded near Mannar due to bad weather
– sundaytimes.lk/online/news-online/80-meters-long-cargo-barge-grounded-near-Mannar-due-to-bad-weather/2-1142407
• Navy renders assistance to barge ‘Atulya’ and tug ‘Avadh’ which drifted to Nadukuda beach
– island.lk/navy-renders-assistance-to-barge-atulya-and-tug-avadh-which-drifted-to-nadukuda-beach/
• X-Press Pearl disaster: AG for talks in Singapore
– sundaytimes.lk/230702/news/x-press-pearl-disaster-ag-for-talks-in-singapore-524461.html
• COPA slams Zoological Gardens Dept. for purchasing birds at exorbitant prices
– adaderana.lk/news/91809/copa-slams-zoological-gardens-dept-for-purchasing-birds-at-exorbitant-prices
• Coca-Cola Beverages Sri Lanka and Uber Eats Sri Lanka launch ‘Ride for Recycling’
– island.lk/coca-cola-beverages-sri-lanka-and-uber-eats-sri-lanka-launch-ride-for-recycling/
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D7. Industry (False definitions, anti-industrial sermons, rentier/entrepreneur, etc)
ee Industry notes the ignorance about industrialization (versus handicraft and manufacture), the dependence on importing foreign machinery, the need to make machines that make machines, build a producer culture. False definitions of industry, entrepreneur, etc, abound, and the need for a holistic political, economic and military strategy to overcome domination by merchants and moneylenders.
• Killer Indian black market drugs: dead and blind in Sri Lankan hospitals
– lankaweb.com/news/items/2023/07/04/killer-black-market-drugs-dead-and-blind-in-sri-lankan-hospitals/
• Amazing callous responses by Health Minister and NMRA Chief
‘Whether registered or unregistered,’ he declared, ‘has nothing to do with the final result.’
– sundaytimes.lk/230702/columns/blame-mystery-hospital-deaths-on-their-karma-dont-blame-us-524356.html
• Investigate the accuracy of media reports concerning the health sector crises and provide relief measures to the affected individuals – Sagala
– island.lk/investigate-the-accuracy-of-media-reports-concerning-the-health-sector-crises-and-provide-relief-measures-to-the-affected-individuals-sagala/
• Govt. scraps inactive tenders in energy sector to combat bid manipulation
– ft.lk/front-page/Govt-scraps-inactive-tenders-in-energy-sector-to-combat-bid-manipulation/44-750374
• Two Agreements with new foreign fuel retailers
– island.lk/govt-makes-two-amendments-to-agreements-with-new-foreign-fuel-retailers/
• China’s Sinopec, Singapore-based Vitol vie for Sri Lanka’s $4 bln refinery establishment
– economynext.com/chinas-sinopec-singapore-based-vitol-vie-for-sri-lankas-4-bln-refinery-establishment-125175/
• Sri Lanka amends new fuel supplier deal to smoothen pressure on exchange rate – minister
– economynext.com/sri-lanka-amends-new-fuel-supplier-deal-to-smoothen-pressure-on-exchange-rate-minister-125273/
• Ceylon Petroleum Corporation repaid all loans, on path to becoming ‘financially stable’
– lankaweb.com/news/items/2023/07/04/ceylon-petroleum-corporation-repaid-all-loans-is-on-path-to-becoming-financially-stable-minister/
• Investors in Mobil petrol stations & service stations had to offer bribes to company inspectors
– island.lk/getting-a-break-into-tea-tasting-a-short-stint-at-mobil-and-then-back-to-tea/
• Asian Infrastructure Investment Bank offers $220 million for transmission & grid development
– themorning.lk/articles/7CGks3EAigLQG1ysNHrf
• Asian Development Bank (ADB) regional power trade workshop in Colombo from 4 to 6 July
‘under discussion since 2002 MoU for India-Sri Lanka electricity grid interconnection’
– ft.lk/columns/ADB-s-role-in-facilitating-regional-energy-cooperation-in-South-Asia-region/4-750253
• Sri Lanka electricity reforms to parliament in September: Minister
– economynext.com/sri-lanka-electricity-reforms-to-parliament-in-september-minister-125536/
• Frequent tremors lead to gauging of strengths of buildings to withstand them
– island.lk/frequent-tremors-lead-to-gauging-of-strengths-of-buildings-to-withstand-them/
• Inside the subsea cable firm secretly helping USA wage war in the ocean
– reuters.com/investigates/special-report/us-china-tech-subcom/
• Sri Lanka accidents kill two people every 90 minutes
– economynext.com/sri-lanka-accidents-kill-two-people-every-90-minutes-125229/
• Deplorable bus services, some pertinent facts and questions
– island.lk/deplorable-bus-services-some-pertinent-facts-and-questions/
• Do not merely implement the LRT project again
– lankaweb.com/news/items/2023/07/06/to-president-wickramasingha/
• 118th AGM of Automobile Association
– island.lk/118th-agm-of-automobile-association-of-ceylon/
• Top executives of Tata Group hold discussion with BOI
– ft.lk/business/Top-executives-of-Tata-Group-hold-discussion-with-BOI/34-750369
• DM de Z Wickremasinghe founded scientific study of Ceylon epigraphy
– sundaytimes.lk/230702/plus/the-brilliant-yet-unsung-epigraphist-2-523961.html
• World Machine Tool Production and Consumption Modestly Down in 2022
– mmsonline.com/articles/manufacturing-technology-and-training-in-europe
• Breaking News from 2021 World Machine Tool Survey
– mmsonline.com/articles/breaking-news-from-2021-world-machine-tool-survey
• Chinese Gallium, Germanium Giants Soar as China Curbs Exports of Chipmaking Metals
‘AESA (active electronically scanned array) radars used on modern warships and fighter airplanes can’t be made without those metals. China produces some 95% of those available on the global market.’
– yicaiglobal.com/news/20230704-02-chinese-gallium-germanium-giants-soar-as-china-says-to-control-export-of-key-semiconductor-materials
• Why does so much of the world’s manufacturing still take place in China?
– theconversation.com/why-does-so-much-of-the-worlds-manufacturing-still-take-place-in-china-207178
• Illegal mining runs deeper than zama zamas
– moneyweb.co.za/moneyweb-podcasts/moneyweb-midday/illegal-mining-runs-deeper-than-zama-zamas/
• Economic Commission for Latin America and the Caribbean (ECLAC) calls for lithium production development agenda in Latin America
– radiohc.cu/en/noticias/internacionales/327763-eclac-calls-for-lithium-production-development-agenda-in-latin-america
• Tesla: The Cars That Racism Built? Black Workers Claim Lawsuits Have Not Stopped Discrimination
‘They heard Tesla workers refer to the Fremont plant as ‘The Plantation’ or the ‘Slave Ship,…’
– blackagendareport.com/tesla-cars-racism-built-black-workers-claim-lawsuits-have-not-stopped-discrimination
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D8. Finance (Making money from money, banks, lack of investment in modernity)
ee Finance tracks the effects of financialization, the curious role of ratings agencies, false indices, etc., and the rule of moneylenders, preventing investment in modern production.
• Fitch says Govt.’s debt plan tempers funding risk for NBFIs
– ft.lk/front-page/Fitch-says-Govt-s-debt-plan-tempers-funding-risk-for-NBFIs/44-750376
• Monik International Micro Finance Company opens 13th branch in Jaffna
‘Chairman Wasala Ariyapala opening the branch with Jaffna SSP S. M. Jarun… a very special loan package that focuses on the school children’
– ft.lk/business/Monik-International-Micro-Finance-Company-opens-13th-branch-in-Jaffna/34-750365
• Tushara Jayaratne appointed Sri Lanka SEC Deputy Director General
– economynext.com/tushara-jayaratne-appointed-sri-lanka-sec-deputy-director-general-125334/
• Apple Hits $3 Trillion Market Cap After Spending More than Half a Trillion Dollars on Stock Buybacks Since 2013
‘Apple’s $3 trillion market value is eight times that of the second largest mobile phone manufacturer, Samsung…The second most valuable company in the world is Microsoft’
– wallstreetonparade.com/2023/07/apple-hits-3-trillion-market-cap-after-spending-more-than-half-a-trillion-dollars-on-stock-buybacks-since-2013
• These Charts Show Why the US Fed Is Terrified to Stop Raising Interest Rates and Why Nasdaq Is Ripping Higher
– wallstreetonparade.com/2023/07/these-charts-show-why-the-fed-is-terrified-to-stop-raising-interest-rates-and-why-nasdaq-is-ripping-higher/
• Large Banks Have Bled $921 Billion in Deposits Since April 2022 — the Fastest Pace in 40 Years — and a Much Larger Decline than Small Banks
– wallstreetonparade.com/2023/07/large-banks-have-bled-921-billion-in-deposits-since-april-2022-the-fastest-pace-in-40-years-and-a-much-larger-decline-than-small-banks/
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D9. Business (Rentierism: money via imports, real-estate, tourism, insurance, fear, privatization)
ee Business focuses on the rentier diversions of the oligarchy, the domination by a merchant mafia, making money from unproductive land sales, tourism, insurance, advertising, etc. – the charade of corporate press releases disguised as ‘news’
• Calls to regulate real estate industry
– sundaytimes.lk/230702/business-times/calls-to-regulate-real-estate-industry-524019.html
• Dozens arrested after clash over ownership of house in Colombo 07
– adaderana.lk/news/91815/dozens-arrested-after-clash-over-ownership-of-house-in-colombo-07
• Minimum room rates leave tour operators helpless!
– sundaytimes.lk/230702/business-times/minimum-room-rates-leave-tour-operators-helpless-524016.html
• High-level Israel delegation and EDB discuss avenues to promote bilateral trade
– ft.lk/business/High-level-Israel-delegation-and-EDB-discuss-avenues-to-promote-bilateral-trade/34-750368
• Colombo Business Journal (CBJ) leadership issue edited abroad
– sundaytimes.lk/230702/business-times/organisational-leadership-focus-in-colombo-business-journal-523995.html
• Training in London offered completely contrary view to previous beliefs in integrity of English business style.
– island.lk/getting-a-break-into-tea-tasting-a-short-stint-at-mobil-and-then-back-to-tea/
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D10. Politics (Anti-parliament discourse, unelected constitution)
ee Politics points to the constant diversions and spectacles and the mercantile and financial forces funding the political actors, of policy hijacked by private interests minus public oversight.
• I wish to know how we became Sinhala – Nalin de Silva
– kalaya.org/2023/07/blog-post_6.html
• Nationalism has no leadership today – Nalin de Silva
– kalaya.org/2023/07/blog-post_7.html
• Sneak attacks on the Buddha Sasana – Wasala
– lankaweb.com/news/items/2023/07/02/sneak-attacks-on-buddha-sasana/
• Elephant allegedly abused in Sri Lanka flown back to Thailand
– island.lk/elephant-allegedly-abused-in-sri-lanka-flown-back-to-thailand/
• NGOs trying to do away with elephants from Perahera culture: Asgiriya Chapter
– lankaweb.com/news/items/2023/07/04/ngos-trying-to-do-away-with-elephants-from-perahera-culture-asgiriya-chapter/
• Who venerates King Devanampiya Tissa? – Nalin de Silva
– kalaya.org/2023/07/blog-post_30.html
• Uncle & Nephew – Nalin de Silva
– kalaya.org/2023/07/blog-post_8.html
• The epidemiology of violence – Susirith Mendis
– island.lk/the-epidemiology-of-violence-2/
• Stories and true Buddha Dhamma: What do scholars advise? – Wijewardena
– ft.lk/columns/Stories-and-true-Buddha-Dhamma-What-do-scholars-advise/4-750168
• Sri Lanka’s SJB rebuffs president’s invitation, wants parliament dissolved instead
– economynext.com/sri-lankas-sjb-rebuffs-presidents-invitation-wants-parliament-dissolved-instead-125170/
• The need for more Left voices – Devapriya
– island.lk/the-need-for-more-left-voices/
• The role of myth: A reassessment – Devapriya
– island.lk/the-role-of-myth-a-reassessment/
• The Future of Samasamajism – David
– island.lk/the-future-of-samasamajism/
• Identity politics and French law-and-order crisis
– island.lk/identity-politics-and-french-law-and-order-crisis/
• If a third person was not present, we addressed each other by our Christian names
– island.lk/succession-to-ds-the-hartal-and-dudleys-resignation/
• Is It Fascist, or Does the Outlaw US Empire Only Promote Fascism?
– vk.com/@580896205-is-it-fascist-or-does-the-outlaw-us-empire-only-promote-fasc
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D11. Media (Mis/Coverage of economics, technology, science and art)
ee Media shows how corporate media monopoly determines what is news, art, culture, etc. The media is part of the public relations (corporate propaganda) industry. The failure to highlight our priorities, the need to read between the lines. To set new perspectives and priorities.
• The Cost of ‘People’s Riots’ – Role of Social Media in Sri Lanka & France & Double Standards in Commentary
– lankaweb.com/news/items/2023/07/06/the-cost-of-peoples-riots-role-of-social-media-in-sri-lanka-france-double-standards-in-commentary/
• Attacking the Mahavamsa – Nalin de Silva
– kalaya.org/2023/07/blog-post_2.html
• Elara has a Persian connection – Nalin de Silva
– kalaya.org/2023/07/blog-post_3.html
• Becoming Sinhala Buddhist
– kalaya.org/2023/07/blog-post_4.html
• Ancient capital Kotte’s landmarks lie unprotected
– sundaytimes.lk/230702/news/ancient-capitals-landmarks-lie-unprotected-524172.html
• Buddhist Viharas & Eelam Part 3A
– lankaweb.com/news/items/2023/07/02/buddhist-viharas-and-eelam-part-3a/
• Remembering George Turnour as UNESCO includes Mahawamsa in its heritage list
– lankaweb.com/news/items/2023/07/02/remembering-george-turnour-as-unesco-includes-mahawamsa-in-its-heritage-list/
• Gamini Hattotuwegama’s Street Theatre group was a Third Theatre.
– island.lk/eugenio-barbas-living-archive-floating-islands-ii/
• A Portrait of a Soviet CIA Propagandist as a Young Nazi Collaborator – 1, 2 & 3
– yasha.substack.com/p/part-one-a-portrait-of-a-soviet-cia
– yasha.substack.com/p/part-two-setting-up-the-cias-radio
– yasha.substack.com/p/part-three-the-schizoid-world-of
• Marx Against Hegel? Idealism, Materialism, and History as Liberation – Losurdo, 2010
– redsails.org/losurdo-hegel-marx/
• To Sanitize the Master’s Corpus: On the Heidegger Hoax
– lareviewofbooks.org/article/the-heidegger-hoax
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email: econenews@gmail.com
blog: eesrilanka.wordpress.com
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