How the global technocracy brought Sri Lanka to ruin

One of my favorite “angry young man” books is former New York Times correspondent David Halberstam’s “The Best and the Brightest,” a devastating portrayal of the American elite who set in motion the tragedy of the Vietnam War.
I once met the late writer, and he told me that the key to the story — and the cause of the American debacle in Indochina — was that again and again policy decisions were made to suit the needs and views of the Washington foreign policy elite — that the real negotiations went on in the White House, the Congress and the tasteful confines of tony elite gatherings at the Council on Foreign Relations.
The problem was that, while these policy deals made sense in this rarefied atmosphere, they had almost nothing to do with the facts on the ground in the faraway jungles of Vietnam. As Lawrence of Arabia believed, the world and its political and cultural conditions are specific; to miss this basic reality is to fail at political risk.
I was thinking of Halberstam and Lawrence this past week, as the crisis in Sri Lanka unfolded in all its ghastly aspects. Three months of economic chaos led thousands of protesters to dramatically storm the presidential palace, as scenes emerged of boys in T-shirts swimming in the opulent presidential pool. Reportedly, $50,000-worth of cash was found under disgraced President Gotabaya Rajapaksa’s bed.
So far, all this sounds like the standard emerging market crisis — a simple tale of domestic corruption and mismanagement, the negative effects of the pandemic crisis (which derailed Sri Lanka’s booming tourist industry) and hyperinflation (which hit a stratospheric 55 percent in June). But, upon closer inspection, this crisis is a lot more about global elite dysfunction, far more similar to the intellectual rot Halberstam so beautifully chronicled, than merely a garden variety emerging market hiccup.
For the political risk trigger event that sent Sri Lanka into a tailspin was not these usual problems, common to countries as far afield as Lebanon and Venezuela. No, what brought the crisis to a boil was the desire of the long-ruling Rajapaksa dynasty to curry favor with the international technocracy, making “Davos Man” happy by overnight transforming the island into a net-zero nation, doing away at a stroke with all the chemical fertilizers and pesticides absolutely necessary to make the country function economically.

What makes sense in a boardroom in Geneva or Frankfurt does not necessarily apply to the messiness of a complicated, heterogeneous world

Dr. John C. Hulsman

 

In order for European greens to feel happy about the organic stamp likely to then be placed on Sri Lankan food exports, the Rajapaksas were prepared to wager the health of their entire economy. Anyone with a specific knowledge of the island would have known better, but as Halberstam would recognize, that is precisely the point.
The fertilizer ban came into effect in April 2021, only to be rescinded due to overwhelming nationwide protests in November of that year. But the damage had been done to the harvest. Only a trickle of chemical fertilizers made it to the paddy fields. The economic results were as predictable as they were devastating. Food prices in the country have risen by 80 percent. Over the past year, 500,000 Sri Lankans have been plunged into poverty. In 2019, the island produced 3.5 billion kilos of rice. In 2021, it is estimated that this yield plummeted by 43 percent.
But the gormless international technocracy is nothing if not unaware. While imposing its own radical green agenda on the island, bankrupting, impoverishing and nearly starving Sri Lanka, it is now busy at work on its next human-made disaster — placing fertilizer sanctions on Russia and Belarus, which between them produce 17 percent of the global total used for food (especially grain) exports. Just as natural gas is an exception to Western sanctions due to Europe’s obvious national interests, so food and fertilizer must not be denied to the developing world.
To counter this disaster, Sri Lanka called for a global conference to prevent famine. At it, Andrey Melnichenko, the former owner of EuroChem, a leading fertilizer producer, called for the banning of such sanctions, which are “economic weapons of mass destruction” capable of causing the deaths of millions. Melnichenko was sanctioned despite leaving Russia 14 years ago and living since then in Switzerland. Does this make sense to anyone but the international technocracy?
The food disruption that fertilizer sanctions may cause could hit the Middle East and North Africa especially hard, causing national instabilities, a migration crisis (which ironically would devastate Europe) and radicalism in the region, the last thing anyone ought to want. These hare-brained Davos Man schemes — again, more about feeling good than actually doing good — may lead directly to chaos, famine and death; the humanitarian costs could be unbearable.
Tragically, Sri Lanka was indirectly a victim of an out-of-touch international technocracy’s failure to understand that what makes sense in a boardroom in Geneva or Frankfurt does not necessarily apply to the messiness of a complicated, heterogeneous world. One mistake is more than enough. Davos Man must not be allowed to sow chaos and famine in North Africa as well, merely to be seen to “do something” about the Russian invasion of Ukraine. The real world is simply too important to be left to such a discredited international elite.

• John C. Hulsman is the president and managing partner of John C. Hulsman Enterprises, a prominent global political risk consulting firm. He is also a senior columnist for City AM, the newspaper of the City of London. He can be contacted via johnhulsman.substack.com.