We read today that winds of nationalism are blowing through Latin America. They are blowing across Argentina, Brazil, Chile, Ecuador, Uruguay and Venezuela. Mexico too is expected to join them when it goes to the polls in July. These new regimes are being characterised as leftwing – mostly left of centre – with sympathy in varying degree towards the Cuban revolution. The fundamental problems facing these countries are the same – poverty, unemployment, rising cost of living, regional disparities and mounting youth disillusionment. The pursued solutions are a hybrid of state led interventions in the economy, reflecting a challenge to the Washington Consensus of free markets and privatisation. Here in Sri Lanka, we have a similar situation. The problems are very much the same – poverty, unemployment, rising cost of living, regional disparities and youth disillusionment. But here they are compounded by an ethnic conflict and violence, which makes the challenges more complex and the tasks of dealing with them more daunting. Here too it seems, the Washington consensus has failed. One might argue of course that the reason was lack of consistency of application. But consistency depends also on the socio-political realities and balance of political forces. In a democratic constituency which was replete with elections, it was almost impossible to carryout structural adjustment programmes consistently, since they carried with them all the consequences of relative price adjustments and short-term disruption of life. Further, the free trade dogma carried with it threats to indigenous capital formation and investment, with little or no time for “learning by doing processes”. This is the reason why there has been a fusion of the nationalist movement with aspirations of egalitarianism and socialism.