By: Raina Lath
A few months ago, when former President Gotabaya Rajapaksa fled the country, a state of emergency was declared.
What was the crisis in Sri Lanka?
As many of us may know, Sri Lanka has been facing the worst economic crisis since its independence in 1948. During April, protests had begun in Colombo and rapidly spread through the entire country. Shortages of medicine and fuel as well as frequent power cuts have caused prices to rise drastically. Due to lack of foreign currency, the government is unable to import more. So how did the crisis come about?
The former government had blamed the Covid 19 pandemic which had badly affected the tourist economy. However, many experts blame former President Rajapaksa's poor economic mismanagement for several years. It became the first country in the Asia Pacific region in 20 years to default on foreign debt.
Additionally, according to official data, food costs increased 84.6% from a year earlier. Mr. Rajapaksa of Sri Lanka fled the country and resigned in July as a result of the country's recent political unrest. In response to a dramatic rise in the price of food and petrol, hundreds of thousands of people took to the streets in frequently violent protests. The administration of Mr. Rajapaksa was criticised by many Sri Lankans for how it handled the situation.
Before stepping down he made Prime Minister Ranil Wickremesinghe acting president.
What is the plan to tackle the crisis?
While he worked to stabilize the situation, Mr. Wickremesinghe proclaimed a state of emergency throughout the nation and enforced a curfew in the western region. In terms of the economic crisis, the overcoming would require a stable government that could eventually raise interests and taxes to raise government revenue. New economic reforms would also need to be put in place in order to re-stabilize the economy in Sri lanka.
The country currently owes over $51 billion to foreign leaders. Thankfully, India has contributed at least $1.9 billion, while the World Bank has agreed to give Sri Lanka $600 million. In addition, A potential loan of $3 billion is being discussed by the International Monetary Fund (IMF).
What is happening now?
President Ranil Wickremesinghe has adopted a harsh stance against the activists who drove his predecessor to flee the nation and quit in July at the height of the country's crisis. That being said, the protests and rioting are still ongoing.
Soldiers demolished a long-standing protest camp outside the President's office soon after Mr. Wickremesinghe assumed power. They detained hundreds of protesters. After the government proclaimed the city center a "high security zone" and forbade protests there, officers in riot gear stopped the student march.
On 23rd of September Wickremesinghe issued an order prohibiting any rallies and demonstrations in the vicinity of important buildings, including his office and the residences of senior military officers. However on September 24th, the protests continued calling for the release of fellow activists arrested under anti-terrorism laws. The police responded using water cannons and tear gas to disperse protesters.
It is apparent the state of Sri lanka is still in crisis, however as the new government works to recover from this economic slump, hopefully the state of sri lanka will restabilize.
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