Thursday, March 23, 2023

Sri Lanka holds its breath as new PM fights to save economy

COLOMBO, Sri Lanka ( Associated Press) — It’s been almost three weeks since Ranil Wickremesinghe He took office as Sri Lanka’s prime minister with a tough mandate to pull the beleaguered country from the brink of an economic abyss that threatens to tear it apart.

five-time prime minister An inherited country that is headed for bankruptcy and so plagued by foreign debt that it has no money left for basic imports. Sri Lankans are struggling to access essentials like food, fuel, medicine, cooking gas and even toilet paper and matches.

In his new job, Wickremesinghe leaves no doubt about what will happen next. “The next few months will be the toughest of our lives,” he told the country, fed up with long lines, skyrocketing inflation and daily protests that are spiraling out of control.

“We must prepare ourselves to make some sacrifices and face the challenges of this period.”

Since the televised speech of May 17The veteran politician, who also serves as finance minister, has begun difficult negotiations with financial institutions, lenders and allies, and UN agencies to replenish the coffers and offer some relief to impatient citizens.

He has taken necessary steps such as raising taxes and vowing to overhaul the government that concentrated power under President Gotabaya Rajapaksa, a model that many believe exacerbated the crisis.

He took office last month after days of violent protests, forcing Mahinda, brother of his predecessor President Gotba RajapaksaTo get down from the angry mob at the naval base and seek security. Wickremesinghe is due to deliver a much-anticipated speech in Parliament on Tuesday, in which many hope will showcase the strategy to fix the crisis.

But time may not be on their side as reforms are slow and people want results now. He is also a one-man party in Parliament – the only MLA from his party after suffering a humiliating defeat in the 2020 election.

“A person who doesn’t have a political base has an unprecedented crisis to manage,” said Dayan Jayatilka, a former diplomat and political analyst.

Lines stretched for kilometers (miles) every day to buy fuel and cooking gas, walking around blocks, Sri Lankans spent thrice to buy essential items to withstand heavy rains and scorching heat is what they used to. Often, they have to wait several days, and many still leave empty handed.

Jagat Chandana, 43, has been waiting in line on the outskirts of the capital Colombo with a canister to buy cooking gas for two days. “It has gone crazy. We are absolutely helpless. It seems that even Ranil cannot solve the crisis. They (politicians) only talk but people at the grassroots level are suffering.

Protesters have been camping outside Rajapaksa’s office for more than 50 days, demanding Rajapaksa’s resignation.

They say economic mismanagement, policy blunders such as hasty restrictions on imported chemical fertilizers that ravaged crops, and a government stocked with Rajapaksa’s relatives caused the crisis. At their peak in power, six Rajapaksas held government positions – the crisis has seen all but one exit. The other five still remain as MPs.

Sri Lanka has stopped the payment of foreign debt of about $ 7 billion this year. It owes $26 billion by 2026 out of a total of $51 billion.

Foreign exchange reserves have come down to just two weeks of imports while Wickremesinghe is preparing to receive a bailout package from the International Monetary Fund. On Thursday, he said any bridge financing would depend on the IMF agreement and he expected talks to be concluded by the end of June. Wickremesinghe said last week that the government was targeting $5 billion for repayment and $1 billion to augment the country’s reserves.

In such a volatile situation, Wickremesinghe has been able to bring in some transparency and rationality, which was lacking in the previous administration run by the Rajapaksa clan, Jayateleka said.

But analysts also say they will find it difficult to face some challenges, especially as they face a tumultuous battle to bring in much-needed reforms to amend the Constitution and strengthen the powers of Parliament.

“Their offers are good for medium and long term. But people want immediate change and they don’t see that,” said political analyst, Jahan Perera, adding that some see Wickremesinghe as helping Rajapaksa stay in power.

In addition to demanding a new president, protesters have pushed for weeks to fully reform a broken governance model.

For nearly 45 years, Sri Lanka has been ruled under a powerful executive presidential system. After a thumping electoral victory in 2019, Rajapaksa strengthened the system through constitutional amendments that further concentrated powers in the presidency – a move that worried even critics at the time.

Wickremesinghe made an important and opening pitch for the withdrawal of some of the President’s powers. But such measures would not be easy and would require not only the approval of the Supreme Court but also a two-thirds majority in Parliament.

The question remains whether Wickremesinghe will be able to push reforms in the 225-seat parliament, where Rajapaksa’s party has a majority. Some opposition parties have already given their support for the reforms, but Wickremesinghe’s sole standing in the House could prove to be a major drawback. Or it could be a property.

His party split in 2020 amid a leadership crisis, prompting most senior members to leave and form a new party – currently the country’s main opposition.

“He has the opportunity to play the role of a technical prime minister, who is not associated with any political party, with his expertise and experience,” Jayateleka said.

The size of the protest has also been shrinking since Wickremesinghe took office. Perera said it is difficult for people to maintain the high tempo but as long as the economic crisis continues, there will be demonstrations.

While there remain signs of financial hardship and struggle in Sri Lanka, there is a growing expectation among some that Wickremesinghe will see them through difficult times.

The carpenter, Amila Prasanna, said, “He can’t do miracles, it will take time to solve the crisis because the previous ministers have messed up.” “He is trying to solve the problems one by one, and I am sure he will do something,” he said as he stood in a queue for three days to buy gas.


The party reported from New Delhi.

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Nation World News Desk
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