Sri Lanka Update 14 July, 2022

In the space of one week Sri Lanka has turned into a real-life reality TV show. If the situation weren’t so dire for Sri Lankans, I’d dare label the situation there as quality entertainment. Unfortunately, living conditions on the island continue to deteriorate as the political situation grows increasingly muddled. Even more alarming is the frail state of Sri Lankan society. Make no mistake about it, the island nation is on the verge of a complete collapse.

Sri Lankan President Gotabaya Rajapaksa’s aircraft has landed in Singapore. After departing Colombo, Rajapaksa flew to the Maldives before winging his way east. There are reports surfacing that Jeddah will be his next destination. The purpose behind his tour could be to garner international support for an effort to remain in power. The president has not submitted a letter of resignation as promised, meaning he is still the rightful leader of Sri Lanka. Parliament is moving to strip him of his presidential powers though. The appointment of Prime Minister Ranil Wickremesinghe as acting president only made the situation worse and incensed protesters. His office was taken over by protesters, leading to a number of clashes between security forces and civilians. A state of emergency was declared, as well as a curfew. Right now, Colombo has settled into an uneasy calm. Protesters have withdrawn from the presidential residence and Wickremesinghe’s office but remain in the president’s office.

Until the political situation stabilizes, negotiations between the government and the IMF are on hold. An agreement with the IMF is essential to lay the groundwork for an economic recovery. However, as it stands right now, there will be no progress made on this front until the vacant presidency seat is filled and calm returns to Sri Lanka. It could be a long time until that happens as the island nation remains in turmoil without an end in sight.

Sri Lanka Is Coming Into Play

Uncertainty is growing in Sri Lanka as the nation’s top political leaders have not been heard from in the aftermath of Saturday’s takeover of the presidential residence and offices. The prime minister’s own residence was overrun by protesters as well. Since Saturday’s unrest, Sri Lanka’s President Gotabaya Rajapaksa has not been heard from. Prime Minister Ranil Wickremesinge has gone radio silent too. There have been reports the president plans to resign on Wednesday, however Rajapaksa has not addressed the reports or his intentions. At the present time it is unclear who, if anyone, is leading Sri Lanka. The longer Rajapaksa remains incommunicado, the greater the chances are of a vacuum forming in Colombo. Opposition leaders are trying to determine if Rajapaksa will in fact resign on Wednesday, and if so, what will the nation’s new government look like. At first glance the speaker of parliament appears to be the probable choice to lead the nation after Rajapaksa’s departure, yet it is unclear what meetings are going on behind the scenes.

Events over the weekend make it clear Sri Lanka is just about in play on the geopolitical chessboard. Whoever takes the reins of power in Colombo next will be faced with the daunting task of preventing the country from careening off the cliff into economic oblivion once and for all. To stop this from happening, large amounts of financial and material aid will be needed. Unfortunately for Sri Lanka, its moment of need comes in the midst of global instability brought on by the Ukraine war and subsequent surging energy prices. India, which has been Sri Lanka’s guardian angel of sorts for a long time, has already contributed billions of dollars in an effort to keep the nation afloat. Yet more funds, fuel and food will be needed in the coming weeks and months.

Should India fail to stabilize Sri Lanka, the door will open for China to move in and attempt to save Sri Lanka while at the same time dragging the island nation inexorably into Beijing’s sphere of influence. Attention should be locked on Sri Lanka and the entire Indian Ocean region in the upcoming week. Things are happening there which will have a significant effect on regional security as well as the growing India-China rivalry.

Sri Lanka’s Prime Minister Claims National Economy Has ‘Collapsed.’

Sri Lanka’s prime minister has told that nation’s parliament that the national economy has, for all intent and purposes, collapsed. Ranil Wickremesinghe informed lawmakers that Sri Lanka is “facing a far more serious situation beyond the mere shortages of fuel, gas, electricity and food. Our economy has completely collapsed.” Wickremesinghe’s remarks did not bring any new developments to light. In fact, the rather new prime minister’s words seem intended to remind lawmakers and his critics that the task of rebuilding Sri Lanka’s economic foundation will take time and much effort. After being in power for roughly one month, opposition party politicians are attempting to lay blame for the economic collapse upon Wickremesinghe’s shoulders. As the nation slides deeper into economic malaise, the politicians are attempting to cover their own backsides and assess blame upon others.

The collapse of the national economy came about at least partly due to a perfect storm of circumstances. Heavy debt, loss of tourism revenue, a foreign currency crisis and other pandemic-related impacts, as well as the soaring costs of commodities are the main ingredients of Sri Lanka’s economic nightmare. The nation is no longer able to buy imported fuel, even for cash, due to the heavy debt owed by Ceylon Petroleum Corporation. There are no nation-states or supranational bodies willing to provide fuel, creating significant fuel shortages.

The Sri Lankan government plans to call India, China and Japan to a donor conference in early August in an attempt to increase foreign financial assistance. An interim budget will be presented around the same time. This is hoped to help Sri Lanka’s position in negotiations with the IMF. August will be when geopolitics takes on a broader and more significant position in Sri Lanka’s economic crisis. India and Japan will seek to raise their influence with Colombo while simultaneously reducing China’s influence. India and Japan, as Quad members, have political and military incentive to work together and push back China’s inroads in Sri Lanka. Beijing is attempting to move deeper into the Indian Ocean and establish basing rights for Chinese warships in an area historically regarded as the Indian sphere of influence.

Sri Lanka Crisis Update: Shortages Loom, Some Help On The Way

Sri Lanka is girding for potential shortages of food products and fuel in the near future. Citizens have been lining up for cooking gas, automobile fuel since Friday. As the government attempts to stave off complete economic meltdown, the nation has defaulted on debt for the first time in its history. So, much to the chagrin of Sri Lanka’s leaders, the economic outlook remains bleak as the government lifts the state of emergency decree that has been in place since early May. The state of emergency went into effect as a result of violent street protests and riots in Colombo and across the country in late April and early May. The root cause of the unrest was spiraling inflation and other factors of the nation’s economic crisis.

India and Japan will provide emergency relief to the island-nation in a bid to stave off a complete collapse. The first ship laden with food and other material will depart from India on Wednesday. Japan will provide an emergency grant for $3 million worth of medicine and food. These moves also have geopolitical purpose as both nations would prefer to keep Chinese involvement in the Sri Lankan crisis at bay. Tokyo and New Delhi are wary about offering an opening for China to expand its presence and influence in the Indian Ocean region.

Sri Lanka In Crisis

Public anger and frustration is threatening to boil over in Sri Lanka amid a growing economic crisis that has greatly diminished the standard of living and now threatens to unseat the current government. Sri Lankans are defying the present state of emergency which bans public gathering and protests. Sri Lankan President Gotabaya Rajapaksa declared the emergency on Saturday, hoping to prevent the large-scale demonstrations that were scheduled for today (Sunday, 3 April, 2022). Along with restricting public movement and imposing a curfew, internet access was also severely limited, a move that has caused dissent within the Sri Lankan government.

The government’s heavy-handed moves come in response to a demonstration involving thousands of people outside Gotabaya Rajapaksa’s home in Colombo. The protest began peacefully but turned violent when security forces used tear gas and water cannons on the crowd. Demonstrators responded by throwing rocks and setting fire to vehicles used by the security forces. Over fifty demonstrators were arrested, and two dozen security officers suffered injuries.

The root cause of the present situation is the government’s handling of the worst economic crisis to hit the island nation in decades. Conditions have been going downhill for some time owing to a combination of events and circumstances that started with the Easter Sunday bombings of 2019. Those attacks, which killed over 250 people, hit Sri Lanka’s tourism-reliant economy very hard. Next came the COVID-19 pandemic which placed heavy pressure on the currency. Along with a host of other factors, these landmark events have combined to produce a situation where Sir Lankans find it increasingly difficult to purchase fuel, medicine and other essential goods.

All eyes are now on Gotabaya Rajapaksa and the government. How the nation’s leaders react to public defiance of the curfew and state of emergency will determine what the next phase of the crisis will bring. Already, many politicians from parties in Gotabaya Rajapaksa’s governing coalition are starting to grow antsy. Calls that he appoint a caretaker government that represents all eleven parties represented in parliament are growing louder. The Sri Lanka Freedom Party, a coalition member, announced on Friday that it will leave the coalition unless Rajapaksa takes measures to “alleviate the economic crisis, after which an election must be called for.”