Sri Lanka Is “Grinding to a Halt” Amid Austerity, Prompting Mass Protests

Protests calling for President Gotabaya Rajapaksa’s resignation have been sparked by fuel shortages in Sri Lanka. This comes as Sri Lanka’s government has forced the closure of all schools and announced plans to cut electricity by up to three hours a day, as well as stop printing currency to quell inflation. Meanwhile, Sri Lanka is also facing a dire shortage of food and medicine, and doctors say the country’s entire health system could collapse. “There is no discussion on the part of the government on how we as Sri Lankans are going to come out of this crisis,” says Ahilan Kadirgamar, political economist and senior lecturer at the University of Jaffna, who explains how the government’s doubling down on austerity measures has devastated the working class.


This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN:This is Democracy Now!,, The War and Peace Report. I’m Amy Goodman, with Nermeen Shaikh, as we go now to the island nation of Sri Lanka, where protests are escalating amidst a growing economic crisis and gas shortage faced by some 22 million people, many forced to wait for days and nights in long lines for fuel.

SRI LANKAN MAN: [translated]I tried to use WhatsApp group chats when the petrol problem arose to check where petrol was available. However, that was not practical. It took two to three hours to get into a queue for petrol. It was then four, six, and even eight hours. I was in a gasoline queue for three days about three weeks ago.

AMY GOODMAN: Police fired tear gas and water cannons at hundreds of demonstrators near Sri Lanka’s Parliament Wednesday as they called for the president, Gotabaya Rajapaksa, to step down.

Sri Lanka’s government has forced the country’s schools to stay closed for another week because there’s not enough gas for students and teachers to travel to school. Authorities also announced plans to cut electricity by up to three hours a day because Sri Lanka doesn’t have enough fuel. Sri Lanka’s president said Wednesday on Twitter he had reached out to Russian President Vladimir Putin and, quote, “requested an offer of credit support to import fuel.”

Meanwhile, Sri Lanka is also facing a dire shortage of food and medicine, and doctors are saying the country’s entire health system could collapse. Sri Lanka announced Tuesday that it will cease printing money as inflation is expected at a record 60%.

We travel to Colombo, Sri Lanka’s capital, to talk to Ahilan Kadirgamar. His recent publications include his work as a political economist and senior lecturer at University of Jaffna. op-edFor the Daily Mirror headlined “When they can’t govern, they must Go Home.”

Welcome back Democracy Now! Can you start off by explaining the extent of the issue and the significance of Sri Lanka saying it’s turning to Russia for support to get fuel?

AHILAN KADIRGAMAR:Amy, thank you so much for having me.

The situation has been steadily deteriorating from week to weeks. In the past six months, Sri Lanka had been in a severe downturn. But in the last three months — and we’ve had a new prime minister in power since May 11th. And that’s not all. Sri Lanka has been planning to go for an elections in the last few months. IMFAn agreement debt IMFThe team spent two weeks in Sri Lanka. Two weeks ago, an assistant secretary to the U.S. Treasury from the United States and an assistant secretary to the state from the United States visited Sri Lanka. India sent high-ranking officials to visit. But, there was no deal and Sri Lanka is now in a very serious situation. Even the World Bank, the IMF expect Sri Lanka’s economy to shrink by anywhere from 6 to 8%. This is a negative sign. GDPI believe this year’s growth will be more than 10%. So, it’s — farmers have stopped cultivating. Fishermen can’t go to the sea, because they don’t have kerosene oil. And our entire informal sector — 60% of our economy is the informal sector — has come grinding to a halt because of fuel shortages.

People are blaming President Gotabaya Rajapaksa as well as Prime Minister Ranil Wickremesinghe, for the ongoing economic crisis they are currently facing. And it’s in that context there is likely to be a very powerful wave of protests starting this Saturday. They saw that two months ago when the president’s brother, Mahinda Rajapaksa, resigned as prime minister. Now, day after tomorrow, there’s going to be very massive protests calling for the resignation of the president and prime minister. And it’s in the context of this wave that the president is also desperately asking various actors, including President Putin of Russia, to provide oil, to try to pacify the masses here in Sri Lanka.

NERMEEN SHAIKH:Ahilan. Could you please talk about the government’s response so far to these protests. Also, piece that you wrote earlier this week, headlined “When they can’t govern, they must Go Home,” in which you point out that “The ideology of our ruling class” — namely, Sri Lanka’s ruling class — “for decades has been one of solving all our problems from food security to people’s livelihoods by importing.” Now, what does that have to do with the scale of the crisis right now, the fact that Sri Lanka was so heavily dependent on imports?

AHILAN KADIRGAMAR:Sri Lanka was the very first country in South Asia that liberalized its economy in 1977. This was even before the election of Prime Minister Margaret Thatcher and President Reagan. Sri Lanka was placed on the neoliberal track with structural adjustment policies. IMFThe World Bank.

We also have some other things. [inaudible]Including in agriculture, which made us even more dependent on imports for food. A lot of produce that could have been produced here, whether it’s milk foods, whether it’s vegetables, all of these started to be imported. And this created an economy that was more dependent on the outside sector. That trend was further accelerated following the civil war in Sri Lanka in 2009 that ended with excessive borrowings on international financial markets. These are known as sovereign bonds.

This has led to a continuing dependency and belief that we can borrow our way out of it. I would argue that even today, over the past four months, the government still believes that the solution to all of our problems is to get an IMF solution, IMFAs if they were in agreement IMFYou can enter Sri Lanka to restructure the economy, and everything will be fine. The government is not discussing how Sri Lankans will get out of this crisis or how they are going to address the huge inequalities within the country. But instead, they’ve been implementing austerity measures over the last three, four months, which have made the burden on the people that much more harsher.

So, at the core of this is the class question, in terms of who has benefited from these imports and this inflow of global finance, and who is asked to pay for it now as the cost of living — if you take the price of bread, it has tripled over the last six months, but the incomes and livelihoods of working people have declined or are increasingly disrupted. And that —

AMY GOODMAN: Ahilan — go ahead.

AHILAN KADIRGAMAR:The police have become more repressive in this context as protestors take to the streets and go on the streets. They are arresting protesters and targeting them. Students, especially university students, have been at the forefront of protests. They’ve been tear-gassed. And it’s to be seen what would happen on Saturday, when another big wave of protests are to be launched in Sri Lanka, throughout the country and particularly in Colombo, pressuring the president and prime minister to resign, what the military and the police will do in that context.

The demand now is for both of them to resign and for an interim government to be formed to be able to stabilize the country economically and politically, and also to bring about a people’s council, with representatives of the people, of the protesters, of professional organizations, to be able to stabilize the country until we can have elections and move forward.

AMY GOODMAN:Ahilankadirgamar, thank you so much for being with me, political economist, senior lecturer at University of Jaffna. I’m usually in Jaffna right now but in Colombo. We’ll link to your pieceThe Daily Mirror, “When they can’t govern, they must Go Home.”