Sri Lanka’s prime minister stepped down Monday following weeks of street protests over the country’s worst economic crisis in its history, which has seen skyrocketing food and fuel prices in the island nation. Prime Minister Mahinda Rajapaksa’s resignation came after supporters of the ruling party stormed a major protest site in the capital Colombo, attacking protesters and prompting clashes with police. President Gotabaya Rajapaksa, the outgoing prime minister’s brother, has declared a state of emergency and remains in power, despite protesters’ demands for the resignations of all members of the political dynasty that has dominated Sri Lanka’s politics for decades. “The gross mismanagement of our economy by this regime combined with a history of neoliberal policies is what has brought Sri Lanka to its knees,” says Ahilan Kadirgamar, a political economist and senior lecturer at the University of Jaffna in northern Sri Lanka.
This is a rush transcript. Copy may not be final.
AMY GOODMAN:Today’s story will be in Sri Lanka, an Indian Ocean nation. The government granted emergency powers to its military force and police force following protests in Colombo. This is as the country is facing its worst economic crisis in history. This comes after Sri Lanka’s prime minister was forced to resign, following large anti-government protests in recent weeks that have demanded the ouster of all members of the Rajapaksa family. As Sri Lanka seeks to end its economic crisis, this move will allow for the formation a new cabinet. Prime Minister Mahinda Rajapaksa has been accused of nepotism, and corruption since he placed three of his siblings in high-ranking government positions. On Monday, supporters and members of his ruling party stormed a major peaceful protest spot in Colombo. This prompted clashes between protesters, police, and tear gas and water cannons. This is one the opposition leaders.
SAJITH PREMADASA: [translated]This inhumane attack must be committed by everyone involved in this government, including President Rajapaksa as well as Prime Minister Rajapaksa. This was a planned attack. This was a well-planned project. This was both political terrorism and state terrorism. This must be held the Rajapaksas responsible.
AMY GOODMAN:Thousands of protestors responded to the attack by setting fire to homes, businesses, and offices belonging to lawmakers from ruling parties. At least five people have been shot dead and many more injured. This is an anti-government protester speaking outside the prime minister’s residence in Colombo.
PROTESTER:Nearly 20,000 people came with sticks, heavy sticks and beat us all. They destroyed our house. This was the place we were living in. Can you see it? These were the tents we were using. They arrived. They took everything off of us, including our buffers. They beat three of my coworkers. And these are university young graduates who are fighting for their rights — no education, no food, economy at a standstill — because we want the Rajapaksas to go.
AMY GOODMAN:We go to Jaffna in Sri Lanka to talk to Ahilan Kadirgamar (political economist and senior lecturer at University of Jaffna).
Welcome back Democracy Now!Can you please just explain to us what is going on in your country? How come the prime Minister resigned? How many people were injured? At least five have died?
AHILAN KADIRGAMAR:Amy, we are grateful.
Sri Lanka is experiencing perhaps the worst economic crisis in its history since the 1930s. There are severe shortages of essential goods. Prices for diesel and gasoline have doubled and there are large lines due to shortages. The cost of bread has risen by twofold. The price of rice is now twice as high. There is also a shortage of medicine. So, all of this — and the people are asking: What is the reason for this? People are blaming the Rajapaksa government, which came to power in late 2019;
Now, this economic crisis, of course it’s been aggravated by the war in Ukraine, with global commodity prices going up; the pandemic, which disrupted the tourism sector in Sri Lanka. It goes back to Sri Lankan liberalism. Because Sri Lanka was, up until the 1970s and alongside India’s Kerala and Cuba, a model country for development. We had very high human development indicators and low per capita incomes. This was due to free education and a free healthcare system that continues to be free. Even in my university for my students, university students — all universities are state universities — education continues to be free.
The combination of the history and mismanagement of the economy by this regime has brought Sri Lanka to the brink of collapse. And the people are asking very serious questions about particularly this regime and how they’ve handled this economic crisis since they came to power. Mahinda Rajapaksa was the prime minister and he just resigned. From 2005 to 2015, he was president for ten years. He was president for ten years, from 2005 to 2015. When they were returned to power, they concentrated only on consolidating that power. Even though the pandemic was ravaging the country, Sri Lanka provided the least amount of relief compared to other South Asian nations. During the pandemic, people received very little relief. They’ve suffered quite a bit. They tried to consolidate and expand their power throughout. In fact, after the parliamentary elections in 2020, they brought about an amendment to the Constitution to put — to heap huge amounts of power in the president. We have both a parliamentary and a presidential system in Sri Lanka. The president holds enormous amounts of power. So, now, even though the prime minister has resigned after weeks of protests, now there’s militant protests calling for the resignation of the president. And that’s where Sri Lanka is at the moment.
JUAN GONZÁLEZ:Could you please tell us: How is the family able to consolidate power with so many siblings serving as president? Did the government or the general public not react to this?
AHILAN KADIRGAMAR: This has been a long project, from 2005 — you know, Sri Lanka went through a three decade-long civil war. Mahindarajapaksa was elected president in 2005, long before the civil war had ended. He was also credited with destroying the Tamil Tigers. He left a legacy. Then he was elected to the next term. He became even more arrogant about involving more of his family in politics. There was a reaction. After the war, there was a reaction. In 2015, they were overthrown by regime change.
However, the new government that came into power did not do much to address the economic problems. For two years, there was drought. They started to lose credibility. In 2019, you may recall, Sri Lanka was the victim of terror attacks on Easter Day 2019. And questions remain as to who was behind it, but it’s claimed to be ISIS-inspired attacks. The terror attacks that brought the Rajapaksas power in late 2019 were a result of these terrorist attacks. They have also used a form of virulent nationalism, a Sinhala Buddhist nationalism to mobilize the majority population against minorities. In particular, Islamophobic forces have been mobilized in a lot of attacks on the Muslim community over the past decade. All of this has allowed them to consolidate power.
But I think that with this economic crisis, the majority population has come to realize that this regime has really stolen the country. So, the core of it all is an economic crisis that has turned into a serious political crisis.
JUAN GONZÁLEZ:As in many developing countries, international agencies can play a significant role in shaping government policies. Could you speak about the role of the World Bank? IMF in terms of Sri Lanka’s economic policies?
AHILAN KADIRGAMAR: Yeah, definitely, the — if we look at 1970s, until then we had a left-leaning government. And with the long economic downturn in the 1970s, we went into — a right-wing government emerged. In 1977, J.R. Jayewardene led a pro-U.S. government. Sri Lanka was able to implement structural adjustment policies thanks to the World Bank. IMF. We decided to liberalize financial systems and trade. And that, over the last four decades, has led to huge amount of — much higher levels of inequality in the country. And that’s been continued.
But the support of the has been a major factor in the 12 years since the war. IMF — we’ve gone through 16 IMFSri Lankan agreements With the support of IMF, we’ve been borrowing considerable amounts in the international capital markets, what are called sovereign bonds, at very high interest rates, on the order of — annual interest rates on the order of 7.5%, which means when these bonds are repaid in 10-year time frame, the interest cost is equaling to the principal. So, if you borrowed $500 million U.S., by the time you repay it, it’s $1 billion U.S. These international agencies supported this loan. They are, therefore, part of the problem.
Now, the solution to the current financial crisis is also being considered to be going back towards the IMFFor an agreement. Even the opposition has agreed to that. Even if there’s a change of government, their main way forward, they think going to the IMFIt is a miracle cure. You know, in my opinion, that the IMFIndia and other creditors might be able help us to address the shortages of supplies caused by the fall in foreign reserves. However, we must be careful because the future is uncertain. IMF conditionalities that are likely to be placed — it’s already there in many of the IMF reports — are calling for austerity, further cuts to social welfare, market pricing utilities. Now, if you take a country like Sri Lanka, it’s a model because 99% of our people have electricity. It is also very affordable. Rural households can get electricity for as low as $2 per month. However, all of that will be market price right now so there are big questions about the future of social welfare if we continue to pursue austerity policies.
AMY GOODMAN:Ahilan, before you end, if possible, can you talk about is this the end for the Rajapaksa Dynasty? I mean, you have Mahinda Rajapaksa resigning, but his brother, who’s the president, Gotabaya Rajapaksa, remaining. Explain who they are, how they’ve retained power for so long, and if you see the whole family dynasty collapsing?
AHILAN KADIRGAMAR: The whole family and the regime has been completely delegitimized, so it’s going to be very hard for them. There’s probably no political future for them, though we can’t say for sure. You are discussing the history of Marcos in the Philippines in your program. Maybe their children down the road will make a comeback. They are likely to be gone for at least the next few decades. They may also face prosecution for all these corruption claims and so forth, not to mention the various human rights violations that have been part of their rule.
The president, who has a lot of power, is unlikely to resign. They will probably try to prolong this as long and as long possible. But even as they prolong if the president stays in power, it’s going to bring about almost a state of anarchy in the country. The economic crisis continues to worsen. All trade unions are on a permanent strike. We are witnessing protests that have not been seen in this country in over 70 years. So, it’s a major moment.
Rajapaksa must go, I believe. Their family politics is over. The real question is, what alternative is possible? The liberals really don’t have an alternative to this economic crisis. We must really focus on our food system. We are facing starvation and possibly famine-like conditions in the future. How will this all play out? Can we rebuild our food system? Focus on local production. Think about self-sufficiency. Would you like to reduce inequality in the country? IMF, which is to seek to return to the path of inequality, trade liberalization and financialization which has actually caused this crisis. Rajapaksa is now out of office, but who will take the reins to steer Sri Lanka in the right direction?
AMY GOODMAN:We will continue to follow the example. Ahilankadirgamar, we thank you for being here, political economist, senior lecturer, University of Jaffna in Sri Lanka. There, hundreds of protesters were injured, and at least five have died.
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