Going Nowhere

In the socio-economic predicament of Sri Lanka, the new Prime Minister, Ranil Wickremesinghe, has been appointed once again. He takes the reins of the country for the sixth time after the previous Prime Minister Mahinda Rajapaksa gave in to mass riots and resigned from office. Even after five previous stints as prime minister of the country and having a considerate political experience under his belt, the incumbent prime minister now finds himself ensnared by myriad constraints.

The biggest challenge he has to deal with is the perpetually eroding economy, which is already in a shambles. The foreign loans accumulated by Sri Lanka amount to a total of 50 billion dollars. This mountain of foreign loans has led to a plethora of complications in several economic processes as the country’s limited revenue will be used for the servicing of these loans. This has further thwarted the already dwindling economy by stopping various developmental initiatives such as work on infrastructure, health and education.

As the country struggles with its dollar crunch, more import curbs and capital control will be implemented, which will further destroy the economy. In the midst of having a severe food shortage and the perpetual free fall of the rupee, Sri Lanka becomes the first Asia-Pacific country to default on foreign debt. The massive amount of trade and fiscal deficit tells the real story behind the default status of Sri Lanka. When Gotabaya came into power in 2019, his policies further acted as the catalyst which led to the disintegration of Sri Lanka. It was Gotabaya who slashed taxes, forcing the government to purchase dollar reserves. These ambitious policies actually were disaster.

Apart from the failing economy, the prime minister also faces problems in the form of political uncertainty. Wickremesinghe, for the record, has never completed a single term in all five of his previous stints as Prime Minister. Therefore, even after his recent new appointment, political uncertainty continues.

This uncertainty is not only for the new PM but for the entire government of Sri Lanka as protests have not yet seized. What is even more surprising is the fact that the Prime Minister is close to the Rajapaksa family even though when in the opposition. It seems power still resides in the hands of the Rajapaksa dynasty and the problems that drove Sri Lanka to its present state would continue.

The veteran politician has also been accused of backing the Rajapaksas brothers and has even refused to take a stand against the corruption done by members of the previous regime. His pro-Rajapaksa image might be seen as a catalyst for yet another unfinished tenure as the prime minister of Sri Lanka. To make matters more aggravated, Wickremesinghe’s party – United National Party (UNP) – despite being the oldest political party of the country, failed to win even a single seat in parliamentary elections of 2020. Ranil’s party thus became unseated but he still managed to get a seat in the Parliament on the basis of a commutative national vote allocated to the UNP. With no support in the parliament, the prime minister will face an uphill battle to fight while handling the administrative processes of the country.

One huge reason for the appointment of Wickremesinghe can be seen in the form of his stance as a pro-West laissez faire market reformist. His appointment is, therefore, a desperate attempt to restore international credibility as the government negotiates a bailout package with the International Monetary Fund (IMF). However, before any agreement can take place, the IMF would most certainly ask for the restructuring of the nation’s debt and the process could take up to six months to come in effect. With massive riots and protests taking place, the people of a bankrupt nation would not wait that long.

The Prime Minister’s biggest problem right now would not only be to somehow get a bailout package from the IMF but also to clip the executive powers of the presidency and set a date for Gotabaya’s resignation as president. That is the top priority of the people of Sri Lanka right now and if the appointment of a new Prime Minister does prove to be a way for Gotabaya to still somehow extend his tenure as a president, then the appointment of Ranil as PM would be nothing but a slap for the entire population of the island nation. This would add fuel to fire and create further anarchy within the country. The incumbent Prime Minister has a daunting task ahead of him if he is to steer the country out of its current socio-economic and political crisis.