Sri Lanka is facing an economic crisis. Here’s what it’s like for people on the

On Feb 4, 2022

Like his neighbors, he was frustrated by the more than 10-hour power cuts that plunged Colombo into darkness, and a shortage of gas to cook with that made it hard for his family to eat.

Then on Thursday — the fourth night — the protest turned violent.

Furious demonstrators hurled bricks and started fires outside Sri Lankan President Gotabaya Rajapaksa’s private residence, as police used tear gas and water cannons to break up the protests.

“People were visibly angry, shouting,” said Upul, who asked only to be referred to by his last name for fear of repercussions. “Earlier (in the week) they demanded the President to step down, (on Thursday) they were yelling and calling him names.”

For weeks, Sri Lanka has been battling its worst economic crisis since the island nation gained independence in 1948, leaving food, fuel, gas and medicine in short supply, and sending the cost of basic goods skyrocketing.

Shops have been forced to close because they can’t run fridges, air conditioners or fans, and soldiers are stationed at gas stations to calm customers, who line-up for hours in the searing heat to fill their tanks. Some people have even died waiting.

But Thursday night marked an escalation in Sri Lanka’s ongoing economic crisis.

Following the protests, the police imposed a curfew and the President ordered a nationwide public emergency, giving authorities powers to detain people without a warrant. On Saturday evening, Sri Lanka declared a nationwide 36-hour curfew, effectively barring protests planned on Sunday — but protests went ahead Saturday anyway. In a statement Sunday, police said they had arrested 664 people for violating the curfew.

Meanwhile, the government is seeking financial support from the International Monetary Fund (IMF) and turning to regional powers that may be able to help.

But there is brewing fury inside Sri Lanka — and experts warn the situation is likely to get worse before it gets better.

A Sri Lankan policeman tries to disperse protesters in Colombo, March 31, 2022.

Days spent waiting in line

For weeks, life in Sri Lanka has involved hours of queuing — just to get basic goods needed to survive.

“Our daily life has been reduced to standing in a queue,” said Malkanthi Silva, 53, as she leaned on a worn blue gas cylinder in Colombo’s baking heat, where she had already been waiting for hours for the propane she needs to cook to feed her family. “When we need milk powder, there’s a queue for that, if we need medication there’s another queue for that.”

Though the situation is now particularly acute, it’s been years in the making.

“30% is misfortune. 70% is mismanagement,” said Murtaza Jafferjee, chair of Colombo-based think tank Advocata Institute.

For the past decade, he said, the Sri Lankan government had borrowed vast sums of money from foreign lenders and expanded public services. As the government’s borrowings grew, the economy took hits from major monsoons that hurt agricultural output in 2016 and 2017, followed by a constitutional crisis in 2018, and the deadly Easter bombings in 2019.

Sri Lankans spend most of their day queueing for fuel and gas as the country's economic crisis worsens.

In 2019, the newly elected President Rajapaksa slashed taxes in an attempt to stimulate the economy.

“They misdiagnosed the problem and felt that they had to give a fiscal stimulus through tax cuts,” Jafferjee said.

But while President Rajapaksa was new to the role, he wasn’t new to government.

As defense minister under the leadership of his elder brother, Rajapaksa oversaw a 2009 military operation that ended a 26-year civil war with the Liberation Tigers of Tamil Eelam (LTTE). The United Nations opened an investigation last year into allegations of war crimes committed by both sides.

After winning the presidential election, Rajapaksa appointed his brother, former President Mahinda Rajapaksa, as Prime Minister and filled dozens of government roles with serving or former military and intelligence personnel, according to the UN. Their younger brother, Basil Rajapaksa, was later appointed finance minister.

In 2020, the pandemic hit, bringing Sri Lanka’s tourist-dependent economy shuddering to a halt as the country shut its borders and imposed lockdowns and curfews. The government was left with a large deficit.

Opposition party supporters shout slogans during a protest outside the President's office in Colombo, Tuesday, March 15, 2022.

Shanta Devarajan, an international development professor at Georgetown University and former World Bank chief economist, says the tax cuts and economic malaise hit government revenue, prompting rating agencies to downgrade Sri Lanka’s credit rating to near default levels — meaning the country lost access to overseas markets.

Sri Lanka fell back on its foreign exchange reserves to pay off government debt, shrinking its reserves from $6.9 billion in 2018 to $2.2 billion this year, according to an IMF briefing.

The cash crunch impacted imports of fuel and other essentials, and in February Sri Lanka imposed rolling power cuts to deal with the fuel crisis that had sent prices soaring, even before the global crunch that ensued as Russia launched an unprovoked invasion of Ukraine.

Last month, the government floated the Sri Lankan rupee, effectively devaluing it by causing the…

asia Sri Lanka is facing an economic crisis. Here's what it's like for people on the ground - CNN

Sri Lanka is facing an economic crisis. Here’s what it’s like for people on the

Days spent waiting in line

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