28 C
Colombo

Sri Lanka is the core of a global catastrophe, far from Ukraine.

Published:

The conflict in Ukraine may still be the main topic of discussion worldwide. However, it is a nation that is far from a battleground and has evolved into a sort of global moment crucible. Sri Lanka has been in an economic death spiral for months. A public debt crisis has resulted in shortages of food, fuel, cooking gas, medicines, cash, and other necessities. This crisis was made worse by the impact of the pandemic and then by the disruptions that followed Russia’s invasion of Ukraine.

Around 70% of Sri Lankan households reported cutting back on food consumption in a UN poll, with food price inflation hovering around 57%. (contrast that to roughly 10 percent in the United States from the previous year). The 22 million-person nation is nearly out of petroleum, and new shipments won’t arrive for several days.

Prime Minister Mahinda Rajapaksa’s administration was overthrown in May as a result of mounting popular outrage and protests, but the situation continues, and concerns about future clashes between security forces and angry citizens rise. Rolling power outages and days-long fuel lineups have become commonplace features of daily life. To keep Sri Lankans off the highways, schools and offices have been closed for at least the duration of this week.

Doctors, nurses, teachers, and bankers in the Sri Lankan city of Colombo marched last week in protest of their inability to obtain the necessary gasoline or diesel to complete critical tasks. For the average person, things have gotten intolerable, a teachers union leader told Reuters.

Sri Lanka made its first debt default in its history as an independent country in May. In an effort to shepherd the nation out of its problems, a caretaker administration led by shrewd experienced politician Prime Minister Ranil Wickremesinghe has enlisted the aid of regional superpowers India and China.

But for a nation that is unable to pay for its imports, the future still seems dismal. The government has resorted to making rather desperate appeals: It introduced a plan to give government workers an extra day off to grow crops in their backyards and also offered all of the country’s 1.5 million public sector workers the chance to take five years of unpaid leave so they could find employment abroad, emigrate, and send desperately needed remittances home.

Additionally, there are presently long wait times at the passport offices, and the nation’s online application system has been backlogged for months. The neediest people are trying to escape by boat to nearby nations like India. The collapse of the Sri Lankan economy has been compared by analysts to the financial instability that engulfed the region’s main economies in the late 1990s. Others express concern that Sri Lanka could become “South Asia’s Lebanon,” indebted and dysfunctional.

Negotiations regarding a prospective rescue package that started on June 20 between representatives of the country’s interim government and the International Monetary Fund ended last week without a conclusion. As a developing nation, “we have previously held dialogues,” Wickremesinghe said on Tuesday. “However, the situation has changed. Now that we are a bankrupt nation, we are taking part in the negotiations. As a result, we are faced with a more challenging and complex scenario.

The issues facing Sri Lanka are, in many ways, peculiar to its circumstances and self-inflicted. However, an extensive, interconnected set of global phenomena are also intimately tied to the startling downfall of the nation: The conflict in Ukraine has increased food and energy costs globally and worsened the precarious situation in Sri Lanka.

A consultant with the International Trouble Group, Alan Keenan, told my colleague Gerry Shih earlier this year that Sri Lanka would be in crisis even if there wasn’t a war in Ukraine. “This is the Ukraine effect: a credit line you believed would cover two months’ worth of fuel only covers one. Even if you receive a bailout, you will still spend less on petrol, food, and medical.

Other places experience similar pressures. One person in the drought-stricken nations of Kenya, Ethiopia, and Somalia dies of hunger every 48 seconds, according to a joint report from Oxfam and Save the Children in May. Prices had risen to record highs as a result of the turmoil in Ukraine, making food “unaffordable for millions” of people in East Africa.

The organization observed in a statement that “the number of people experiencing extreme hunger in the three nations has more than doubled since last year – from over 10 million to over 23 million today.” This is occurring “against a backdrop of debilitating debt that more than quadrupled in less than a decade — from $20.7 billion in 2012 to $65.3 billion by 2020 — draining these countries’ resources out of public services and social safety.”

Related articles

Recent articles