What lies ahead for Sri Lanka?

Author: Chulanee Attanayake, NUS

Once the heroes of Sri Lanka who defeated the Liberation Tigers of Tamil Eelam, the Rajapaksa regime ended with former president Gotabaya Rajapaksa resigning from his post. He fled the country following nationwide protests and unrest that broke out on 9 July 2022.

Rajapaksa’s administration is not solely responsible for Sri Lanka’s economic woes. Policy failures by successive governments, combined with the COVID-19 pandemic and Ukraine crisis, put a strain on the economy. But a series of misplaced and ill-advised policies made by his government exacerbated a crisis that had been years in the making. Stories of mismanagement and allegations of corruption will taint the Rajapaksa administration’s legacy.

The uprising resulted from months of protests demanding the Rajapaksa family step down from Sri Lankan politics. Former prime minister Mahinda Rajapaksa and finance minister Basil Rajapaksa resigned from their posts and left parliament following the protests but Gotabaya held on to his position, determined to finish his term.

On 9 July, protesters ran out of patience and stormed the president’s official residence. Gotabaya announced his willingness to resign on 13 July but this did not placate the hundreds of thousands of protesters who flocked to Colombo to force him out of office.

While the 9 July protest was an unprecedented uprising against Sri Lanka’s rulers, there was initially minimal violence. The military and police were widely deployed at the president’s residence and office,  but compared to what was seen at similar uprisings in Egypt or Lebanon during the Arab Spring, the protests remained largely peaceful.

It did not take long for the protests to turn violent in the days leading up to Rajapaksa’s resignation. On the night of 9 July, an unknown group set fire to the prime minister’s residence. Protesters stormed the Prime Minister’s office on 13 July, leading to another clash between the protesters and the police. The two state-run television stations were forced off the air after protesters attempted to storm their offices. Protesters reportedly attempted to breach the police barricades along the road leading to the parliament, causing another violent clash between the police, military and protesters.

Gotabaya officially resigned on 14 July after fleeing to Singapore. According to Sri Lanka’s constitution, when a president’s seat is vacated before the end of a term, a president was to be selected within the parliament for the remaining period. Accordingly, a secret ballot was held on July 20, electing Ranil Wickremesinghe as the eighth Executive President in Sri Lanka.

Since the protest movement lacked cohesive leadership by any single group, the protesters do not have a clear preference for the new president. Yet there were calls for Ranil Wickremesinghe to step down. He is seen as an associate of the Rajapaksas and the ruling party. The leftist student formations and trade unions aligned with the National People’s Power party (NPP) that dominated the protests likely expected Dissanayake to take over the leadership. He is the only leader whose party has not ruled the country in the past and who they see as capable of bringing the necessary reforms.

Sri Lanka needs leadership willing to work hand in hand with the International Monetary Fund (IMF). In this regard, Wickremesinghe likely has more international standing than the other three presidential contestants. In 2016, Wickremesinghe successfully negotiated an extended facility with IMF in order to stabilise the forex reserve. Protesters are divided among Sri Lanka’s chance with IMF. While  most protesters have demanded that the government work with the IMF on a bailout to resolve the deepening economic crisis, the NPP-backed student unions and trade unions have been sceptical about IMF intervention.

Sri Lanka needs immediate solutions to the deepening economic crisis. At this point, only an IMF bailout can restore Sri Lanka’s legitimacy and credibility among creditors. Continuous political instability will delay negotiations and deepen economic distress.

It is unclear how the public would respond to the conditions of an IMF bailout. Higher taxes, increased interest rates and cutting down on public subsidies such as electricity and power are unlikely to be popular policies. Already, NPP-backed student unions and trade unions have raised opposition over possible privatisation policies that may come under Wickremesinghe government.

Now that the protesters have achieved their only common goal — regime change — disagreement among the protesters may cause ruptures in the groups. This is likely considering that the protests focussed on individuals rather than structural problems. Internal conflict could delay the reform process and may even lead to further political instability if new leaders fail to retain power for more than a short time.

The incoming Sri Lankan government will face a dilemma. If it wants to enact the reforms required for a long-term solution, it should be prepared to take drastic measures that would be unpopular among the public. If it takes populist measures, the dire economic conditions will continue. The future of the next government will depend on its ability to navigate such a course.

Chulanee Attanayake is Research Fellow at the Institute of South Asian Studies, National University of Singapore.

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