In the country, which is bearing the brunt of the worst economic crisis since its independence in 1948, shortages of gasoline, gas, medicine and food are accumulating. But despite the challenges, the president clings to power.
Night has just fallen on Colombo, but the queue is getting longer. Hundreds of vehicles line up in an endless queue in the center of the Sri Lankan capital: taxis, scooters, private vans, or shiny German sedans. Thus all social classes are united in Sri Lanka’s daily struggle for petrol.
With the hoarse noise of a diesel engine, the white Vajira Kumar truck finally reached the pump. “I spend my days in these queues, blasting that newspaper delivery guy, his eyes shaded under his graying hair. When I finally get fuel, I leave to drop by six in the morning. Then I go back to line up. Previously, I had another job during the day, and now it’s not possible anymore.” Now he hadn’t finished his sentence when a fight broke out at the nearby pump, keeping his best quality gasoline Tuk Tuk, just ran out. One of the drivers, furious, accuses the manager of selling gasoline for 20,000 rupees ($72 CAD) to the driver of a large car, twice the maximum allowed. The manager denies it, but turns to a corner of the station when questioned, next to the owner of a white Audi and her friend, two elegant women covered in jewels. They claim that they queued up and say that they are also experiencing this crisis in their own way: “When we meet with our friends, we now have to share the same car to save gas, says Anita with a nervous laugh. For the first time, a visa to go to Europe has just been refused. »
Since the beginning of the year, Sri Lanka has been plunged into its worst economic crisis since its independence in 1948, involving successive shortages and impoverishment of this emerging Asian nation of 22 million people. The result of the accumulation of disastrous conditions and disastrous decisions: attacks on churches in April 2019, which were followed by the COVID-19 pandemic, led to the disappearance of tourists. This sector, which contributed 5.6% of GDP in 2018, fell to 0.8% in 2020. This has drained a key source of foreign exchange, and made it more difficult to repay heavy debts, contracted mainly to Japan and China.
In December 2019, the new president, Gotabaya Rajapaksa, aggravated the situation by cutting taxes: the value-added tax rate was halved, the level of income tax payment decreased from 500 thousand to 3 million rupees per year (15,000 euros at that). the time) ). This could have resulted in a tax loss of about 2% of GDP and the end of emptying state coffers. Sri Lankans, who enjoyed per capita incomes twice that of their Indian neighbors, have seen their purchasing power plummet: In March, the central bank began depreciating the rupee to encourage foreign investment and send money from expatriates to a country that has become cheaper, but this also makes imports of basic commodities, such as milk or Wheat or oil, more expensive, as well as an external debt of 49 billion euros ($66 billion).
“The hardest thing is the chicken”
At the end of May, the government was unable to repay its first loans. Sri Lanka is in default, for the first time in its history, and the government no longer knows how to get out of it. “We weren’t expecting it. One day, we woke up and couldn’t buy anything,” said Malathi Arulkumar, a 42-year-old housewife who lives in a tiny house in the popular Wanathamola district of Colombo. Within two months, Rs 80 has been lost. % of her value, and her family earning 50,000 rupees a month (Canadian dollars 241) feels that, with most prices doubling. So, home rations: “We can no longer buy powdered milk, cheese and cake, I buy half as much vegetables and rice,” she explains, tears in her eyes.The hardest thing is chicken: we ate it regularly, and my children demanded it.So I buy some exceptionally, and let them.In her cramped kitchen, she shows us, embarrassed, three skinny chicken wings she’s about to prepare in a large frying pan.
You still have to be able to cook: the 12.5kg gas cylinder that most households use has quadrupled in eight months, and it’s very hard to find. In a nearby neighborhood, 62-year-old Muhammed Amr El Din has been waiting outside a store for five days to refill his blue gas cylinder, but the curtain is constantly drawn. And he is not the only one waiting: next to him, a hundred packages are lined up on the sidewalk. To prevent them from being stolen, they are chained, locked and numbered. “We all have to pay someone to watch them all night,” he adds. And during this time we have to cook over a wood fire, or eat outside, which costs us dearly. A woman admitted that she stopped sending her children to school to save money, and therefore would not have to pay for snacks or pencils.
This daily struggle, “aragalaya” in Sinhala, has become even more important in recent weeks, because medicines have also started to run out. In the oncology ward of Apaksha Hospital, east Colombo, a 72-year-old white-haired man waits. “It’s been two weeks since my wife was diagnosed with lung cancer,” he says. But we could not start the treatment, because the necessary medicines were missing. Looks like they just arrived. India has long been a staunch supporter of the country, providing 3.3 billion euros ($4.4 billion) in credit this year, as well as tons of medicine, but according to the Federation of Public Health Professionals, fourteen vital drugs are needed to treat the heart. Problems, respiratory failure, cancers, or rabies vaccinations, are still missing in recent days. “We have not recorded any deaths due to this deficiency, but if it continues, it will,” warns Surgeon Vasan Ratnasingham, a spokesperson for the association. The United Nations reiterated this warning on June 9, calling on the international community to provide 44 million euros ($59 million) in emergency humanitarian aid: “Nearly five million people, or 22% of the population, are in need of food assistance, and 86 % of the population of Sri” Lankans began to reduce their diet. »
“I have to emigrate”
In the face of this generalized poverty, everyone who can leave the country. The Ministry of Foreign Affairs is teeming with young Sri Lankans who are in a hurry to obtain a passport or have their diplomas certified. Drunken dregs barely come out, a little dumbfounded. “I never imagined that I would go live abroad, admits this young 25-year-old civil engineer, who found a job in Dubai. But due to the crisis, I am about to lose my job here. We are working on a public construction project, but the state has not No longer able to pay us. So I have no choice: I must emigrate.”
At least 100,000 Sri Lankans left to work abroad between January and April, double the pace of last year. They are more educated than before. “We are experiencing a brain drain,” admits Sujeev Rajakulendran, CEO of Esshva, which provides IT services outsourcing. He has been trying for two months to recruit thirty young engineers, but has only been able to find one, who will leave for the UK by himself in December. This sector of new technologies employed 120,000 people last year and was the fifth largest export component, bringing the much needed currency into the country these days. But in the face of economic instability and shortage of manpower, companies are considering opening branches in India or Philippines to develop more easily.
From the slums to the luxury clubs of Colombo, the vast majority of Sri Lankans are now demanding one thing: the departure of President Gotabaya Rajapaksa, who bears responsibility for the crisis. On the bay, in front of the office of the Presidency, the large “Gota Go” camp – for “Gotabaya must go” – the center of the protest since April 9, still houses several hundred residents, and demonstrations of hundreds of other people regularly in this neighbourhood. “In the company, if a CEO can no longer pay his employees and send them to beg, he is fired, and a businessman protests in a procession. We need to get these people out and change the system to restore investor confidence. The Rajapaksa clan, which until recently held the positions of chief, has collapsed. The Prime Minister and Finance Minister: The last two have left their posts, but the president still rules out resignation.The new Prime Minister, Ranil Wickremesinghe, also Finance Minister, is in discussions with the IMF for a new loan, and a team from the IMF is expected to arrive in Colombo On June 20. The country needs 5.7 billion euros ($7.7 million) to stay afloat for the next six months. A huge amount, even for the agency. This will not be Sri Lanka’s first loan from the International Monetary Fund, but certainly the largest in its history.