(Colombo) Sri Lanka’s new left-wing president is wasting no time: as soon as he was sworn in, Anura Kumara Dissanayake appointed a provisional government on Tuesday and was to dissolve parliament immediately to hold early elections.
A Marxist by training, but largely converted to the market economy, Mr. Dissanayake, 55, was widely elected on Saturday, two years after the serious economic crisis which imposed a brutal and unpopular austerity cure on his country.
On Tuesday, his services announced the appointment of Harini Amarasuriya, a 54-year-old MP, as prime minister, along with the appointment of the ministries of Justice, Education, Health and Labour.
A university professor, the new head of government has held since 2020 one of only three seats – out of 225 – occupied in Parliament by the Marxist People’s Liberation Front (JVP) of the new head of state.
She distinguished herself in particular by defending gender equality and the rights of minorities.
Mme Amarasuriya and the two other JVP MPs are sharing the other portfolios allocated on Tuesday and will handle the day-to-day affairs of the other ministries until the next legislative elections.
“This is the smallest government in the history of Sri Lanka,” JVP leader Namal Karunaratne joked to reporters. “The dissolution of Parliament will come after, maybe in the next 24 hours,” he added.
Dry diet
On Monday, during a trip to Kandy (Centre), Mr. Dissanayake himself confirmed his promise to quickly call early elections. “Wait two days,” he told journalists.
Sri Lanka experienced its worst economic crisis in history two years ago, forcing it to default on its public debt, then estimated at $46 billion. Weeks of popular protests against shortages and inflation led to the fall of President Gotabaya Rajapaksa in July 2022.
In exchange for a $2.9 billion aid package from the International Monetary Fund (IMF) in 2023, his successor Ranil Wickremesinghe has increased tax increases and cuts in public spending.
The country’s economy has recovered somewhat since then, but remains fragile, according to the IMF. But the regime has fuelled anger among many Sri Lankans.
During his campaign, Mr Dissanayake saw his popularity soar as he denounced the “corrupt” elites he said were responsible for the 2022 bankruptcy and promised to cut taxes on basic necessities.
Even before announcing his victory, he confirmed that he wanted to renegotiate the agreement signed with the IMF.
“Red line”
The financial institution said on Monday that it was ready to discuss the matter with him. “We look forward to working with President Dissanayake and his team soon to confirm the progress that has already been hard-won,” a spokesperson said.
However, the new president’s room for maneuver appears to be limited, experts note.
“I’m afraid that on the fiscal side, there are few adjustments possible,” Murtaza Jafferjee, director of the independent think tank Advocata, told AFP. “There are red lines that the IMF will not want to negotiate.”
“It would be in the country’s interest to avoid any litigation with sovereign bondholders,” added Umesh Moramudali, professor of economics at the University of Colombo.
The new parliament must therefore validate a debt restructuring agreement announced last week. This agreement provides for a 27% discount on the 12.5 billion of sovereign bonds held by the country’s private creditors.
Anura Kumara Dissanayake has made no secret of the difficulties that await him.
“I am fully aware of the importance of the mandate I have received,” he said Monday in his inaugural address. “I am not a magician, […] I will do my best.”