In the country, which is bearing the brunt of the worst economic crisis since its independence in 1948, shortages of petrol, gas, medicine and food are accumulating. But despite the challenges, the president clings to power.
Night has just fallen on Colombo, but the queue keeps getting longer. Hundreds of vehicles line up in an endless queue in the center of the Sri Lankan capital: taxis, scooters, small private cars or shiny German sedans. All social classes are thus united in the daily struggle of Sri Lankans: to obtain gasoline.
With the hoarse noise of a diesel engine, Vajira Kumar’s white truck finally arrives at the pump. “I spend my days in these queues, blows this newspaper delivery man, his eyes darkened under his graying hair. When I finally get fuel, I leave to deliver until 6 in the morning. Then I come back to line up. Before, I had another job during the day, now it’s not possible anymore. He hadn’t finished his sentence when a fight broke out at the nearby pump, where the best quality petrol, reserved for tuk-tuks, just ran out. One of the drivers, furious, accuses the manager of having sold gasoline for 20,000 rupees (72 Canadian dollars) to the driver of a large car, twice the authorized maximum. The manager denies it, but takes refuge in a corner of the station when questioned, next to the owner of a white Audi and her friend, two dapper women covered in jewelry. They claim to have queued and say they are also suffering from this crisis, in their own way: “When we meet up with friends, we now have to share the same car to save gas, says Anita, with a nervous laugh. And for the first time, I have just been refused a visa to go to Europe. »
Sri Lanka entered since the beginning of the year in the worst economic crisis since its independence, in 1948, which involves cascading shortages and an impoverishment of this emerging Asian country of 22 million inhabitants. The result of an accumulation of catastrophic conjunctures and disastrous decisions: the attacks on churches in April 2019, followed by the COVID-19 pandemic, made tourists disappear. This sector, which contributed 5.6% of GDP in 2018, fell to 0.8% in 2020. This dried up an essential source of foreign exchange, and made it even more difficult to pay off heavy debts, contracted mainly towards the Japan and China.
In December 2019, the new president, Gotabaya Rajapaksa, worsens the situation by reducing taxes: the VAT rate is halved, the level for the payment of income tax drops from 500,000 to 3 million rupees per year (15,000 euros at the rate at the time). This would have resulted in a tax loss estimated at 2% of GDP and finished emptying the state coffers. The Sri Lankans, who enjoyed a per capita income twice as high as their Indian neighbors, saw their purchasing power collapse: in March, the Central Bank began to devalue the rupee to encourage foreign investment and sending money from expatriates to a country that has become cheaper, but this also makes imports of essential goods, such as milk, wheat or oil, more expensive, as well as the external debt of 49 billion euros (66 billion dollars) .
“The hardest thing is the chicken”
At the end of May, the government cannot repay its first loans. Sri Lanka is in default of payment, for the first time in its history, and the government no longer knows how to get out of it. “We didn’t see it coming. One day, we woke up and we couldn’t buy anything,” says Malathy Arulkumar, a 42-year-old housewife who lives in a small house in the popular district of Wanathamulla, in Colombo. In two months, the rupee has lost 80% of its value, and her family, who earn 50,000 rupees a month (241 Canadian dollars) are feeling it, as most prices have doubled. So the household rations: “We can no longer buy powdered milk, cheese, cakes, and I buy half as many vegetables and rice,” she explains, tears in her eyes. The most difficult thing is the chicken: we ate it regularly, and my children ask for it. So I buy some exceptionally, and I leave them. In her cramped kitchen, she shows us, embarrassed, three skinny chicken wings that she is about to prepare in a large wok.
You still have to be able to cook: the price of the 12.5 kilo gas cylinder, used by most households, has quadrupled in eight months, and it is very difficult to find it. In an adjacent neighborhood, 62-year-old Mohammed Amurddin has been waiting outside a store for five days to refill his blue gas cylinder, but the curtain is constantly drawn. And he’s not the only one waiting: next to him, a hundred canisters are lined up on the pavement. To prevent them from being stolen, they are chained, padlocked and numbered. “We all have to pay someone to watch them overnight,” he adds. And during this time, we have to cook over a wood fire, or eat out, which costs us dearly. A woman admits that to save money, she stopped sending her children to school, so she wouldn’t have to pay for snacks or pencils.
This daily struggle, “aragalaya” in Sinhalese, has become even more vital in recent weeks, because medicines are also starting to run out. In the oncology ward of Apeksha Hospital, east of 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 couldn’t start the treatment, because the necessary drugs were missing. Apparently they just arrived. India has been a strong backer for the country, offering 3.3 billion euros ($4.4 billion) in credit this year, as well as tons of medicines, but according to the association of public health professionals, fourteen vital medicines, necessary for the treatment of heart problems, respiratory failure, cancers, or vaccines against rabies, were still missing in recent days. “We have not recorded any deaths because of these shortages, but if they continue, it will happen,” warns surgeon Vasan Ratnasingam, spokesperson for the association. The UN echoed this warning on June 9, calling on the international community to provide emergency humanitarian aid of 44 million euros ($59 million): “Nearly five million people, or 22% of the population, need food assistance, and 86% of Sri Lankans have started to reduce their diet. »
“I have to emigrate”
Faced with this generalized impoverishment, all those who can leave the country. The Ministry of Foreign Affairs is teeming with young Sri Lankans in a hurry to obtain a passport or have their diplomas certified. Thamal Rukhsa barely comes out, a little stunned. “I never imagined that I would go to live abroad, confides this young civil engineer of 25 years, who has found a job in Dubai. But because of the crisis, I’m about to lose my job here. We are working on a public building project, but the state can no longer pay us. So I have no choice: I have to emigrate. »
At least 100,000 Sri Lankans left to work abroad between January and April, twice as fast as last year. And they are more educated than before. “We are suffering from a brain drain,” recognizes Sujeev Rajakulendran, CEO of the company Esshva, which provides outsourced IT services. He has been trying for two months to recruit thirty young engineers, but has only been able to find one person, who is leaving for the United Kingdom himself in December. This sector of new technologies employed 120,000 people last year and represented the fifth largest export item, bringing into the country the currencies so in demand these days. But faced with economic instability and the lack of manpower, companies are considering opening subsidiaries in India or the Philippines to develop more easily.
From the slums to the posh clubs of Colombo, the vast majority of Sri Lankans are now demanding one thing: the departure of President Gotabaya Rajapaksa, held responsible for the crisis. On the bay, in front of the office of the presidency, the large camp “Gota Go” – for “Gotabaya must leave” -, epicenter of the protest since April 9, still has several hundred residents, and demonstrations of hundreds of other people regularly take place in this neighborhood. “In a company, if a CEO can no longer pay his employees and sends them to beg, he is fired, protests an entrepreneur in a parade. We need to get these people out and change the system to restore investor confidence. The Rajapaksa clan, which until recently held the posts of president, prime minister and finance minister, has crumbled: the last two have left their posts, but the president still rules out resigning. The new Prime Minister, Ranil Wickremesinghe, also Minister of Finance, is in discussions with the International Monetary Fund to take out a new loan, and an IMF team is expected in Colombo on June 20. The country needs 5.7 billion euros ($7.7 million) to stay afloat for the next six months. A colossal sum, even for the agency. This would not be Sri Lanka’s first loan from the IMF, but certainly the largest in its history.