Can Sri Lanka Rise again? — Fall of Sri Lanka
This is the script for my YouTube video that you can watch here
Fueled by decade of bad decisions and the pandemic, Sri Lanka has fallen. But what went wrong and what will make things right?
On the 9th of July 2022, protestors stormed into the empty house of the president and took over the country, completing the Fall Of Sri Lanka. But the writing was on the wall for quite some time. A very poor display of top level management in the economic sector wounded the country until the pandemic dealt the final blow. But the burning question going forward is how can Sri Lanka recover from this dire situation and save countless citizens from suffering? Let’s dive in.
The soaring consumer inflation has made most Sri Lankans unable to afford essential goods and is pushing towards famine.
Power outages and fuel shortage have stopped many offices, institutions and schools from functioning. The $51bn loan is hanging ominously over the country. The International Monetary Fund is planning a bailout but that requires a stable government. Also further loans might send the country into further trouble.
Major tax cuts, taking unnecessary loans for unnecessary projects and only relying on tourism for income set a chain reaction of events that led to the economic crash in the country. These are signs that other developing countries should become aware to avoid similar situations, but back to Sri Lanka, is it possible to recover the economy at this state? Here are a few ideas.
The first task for the new government is to repay the mammoth loan, but even before that, ensure basic amenities to the citizens. To do that, the government needs to turn to other countries. A global call for aid is what will save the country from going into famine. If Sri Lanka ever needed great diplomats, its NOW. As the Governor of the Central Bank suggests, it is trying to implement high interest rates and some of the financial decisions taken are now being reversed.
Foods, Fuel, pesticide, medicine etc. are something countries all over the world needs to help Sri Lanka with immediately. One thing that needs to be addressed is the internal food production. Even with outside help, Sri Lanka MUST ensure food security before it can tackle other issues.
Sri Lanka needs multiple revenue streams to quicken the recovery process. Relying on tourism alone has already proved to be bad for the economy. Diversifying the export portfolio is necessary.
Setting up cheap and direct channels for Sri Lankans working abroad to send remittance is a step that will help the economy to boost drastically, at least for a short period. Professor Mick Moore suggests merely increasing the tax rates, bringing back tax rates based on income and shifting jobs more from public to private institutions will boost the overall national revenue.
Setting up special tourism zones with special effort to provide uninterrupted utility and security will boost the confidence of tourists and slowly pull back the industry again. Setting up similar incentives and economic zones for foreign business and investors will help as well.
Incentives to encourage multiple potential export sectors will also help with the long term loan repayments and help stop similar situations from happening in the future. Dr. Howard Nicholas thinks a joint strategic approach by the local and foreign companies, government and other parties involved to create an export oriented economy will be the key to the ultimate financial success for the country.
At the moment, it’s all about damage control, and stopping the poison from spreading further. With time, all wounds heal but time is something that millions of Sri Lankans cannot afford right now.
The current situation in Sri Lanka requires support from all nations and slowly but surely, we all hope that the Pearl of the Indian Ocean will once again shine in her past glory.
The author would like to thank:
AFP
BBC
REUTERS
Sky News
TNT World
DW
WION
EFSAS
SLIM Sri Lanka
And
Many others
