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The present Economic and Political crisis in Sri Lanka at glance and our struggles

The present Economic and Political crisis in Sri Lanka at glance and our struggles

The economic and political crisis of Sri Lanka between 2019 to 2022 has been a worldwide talking topic. The ongoing situation of Sri Lanka is largely attributed to the economic mismanagement of the incumbent government, leading to inflation which Sri Lanka had never experienced before, near depletion of foreign exchange reserves, shortage of major essentials, soaring domestic prices, and sinking banking sector. Throughout the decade, the Sri Lanka government has been borrowing vast sums of money which have caused a series of hammer blows to the economy. Also, the natural disasters weren’t favourable to the country – such as heavy monsoons, Easter Sunday attacks, COVID, and the ban on chemical fertilizers which affected the farmers’ harvests. By expecting to stimulate the economy, the present government slashed taxes in a doomed attempt which backfired and hit the revenue of Sri Lanka. Foreign reserves are severely depleted, estimated < 1 week of unstable reserves shrinking its reserves from $6.9 billion in 2018 to $2.2 billion this year. This impacted imports of fuel and other essentials, which sent prices soaring. The oil import bill has sharply increased. Shortages of fuel, cooking gas, medicines, medical supplies and food items made the Sri Lankan people get into the streets like never before. Consumer price inflation is now over 20% driven by both domestic shortages and import prices (LKR depreciation) and shortages (lack of forex) and severe USD liquidity shortages have directly left the Sri Lankan economy in the worst possible situation.

Sri Lankans were compelled to wait in endless queues and lines daily to consume their basic goods which even caused deaths and health crises with the heat and longevity of the lines. Unlike the other generations before, today’s younger generations are well aware of the government’s doings and this worsening economic crisis was the breaking point to bring all of them together and get into the streets to raise their voices and their struggle continues whole over the island especially in Galle Face for more than 3 weeks now demanding the immediate resignation of the President, Prime Minister, and the entire government is continuing despite inclement weather. Thousands of them are students and people from all over the country visit there and show their support. Thousands of Sri Lankan university students mobbed Prime Minister Mahinda Rajapaksa’s home on Sunday demanding his resignation over the island nation’s worsening economic crisis. Police also have been using brutality on the protesters which proved the killings of 04 persons by shooting them who were engaging in peaceful protest action in Rambukkana by the police officials as reported. This aggravated the situation even more among the nation island-wide. Especially the situation of garment sector workers, who have been in vulnerable conditions even before this crisis, now has compelled them to bear an immense weight on their shoulders and minds.

Sri Lankan trade unions including our union (FTZ&GSEU) have been writing, campaigning and predicting the situation to the government for years before which were totally ignored and now paying the price. Trade unions both in the Public and Private sectors are also carrying out joint campaigns but there is a vacuum of leadership to rally around all the protests with a clear program of action and proposals of solutions for the prevailing crisis. Our union FTZ & GSEU together with the unions at National Labour Advisory Councils have formulated the proposals of solutions for the current crises and submitted them for social dialogue. As a part of our process to show the opposition, Free Trade Zones & General Services Employees’ Union together with its members marched to the streets of Katunayake, Biyagama, Ekala and other places where individual factories are located under the slogan of “Let’s send Gota Home! Abolish the executive presidency”. The photos and videos are attached for your information. We will march with them once again on May 1st 2022, we will send you the updates soon. We all need your support and prayers in these hard times as always. 

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