Sri Lanka

Light on Lanka

The country’s efforts to secure restructur- ing deals with creditors, including an earlier agreement with the Export-Import Bank of China, play a crucial role in this unfolding drama.

Uncertainty deepens

President Rajapaksa dissolved the Cabinet on Monday as he tried to put in place a unity government in the face of public unrest over the ruling party’s handling of the direly indebted economy. The endemic shortage of food and crippling power cuts are but symptoms of the overwhelming malaise.

Gota, go! Crisis unites Lankans

The suffering masses took to the streets with a single slogan, never before articulated against any head of state of this country. And in this desperation, the slogans arising from hunger, weariness, and helpless resentment were blind to all the differences between the communities, their collective frustration bringing them together as no lavishly foreign funded NGOs and INGOs could achieve for the last 10 years after the war.

Man-made Disaster

The only possible way out of this quagmire is for Sri Lanka to restore macroeconomic stability and debt sustainability, while protecting vulnerable groups through well-targeted social safety nets. It will have to phase out the central bank‘s direct financing of budget deficits, besides ensuring a gradual return to a market-determined exchange rate to rebuild international reserves