Why Sri Lanka’s entire cabinet resigned over economic crisis

Sri Lanka’s cabinet ministers have resigned over the country’s worst economic crisis in decades.

All 26 ministers, apart from President Gotabaya Rajapaksa and his elder brother, Prime Minister Mahinda Rajapaksa, stepped down during a late-night meeting on Sunday, said the education minister, Dinesh Gunawardena.

The development came as the South Asian nation is facing severe shortages of food, fuel and other essentials in “its most painful downturn since independence from Britain in 1948”, said The Guardian.

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State of emergency

For several weeks, Sri Lanka has been battling a worsening economic crisis. The problems are caused in part by a lack of foreign currency, which the country uses to pay for fuel imports.

“With power cuts lasting half a day or more, and shortages of food, medicines and fuel, public anger has reached a new high,” said the BBC. The shortages, caused by the foreign exchange crisis, have meant long queues have formed at shops and fuel stations, with some people dying as they wait.

“For weeks,” said CNN, “life in Sri Lanka has involved hours of queuing – just to get basic goods needed to survive”. The president declared a state of emergency on 1 April.

The Covid-19 pandemic also caused problems for Sri Lanka’s tourist-dependent economy, as the nation closed its borders and imposed lockdowns and curfews. The holiday sector had already been hit hard by the Easter Sunday bombings of 2019, which killed more than 250 people in churches and hotels.

Opposition leader Sajith Premadasa has described the sitting government as “evil” and blamed it for many of the nation’s economic woes, reported The Independent.

Last week, public anger boiled over and Sri Lankan police imposed a curfew and fired tear gas at demonstrators protesting outside the president’s house. Some demonstrators had pushed through barricades and were later described by the president as “extremist elements”.

The curfew order, which banned anyone from being on any public road, in a park, on trains or on the seashore unless they had written permission from the authorities, was defied by thousands of people across the country on Sunday.

The Ministry of Defence has also caused anger by suspending access to Facebook, Twitter, WhatsApp and YouTube, after social networks became the hub for spreading information about the planned protests and voicing anger over the crisis, noted Nikkei Asia.

Sri Lanka’s ‘Arab spring’

The cabinet resignations are not expected to quell public anger. The protesters “say they won’t stop until Mr Rajapaksa resigns”, said Rajini Vaidyanathan, the BBC’s South Asia correspondent.

He added that the “groundswell of anti-government opinion” is “uniting people from all backgrounds, faiths and ages”.

Indeed, there is already anger that the president and his family, who are regarded as being to blame for the situation, will remain in power after the resignations. Describing the situation on Twitter, Ranga Jayasuriya, a journalist, said it was a “sick joke”.

Ranil Wickremesinghe, who served as prime minister between 2015 and 2019, said Sri Lanka was having its own “Arab Spring”, reported The New York Times.

The Sri Lanka Freedom Party announced last week that it would abandon the governing coalition, unless the government acted to “alleviate the economic crisis, after which an election must be called for”. Several other parties in the governing coalition are calling for a caretaker government, made up of all 11 parties represented in the legislature.

Bloomberg reported that the governor of the central bank has also submitted his resignation, ahead of an expected decision on interest rates tomorrow. The loss of Ajith Nivard Cabraal is noteworthy, as during his first term in office, between 2006 and 2015, he helped to more than triple the size of the Sri Lankan economy, according to the bank, the BBC reported.

Meanwhile, said Reuters, this crisis “sends a warning worldwide”. Whether other countries “rush to deal with surging prices with tax cuts, or ramping up subsidies”, wrote Una Galani, Sri Lanka’s “speedy unravelling offers a warning of the political risks of complacency”.