After the popular uprising in Sri Lanka, things had calmed down on the island. But now the ousted President is returning. This creates new tensions in the crisis country.
Former President Gotabaya Rajapaksa drove in a long convoy of vehicles from Colombo Airport to the capital on Saturday night.
When the protests in Sri Lanka’s capital Colombo reached their climax in mid-July, something seemed to be changing permanently on the island: the population’s anger at the corrupt government was greater than ever and developed enormous political momentum. Demonstrators stormed the presidential palace. President Gotabaya Rajapaksa, the icon of corruption and economic crisis, fled into exile. First he found refuge in the Maldives, then in Singapore, and finally in Thailand.
Less than two months later he is back. Rajapaksa landed in Colombo on Saturday. He was given an official residence and personal protection there. His return to Sri Lanka is an indication that changes on the island may not have been as enduring as protesters had hoped.
No President of New Beginnings
The new president is Ranil Wickremesinghe, who was elected by parliament in July as Rajapaksa’s successor. He is 73 years old and has previously been prime minister five times. Wickremesinghe belongs to a micro-party and is its sole representative in Parliament. He only became president because the majority party, controlled by the Rajapaksa clan, supported him.
It was indicated early on that Wickremesinghe was not a fresh start president. Immediately after his election, he described the demonstrators as fascists. He had the police clear the protest camps in Colombo – the security authorities had previously tolerated the mostly peaceful demonstrators for months. Since then, the protests in Sri Lanka have died down and the police arrested several activists.
However, the current calm on the island is deceptive. It seems all it takes is a spark to reignite the demonstrations. It is still unclear what role the former president will now play. His spokesman declined to comment to the media. Rajapaksa was elected in 2019 because of his reputation as a strongman. He had commanded the army during the civil war and was at the head of the army when the war ended in 2008. He was also blamed for massacres perpetrated by Sri Lanka’s army in the north of the island.
During his presidency, the country plunged into its worst economic crisis since independence. The island has long had a trade deficit, but this worsened under Rajapaksa. Because of the Covid pandemic, the tourism sector collapsed, foreigners stopped bringing dollars to the island, and foreign exchange reserves melted. Instead of taking countermeasures, Rajapaksa and his family continued to use public funds, earning money from several infrastructure projects. At the same time, the government distributed tax breaks to the richest Sri Lankans.
The indebted island had to declare insolvency in the spring. The inhabitants still lack many things today: fuel, electricity and often food. Food prices are so high that many people can no longer afford three meals a day.
IMF puts together aid package
In a report earlier this year, the International Monetary Fund (IMF) warned that Sri Lanka’s tax policy was leading to a crisis. The Rajapaksa government simply brushed aside doubts and started negotiations with the IMF far too late. She only asked for help when the population was already suffering greatly from the crisis.
At least the relationship with the IMF seems to be improving under the new president. Wickremesinghe had already negotiated several times with the IMF as prime minister. This experience has now paid off: Last week, the negotiators agreed on an aid package worth 2.9 billion dollars. The condition for this is that the country implements reforms and negotiates debt cancellation with its creditors. That’s a challenge because Sri Lanka’s biggest creditor is China, which rarely forgives debt.
The aid package has yet to be approved by the IMF Board. This is usually considered a formality. However, it is important to the organization to only give money to countries that are politically stable. Rajapaksa’s return could endanger that very stability. Opponents have already called for the former president’s arrest. Perhaps his return is the spark that reignites the demonstrations.