{"id":2204,"date":"2023-03-10T17:28:07","date_gmt":"2023-03-10T22:28:07","guid":{"rendered":"http:\/\/www.presbyterianmission.org\/together-justice\/?p=2204"},"modified":"2023-03-10T17:28:07","modified_gmt":"2023-03-10T22:28:07","slug":"sri-lanka-the-shattered-pearl-of-the-indian-ocean","status":"publish","type":"post","link":"https:\/\/centernet.pcusa.org\/together-justice\/2023\/03\/10\/sri-lanka-the-shattered-pearl-of-the-indian-ocean\/","title":{"rendered":"Sri Lanka, the Shattered Pearl of the Indian Ocean"},"content":{"rendered":"
By Herman Kumara | Praja Abhilasha, Sri Lanka<\/h5>\n
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Sri Lankan southern beach seascape. https:\/\/www.stockvault.net\/photo\/280427\/sri-lanka-southern-beach-seascape<\/p><\/div>\n

Sri Lanka was known worldwide as the pearl of the Indian Ocean, but that pearl has shattered into pieces thanks to almost 3 decades of civil war followed by the current food, fuel, energy, and finance crises. And the crises culminated in the April 2022 declaration of bankruptcy by the Government of Sri Lanka. \u00a0The declaration of bankruptcy meant that we could no longer pay back our loans from foreign and local lenders, and international finance institutes.<\/p>\n

How did this happen to a country rich with natural resources: land, sea, forests, unpolluted air, and abundant with biodiversity? Didn\u2019t we have everything we needed to be self-sufficient and independent? And Sri Lanka is a country where a high percentage of the country is educated and we maintain a democratic system. We need to study why this has happened in a country that had everything it needed to be prosperous.<\/p>\n

Sri Lanka became politically independent from British colonizers in 1948. We celebrated our 75th<\/sup> Independence Day this past February. Although we received political independence, we were not economically independent and continued to depend on foreign countries for \u201cso called\u201d development programs. It is important to note that we had a surplus budget when the British Colonizers left the country in 1948. However, the surplus didn\u2019t last long. When the country adopted neo-liberal economic policies, a shift towards free trade, deregulation, and privatization, in 1978, we began to experience budget deficits.<\/p>\n

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Sri Lanka External Debt \u2013 we see a sharp upward trend since 2005. Source: https:\/\/www.macrotrends.net\/countries\/LKA\/sri-lanka\/external-debt-stock<\/p><\/div>\n

After the adoption of neo-liberal policies, the whole country became a dumping site for foreign imports and our long history of local production totally collapsed. We spent a lot of foreign currency on imports from agricultural products to fish, from nails to motors[1]<\/a>, from education items to books.<\/p>\n

Foreign debt has increased annually since 2022. But if you notice in the chart below, external debt doubled between 2005 and 2010, and then again from 2010 to 2015.There are many factors that have contributed to the debt load of the country. The primary factor is the lack of promotion of local production, which includes a lack of incentives for local producers, and a lack of policies that favor or prioritize local markets and local consumption.<\/p>\n

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Sri Lanka External Debt – Historical Data. Source: https:\/\/www.macrotrends.net\/countries\/LKA\/sri-lanka\/external-debt-stock<\/p><\/div>\n

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It is very important to learn why we face this situation of finance, food, fuel and energy crisis lead to a bankrupt country. We can see external and internal factors lead to this situation.<\/p>\n

External Factors:<\/strong><\/p>\n