In part two, political economist Dr. Devaka Gunawardena outlines the political dynasties in Sri Lanka that governed the country until the National People Power’s (NPP) recent electoral victory. Gunawardena discusses how NPP leader Anura Kumara Dissanayake has garnered widespread support across different ethnic and class lines despite being a political outsider.
In November 2024, Anura Kumara Dissanayake’s National People’s Power (NPP) coalition won a two-thirds majority in Sri Lanka’s general elections, marking a historic win for the Sri Lankan left. NPP’s victory came at a time of prolonged economic crisis exacerbated by the crushing terms of Sri Lanka’s IMF agreement. Political economist Dr. Devaka Gunawardena traces the factors leading to Sri Lanka’s economic woes and how international sovereign bonds (ISBs) held by private equity firms such as BlackRock constitute a large segment of Sri Lanka’s debt. Given the government’s recent private creditor debt restructuring agreement, can the NPP still deliver on its campaign promises of wealth redistribution and reversing austerity?
Due to its prime geographical location in maintaining global value chains and shipping routes, the U.S., via the U.S. International Development Finance Corporation (DFC), as well as India’s Adani Group and China, are all investing in Sri Lanka’s ports. In part 2, sociologist Asoka Bandarage discusses how many countries and multi-national corporations treat Sri Lanka as testing and dumping grounds, exemplified by reports that the Dali ship, which crashed into the Baltimore Bridge, was carrying hazardous waste to Sri Lanka.
The Sri Lankan government turned to the IMF for a near $3 billion bailout to repay loans provided by India and Japan, as well as international sovereign bonds issued by foreign creditors such as BlackRock. Dr. Asoka Bandarage, sociologist and author of Crisis in Sri Lanka and the World, suggests that Prime Minister Rajapaksa’s declaration of bankruptcy in 2022 and the subsequent IMF bailout under Prime Minister Wickremesinghe was not an absolute necessity, but an attempt to shift Sri Lanka further under the umbrella of Western and Indian institutions, and away from Chinese loans.
Dr. Asoka Bandarage is an adjunct professor at the California Institute for Integral Studies and the author of a new book, Crisis in Sri Lanka and the World. Sri Lanka has had a minuscule carbon footprint, and yet the country is particularly vulnerable to the effects of climate change, coastal erosion, and flooding. She discusses the convergence of existential climate and debt crises in Sri Lanka, the latter resulting from IMF debt restructuring and the lack of a globally coordinated multilateral sovereign debt mechanism that places traditional and private lenders on an equal footing.
End of content
End of content
