ECONOMYNEXT – Sri Lanka will go for the island nation’s 8th presidential poll to elect a new leader for the next five years later this year between September 17 and October 16.
The election comes two years after President Ranil Wickremesinghe was elected as the 8th leader of the country through the parliament in an unprecedented manner after his predecessor Gotabaya Rajapaksa fled the country fearing for his life in July 2022 amid mass protests across the country following an unprecedented economic crisis.
Wickremesinghe, since then, had to implement a raft of hard economic reforms committed to the International Monetary Fund (IMF) including tax hikes, new revenue measures, and a raft of new laws to ensure the economic recovery under an IMF programme.
Wickremesinghe’s policies have started to help the economic recovery at the expense of his popularity in a nation where most voters are financially illiterate. They elect their leader based on unproven campaign promises for their own benefits instead overall policies for the nation’s prosperity.
Here are five key political risks the island nation is facing ahead of the upcoming presidential polls:
Economic Stability:
Sri Lanka still faces significant economic challenges despite Wickremesinghe government’s gains through IMF-led policy reforms. It has returned to positive economic growth, lower single digit inflation, primary surplus in current account, and higher tax revenue along with currency appreciation due to tough policies under IMF.
But the island nation has yet to complete external debt restructuring formally with both bilateral and private commercial creditors/sovereign bond holders.
Sri Lanka has a bad reputation of policy inconsistency from one government to another and sometimes within the same government in the past mainly to sustain electoral wins.
Still the island nation’s political leaders are struggling to agree on key policies. Opposition parties have publicly said they want to amend commitments Wickremesinghe’s government has agreed with the IMF while there are contradictions over the current government policies within the coalition partners of the government. Such undecided policies could make external creditors to come into terms with the current government unless Wickremesinghe makes it consistency through parliament approvals such as the proposed Economic Transformation Act.
Delays in policy consistency could hit the country’s economic stability and ability to seek external funding as well as investments for future economic development.
The results of a policy inconsistency regime could lead to another social unrest and political instability.
Geopolitical Influences:
Sri Lanka’s strategic location in the Indian Ocean makes it a focal point in regional geopolitics, with competing influences from major powers India and China. That could impact domestic political stability.
Under Wickremesinghe, China has been maintaining a lower profile though it has won crucial deals like Sinopec fuel distributor stations and a massive refinery in the deep Southern port district of Hambantota.
India, on the other hand, has been very active in the island nation’s politics and economic recovery. It helped with loans and bilateral aids when the IMF delayed its approval while other countries were hesitant to help in 2022 when it was reeling with economic crisis.
However, many political analysts and legislators see unprecedented Indian influence in a number of Sri Lanka’s strategic policies including defence, energy, and economy could trigger dormant anti-Indian sentiment. Some of such influences have already rekindle protest against India.
Local political analysts see India as a key strategic partner on one hand and a spoiler on the other hand for its role in intervening in some crucial domestic policies.
The current government leaders have acknowledged the Indian concerns over the regional security amid rising Chinese influence in the past.
However, they say, India’s hard push for some projects leave the government to consider the real motives of such projects multiple times. These projects include Adani’s renewable energy projects, unique identity card deal funded by India, and key connectivity projects like electricity grids, along with gas and oil pipelines between the two neighbours. India is also pushing to take control of one of the world’s most strategic natural ports in the Eastern port district of Trincomalee on a long term lease similar to China got the Hambantota port in 2017.
These projects, which could be beneficial for the country, are likely to face delays because of hard push by India and protests by Sri Lankans, government officials say. India, however, has denied claims of intervention and its hard push for projects.
On the other hand, senior government officials say, Beijing has been irritating India through sending its research ships to Sri Lanka time to time for port calls. On repeated strong Indian protests, Sri Lanka banned Chinese research vessels coming to Colombo for research purposes in 2023 for one year. India argues such ships could compromise its and the India Ocean’s security. Some Sri Lanka cabinet ministers says Sri Lanka can’t stop Chinese research ships if they come for port calls.
Recovering from the unprecedented economic crisis, Sri Lanka cannot antagonise either India or China along with other strategic international partners like the United States, Japan, Russia, the United Kingdom, European Union countries, and Iran.
Any future government will be compelled to navigate through the concerns of these international partners when dealing with strategic investment policies. The island nation’s current simple non-align foreign policy may not be adequate for such navigations, they say.
Wickremesinghe’s administration has handled such concerns with compromises and political instability could arise if a future government deviate from the current stance, analysts say.
Governance and Corruption:
Concerns persist about governance issues, corruption, and lack of transparency, which erode public trust in institutions and could lead to protests or political instability. One of the key demands of millions of 2022 protestors who forced former leader Gotabaya Rajapaksa to flee the country was corruption allegations.
They have strongly felt that the past corruptions had led to the economic crisis in 2022. They have demanded strong actions against those corrupt leaders and bureaucrats and to recover stolen assets owned by them both within and outside Sri Lanka.
Wickremesinghe’s government has come up with Anti-Corruption Act and proposed a strong Proceed of Crime bill. However, the public perception on the deep rooted corruption has not changed. If Sri Lankan policy makers delay the implementation of corruption-busting policies and punish those involved in past corrupt deals further, another mass protest similar to 2022 cannot be ruled out and such delay will trigger the political instability in future.
Concerns over Human Rights/Economic Crimes:
The country’s human rights record, particularly concerning allegations of war crimes and accountability issues related to the civil war, remains a contentious issue both domestically and internationally.
Sri Lanka has taken baby steps to address the past allegations of human rights abuses. These steps include setting up offices to deal with missing people and reparation. However, victims and immediate family members say the government is not doing enough.
Many political leaders still believe demand for accountability on the human rights could disappear with the time. Instead, the island nation’s political leaders, military officials, and bureaucrats are now being looked into their records to consider selected sanction like travel bans.
Already a new report from the Office of the United Nations High Commissioner for Human Rights (OHCHR) has recommended targeted sanctions on officials responsible for disappearances in Sri Lanka since 1970 and has called for justice outside the country for the families of victims.
A limited number of Western nations have already imposed targeted sanctions, including travel bans for some Sri Lankan political and military leaders, after finding credible information about human rights violations,.The United States has imposed a travel ban on former Army Chief Shavendra Silva and his immediate family members, former Navy chief Wasantha Karannagoda, and some others citing human rights violations. Canada last year imposed financial sanctions to freeze the assets of former Sri Lankan presidents Mahinda Rajapaksa and Gotabaya Rajapaksa citing rights abuses. This list is expected to expand with Sri Lanka’s denial of addressing the past rights allegations.
The OHCHR has urged the international community to engage with Sri Lanka due to an accountability gap at the domestic level with victims urging prosecution in a third State due to “widespread impunity in Sri Lanka.” With the alleged economic crimes, some new actions including asset freezing are expected in the near future, global analysts say.
The 2022 economic crisis also has been considered by Sri Lanka’s international partners to see if somebody have bought assets using siphoned off money they pocketed out through corrupt deals. International analysts say Sri Lankans who are alleged have misappropriated public funds and properties may also face questioning on the assets owned by them in other countries in future.
The key concern has been most of the alleged human rights violators and economic criminals are yet to face any local investigation or law suit. President Wickremesinghe has been accused of protecting most of these alleged criminals though he has pledged that he will act according to the law and emphasised the need for more stringent laws. These alleged criminals could become a liability for any government in the future unless they are cleared by an independent judiciary. Having such accused could bring some elements of political instability and public unrest.
Political uncertainty:
Sri Lanka is facing uncertainty due to risks involved with possible policy changes after the presidential poll.
President Wickremesinghe has been constrained by a lack of people’s mandate though his election as the president in the parliament is constitutional. He became the president while having only one seat in the 225-member legislature. He is being backed by former President Rajapaksa-led nationalist Sri Lanka Podujana Peramuna (SLPP) which people wanted oust for its wrong economic policies.
Opposition parties are highly divided and polarised while political analysts predict no clear winner in the upcoming presidential poll as of now.
Anura Kumara Dissanayaka, the leader of Marxist Janatha Vimukthi Peramuna (JVP)-led National People’s Power (NPP) is still somewhat populour leader among the voters, according to some informal surveys followed by the main opposition leader Sajith Premadasa.
Analysts say Dissanayaka’s popularity comes mainly from his eloquent critics over corruption under successive governments and promise over strong actions on wrong doers and curbing corruption. Analysts say the Marxist leader may struggle in government policies if he wins the poll as he and his party have zero experience in formulating and delivering policies.
Premadasa has been trying to win people by impressing them with his Japanese language and sports skills among many others. Analysts say Premadasa is populour because of his father former leader Ranasinghe Premadasa and anti-incumbency stance by the public. Premadasa, analysts say, also has little experience in handling a crisis-hit economy. Premadasa was the deputy leader under Wickremesinghe-led center-right United National Party (UNP) until he broke away from it and started Samagi Jana Balawegaya (SJB) as an alternative to Wickremesinghe’s party. Moves to iron out differences between Wickremasinghe and Premadasa have yet to see success.
Wickremesinghe, whose party has only one member in the parliament, is planning to contest under a broader independent coalition, facilitating most current and the past legislators to back him despite ideological differences their parties have.
There is no clear survey or polls to suggest who will be the likely winner at the moment. Wickremesinghe’s popularity has been on the rise among the public in the last two months, but Dissanayaka and Premadasa are ahead of him, analysts say. Regardless of who wins, analysts expect some drastic policy measures including from Wickremesinghe as he will be ruling with people’s mandate for the first time after the election, if he wins.
These factors collectively contribute to a complex political landscape in Sri Lanka, influencing both domestic governance and international relations