Executive summary:Mass protests broke out in Colombo, the capital of Sri Lanka. Following Prime Minister Wickremesinghe’s willingness to resign, the latest news from the Prime Minister’s Office said that President Rajapaksa notified the Prime Minister on the 11th to officially announce his resignation. Analysts believe that the situation in Sri Lanka is chaotic, and it is still unknown whether the formation of a new government will take place.
Mass protests broke out in Colombo, the capital of Sri Lanka. Following Prime Minister Wickremesinghe’s willingness to resign, the latest news from the Prime Minister’s Office said that President Rajapaksa notified the Prime Minister on the 11th to officially announce his resignation. Analysts believe that the situation in Sri Lanka is chaotic, and it is still unknown whether the formation of a new government will take place.
Demonstrations eased slightly
Speaker calls for calm
Speaker Abe Wadena said that President Rajapaksa’s decision to resign was to ensure a peaceful transition of the regime and it is crucial to keep the country at peace. Abeywarden also asked all civil servants and the public to respect the law, remain calm and ensure the smooth conduct of daily activities.
According to the Sri Lankan constitution, following the resignation of the president and prime minister, the speaker will act as president on an interim basis, and the transition time will not exceed 30 days. Local opposition parties held a meeting on the 10th to discuss the formation of a new government.
At present, the situation in Colombo has eased slightly. Many people remained at the presidential palace, and members of the security forces stood guard outside the door with rifles, but did not prevent people from entering. Dozens of people were injured during the protests, local media previously reported.
“The country is bankrupt”
The economic crisis continues to intensify
Sri Lanka’s economic crisis has lasted for nearly a year. The local inflation rate soared to 54.6% in June, and food prices surged by 80%, and the inflation rate is expected to climb to 70% in the next few months.
For months, Sri Lanka has faced high prices, a shortage of electricity and shortages of essentials such as food and medicine. On the 17th of last month, the authorities issued an order that except for employees in important positions such as medical care, the rest of the public must work from home. The local government also suspended the sale of fuel to the public at the end of last month to provide fuel only for public transport and basic medical services, and school closures were extended to deal with the fuel shortage crisis.
Speaking to parliament last week, Sri Lankan Prime Minister Wickremesinghe said “the country is bankrupt” and said the unprecedented economic crisis “will last until at least the end of 2023”.
Political uncertainty increases
IMF talks affected
At present, Sri Lanka is negotiating with the International Monetary Fund (IMF), hoping to seek 3 billion US dollars in bailout funds, and is also negotiating debt restructuring with foreign creditors.
But Prime Minister Wickremesinghe acknowledged that as a “bankrupt country” rather than a developing country, negotiations with the IMF are already difficult. Analysts pointed out that the resignation of the Sri Lankan President and Prime Minister will increase political uncertainty and may further affect the negotiations between Sri Lanka and the IMF.
The analysis also believes that the situation in Sri Lanka is chaotic, and the formation of a new government is highly questioned. Political analyst Pereira said the details of the power transfer in Sri Lanka were still uncertain and the resignation of the president and prime minister was likely to trigger a “dangerous power vacuum”. Although the speaker can appoint a new government, it remains to be seen whether it will be accepted by the public.
Original title: The country “bankrupt”, the president and the prime minister resigned, what happened to the country?
