One of the first signs of trouble came just before the coronavirus pandemic hit.
The newly elected president of Sri Lanka, Gotabaya Rajapaksa, fulfilled a campaign promise and enacted sweeping tax cuts in November 2019. The move would stimulate the local economy, said Mr. Rajapaksa, a member of a family that has dominated the country’s politics in recent decades.
But that plan was ground to a halt by the virus. Travel restrictions and lockdowns were a body blow to Sri Lanka’s tourism-based economy. And, crucially, the country was deprived of the foreign currency that it uses to buy fuel.
Credit-ratings agencies were soon warning about Sri Lanka’s deteriorating ability to pay down its already high debt. But, as the strains from the tax cuts on government coffers intensified and the Sri Lankan rupee lost value, Mr. Rajapaksa was unbowed.
One of the president’s next moves, in 2021, was to ban foreign-made fertilizer. Mr. Rajapaksa argued that the policy — billed as a push toward organic farming — was better for human and environmental health. Critics pointed out that stopping those imports would help shore up the country’s foreign-exchange reserves.
The policy was disastrous: Farmers were ill prepared for the change, and crop yields plummeted. That led to soaring food prices, which were already rising because of the pandemic, and led to worries about shortages. The fertilizer ban was lifted before the end of the year, but the reversal was too late to save the next harvest.
Soon, for many Sri Lankans, food and fuel were either impossible to find or too expensive to buy. The country was moving from a debt crisis to an all-out economic collapse. Daily life was upended with rolling power cuts, people waiting in lines for hours to buy fuel and cooking gas, and abrupt halts to public transportation.
The downward spiral was hastened by the war in Ukraine, which compounded supply-chain problems across the globe. In April, the government suspended payments on its international debt.
By this time, demonstrations against the government had become an almost daily affair in the country. Protesters blamed Mr. Rajapaksa and his family for their strife and wanted them out of government.
Source : Nytimes
