Chaos in Sri Lanka offers a warning
Gotabaya Rajapaksa came to be known as The Terminator for crushing Sri Lanka’s nearly three-decade Tamil insurgency in 2009 as a defense official during the presidency of his older brother, Mahinda Rajapaksa. Gotabaya’s reputation for decisiveness brought the siblings — pushed out of office in 2015 — back to power four years later after a series of Islamist suicide bombings stirred renewed fondness for their ruthless ways.
This time, Gotabaya, 73, became president and appointed Mahinda, 76, as his prime minister. They promised “vistas of prosperity and splendor.” Instead, they delivered soaring inflation, severe food and fuel shortages, power blackouts and a country on the precipice of collapse.
The calamity unfolding in Sri Lanka is the culmination of a perfect storm of causes: debilitating debt, China’s geopolitical ambitions, the pandemic, the turmoil in global food and fuel markets caused by Russia’s invasion of Ukraine and — underlying it all — the hubris and recklessness of the Rajapaksa dynasty.
The turmoil in Sri Lanka is a dire warning sign in this period of inflationary unrest to developing economies — Nigeria, Laos, Argentina, Pakistan and others — battered by debt and mounting food and fuel prices.
On Saturday, President Rajapaksa fled after thousands of protesters stormed the presidential palace. He is said to have agreed to resign. His ignominious departure was almost a carbon copy of his big brother’s: Mahinda resigned in May after his official residence also was swarmed by an angry mob.
The Rajapaksas were relatively minor players until Mahinda in 1970 inherited the parliamentary seat vacated by his father five years earlier. Navigating Sri Lanka’s restive politics over the decades, he expediently transformed from a champion of human rights to a hard-line ethnonationalist.
Still, the family’s position was so uncertain that his brother Gotabaya moved to the United States in 1998, took a job as an IT technician and became an American citizen in 2003.
When Mahinda won the presidency in 2005, he packed the government with family members. Gotabaya, appointed to the defense ministry, defeated Tamil separatists, who had waged a bloody war against their relegation to second-class status in the majority-Sinhalese country. The campaign was so savage that it invited credible accusations of war crimes.
The family tightened its grip on the country and went on a borrowing spree to entrench its cult. It found a receptive partner in China, which was just then accelerating its drive to position itself as a rival to India in South Asia. Beijing wooed Nepal, Myanmar and Pakistan with lavish loans.
Strategically located in the Indian Ocean, Sri Lanka was central to China’s plans, and Beijing got the Rajapaksas hooked on easy money. China quickly became one of the largest holders of Sri Lanka’s ballooning debt, accounting for around 10 percent, about the same as Japan but on more onerous terms. Billions of dollars flowed in, and wasteful vanity projects proliferated in the capital, Colombo.
The Rajapaksas surrendered Sri Lankan sovereignty as collateral. They used Chinese loans to finance the construction of a port at Hambantota, the family’s home district in the south. But in 2017, Sri Lanka was forced to hand over the port and 15,000 acres of adjacent land to China on a 99-year lease when it could no longer keep up with debt repayments on the project. The Rajapaksas had been voted out two years earlier, but China now had an Indian Ocean foothold.
Unfortunately for Sri Lanka, the family wasn’t finished destroying the country. In 2019, coordinated Islamist terrorist attacks across the country on Easter Sunday killed 269 people and ignited a nationalist backlash that vaulted the Rajapaksas back into power.
The brothers again staffed every consequential ministry with relatives, who often had little understanding of their jobs. And despite the country’s already precarious finances, they proceeded to apply steep tax cuts in an attempt to stimulate the economy.
Bad decisions and bad luck followed. Just as the tax cuts shrank government revenues, the pandemic devastated tourism, a vital fount of income for Sri Lanka. Facing a balance-of-payments crisis, the government banned the import of motor vehicles and synthetic fertilizers and pesticides to save hard currency and an overnight transition to organic farming.
The result was catastrophic: Production of tea — a major source of export revenue — fell some 18 percent, and grain output dropped 43 percent. The government saved $400 million by banning foreign fertilizer but was forced to spend $450 million to import rice. It reversed the fertilizer ban for several key crops, but the knockout blow landed when Russia invaded Ukraine. The resultant spike in commodity prices, especially for fuel, plunged the country into chaos.
The Rajapaksas will no doubt argue that this nightmare would have occurred regardless of who was in control. But to succumb to this reasoning, we would have to overlook how the Rajapaksas debilitated their nation’s democracy and government institutions and ran the country like a family business. A genuinely democratic government, open to dissent and consultation, might very well have mitigated the suffering that now courses through the country: Businesses have boarded up, lifesaving drugs are in shortage and even middle-class families are being forced to forgo meals. Sri Lanka is an object lesson in the perils of embracing strongmen.
Sri Lankans who allowed themselves to be deluded by the Rajapaksas’ fantasies of prosperity underwritten by Chinese money have supplied a vivid warning to similarly fragile nations of the hazards of taking that route.
India has stepped in with emergency aid — credit lines, food and fuel — but far more is needed.
If there is a silver lining, it is that the anger provoked by the Rajapaksas has succeeded to some extent in uniting a people fractured for more than half a century along ethnic lines. Tamils and Sinhalese are now in the same boat. But the jubilation in the streets at overthrowing the Rajapaksas will have to give way in the days ahead to a hard reckoning with the consequences of their misrule.
The Rajapaksas have fled into hiding. The depredations of their reign are out in the open.