Economy · June 24, 2022

The Sri Lankan crisis once paralyzes the booming middle class – The diplomat

Miraj Madushanka never thought she needed government rations to make sure her family could eat two meals a day, but Sri Lanka’s worst economic crisis in its history has reshaped her life and that of many others. in its nascent middle class.

Families who have never had to think twice about fuel or food are struggling to manage three meals a day while cutting down on portions. Days are spent waiting in line to buy scarce fuel. The crisis derailed years of progress towards the relatively comfortable lifestyles they aspired to across South Asia.

Sri Lanka, an island nation of 22 million, is plunging into bankruptcy after amassing $ 51 billion in foreign debt. There is hardly any money to import items such as gasoline, milk, cooking gas and toilet paper.

Before things began to unravel, Madushanka, a 27-year-old accountant, studied in Japan and was hoping to work there. He returned home in 2018 after his father died to take care of his mother and sister.

Madushanka finished her studies and found a job in tourism, but lost it in the shadow of the 2019 terrorist attacks that rocked the country and its economy.

Do you like this article? Click here to sign up for full access. Only $ 5 a month.

Subsequent work vanished during the pandemic. He now works for a management company, his fourth job in four years. But even with a reliable salary, he can barely support his family.

Food prices have tripled in recent weeks, forcing the family to seek government rice aid and donations from nearby Buddhist temples and mosques. Madushanka’s savings are over.

“Right now, there’s just enough to survive – if there are months where we don’t get extra benefits from the outside, we just have to resist somehow,” he said.

Even past crises, such as the nearly 30-year civil war in Sri Lanka that ended in 2009 or the devastating 2004 tsunami, have not caused this degree of pain or distress for those outside the affected areas. experts say.

Until recently, Sri Lanka’s middle class, estimated by experts to be between 15 and 20 percent of the country’s urban population, generally enjoyed economic security and comfort.

“The crisis really shocked the middle class – it forced them into difficulties they had never been exposed to before, such as procuring basic necessities, not knowing if they could refuel despite spending hours in line,” said Bhavani Fonseka. senior researcher at the Center for Policy Alternatives in Colombo, the capital of Sri Lanka.

“They have really been shaken like no other time in the past three decades,” Fonseka said.

Sri Lanka’s middle class began to grow in the 1970s after the country’s economy opened up to more trade and investment. It has since grown steadily, with Sri Lanka’s GDP per capita rising relative to that of many of its neighbors.

“The ambition was to own a house and a car, to be able to send your kids to a good school, eat out every few weeks and afford a vacation here and there,” said economist Chayu Damsinghe. “But now it looks like the middle class has lost its dream,” he added.

“If the middle class is struggling like this, imagine how much the most vulnerable are affected,” Fonseka said.

Do you like this article? Click here to sign up for full access. Only $ 5 a month.

Protests have raged since April, with protesters blaming President Gotabaya Rajapaksa and his government for political blunders that have torpedoed the economy and plunged the nation into chaos. In May, a wave of violent protests forced Rajapaksa’s brother and then Prime Minister Mahinda Rajapaksa to step down. His successor, Ranil Wickremesinghe, is banking on an IMF bailout package and help from friendly countries like India and China to keep the economy afloat.

In an interview with the Associated Press last week, Wickremesinghe said he feared food shortages could persist into 2024 as the war in Ukraine disrupts global supply chains, driving up the prices of some commodities.

Sri Lanka’s difficult economic situation was exacerbated by a ban on the import of chemical fertilizers last year which angered farmers and damaged crops. The ban was lifted after six months, but the damage had already been done, leading to food shortages.

Government officials have been given three months off every Friday to save fuel and grow their own fruit and vegetables as food supplies are running out. The inflation rate for food is 57 percent, according to official data, and 70 percent of Sri Lankan homes surveyed by UNICEF in May reported reduced food consumption.

On a recent afternoon, residents thronged a busy fruit and vegetable market in Colombo, sweating under the glare of the sun as they carefully compared the prices of tomatoes and oranges with those of the markets they had previously visited.

Sriyani Kankanamge, 63, said he stopped buying meat or fish and only bought a few types of vegetables. “I’m angry. The prices of every essential element are going up: rice, sugar, milk, chicken, fish. How can people eat?” she said bitterly.

Madushanka’s family decided to forgo three daily meals just for a late breakfast and dinner.

On a recent Friday, his mother, Ambepitiyage Indrani, was grinding coconut and boiling a pot of water on a thin pile of firewood. When their gas bottle ran out in May, the thought of waiting in line with no guarantee of success seemed futile. The once bright white kitchen ceiling is now streaked with soot from the cooking fire. An electric cooker bought a few years ago has been sold.

Indrani has glaucoma in his left eye and is using his eye drops once a day instead of twice as recommended by his doctor. The price of the medicine has quadrupled.

“It was the hardest time of my life,” she said, recalling how just a few months ago she used to cook extra food to give to others in the neighborhood.

The family’s radio and television have been off for weeks, their scooter is parked outside, under cover. They hardly use it anymore, preferring to walk or take the bus rather than queuing for fuel.

When the three-hour daily power outage occurs, Madushanka sometimes heads to the main protest site outside the president’s office.

Like many Sri Lankans, he feels that the only way out may be to leave.

“I had a simple dream: to build a house, buy a car, work full time during the week and go on vacation every now and then. I wanted to get married and start a family, “she said.” But I’m afraid this dream is no longer possible, at least not in this country. “