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Averting a humanitarian disaster

06 Nov 2022

The re-emergence of fuel queues last week, albeit over a technical issue of dealers delaying the placing of orders in anticipation of a price reduction according to the Petroleum Minister, showed just how fickle the new-found ‘normalcy’ can be, given the hand-to-mouth existence of this nation. The queues also pointed to just how much a ministerial assurance is worth these days, with people turning a deaf ear to the Minister. As the saying goes, once bitten, twice shy. The fuel issue – or non-issue – notwithstanding, news that fuel ships that had arrived in Colombo weeks ago were still anchored out-harbour awaiting payment for unloading, incurring substantial costs by way of demurrage, has certainly contributed to the concerns. Meanwhile, news making its way along the grapevine isn’t very reassuring either, with the risk of reverting to the status quo ante of three months ago still a potent possibility. According to reports, the continuing depletion of foreign reserves to a current usable quantum of a little over $ 200 million last month – an amount that is barely enough for a month’s essential imports – is certainly adding fuel to the fire.  Further raising concerns was the downgrading of Sri Lanka’s bonds to ‘D’ from ‘CC’ by global ratings agency S&P Global last week, reportedly following two missed interest payments in September. It will be recalled that Sri Lanka halted paying back its external loans in April, a move that officially declared the country as bankrupt; nevertheless, interest payments continued to be serviced at least on some commitments, but these too have apparently come to a halt in September, triggering the rating downgrade. However, the most worrisome development is the likely delay of the much-anticipated International Monetary Fund (IMF) bailout, with a new timeline of March next year being tossed around – that too being dependent on multiple variables – replacing the previously-targeted December this year. As we have been consistently pointing out, it is fair to assume that with all 16 of its previous interventions never having seen completion owing to local political dynamics, the IMF will understandably add greater weightage to political stability in considering its 17th intervention. Unfortunately, that is not something that can be assured or guaranteed by the current administration, which has a maximum lifespan half that of the proposed bailout programme. Therein lies the rub and the only feasible way out of this conundrum is for the administration to consult the people at the earliest possible opportunity, seeking a fresh mandate. Meanwhile, the quality of life of the average citizen continues to decline at an alarming rate, with little or no intervention on the part of the State to halt the slide. A couple of months ago a UN report stated that 4.2 million Sri Lankans were in urgent need of humanitarian assistance as a direct consequence of the economic crisis. Last week a report made public by the International Federation of Red Cross and Red Crescent Societies (IFRC) put that figure at a ‘minimum of 5.7 million people,’ or one out of four Sri Lankans. The continuing slide shown by data from independent institutions covering the past couple of months, with hardly any interventions planned or executed during this period by the State, is indicative of a crisis that is going from bad to worse.  The IFRC Needs Assessment Report goes on to state that ‘in the absence of interventions to address the crisis, the numbers affected will continue to multiply and the consequences will deepen’. The ‘consequences’ averred to include food security, livelihoods, education, healthcare, and child protection, among others. Given the meagre resources at its disposal, there is little that the administration can do short of appealing for international humanitarian aid, which should be distinctly different and set apart from the financial assistance it is seeking in order to tide over the economic crisis. The failure or delay in coming to the rescue of those in the deep end of the crisis could lead to a heightened level of social upheaval – the last thing the country needs at this juncture. Resorting to strongarm tactics to stifle such upheaval in the absence of mitigatory measures to first quell the fires in the stomachs of those affected will be counterproductive and invariably lead to chaos and anarchy. Therefore, all eyes will be on the Finance Minister’s Budget 2023 presentation in Parliament on the 14th of this month. As per the Appropriation Bill 2023 presented in Parliament last month, the top allocation continues to go to defence and public security, with a combined allocation of Rs. 539 billion, followed by health at Rs. 322 billion, education at Rs. 233 billion, and transport at Rs. 372 billion. While the health sector is currently on the brink of collapse owing to an acute shortage of medicine, supplies, and equipment, the country continues to maintain an unsustainable combined security forces strength in excess of 350,000 personnel even 13 years after the war ended.  Given the economic travails that have so far drastically affected one-fourth of the country’s population and critical sectors such as health and education, which are badly in need of urgent funding, it is unconscionable that Sri Lanka has an army that is double in terms of manpower of that of Britain. No politician has had the political will to downsize the number of active service personnel in relation to current requirements owing to the political consequences of such a venture. At least now, the administration has a ready-made reason to look at the matter in a more circumspect manner that will nullify any perceived negative political fallout. Therefore, it is up to the leadership to seize the opportunity. If not immediately, it will at least in time to come help divert funds from this non-productive use to more gainful use such as increased funding for education and even the setting up of a State venture capital fund for start-ups that will collectively help stem the brain drain currently taking place. The continued failure of the State to come to the rescue of those most vulnerable to the economic crisis will likely result in these people being driven to destitution. As the IFRC report points out, it will lead to a plethora of socioeconomic issues, among which the most concerning is widespread malnutrition – especially among children and pregnant women, children swapping education for employment in menial jobs, and postponement of medical care – leading to more acute afflictions, as well as people becoming victims of crime, theft, and scams, a brain drain that is fast turning in to a human tsunami, and increased human trafficking. All told, it adds up to a toxic socio-econo-political combination that will take years to recover from.  While those in the hot seats will do everything they can to stay in those seats and the Opposition parties will each go their own way leading to nowhere, it is the people who are being dealt a raw deal for no fault of theirs, other than electing misfits to responsible positions. It is therefore a two-way street from here on, where the political leadership will have no alternative but to stop playing politics with people’s lives, while the people themselves will have the responsibility of first demanding that their voice be heard through the ballot and, secondly, not repeating past mistakes once they have the ballot in hand.  


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