Sri Lanka’s big businesses mount pressure on govt.

 demonstrator waves Sri Lanka’s national flag as he demonstrates against the country’s ongoing economic and political crisis, on April 26, 2022 in Penideniya, Sri Lanka.

demonstrator waves Sri Lanka’s national flag as he demonstrates against the country’s ongoing economic and political crisis, on April 26, 2022 in Penideniya, Sri Lanka. | Photo Credit: Getty Images

It is not just Sri Lanka’s angry citizens and political Opposition who are challenging the Rajapaksa administration’s “failed” response to the country’s dire economic condition.  Increasingly, prominent capitalists and big businesses are shedding their habitual caution and openly criticising the political impasse that is further threatening the country’s crashing economy.

MAS Holdings, among the biggest names in the apparel industry in the region, issued a statement last week “unconditionally supporting” protesters’ call for change and good governance, and urging leaders “to heed the voice of the people and act on it”.

As the largest private sector employer and exporter in Sri Lanka — garment exports are crucial to the island’s foreign revenue — MAS reiterated “the need for immediate and decisive action to resolve the current economic and social crisis, in a peaceful and sustainable manner”. 

For more than a fortnight now, citizens have been protesting near Colombo’s seafront, amplifying a demand that earlier emerged in spontaneous, scattered public protests across the country. “Gota go home”, “Rajapaksas go home,” they chant, asking President Gotabaya Rajapaksa and his elder brother and Prime Minister Mahinda Rajapaksa to quit, taking responsibility for the unprecedented economic crisis.

The demonstrators have broadened their demands over time, but their call for the ruling Rajapaksa brothers’ resignation remains central, as citizens struggle to access and afford basic items of food, fuel, and cooking gas amid crippling shortages and rapid price hikes.

The widespread resentment has prompted even big businesses that rarely confront the government to speak up. The private sector leaders are explicitly backing the ongoing anti-government protests, while seeking a swift and critical response from those in power.  

Sri Lanka’s largest listed company John Keells Holdings has expressed solidarity with the “peaceful protesters”.  Calling for “decisive action” from the leadership, the company cautioned authorities that “social unrest” could continue if there is no “sustainable solution” in response to the growing calls for change and good governance.  

Apart from large-scale manufacturers and multinational corporations, traditional business houses are also weighing in. Sri Lanka’s pioneer biscuit manufacturer Maliban said it extends its “fullest support” to the “peaceful and respectful social movement calling for change”. 

“We also note with quiet admiration, the deep resilience and cultured restraint of our Sri Lankan public and notably our aspiring youth, as we stand in unison with their noble aspirations to guide Sri Lanka to regain our lost glory and place of pride; built on sound transparent policies, good governance and apolitical approach based on mutual respect among all stakeholders,” the company said in a statement.

Last week, the Joint Chambers, an amalgam of the country’s chambers of commerce and industry, wrote to President Gotabaya, voicing concern over the “political deadlock”, consequent to the ruling brothers’ reluctance to step down, and the Opposition’s rejection of Mr. Gotabaya’s offer to form a national government under his Presidency. While welcoming the government’s talks with the International Monetary Fund, the private sector interlocutors said: “The Joint Chambers are however concerned that the current political deadlock coupled with growing public unrest could potentially derail the actions being taken to resolve the serious economic crisis faced by the country.”

Earlier this month, Sri Lanka announced a default on its $51-billion foreign debt, ahead of talks with the IMF. Authorities also floated the rupee in March, following which its value has dropped drastically, to nearly 340 against a U.S. dollar [official buying rate], and to well over 400 in the black market.

While Colombo awaits news on the IMF’s conditional assistance, the government is struggling to cope despite bilateral assistance from partners, including India and China, as its foreign reserves are drying up. The President’s office on Tuesday said the World Bank would extend $600 million assistance to Sri Lanka to meet emergency medical needs, towards food supplies and cooking gas.

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Printable version | Jun 29, 2022 8:45:32 pm |