Sri Lanka will hold a presidential election on September 21, as announced in a government notice on Friday. This election is a crucial event, expected to determine the future of reforms in the South Asian island nation, which is currently experiencing its most severe financial crisis in decades. Nominations for the election must be submitted by August 15. Incumbent President Ranil Wickremesinghe is widely anticipated to run for another term, with almost 17 million of Sri Lanka’s 22 million population eligible to vote. Wickremesinghe, 75, took office in July 2022 after widespread protests forced his predecessor, Gotabaya Rajapaksa, to flee the country and subsequently resign. Parliament elected Wickremesinghe to serve the remaining term of the five-year term vacated by Rajapaksa, who had been elected in November 2019. “This is a critical time for Sri Lanka,” said Bhavani Fonseka, senior researcher for the Colombo-based Centre for Policy Alternatives. “An election being called is extremely important for democracy but now the election commission must be allowed to do what they are mandated to do. Having a free and fair election is essential.” Aided by a $2.9 billion International Monetary Fund (IMF) bailout program, Wickremesinghe has taken steps to revive the shattered economy. Inflation has been brought down from a steep 70% in September 2022 to 1.7% in June, the rupee has strengthened, and foreign exchange reserves have been rebuilt from their previously depleted state. Sri Lanka’s economy is projected to grow by 3% in 2024, after shrinking by 2.3% last year and 7.3% during the peak of the crisis. Bilateral creditors, including Japan, China, and India, signed a $10 billion debt rework agreement last month, providing Colombo with breathing room to defer repayments for four years and save $5 billion. However, Sri Lanka still needs to finalize a preliminary agreement with bondholders on restructuring $12.5 billion of debt before the third IMF review later this year. The IMF program’s higher taxes, prolonged inflation, and a stagnant job market stemming from the protracted crisis have pushed a quarter of the population into poverty and driven thousands to migrate. Opposition leader Sajith Premadasa and parliamentarian Anura Kumara Dissanayake, who heads the Marxist-leaning Janatha Vimukthi Peramuna (JVP), are anticipated to capitalize on this discontent in their presidential campaigns. Both Premadasa and Dissanayake have publicly stated their intention to reassess the IMF program to alleviate the cost of living burden on Sri Lankans and reduce the country’s debt repayment obligations. Sri Lanka’s economic recovery remains fragile, and analysts warn that attempts to undo the reforms could trigger a new crisis. They emphasize that the new government must ensure the continuation and completion of these reforms to transform the economy and set it on a path to sustained growth.
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