Sri Lanka: protests against the debt trap and imperialism

Featured: protesters with masks of the president of the government. Source: Taz.

At the beginning of this week, Sri Lankan President Ranil Wickremesinghe announced big pension cuts against the people of the country. This measure was one of the proposals made by the International Monetary Fund (IMF) to lend money to Sri Lanka in order to pay off the debt (lending money to pay the debt, means to sink even deeper in depth). This proposal unleashed new protests against imperialism, the measures imposed on the people of Sri Lanka and against the Wickremesinghe government that is in the service of imperialism.

These protests are a continuation of those that have already taken place since March of last year, when there were huge and continuous demonstrations in the country. These demonstrations occurred due to the terrible situation that the people of Sri Lanka are suffering due to the economic crisis caused by the imperialists and the local ruling classes. In this crisis, the debt trap plays a very important role, since due to the non-payment of this debt, which was already totally unaffordable, there was a shortage of medicines, food, fuel, there was power cuts, etc. The protests went so far as to overthrow the Sri Lankan government and seized parliament. The State had to declare a state of emergency, unleashing a great repression against the people. The ruling classes and imperialism solved the situation in Sri Lanka, changing the government of the former president Gotabaya Rajapaksa to that of Ranil Wickremesinghe, the current president, and sending the army to the streets to suppress the protests.

Protesters in the Parliament of Sri Lanka during the protests of last year. Source: BBC.

Sri Lanka currently has a total debt of 83 billion dollars to internal and external debtors. Of this debt, 7.1 billion dollars are owed to external bilateral creditors, that is, to other States. Of this amount, one fifth is owed to the Chinese State, which is the main creditor State.

As for Yankee imperialism, it acts mainly through the IMF, which, taking advantage of the pressing debt problem for Sri Lanka, has shown itself to be the “savior” of the country. The new government of Sri Lanka has agreed to a huge loan with the financial entity, controlled by Yankee imperialism. In March 2023 it was announced that the IMF agreed to lend Sri Lanka 2.9 billion dollars, but it would be in exchange for a series of measures and among them it was anticipated that one of them would be a tax reform. We have written previously about how this debt trap works and how it affects oppressed countries.

In the case of Sri Lanka we can see the hand of different imperialisms participating in this debt trap and wanting to take advantage. The main imperialism is the Yankee, which, as we have seen, acts mainly through the IMF. On the other hand, there is a Committee of Creditors, made up of the main state creditors: China, India, Japan and France. Chinese social-imperialism is going its own way, and is conducting its own negotiations with Sri Lanka and refuses to renegotiate the debt with the other creditors. Regarding the old Indian State, subjugated by Yankee imperialism, it is used like to take advantage due to its regional influence to get closer to Sri Lanka and act there. India is used to sign new economic partnership treaties, make new money loans and link the central banks of both countries. In addition, it is used to have direct influence in this Committee of State Creditors in Sri Lanka, without the need for the Yankee imperialist State itself to have a seat on it.

Japan has been investing in Sri Lanka since the 1970s, but with the beginning of the 2019 economic crisis, were canceled infrastructure projects in Colombo (Sri Lanka’s capital) valued at $1.5 billion. Japan currently holds 3.5 billion dollars of Sri Lanka’s debt, and is participating in debt restructuring negotiations. For its part, France is publicly involved in the country for the first time, and Macron’s presidential visit is the first by the French State in Sri Lanka. It has been in the 75th anniversary of the establishment of diplomatic relations. This visit has been used to promise new investments worth in 626 million dollars, to criticize the “new imperialism” exercised by China, and to talk together with India and Japan how Sri Lanka’s debt will be restructured. This shows that US imperialism is using other imperialist powers in this area to hit the interests of Chinese social-imperialism.

As we have seen, one year after the overthrow of the Rajapaksa government, the new government of Sri Lanka continues on the same path as the previous one, placing the burden of debt and imperialist measures on the people. President Wickremesinghe has criminalized the protests very soon. At the beginning of August, he claimed that there would be new violent protests in the country by various groups, and that at least two of them were organizing violence in the streets through social networks

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