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Sri Lanka in crisis: The current situation (Blog 1 of 2)

This year we have all sadly already borne witness to some horrific tragedies occurring around the world. Our hearts go out to all those affected and we send our love to anyone struggling with the challenges this decade has brought.


You may have seen Sri Lanka making the headlines too. For our international FHF family, we wanted to share a brief overview of the current situation here and in our next blog we will explain what we are doing to help.


A range of factors have contributed to a three-fold crisis in the country right now:


(i) Economic crisis

Sri Lanka is currently in its worst economic crisis for 70 years and has defaulted on its international debts for the first time in its history, including $50bn worth of debts in May. The country now has very little foreign currency reserves, which means it is unable to import food, fuel and essential items from abroad. The official inflation rate was 39.1% year on year in May, however unofficial data often places it higher. The BBC reported that food prices in Colombo have increased by 57.4% over the same period and data from Ceypetco shows that petrol prices have increased 168% since June 2021.


This economic collapse was caused by a variety of factors, both historical and more recent. At a high level, Sri Lanka’s recovery from the 2019 bombings was firmly halted by the pandemic, which hit tourism income hard once again. Tax cuts and printing more money caused further damage and abrupt policy changes, particularly a sudden chemical fertilizer ban in April 2021, have led to falling production at a time when it is most needed.


Sri Lanka is in negotiations with the International Monetary Fund for a bailout and is appealing for international donations and aid. Reaching a bailout is likely to take months however, followed by years for the economy to recover. On Tuesday, the Prime Minister said the country needs at least $5bn over the next six months to pay for essential goods.



(ii) Political crisis

Anti-government sentiment has been high since the start of the economic crisis with many blaming the prevailing regime, whom they charge with incompetence and nepotism. Since March 2022, predominantly peaceful protests have been calling on the powerful Rajapaksa family to resign – they held roles including President (with new executive powers introduced), Prime Minister and Finance Minister. On 3 April, the entire cabinet resigned except for Prime Minister Mahinda Rajapaksa, while his brother, President Gotabaya Rajapaksa, also showed no indication of stepping down.


An escalation in violence occurred in early May, with coordinated attacks on protestors by pro-Rajapaksa groups followed by reprisals and an island-wide curfew. The Prime Minster resigned on 9 May and was replaced by Ranil Wickremasinghe, who took on the position for the sixth time in his career. President Gotabaya is still refusing to give up power and so the protests are continuing, centered at the GotaGoGama camp in Galle Face Green.


Political instability can reinforce economic instability and whilst the new Prime Minister has been working to address the country’s most urgent needs, there is a feeling amongst the protestors that a more significant shift in Sri Lanka’s political system will be needed in order to build a new future.

Remon & Freya at the peaceful protests

(iii) Social crisis

As you can imagine from the rising inflation and lack of imports, the people of Sri Lanka are being hit hardest by the economic and political crises. Hours of power blackouts are a daily occurrence, queues for heavily rationed fuel can last over 24 hours, basic foods are becoming unaffordable and many medicines are no longer available. Yet it is feared that the worst is still to come; agricultural experts have predicted that the rice paddy harvest this year will be 30% lower than usual and the Speaker of the Parliament has said there will be acute food shortages and starvation.


FHF Operations Director Remon described the situation recently with this heartbreaking observation:

“The Sri Lankan people have been so resilient for so long. These are people who have dealt with civil wars, tsunamis, bombings and pandemics and still shown smiles and optimism. But now you look around and people are broken. You can see it in their faces: this is too much.”



Stay tuned for our next blog tomorrow on what we are doing to help and how you can get involved.

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