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  • Home
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  • DAILY CURRENT AFFAIRS:Ranil Wickremesinghe becomes Prime Minister for the sixth time in Sri Lanka

Ranil Wickremesinghe becomes Prime Minister for the sixth time in Sri Lanka

Tags: International News

Sri Lankan President Gotabaya Rajapaksa on 12 May 2022 appointed former Prime Minister Ranil Wickremesinghe as prime minister to restore stability to the island nation amid a political deadlock and economic crisis.

Became prime minister for the sixth time

  • This is the sixth time Mr. Wickremesinghe has been appointed as the Prime Minister. Wickremesinghe has never completed his full term.

He will have the task of staving off the devastating effects of the island's economic downturn, that too under President Gotabaya Rajapaksa, who has been opposed by disgruntled citizens demanding his resignation.

Mr. Gotabaya's elder brother Mahinda Rajapaksa resigned as Prime Minister on 2 May.

Mr Wickremesinghe's United National Party (UNP) was abolished in the 2020 general elections, in which Rajapaksa won a two-thirds majority. Mr. Wickremesinghe is currently the only MP from his party.

Factors responsible for the current economic condition of Sri Lanka:

  • When Sri Lanka emerged from 26 years of civil war in 2009, its post-war GDP growth remained at a suitably high level of 8-9% per year until 2012.

  • But with declining global commodity prices, a slowdown in exports and an increase in imports, its average GDP growth rate fell to nearly half its rate since 2013.

  • Sri Lanka's budget deficit during the civil war was high and the 2008 global financial crisis depleted its foreign exchange reserves, forcing the country to take a loan of $2.6 billion from the IMF in 2009.

  • In 2016, Sri Lanka once again approached the IMF for a loan of $ 1.5 billion, but the terms of the IMF worsened the economic health of Sri Lanka.

  • Gotabaya Rajapaksa's government, which came to power in 2019, had promised lower tax rates and wider concessions for farmers in its election campaigns.

  • The quick fulfilment of these unreasonable promises compounded the problem.

  • The COVID-19 pandemic that emerged in the year 2020 made the situation worse, where-

    • Exports of tea, rubber, spices and clothing suffered.

    • Tourist arrivals and revenue declined further.

    • The increase in government expenditure led to a fiscal deficit exceeding 10% in 2020-21 and the 'debt-GDP ratio' increasing from 94% in 2019 to 119% in 2021.

Sri Lanka :

Capital : Colombo, second capital "Sri Jayvardhan Pura Kote"

Currency : Sri Lankan Rupee

President: Gotabaya Rajapakse

Prime Minister: Ranil Wickremesinghe

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