'Worst Economic Crisis' Sri Lanka Prices Soar Additional 30%... Public Outrage Over Brothers' Joint Rule Causing 'Livelihood Collapse'

Sri Lanka Declares 'Default' as Debt Defaulted
Rajapaksa Brothers in Power Under Current Regime... Elder Brother as Prime Minister, Younger as President
President Gotabaya: "Will Change Prime Minister and Form Unity Government"

Vehicles and motorcycles lined up in a long queue to buy fuel at a gas station in Colombo, the capital of Sri Lanka.
[Image source=Yonhap News]

[Asia Economy Intern Reporter Kim Se-eun] Sri Lanka's soaring inflation reached an additional 30% surge in April.

On the 29th (local time), the Sri Lanka Department of Census and Statistics announced that consumer prices in April rose 29.8% compared to the same period last year.

Inflation, which had sharply increased by 14.2% in January, 15.1% in February, and 18.7% in March, faced an even more severe situation in April.

In response, Sri Lankan President Gotabaya Rajapaksa proposed measures such as forming a unity government and reshuffling the cabinet.

The collapse of Sri Lanka's key industry, tourism, a rapid increase in external debt, and failures in fiscal policy combined to cause the economic crisis.

As foreign currency reserves dwindled, shortages of essentials like oil, medicine, and food continued, pushing public livelihood to a breaking point.

Ultimately, the government declared a default by suspending repayment of external debt amounting to $51 billion (approximately 64 trillion won) until it receives bailout funds from the International Monetary Fund (IMF) earlier this month.

At the same time, the government secured loans from India and the World Bank (WB) to urgently purchase essential goods, but inflation shows no signs of easing.

Public anger has been directed at President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa, who are brothers.

Protests have continued daily in front of the presidential office in the capital Colombo, and a nationwide strike took place on the 28th.

As the situation worsened, it is reported that President Gotabaya plans to form a unity government and replace Prime Minister Mahinda.

According to local media, Member of Parliament Maithripala Sirisena stated after a meeting with the president that "the president agreed to appoint a new prime minister and form a cabinet including all political parties."

Earlier this month, President Gotabaya also proposed forming a national unity neutral cabinet, but the opposition rejected it.

Sri Lanka operates a system that is presidential-centered but has strong characteristics of a 'parliamentary cabinet system' where the prime minister also holds authority in government formation.

The opposition is currently pushing for a vote of no confidence against the president and prime minister.

The Rajapaksa family led an almost dictatorial authoritarian rule from 2005 to 2015. At that time, Mahinda was president, and Gotabaya served as deputy defense minister under the defense ministry, which Mahinda concurrently headed.

Subsequently, Gotabaya won the presidential election in November 2019 and simultaneously appointed Mahinda as prime minister.

This content was produced with the assistance of AI translation services.