A. Situation analysis
Description of the Crisis
31 March 2022: Civil Society protests erupted across the country. Hundreds of protestors gathered around the President’s residence demanding the resignation of the President and the Government. More than 50 people were injured and hospitalized due to clashes between protestors and police, and 45 people were arrested.
01 April 2022: The government declares a state of emergency and curfew that gives wide powers to security forces to take actions to control the protests, despite opposition from other coalition parties and civil society. But the protests and rallies grew nationwide.
02 April 2022: Protests in various parts of the country resulted in the imposition of a two-day curfew. Following this decision, there was a blockage of social media platforms, lasting for 15 hours. Protests demanding the resignation of the president and all ministers continued.
04 April 2022: All cabinet ministers resigned expecting to ease the tensions in the country, but protests continue demanding the resignation of the President.
09 -11 April 2022: A major civil society protest was organized in Colombo in front of the Presidential Secretariat, demanding the President’s resignation. The protest continues into the middle of April, with organizers encouraging people across the country to join in. The social and economic context is highly volatile within the country.
The civil unrest has been sparked by an economic crisis in Sri Lanka that has been developing during the COVID-19 pandemic, since March 2020. The pandemic with all the containment measures across the world resulted in a rapid decline of foreign currency income primarily through Sri Lanka’s adversely impacted tourism sector, worker and diaspora remittances, foreign direct investment (FDI) flows and world trade. The GoSL imposed a ban on non-essential imports such as vehicles, luxury goods and food items to limit the international payments in US Dollars and to save the fast-depleting US Dollar reserves.
Throughout the year 2021, the impact of the economic crisis was felt across the country with a shortage of essential food and non-food items, such as milk, dhal/lentil, locally produced vegetables, rice, bread, wheat flour, cooking gas, fertilizer and fuel, and very high increase of prices of these commodities. Due to this reason, protests erupted across the country, mainly organized by the political parties and trade unions demanding a salary increase and controlling inflation.
In the first quarter of 2022, the foreign currency reserves fell to an all-time low and GoSL was not able to import petroleum products such as diesel, petrol, coal, and other hydrocarbons used in thermal power plants. This resulted in long power cuts (even 13 hours a day), long queues at fuel and cooking gas stations for days and disturbed schedules of public transport services. In addition, the shortage of essential food and non-food household items kept worsening.
Besides the impact of the COVID-19 pandemic the tourism industry, import production and fishing industry were also significantly and severely affected by the X-Press Pearl ship disaster of May 2021, which continues to pollute the coastal and marine environment affecting livelihoods. Having no other option, within the last two years (2020-2021), the GoSL used the remaining foreign reserves to pay the international debt and limited the import of essential items, including non-organic fertilizer, fuel and industrial, gas, and medicine.
By the end of January 2022, gross foreign reserves dropped 24 per cent, Sri Lankan Rupee (LKR) continued to devalue and as of 8 April 2022, the value of 1 USD is equal to 320 LKR. Due to the unavailability of foreign currency in the country, a parallel unregulated and unauthorized market has emerged.
Since the GoSL decided to limit the importing of non-organic fertilizer from January 2022, homegrown agricultural product inflation increased to 24.7 per cent in February 2022, due to a shortage of production. The agricultural experts forecast all agricultural harvests of 2022 to remain lower than expected, according to the World Food Programme (WFP), Food inflation continues to rise by +3.4 per cent month-on-month in January 2022.
In early 2022, GoSL imported rice from India. With the depletion of foreign reserves, importing food items was decreased leading to a rise in rice prices in the local market. As a result of the fuel price increase, the cost of other food items such as milk, eggs and vegetable varieties also increased considerably (refer to Table 1).
Shortage of cooking gas has affected not only the day to day lives of people using cooking gas in households but also the small and medium food and beverage businesses. More than 1,000 bakeries and cafeterias were reportedly closed for three weeks, affecting the livelihoods of thousands of people engaged in the food and beverage industry.
The shortage of fuel has led to daily power cuts, even as long as 13 hours as power plants are running out of fuel and to a shortage of the number of essential items such as food, medicine, and cement. Due to the limit on the importation of non-organic fertilizer since January 2022, farmers across the island started to protest, highlighting that a proper long-term plan is needed.
Humanitarian impacts of the crisis
As a result of the dynamic economic crisis, there are long queues in every part of the country for purchasing essential items such as fuel, cooking gas, and medicines. Some people are spending three-four days to get their needs. This has affected daily wage labourers who lost their daily income by spending the days in these queues. Six deaths were reported while waiting in these queues for a few days. Due to the fuel crisis, public transportation operation as per the usual schedule has been disrupted and this also affected the income of the staff employed in the transportation sector. Suspending routine surgeries were reported in four major hospitals due to a shortage of medical supplies, medicines, and 10-13 hours-long power cuts.
Key humanitarian impacts due to ongoing crisis:
- Civil unrest and violence resulting in injuries, hospitalization, and arrests
- Loss of livelihoods particularly by urban poor daily wage earners, who consequently face gaps in food security due to loss of income and shortages of essential food and household items
- Days spent in the hot sun and rain waiting in long queues without drinking water and food, resulting in deaths and hospitalization of people
- Children’s education is affected due to power cuts and lack of stationery items.
- Potential effect on people’s mental wellbeing
- Shortage of life-saving medicines and consumables in the country, resulting in a demand and supply gap.