Sri Lanka's New President Dissanayake Faces Economic Challenges Despite Victory

Sri Lanka's new President, Anura Kumara Dissanayake, faces challenges in reviving the economy despite a landslide election victory in 2022. The Marxist leader aims to build a 'fair economy' through private sector investments and wise public spending. However, resistance to reform plans and bureaucratic hurdles are obstacles in his path.

In 2023, mass protests led to the resignation of President Gotabaya Rajapaksa, highlighting the public's discontent with the economy. Dissanayake, who succeeded him, is now grappling with a go-slow strike by members of 25 unions at the state-owned energy supplier. This has resulted in longer power outages and slower repairs, with around 60,000 faults taking days instead of hours to fix.

The unions' actions have been met with resistance from the Minister of Economic Development, whose name remains unknown. Despite protests, the minister has managed to implement slower changes in the public electricity supply. Meanwhile, the IMF has been pushing for privatizations, adding another layer of complexity to the reform process.

Sri Lanka's economy is expected to grow by 4.6 percent in 2023, but this growth is likely to slow down to 3.5 percent by 2026 due to global uncertainties. Poverty, malnutrition, and unemployment remain persistent issues. The government's efforts to build a 'fair economy' from which all households benefit will require navigating these challenges and addressing the public's concerns.