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Economic Crisis in Sri Lanka Due to the COVID-19 Epidemic
... The inflation soared to 76 per cent in 2021 and gradually started to decline. The general consensus about the source for this crisis is said to be the COVID-19 pandemic during the period of 2019 to 2022 (United Nations Children's Fund, 2020;World Bank, 2021;De Silva, 2021). But it is debatable whether it was caused entirely by COVID-19. ...
The main objective of this study is to investigate the relationship between economics and other social science disciplines, including sociology and political science, in relation to the current economic crisis in Sri Lanka. Qualitative and quantitative data demonstrate that the current economic crisis in Sri Lanka is an outcome of socio-political unrest with civil war between and within the communities from 1983 to 2021. Observation, key person interviews, and statistical (correlation and regression) analyses of time series data from 1983 and 2021 show that Sri Lanka's overall macroeconomic stability, measured by six macroeconomic variables altogether, is positively correlated with socio-political stability, measured by a proxy of percentage change of tourist arrivals with a correlation coefficient of 0.52. One percentage change in socio-political stability leads to a 0.35 percent increase in macroeconomic stability. Effects of socio-political instability are more significant than openness and economic policy in the determination of overall macroeconomic stability. The interviews with subject experts confirm these findings. Policymakers in Sri Lanka have to correct past ethnic policies and bring permanent peace and socio-political solidarity between and within the communities before economic policy reforms to secure the economy from crisis. JBIP, Vol. 16, 2023, pp. 40-52
... According to the Sri Lankan government, the main reasons for this crisis included the COVID-19 pandemic along with the 2019 Easter attack, which adversely affected the tourism industry. The tourism industry is one of the main revenue-generating industries in Sri Lanka and is primarily based in coastal regions (De Silva, 2021). Economic experts believe that another major reason for the economic crisis in Sri Lanka is economic mismanagement after the end of the civil war in 2009 (Sharma et al., 2022;Bhowmick, 2022;Perera, 2022). ...
Effective decision-making is key to the successful conservation and management of natural resources. Mangrove ecosystems all over the world provide an array of ecosystem goods and services and are managed by a wide range of stakeholders representing various sectors. The position of mangroves in the land-sea interface and the rapid development of coastal areas in the Global South make mangrove conservation and management more challenging than the management of other coastal ecosystems. Sri Lankan mangroves are degrading due to numerous natural and anthropogenic causes in recent years. Mangrove degradation in Sri Lanka is further exacerbated by the economic crisis following the COVID-19 pandemic. The coastal communities near mangroves in Sri Lanka heavily depend on mangrove goods and services (more than before, due to a lack of livelihood alternatives), despite formal "no entry" rules by the government. This study's objectives are to delineate the viewpoints of mangrove management experts to understand current mangrove management in Sri Lanka and to provide baseline data for effective decision-making. We used Q methodology, during which 71 mangrove experts representing 21 stakeholder groups were asked to individually rank statements regarding mangrove management. These rankings were subsequently clustered using Principal Component Analysis, allowing the identification of clusters of opinions regarding mangrove management. Stakeholder's perceptions were clustered into three discourses: community-oriented management, government-oriented management, and management in synergy between government and communities for effective mangrove conservation. Our findings emphasize the multifaceted nature of mangrove management in Sri Lanka, revealing diverse perspectives among stakeholders. Our results further highlight the need for a collaborative approach to the co-management of mangroves in Sri * Corresponding author at Environmental Science and Policy 151 (2024) 103632 2 Lanka. We recommend that mangroves be co-managed by the government and local communities ensuring environmental sustainability in Sri Lanka and beyond.
The long-running financial crisis in Sri Lanka has put the country's government to its most significant test and caused great hardship for its citizens. Lanka is experiencing an economic and political emergency, with high expansion and erratic showings across the nation. The Sri Lankan government requires its citizens living abroad to send money home. Due to Sri Lanka's $51 billion in external obligations, 13 Lankan banks have been placed on rating watch negative. On the island paradise, inconvenience is in the making. There isn't any food available. Over the past few months, approximately 500,000 more Sri Lankans have become dependent. Basic medical procedures, prescriptions, and fuel are being discontinued. According to experts, the financial crisis may be more to blame for the deaths in Sri Lanka than the coronavirus. There are frequent blackouts and violent street brawls. The lack of force and the inability to obtain safe drinking water has made it extremely difficult to organize crisis healthcare services. There has been an intrusion into the security net projects. The situation in Sri Lanka is much more complicated than just a money crisis. There is a charitable emergency here. How could it have happened, and how did the public authority of Sri Lanka lose its money? are the only questions being asked. This exam paper's purpose is to provide answers to these questions. Additionally, the paper's author frames a thorough investigation of the problem and the causes of the financial emergency.
This paper analyses the reasons and scenario of the current economic crisis in Sri Lanka. The study examines the possible reasons for the crisis, its ongoing impact on GDP, tourism industry, and on Sri Lankan rupee against other major currencies in the world. The paper shows that Forex reserves of Sri Lanka mainly depend on Tourism revenue, thus underscoring the importance of the tourism industry. But due to current circumstances of the Covid-19 and its severe impacts leads to a high decline in tourism revenue which ultimately affects the country’s reserves. This resulted in the high depreciation in the value of the Sri Lankan rupee against other major currencies in the world. To assess if the country has enough reserves, we have used the Guidotti - Greenspan rule and we found that since the Covid pandemic has begun, Sri Lanka has been unable to follow this rule and the ratio of reserves to short term debt is continuously decreasing. The external sector of Sri Lanka is also not performing well due to the sharp decline in exports. The IMF has approved a bailout package through its Special Drawing Rights to get over this crisis. Therefore, appropriate actions must be undertaken to overcome the crisis and revive the economy
