IMF’s Support for Sri Lanka: A Victory or a Curse?

IMF support cannot/shouldn’t be boasted about, as it merely acts as a painkiller that does not cure the underlying illness

3 mins read
President Ranil Wickremesinghe had talks with the Managing Director of the International Monetary Fund (IMF) Kristalina Georgieva, during meeting took place on the sidelines of the COP27 conference in Egypt, end of last year [Photo: Social Arrangement]

Editorial Comment

The International Monetary Fund (IMF) has been a key player in providing financial assistance to many countries worldwide, including Sri Lanka. While some may see this as a positive development, others view it as a form of manipulation by the West, which is facing economic and structural decline.

From the IMF’s perspective, they are pleased that they have been able to provide support to Sri Lanka, despite concerns about the country’s ability to implement effective policies. However, it is important to note that the IMF is not a panacea for all of a country’s economic problems. Instead, it is a business that provides financial assistance to countries in need. It is understandable that some may view Sri Lanka as just another customer for the IMF, given the number of times the country has sought assistance in the past. However, it is important to recognize that each situation is unique and requires individualized attention and support.

While the IMF may have some doubts about the policy implementers in Sri Lanka, it is important to remember that the country is not alone in its struggles. Many other poor countries around the world also rely on the IMF for support.

Indeed, President Wickremesinghe and his presidency have an enormous responsibility to steer Sri Lanka through these troubled times. As the only viable alternative to manage the crisis, he needs to take bold steps to address the root causes of the country’s economic and social problems. It is imperative that he recognizes the urgent need for social reform and addresses the concerns of the public in a transparent and accountable manner. Selling profitable institutions is not a form of social reform, whether they are under full state control or semi-state control for capitalists.

As a ‘guardian’ of democracy, Mr Wickremesinghe must refrain from curbing the liberty of the people and play a positive role in ensuring that the state management system is fair, just and free from nepotism, cronyism, and favouritism. While western democracy may have lost its luster, it is crucial to recognize that transparency and accountability are essential to creating a healthy and vibrant society. Therefore, it is essential to craft a home-grown solution that is in tune with the local needs and culture.

The IMF’s support can provide much-needed breathing space to Sri Lanka, but it cannot be a substitute for a long-term sustainable solution. The country needs to develop a centralized, efficient, and accountable governance system that can effectively address the issues of institutionalized corruption and mismanagement that have plagued Sri Lanka’s economy for far too long. This requires a concerted effort by all stakeholders, including the government, civil society, and private sector.

The Sri Lankan people have suffered for too long from a political system that has failed to deliver the basic services they need. It is high time that the political class takes responsibility for their actions and works to create a better future for the country. This will require a collective effort to build trust, restore confidence, and promote a culture of accountability that puts the needs of the people first.

It is essential that Sri Lanka learns from its past experiences with the IMF and other countries that have dealt with the institution. While the IMF can provide much-needed financial assistance, it also comes with conditions that often require countries to undertake painful economic reforms that can lead to social unrest and political instability.

Many countries that have worked with the IMF have seen their economies shrink, their public services deteriorate, and their societies become more unequal. The IMF’s policies have often aggravated existing social and economic problems, leading to a cycle of dependency and underdevelopment.

Sri Lanka must be careful not to fall into the same trap. It is essential that the government develops a comprehensive plan that takes into account the country’s unique economic and social circumstances. This plan must be based on transparency, accountability, and good governance, with a clear focus on poverty reduction and social justice.

Moreover, the Sri Lankan government must ensure that any agreement with the IMF is transparent and inclusive, with broad-based participation from civil society, labour unions, and other stakeholders. It is crucial to engage in an honest and open dialogue about the costs and benefits of any IMF program and to ensure that the public is fully informed about the implications of such an agreement.

Sri Lanka needs a new kind of leadership that is focused on building a fair and just society. Mr Wickremesinghe and his government have a historic opportunity to set the country on a new path, one that is built on transparency, accountability, and good governance. The IMF’s support can be an important part of this process, but it is ultimately up to the power of the powerful in Sri Lanka to make the changes necessary for a brighter future. In essence, IMF support cannot/shouldn’t be boasted about, as it merely acts as a painkiller that does not cure the underlying illness. 

Sri Lanka Guardian

The Sri Lanka Guardian is an online web portal founded in August 2007 by a group of concerned Sri Lankan citizens including journalists, activists, academics and retired civil servants. We are independent and non-profit. Email: editor@slguardian.org

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