Sri Lanka’s recent election has seen a rise in popularity for Dissanayake, who has softened some policies, stating he believes in an open economy and is not completely opposed to privatization. Despite claims of a smear campaign against his party, Dissanayake has reassured voters that they will not nationalize everything, including cows. His manifesto focuses on improving state enterprises without resorting to selling them off. While Dissanayake has mended ties with New Delhi, he also maintains close relations with China, with both nations vying for influence in strategic Sri Lanka.
The election in Sri Lanka comes after mass protests over the economy led to the ousting of former president Gotabaya Rajapaksa in 2022. The country faced its worst financial crisis since independence from British colonial rule in 1948. With the help of an IMF deal, Sri Lanka’s economy has seen a slight recovery, with expected growth for the first time in three years. However, high living costs remain a major concern for many voters as a large portion of the population lives in poverty. Dissanayake has pledged to dissolve parliament within 45 days of taking office and has a plan to stick with the IMF program until 2027 to stabilize the economy and address poverty.
Despite previous anti-India sentiments in 1987, Dissanayake’s party has patched up relations with New Delhi, while keeping close ties with China, which is competing against India for influence in Sri Lanka. Dissanayake visited both India and China for meetings with top officials, reassuring that Sri Lankan territory will not be used against any other nation in the ongoing geopolitical rivalry between the two Asian giants. The strategic location of Sri Lanka on global east-west sea routes makes it a valuable asset for both India and China, adding weight to the importance of maintaining balanced relations.
Dissanayake has outlined plans to improve loss-making state enterprises without resorting to outright privatization, aiming to help farmers improve and establish their own dairies. Despite fears of complete nationalization, he has assured citizens that cows will not be taken over by the government. His manifesto focuses on boosting the economy and lifting a quarter of the population out of poverty, which remains a pressing issue for many Sri Lankans. With the country experiencing its first positive economic growth in several years, Dissanayake will need to navigate carefully to ensure a stable recovery and attract investors to aid in the economic stability of Sri Lanka.
The history of Sri Lanka’s economy underlines the importance of the recent election and the challenges facing the incoming administration. With a fragile economy recovering from a severe financial crisis, Dissanayake faces the task of ensuring sustainable growth while reassuring markets and repaying debts. The continued high cost of living remains a critical issue for the population, highlighting the urgency of addressing poverty and improving living standards. Dissanayake has committed to seeking a fresh mandate in general elections and sticking with the IMF program until 2027 to steer Sri Lanka towards a more stable economic future and reduce poverty, emphasizing the importance of responsible governance and economic policies.
