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Social turmoil Lanka’s biggest risk, ex-World Bank official
Sri Lanka faces a “dangerous situation” with continuing social unrest and must avoid a “disorderly default,” the former chief economist of the South Asia regions at the World Bank, Shanta Devarajan told CNBC Friday.
Shortages of food and fuel, along with record inflation and regular blackouts, have brought thousands of Sri Lankans to the streets as the country faces its most painful downturn since independence from Britain in 1948.
“Social turmoil is the biggest risk. That’s why I keep emphasizing the point about cash transfers. As you can see on the streets — the people are angry,” said Devarajan, who is now part of a new government advisory panel formed to tackle the country’s debt crisis.
Devarajan said a cash transfer program aimed at helping the poor, coupled with a reduction of subsidies on food and fuel, will be critical to averting a collapse of Sri Lanka’s debt-ridden economy.
In the past week, protesters and opposition parties alike have called for the resignation of Prime Minister Mahinda Rajapaksa, accusing his government of economic mismanagement.
A foreign currency shortage has left Sri Lanka struggling to import essential goods, even as the coronavirus pandemic has cut off vital tourism revenue. Foreign exchange reserves shrank 16% to $1.93 billion in March
Cautioning against a “disorderly default” on debts by cash-strapped Sri Lanka, he said any austerity measures would also have to be accompanied by efforts to educate the public.
“This is a very dangerous situation. And if you want to introduce austerity in the middle of that situation, you have to manage it very carefully,” said the professor of the practice of development at Georgetown University.
“You have to do two things: One, make sure that the poor are protected — the bottom 40% of the population — [through a] targeted cash transfer. Two, have a public information campaign so that people understand that these measures are needed to avoid an even bigger crisis.”
Ratings agencies have warned of a potential default on billions of dollars in foreign debt, and authorities are struggling to secure more commercial loans because of the credit downgrades.
The Ambassador of Switzerland to Sri Lanka Dr. Siri Walt paid a courtesy call on Prime Minister Dr. Harini Amarasuriya on the 17th of February at the Temple Trees.
Welcoming the Ambassador of Switzerland to Sri Lanka the Prime Minister briefed the Ambassador on her recent visit to Davos to participate in the World Economic Forum Annual Meeting noting that the series of high-level bilateral meetings held on the sidelines of the Forum, along with two important industry visits provided valuable insights for Sri Lanka’s economic engagement.
The discussion focused on Switzerland’s vocational education and training (VET) system, with particular interest in exploring possible cooperation and knowledge-sharing opportunities.
The Prime Minister also conveyed her appreciation for the assistance extended by the Government of Switzerland following Cyclone Ditwah. She emphasized Sri Lanka’s need for enhanced technical assistance during the ongoing rebuilding phase, especially in relation to the reconstruction of bridges and railway infrastructure.
Both sides reaffirmed their shared commitment to further strengthening bilateral relations between Sri Lanka and Switzerland, and to expanding cooperation in areas of mutual interest.
First Secretary (Political) of the Embassy of Switzerland in Colombo Ms. Justine Boillat, First Secretary (Migration) of the Embassy of Switzerland in Colombo Ms. Andrea Kienast and the Secretary to the Prime Minister, Pradeep Saputhanthri, Additional Secretary to the Prime Minister, Ms. Sagarika Bogahawatt and officials from the Ministry of Foreign Affairs , Foreign Employment, Tourism.attended the meeting.
[Prime Minister’s Media Division]
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Advisory for low pressure area in the Southwest Bay of Bengal to the south-east of Sri Lanka
Advisory for low pressure area in the Southwest Bay of Bengal to the south-east of Sri Lanka.
Issued by the Natural Hazards Early Warning Centre of the Department of Meteorology at 03.00 pm on 18 February 2026
Multiday boats fishermen and naval community are warned that the low-pressure area still persists over the Southwest Bay of Bengal to the south-east of Sri Lanka. Under the influence of this system, heavy showers or thundershowers, Strong winds about (50-60) kmph, and rough or very rough seas can be expected in these sea areas.
The Meteorological Department is constantly monitoring the behavior of the system.
The naval and fishing communities are requested to be attentive to the future forecasts and bulletins issued by the Department of Meteorology in this regard.
Canada, said to be the home to the largest Tamil Diaspora community, has expressed concern over the delay in holding Provincial Council (PC) elections. Canadian High Commissioner Isabelle Martin, on Monday (16), took up the issue with Public Administration, Provincial Councils and Local Government Minister Professor Chandana Abayaratne.
Sources quoted Prof. Abayaratne as having told the Canadian HC that the delay was not deliberate on the part of the government. The Minister blamed, what the sources called, certain legal, technical and delimitation issues for the delay.
India compelled Sri Lanka to enact the 13th Amendment to the country’s Constitution to enable the setting up of the Provincial Council system, in line with the Indo-Lanka Peace Accord, which Sri Lanka signed under duress in July 1987.
Prof. Abayaratne has assured the Canadian HC that President Anura Kumara Dissanayake, too, recognised the importance of strengthening the Provincial Council system as a solution to ethnic issues and that urgent steps would be taken in that regard.
During the discussion, matters relating to strengthening political, economic and social relations between the two countries were discussed.
In May 2020, Canada declared that Sri Lanka had perpetrated genocide during the war against the LTTE. Canada also sanctioned former Presidents Mahinda Rajapaksa and Gotabaya Rajapaksa in January 2023 over alleged war crimes.
The Canadian HC also explained her country’s ‘Indo-Pacific’ strategy and how Sri Lanka could benefit from it.
In particular, Canada’s “Pathways to Peace” project will support reconciliation between nations, and to improve communication by encouraging the learning of mutual languages as a second language, and it was also agreed to provide more opportunities for Sri Lankan students to pursue higher studies in Canada.
The Canadian delegation also expressed its willingness to provide the necessary technical assistance to solve the drinking water problems in Puttalam, Mannar and the North-Eastern provinces under technical cooperation, and to implement the relevant projects after a preliminary study.
by Shamindra Ferdinando
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