News
CP Leader warns of danger of being at mercy of the dollar with it likely to lose its world reserve currency status
Suggests looking at India and China as alternative options
By Rathindra Kuruwita
The United States has printed trillions of dollars in the past year and Sri Lanka will be at the mercy of its volatility unless it looks at ways to reduce its dependence on the dollar, General Secretary of the Communist Party of Sri Lanka (CPSL) Dr. G. Weerasinghe told The Island on Wednesday.
The CPSL recently released a policy manifesto, Idirimagin Idiriyata, at the party’s 80th anniversary and proposed an alternative development mechanism.
After several centuries, the centre of world economy has shifted to Asia, and it has opened up new developmental avenues for Sri Lanka, General Secretary of the Communist Party said. Speaking about the Idirimagin Idiriyata policy manifesto the CPSL launched on 03 July, he said that most Sri Lankan economists are western oriented and ignore new world trends.
“In the last 20-30 years, many Asian economies took off, but we couldn’t get on the bus. This is because our entire economy is oriented to the West. We don’t even think what the Chinese, Indian, Korean or Japanese market wants. Clearly they don’t need our tea or garments. We have to figure out what these new markets want,” he said. Dr. Weerasinghe added that China is the main business partner with 140 countries in the world. China and India do a lot of business together, despite the frequent clamouring by Indian media, he said. “China is the biggest market in the world. China has a 500 million strong middle class. We have to also seriously think of India, which is the most populous country in the world. What about ASEAN? CPSL calls for a reorientation of Sri Lanka’s trade policy,” he said.
The CPSL General Secretary said that de-dollarization and the availability of new payment platforms are also developments that Sri Lanka should look at. In recent years, it has become evident that the United States and a few of its allies are manipulating international institutions that were meant to be apolitical, he said.
“They are also using sanctions to punish countries that do not bow down to the West. They are misusing the fact that the U.S. Dollar is the reserve currency of the world. They have also used payment platforms like SWIFT which was said to be beyond politics. A lot of countries have seen what happened to Iran and Russia and are worried that the same fate would befall them. Most major powers in the world are thinking about using alternative currencies to do business between each other. They have also looked at payment gateways like Mir,” he said.
Dr. Weerasinghe said that the US and EU imposed sanctions on about 6000 products on Russia following the Ukrainian war. Without being daunted, it rearranged its economy towards Asia and have managed to escape economic collapse. This made many major powers realize that the US and EU can only influence them, if U.S. dollars are used for trade.
“De-dollarization has gained momentum ever since. Russia, Iran and a few other countries have been kicked out of SWIFT,” he said.
Dr. Weerasinghe said that Sri Lanka has now decided that the Chinese Yuan and the Indian rupee can be used for trade. Some elements are insisting that this would be bad for the country without giving a rational explanation, he said.
The CP General Secretary mentioned that there are a few new development banks in the world, i.e. the BRICS bank and the AAIB. Sri Lanka only depends on the World Bank, IMF, etc., and these establishments have been tools of the West to impose its hegemony on the rest of the world, he said.
Dr. Weerasinghe added that until 1978, Sri Lanka took a number of progressive steps to defeat colonialism, and to industrialize. It attempted to formulate its own drug policy with Dr. Senaka Bibile, which is now widely respected around the world.
However, everything changed after 1977 and the problems created from the shift in the economic policy culminated with the current economic crisis, he said.
“Almost all governments, since 1977, have followed policies that were inimical to the agriculture and manufacturing sectors. We moved to low paying and low-productivity service jobs. It is a well-known fact that all nations that joined the developed nations club in the last 60 years focused on labour intensive manufacturing and boosting agricultural productivity. This is the history of development, but we have decided to ignore, it since 1977,” he said, adding that the institutions set up to ensure adherence to the Washington Consensus, i.e. World Bank and the IMF dictates, had encouraged deindustrialization in Sri Lanka.
“In fact, a 2003 agreement we signed with the IMF says that the Sri Lankan government will not take steps to develop industrialization,” he said.
The CPSL General Secretary said that as the state had lost both tax and non-tax revenue, it was compelled to borrow, especially from the International Sovereign Bond (ISB) markets.
“We started borrowing from these markets in 2007. Up until 2015, we borrowed about 30 percent of our total debt from ISBs. Between 2015 and 2019, we borrowed over 13 billion US dollars from these markets. These bonds are held by companies based in the US and the EU. They are literally poli mudalalis (loan sharks). Borrowing from these markets has ruined us. However, there is a big campaign by the West and its local allies to place the blame on China,” he said.
During an operation conducted in the wee hours of Tuesday (23 Dec 25), the Sri Lanka Navy seized an Indian fishing trawler and apprehended 12 Indian fishermen, while they were poaching in Sri Lankan waters north of Talaimannar.
Recognizing the detrimental effects of poaching on marine resources and the livelihoods of local fishing communities, the Sri Lanka Navy continues to conduct regular operations as
proactive measures to deter such activities. These efforts underscore the collective robust approach steadfast commitment to safeguarding the nation’s marine ecosystems while ensuring the economic security and wellbeing of its citizens.
The fishing trawler along with the fishermen held in this operation was handed over to the Fisheries Inspector of Mannar for onward legal proceedings.
India’s External Affairs Minister, Dr. Subramaniam Jaishankar, met with the Prime Minister of Sri Lanka, Dr. Harini Amarasuriya, on 23 December at Temple Trees, during his visit to Sri Lanka as the Special Envoy of Indian Prime Minister Shri Narendra Modi.
The meeting took place as part of the official visit aimed at holding discussions with Sri Lanka’s top leadership, at a time when the nation commenced reconstruction efforts following the devastation caused by Cyclone Ditwah.
During the discussions, the Minister of External Affairs of India reaffirmed readiness to extend support for Sri Lanka, including assistance in rebuilding railways, bridges, and strengthening of the agricultural sector in the country. He also highlighted the importance of having effective systems in place to respond to disaster situations, supported by strong legislative, administrative, and institutional frameworks. Both sides reviewed ongoing relief efforts and explored avenues to further strengthen bilateral cooperation in disaster response and recovery.
The Prime Minister commended the Government of India for the continued support, noting that the recovery process following the devastation caused by Cyclone Ditwah include beyond immediate relief efforts to long-term measures such as resettlement, and reconstruction of habilitation and infrastructure.
The Prime Minister further stated that steps have been taken to reopen schools as part of the process of restoring normalcy, with close monitoring in place. The Prime Minister emphasized the need to ensure stability, reduce vulnerability, and strengthen protection mechanisms highlighting the solidarity of the people, their strong spirit of volunteerism, and collective action demonstrated during the emergency situation.
The event was attended by the High Commissioner of India Santosh Jha, Additional Secretary (IOR), MEA Puneet Agrawal, Joint Secretary (EAMO), MEA Sandeep Kumar Bayyapu, Deputy High Commissioner Dr. Satyanjal Pandey, and representing Sri Lankan delegation, Secretary to the Prime Minister Pradeep Saputhanthri, Additional Secretary to the Prime minister Ms.Sagarika Bogahawatta, Director General (South Asia), Ministry of Foreign Affairs Samantha Pathirana, Deputy Director, South Asia Division, Ministry of Foreign Affairs Ms.Diana Perera.
[Prime minister’s media division]
Sri Lanka is standing on the edge of a coastal catastrophe, with the nation’s lifeline rapidly eroding under the combined assault of climate change, reckless development and weak compliance, Director General of the Department of Coast Conservation and Coastal Resource Management (DCC&CRM) Dr. Terney Pradeep Kumara has warned.
“This is no longer an environmental warning we can afford to ignore. The crisis is already unfolding before our eyes,” Dr. Kumara told The Island, cautioning that the degradation of Sri Lanka’s 1,620-kilometre coastline has reached a point where delayed action could trigger irreversible damage to ecosystems, livelihoods and national security.
He said accelerating coastal erosion, rising sea levels, saltwater intrusion and the collapse of natural barriers, such as coral reefs and mangroves, are placing entire coastal communities at risk. “When mangroves disappear and reefs are destroyed, villages lose their first line of defence. What follows are floods, loss of homes, declining fisheries and forced displacement,” he said.
Dr. Kumara stressed that the coastline is not merely a development frontier but the backbone of Sri Lanka’s economy and cultural identity. “More than half of our tourism assets, fisheries and key infrastructure are concentrated along the coast.
If the coast fails, the economy will feel the shock immediately,” he warned.
Condemning unregulated construction, illegal sand mining and environmentally blind infrastructure projects, he said short-term economic interests are pushing the coastline towards collapse. “We cannot keep fixing one eroding beach while creating three new erosion sites elsewhere. That is not management—it is destruction,” he said, calling for science-driven, ecosystem-based solutions instead of politically convenient quick fixes.
The Director General said the Department is intensifying enforcement and shifting towards integrated coastal zone management, but warned that laws alone will not save the coast. “This is a shared responsibility. Policymakers, developers, local authorities and the public must understand that every illegal structure, every destroyed mangrove, weakens the island’s natural shield,” he added.
With climate change intensifying storms and sea surges, Dr. Kumara warned that Sri Lanka’s vulnerability will only worsen without urgent, coordinated national action. “The sea has shaped this nation’s history and protected it for centuries. If we fail to protect the coast today, we will be remembered as the generation that allowed the island itself to be slowly eaten away,” he went on to say.
By Ifham Nizam
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