Opinion
JULY 1983: AS THE WORLD SAW SRI LANKA
Monday 25th July 1983 began like just another day. But what we didn’t know was that it was to be the last day of an era. By mid-morning from my second-floor office in Fort I could see the city being put to the torch. Already my two sisters’ homes in the suburbs had been attacked and they were taking shelter with Sinhalese and Burgher neighbours.
After ensuring that the female staff was safely escorted home, I walked to my wife’s office in Kompannavidiya. Outside the Air Force Headquarters on Sir Chittampalam Gardiner Mawatha, gangs were stopping cars and setting them on fire. A Police jeep drove through the inferno; but the mob did not pause from their orgy of destruction. On Malay Street groups were looting and then setting shops ablaze. I watched truckloads of troops chanting ‘Jayaweva’ drive out of Army Headquarters, exhorting and encouraging the mobs.
A Sinhalese colleague accompanied us back home where we packed one briefcase with essential documents and one basket with food and necessities for Nishara, our nine-month-old baby. If we had to flee this was all we would take. When a house in the adjacent road was attacked, we took refuge with a Sinhalese neighbour.
We were among the fortunate. We survived. This article remembers the many who did not return to their homes; who came home to charred ruins; who fled to refugee camps and then into exile overseas. It honours the memories of the men, women, children and domestic animals who perished in Sri Lanka’s Holocaust.
By Jayantha Somasundaram
This article is based on reporting by the international media on the events in Sri Lanka 40 years ago.)
“I am not worried about the opinion of the Jaffna people… now we cannot think of them, not about their lives or their opinion… the more you put pressure in the north, the happier the Sinhala people will be here… Really, if I starve the Tamils out, the Sinhala people will be happy.” – President J.R. Jayewardene, Daily Telegraph (London) 11 July 1983
“Someone seemed to have planned the whole thing and waited only for an opportunity. And the opportunity came on the night of 23 July,” (Race & Class London XXVI.I [1984]). Thirteen soldiers of the 1st Battalion Sri Lanka Light Infantry were killed in a landmine explosion in Thirunelveli. Enraged troops struck back immediately. David Beresford wrote that “members of the Tamil community in Jaffna told the British Guardian troops killed a number of students waiting at a bus stop; the students aged between 18 and 20 had been lined up and fired upon. Six were killed and another two injured. Shortly afterwards troops drove through a village about five miles outside Jaffna shooting at random. Two were reported killed. Soldiers in civilian clothes were out in jeeps and raided a number of houses shooting inhabitants. In one house a family planning official was allegedly shot dead while lying on his bed and his 72-year-old father-in-law a headmaster shot sitting outside on the veranda. About 16 people were killed.
“Asked yesterday why no inquests have been held, President Jayewardene said: I didn’t know until a couple of days ago. It is too late now.” The violence then spread to Trincomalee where since early June Tamils had been subject to violence by hoodlums from the market area. On the 3rd the Mansion Hotel had been attacked. Now sailors went on a rampage destroying Hindu Temples, homes and shops. “In Trincomalee” reported The Irish Times (29.7.83), “130 sailors were under arrest after breaking out of their barracks on Monday and attacking shops and homes.”
“Only one in every 100 policemen is a Tamil. When security forces were ordered last week to protect Tamils in Trincomalee and other cities, they reportedly joined in the looting and burning,” said the London Observer (31.7.83).
A crowd had gathered at Kanatte Cemetery in Colombo for the funeral of the soldiers to be held on the 24th evening. “That night, a section of this crowd started setting fire to Tamil houses at the Borella end of Rosmead Place,” (Race & Class ibid).
On the morning of the 25th, mobs began moving right through Colombo and its suburbs waylaying Tamils and attacking them. They stopped vehicles and set ablaze those belonging to Tamils. They went through commercial areas looted shops and set them on fire. Residential areas were worked systematically and homes occupied by Tamils were attacked, looted and burned. Tamils who fell into the hands of these mobs were beaten and killed.
“There is no doubt that someone had identified the Tamil houses, shops and factories earlier. Seventeen industrial complexes belonging to some of the leading Tamil and Indian industrialists were razed to the ground, including those of the multi-millionaire and firm supporter of the ruling party, A.Y. S. Gnanam (the only capitalist in Sri Lanka to whom the World Bank offered a loan), and the influential Maharaja Organisation. The Indian-owned textile mills of Hirdramani Ltd, which used a labour force of 4,000 in the suburbs of Colombo was gutted. So was K. G. Industries Ltd, Hentley Garments, one of the biggest garment exporters…Several cinemas owned by Tamils were destroyed…Probably the worst affected area was the Pettah, the commercial centre of Colombo, where Tamil and Indian traders played a dominant role. Hardly a single Tamil or Indian establishment was left standing. A most distressing aspect of the vandalism was the burning and the destruction of the houses and dispensaries of eminent Tamil doctors – some with over a quarter of a century of service in Sinhala areas.” (Race & Class ibid)
All over the island
By midday the skyline was marked by columns of smoke as factories, shops and houses burned to the ground. A curfew was imposed at 2.00 pm but the terror did not abate, the attacks continued into the next day. “In the capital Colombo, Tamils are said to have been dragged from their cars and incinerated with petrol,” reported the London Economist (30.7.83).
Anthony Mascarenhas of the London Sunday Times wrote: “Throughout Monday Tamil shops were attacked and burned. Those who resisted perished with their property. Buses and cars were stopped and their Tamil passengers beaten up. Cars were burned and strewn all over the city. The army moved in by noon but troops turned a blind eye. Next day Tuesday, the looters took over defying the curfew. By midweek the trouble had spread all over the island. Affluent Tamils in Colombo who had hidden to escape the mobs were now singled out for attacks in their homes, which were looted and burned.”
“The capital was strewn with the wreckage of scores of shops and houses set ablaze, gutted or looted in the rioting.”(New York Times 28/7/83)
John Elliot of the London Financial Times reported from Colombo: “In each street individual business premises were burned down while others alongside were unscathed. Troops and police either joined the rioters or stood idly by. President Jayawardene failed either intentionally or because he had lost control to stem the damage.”
“By Monday night” said Asiaweek from Hong Kong (12.8.83) “the official death toll in the Greater Colombo area alone was 36 with hundreds more injured and unofficial estimates put the figure at three or four times higher. Most of the dead were helpless Tamils stranded in the city and caught by mobs while trying to flee. In the Borella area two Tamil shop-owners were burnt alive when a mob set fire to a row of shops. In Maradana a Tamil was chased by a mob brought down with stones and then hacked to death.
“On Monday while Borella was being put to the torch rioting broke out in adjacent Welikada prison. Some 400 prisoners from a section reserved for common criminals broke into the maximum-security section. Of the Tamil inmates many of whom were still awaiting trial, 37 were killed, either bludgeoned to death with iron bars or literally trampled to death.
“By Tuesday morning virtually every town in Sri Lanka with a Tamil presence bore scars of rioting. The main target, Tamil owned shops and businesses. According to one estimate more than half the country’s Tamil owned shops were gutted.
“Meanwhile the violence went on” continued Asiaweek (12.8.83). “On Thursday an incoming train from Kandy was stopped just outside the Fort station by security forces acting on a tip that Tamil terrorists were on board. One Tamil was reportedly apprehended carrying hand grenades and an automatic rifle. In the process of arresting them however, pandemonium broke out in the train and the Tamil passengers fled. Ten were run down by a mob of some 2,000 Sinhalese who doused each one with petrol and set them alight while still alive. As the victims screamed in pain the Sinhalese crowd cheered and flashed victory signs, then spilled into the streets looting and burning Tamil shops.”
Welikada Prison
“The same day saw more trouble at Welikada,” explained Asiaweek. “Sinhalese prisoners for the second time in three days broke into the maximum-security wing, this time murdering seventeen Tamil detainees. With three other Tamil inmates killed in the Jaffna jail, the total number of Tamils clubbed or trampled to death by rampaging Sinhalese prisoners was 55.”
David Beresford of The Guardian (13.8.83) recalled that ‘Kutumani’ Yogachandran and Ganeshnathan Jeganathan in speeches from the dock had announced that they would donate their eyes in the hope that they would be grafted onto those who would see the birth of Tamil Eelam. “Reports from Batticaloa jail where the survivors of the Welikada massacre are now being kept say that the two men were forced to kneel and their eyes were gorged out with iron bars before they were killed.”
On his return to London Pat O’Leary told the Associated Press “People were dragged out of their homes and then the houses were burned down. I watched a group of Sinhalese people chase a group of three Tamils. They caught one beat him up threw him to the ground and stoned him. It was terrible. Nobody did a thing to help. Even the Police turned a blind eye.”
A Norwegian woman Eli Skarstein on her return to Oslo told the press that “A mini bus full of Tamils was forced to stop just in front of us in Colombo. A Sinhalese mob poured petrol over the bus and set it on fire. They blocked the car doors and prevented the Tamils from leaving the vehicle. Hundreds of spectators witnessed as 20 Tamils were burned to death.”
“For days soldiers and policemen were not overwhelmed: they were unengaged or, in some cases apparently aiding the attackers,” reported the London Economist (6.8.83). “Numerous eye witnesses attest that soldiers and policemen stood by while Colombo burned. After two days of violence and the murder of 35 Tamils in a maximum-security jail, the only editorial in the government-run newspaper was on ‘saving our forest cover’.
“It was five days after the precipitating ambush and a day after a second prison massacre that the people of Sri Lanka heard from their President. On July 28th Mr. Jayewardene spoke on television to denounce separatism and proscribing any party that endorsed it in order to ‘appease the natural desire and request’ of the Sinhalese ‘to prevent the country being divided’. Not a syllable of sympathy for the Tamil people or any explicit rejection of the spirit of vengeance. Next day Colombo was a battle field: more than 100 people are estimated to have been killed on that Friday alone.”
Tigers in the City
On Friday 29th when a soldier accidently shot himself in the Pettah the rumour spread that ‘Tigers’ were in the City. Indian journalist M. Rahman reported how in response soldiers and Sinhalese mobs retreated to the many bridges leading out of Colombo, killing Tamils desperately trying to get back to their homes.
A middle-aged businessman whom T.R. Lanser interviewed for the London Observer (7.8.83) said “On Friday about noon a mob came to attack Tamil people in the hospital. A Tamil Inspector of Police who was visiting me was murdered, cut with knives, just as he was talking to me. He faced them and he gave us time. Even with this broken foot I ran and hid…”
Michael Hamlyn wrote in the London Times (1.8.83) “burnings and killings continued over the weekend despite a 60-hour curfew. The trouble spread on Saturday to Nuwara Eliya. There were further incidents of violence against Tamils and their property in Chilaw, Matale and Kalutara.
”There was a mass exodus of Tamils displaced from their homes. Thirty busloads of refugees were taken from a camp and embarked on a ship for the North.” The International Herald Tribune (15.8.83) in Paris quoted A. Amirthalingam leader of the TULF (Tamil United Liberation Front) and leader of the Opposition in Parliament, as saying that 2,000 people had died in two months of ethnic unrest. He said the figure included deaths in the whole island since anti-Tamil violence broke out in Trincomalee on June 3rd and culminated in riots throughout the island at the end of July.
Opinion
Nanda Pethiyagoda Wanasundera
A familiar presence who enlivened these pages for over 30 years is no more. Nanda Pethiyagoda Wanasundera who wrote the People and Events column for the Sunday Island under the pseudonym Nan died on Wednesday morning at the age of 93 after a short illness and was cremated the next day in accordance with her wishes. Her last two columns, which she dictated to her younger son, Rajiv, visiting his mother from the US, and to a niece a week later, appeared in April.
Nanda was already on board this newspaper when I became its editor in 1997, writing a weekly column for quite awhile. When I saw her first piece under my stewardship – I think it was on her good friend Ayya Khema of the Dodanduwa nun’s island – I found it so readable and substantial that I realized I had a treasure of a columnist on my newspaper. It remained so for early 30 years when she had written close to maybe 2,000 articles not just her People and Events for the Sunday Island but for The Island (daily) where she had a weekly column, Cassandra Cry as well as under her initials NPW.
She regarded one of my aunts, Mrs. Ratna (NQ) Dias, as her kalyana mitta (mentor or companion who supports, inspires, and guides you on the path to enlightenment) and this could not but further endear her to me. She and Ratna nenda would take a bus to Dodanduwa to visit the island hermitage and those trips were anything but comfortable.
Nanda trained and worked both as a teacher and a librarian. She taught at the Kataluwa government school in the South and later in Colombo at Bishop’s College and Buddhist Ladies College. She was thereafter the librarian at the Overseas School and the Law Faculty of the Colombo University. A loyal alumnus of Girl’s High School, Kandy, where she had both her primary and secondary education, she must surely have been the oldest old girl living at the time of her passing.
Our relationship soon moved from that of professional colleagues to personal friends. She was always immaculately groomed with a collection of Thai/Indonesian lungis matched with stylish tops. She loved to entertain her friends in her well appointed apartment at Fifth Lane, Kollupitiya, laying an elegant table with stoneware crockery and all the trimmings. Although she claimed she couldn’t cook she was supported by her loyal and efficient domestic, Karuna, who had worked in New York for her elder son. Nanda knew how to choose her menus offering us goodies Rajiv brought her from abroad.
I was fortunate to belong to one of her close knit social circles and we met regularly at each other’s homes and restaurants and always had a whale of a time sharing anecdotes and memories, often chatting on the phone of this and that and mutual friends. It is hard to accept that she is gone.
Nanda wrote fluently and had the feel for a story written in a warm and chatty style. Memories of a happy childhood near Kandy, holidays with an elder brother who was one of the first batch of Ceylon’s DROs with a remote posting, extensive travel, work experience, warm relations with a wide and varied circle of friends and acquaintances equipped her with a vast reservoir of background information to draw on.
She swam at the Ladies College pool, a short walk along the barrel drain fro her home on Fifth Lane well into her eighties, practiced yoga, read voraciously and was extremely generous to those who worked for her. It wasn’t long ago that she with Rajiv did a long drive to the rural heartland to visit Podi Hamy who had looked after her two boys and later worked as her cook in Colombo.
Nanda was a very good Buddhist who meditated, She was close to many erudite bhikkus who turned to her to write and publicize many matters of interest to Buddhists and Buddhism. Let me relate a single anecdote to complete this appreciation of a remarkable woman who added light to many lives. It illustrates her ability to deftly turn the tables on whoever when the circumstances so demanded.
Nanda and I, both friends of Capt. Elmo Jayawardena, participated in a ‘Talkmates’ program he set up to improve the English of poor speakers of the language by pairing them with good English speakers for longish telephone conversation. A young woman called Piumi was mentored by both Nanda and I.
She invited Piumi and me along with a cousin of hers to her home for lunch one day. The cousin and I were swapping yarns across the table when I used the ‘b’ word. Piumi turned to Nanda and asked her, “Madam what does ‘b—r’ mean? Nanda responded instantly saying “you better ask the person who used it!”
Touche´! Incidentally Piumi left the lunch with a very generous gift from Nanda.
Manik de Silva
Opinion
Sri Lanka’s Food Safety Imperative
From Burden to Solutions:
Every year on 07 June, the world pauses to reflect on a truth that is at once mundane and profound: the food on our plate should not make us sick. This year, the World Health Organization and the Food and Agriculture Organization of the United Nations have chosen a theme that is both a diagnosis and a directive “From burden to solutions – safe food everywhere.”
The framing is deliberate. For too long, conversations about food safety have been dominated by the language of loss counting the sick, tallying the dead, lamenting the economic damage. The 2026 theme demands that we harness that data not as an epitaph, but as a map that guides us toward targeted, evidence-based action.
Globally, foodborne diseases cause illness in at least 600 million people and claim an estimated 420,000 lives every year. These are not abstractions. They are children who did not return to school, breadwinners who could not return to work, and farmers whose produce never reached a market.
For Sri Lanka, the stakes are deeply personal. As a food scientist who has spent over a decade studying, teaching, and working across our food systems from university laboratories and hotel kitchens to dairy processing plants and international sporting events, I have witnessed both the fragility and the resilience of food safety in this country.
The burden is real. Foodborne infections from Campylobacter, Escherichia coli, Vibrio cholerae, and Hepatitis A continue to be recorded by the Epidemiology Unit. Pesticide residues in vegetables, aflatoxin in stored grains, and heavy metal contamination in seafood present chronic, low-visibility risks that rarely make headlines but accumulate silently in our bodies and in our healthcare bills. The unchecked proliferation of informal food establishments has widened the exposure surface significantly.
Sri Lanka’s food safety architecture rests primarily on the Food Act No. 26 of 1980. A legislation conceived in an era that could not have anticipated the complexity of today’s supply chains, the growth of modern retail, or the risks posed by climate-driven changes in microbial ecology. While amendments in 1991 and 2011 have partially modernised the framework, the foundational challenge of fragmented, multi-ministerial oversight remains unresolved. No single authority commands the end-to-end food chain from farm to fork.
The consequences are visible. Sri Lanka has repeatedly seen food export consignments rejected at international borders due to non-compliance with safety standards. A reputational and economic wound that strikes our tea, spices, fish, and fruit sectors. These rejections are not merely trade disputes; they are data points, signalling systemic gaps in Good Agricultural Practices, cold chain infrastructure, and laboratory testing capacity. The 2026 World Food Safety Day theme is therefore a clarion call to Sri Lanka’s policymakers, industry leaders, academics, and consumers alike. We have data. We have science. What we need is the collective will to act.
The solution begins with data.
The WHO’s landmark 2026 release of national-level foodborne disease burden estimates the first of their kind, covering the period 2000–2021 provides an unprecedented opportunity. For the first time, Sri Lanka will have access to country-specific data on the incidence, mortality, and disability-adjusted life years attributable to specific foodborne hazards. This is not merely an academic resource; it is a policy instrument. Ministries of Health, Agriculture, and Industries must treat it as such, using it to identify where risk is highest, which population groups are most vulnerable, and which interventions deliver the greatest return on public health investment.
Having served as a Food Safety Officer/Trainer and Trainer at the FIFA 2022 World Cup in Qatar, I observed first-hand how a structured, data-driven approach to food safety management grounded in HACCP principles and supported by rigorous real-time monitoring can successfully feed tens of thousands of people across dozens of venues without a single outbreak. The lesson for Sri Lanka is not that we must import foreign systems wholesale, but that the underlying principles of evidence, accountability, and prevention translate universally.
Education is the second pillar of transformation.
In my years of teaching food safety to university students, hotel management students, tourism professionals, and food industry workers, the most consistent finding is that unsafe food practices are rarely born of malice. They arise from ignorance of microbial growth temperatures, of cross-contamination pathways, of the invisible consequences of inadequate handwashing. Behaviour change at scale requires education that begins early. We must embed food safety literacy into our school curricula, not as an elective topic in home economics, but as a fundamental life skill taught alongside reading and arithmetic. Food safety must be as instinctive as looking before crossing a road. Industry bears its own responsibility. Food business operators from the multinational processor to the neighbourhood bakery must understand that food safety is not a compliance cost to be minimised. It is a brand asset, an ethical obligation, and ultimately, a business survival strategy. The investment in quality management systems, whether ISO 22000, FSSC 22000, or the foundational GMP and GHP frameworks, pays returns in consumer trust, export market access, and reduced liability. Safe food is not a luxury reserved for export markets or five-star hotels. It is a right that belongs equally to a schoolchild buying a kottu roti from a street cart and a tourist dining in a star hotel. The 2026 theme reminds us that the burden is well-documented. The solutions exist. The only thing left is the resolve to implement them everywhere, for everyone.
PRIORITY ACTIONS FOR SRI LANKA
= Enact a unified Food Safety Authority consolidating fragmented regulatory mandates under a single body
= Establish mandatory HACCP certification for food businesses beyond the large-scale sector
= Invest in regional food testing laboratories with accredited capacity (ISO/IEC 17025)
= Integrate food safety education into the national school curriculum from primary level
= Strengthen cold chain infrastructure, particularly for seafood and fresh produce destined for export
= Adopt the WHO 2026 national burden data to prioritise health spending on highest-risk hazards
= Empower Public Health Inspectors with digital reporting tools and updated training mandates
Opinion
“The path of freedom: Dismantling the imperialist debt trap
I must first thank Gayantha Dehiwatte for inviting me this afternoon to the launch of his book, The Path of Freedom: Dismantling the Imperialist Debt Trap. The title itself suggests that Sri Lanka has yet to achieve genuine independence, particularly in the sphere of economic decision-making. In recent years, most economic decisions of major importance appear to have emanated from Washington. During the initial phase, these decisions reached Colombo in the form of International Monetary Fund- World bank conditionalities. In more recent years, however, many of these policies have been designed locally by the economists and bureaucrats in the Treasury and the Central Bank of Sri Lanka who are trained in western academic institutions. As a result, local and international experts have worked in synergy united by their adherence to what may be called the TINA (There Is No Alternative) doctrine.
According to Dehiwatte, ‘the current economic structure in Sri Lanka is guided by the principles of neo-liberal free-market economics. This economic theory has been steering the course of Sri Lankan economy since 1978’ (page iii). It was consistently claimed that the policy package introduced in 1978 would generate higher rates of growth, lower unemployment, poverty alleviation, reduced dependency and inequality transforming Sri Lanka into the Singapore or South Korea of the Indian ocean region.
In this talk, I would focus on three main points. My first thesis is that Sri Lanka is now facing a simultaneous presence of three crises namely, the structural, conjunctural and contingent crises, as a direct consequence of the neo-liberal economic policies introduced in 1977. Second, the decision to invite the IMF to play a central role in managing the 2022 debt crisis was a serious mistake. Third, although the de-dollarisation is an essential step towards resolving the crisis it is not by itself sufficient to transform the existing global economic architecture.
The performance of the Sri Lankan economy over the last 48 years (1978- 2026) does not support the contention that the adoption of neo-liberal economic policies as outlined in Washington Consensus would pave the way for sustained economic growth and development. Compared to the period from 1950- 77 period, there has been no significant improvement in either the rate of economic growth or in the level of employment. Dehiwatte reports: ‘As of 2024, approximately one-third of Sri Lankan population -around 7 million people – are living below the poverty line, with about 2.3 million children suffering from hunger due to inadequate access of food. That is, exactly half of the children are going hungry. The total number of families in Sri Lanka is about 5.7 million, of which 3.7 million seeking assistance to survive’ (p. 18). data on consumption patterns strongly corroborate these findings. The top 1% of the population accounts for 22% of GDP whereas the bottom 50% accounts for only about 14%. The crisis Sri Lanka has experienced over the last 48 years is an all-embracing structural crisis, the resolution of which requires far-reaching changes to the existing economic structure. Following Istvan Meszaros, four characteristics of the present crisis may be identified:
(1) It is not confined to a particular sector of the economy;
(2) It is global in scope, being closely linked to the process of globalization;
(3) Its temporal scale is continuous rather than limited and cyclical, making it difficult to identify a clear beginning or point;
(4) Its mode of unfolding is gradual and creeping rather than in contrast to sudden and explosive. (Beyond Capital. pp. 680- 81).
The structural crisis is the product of a conjunction of three interrelated developments: the absence of an independent macroeconomic policy framework, the nature of the bourgeoisie, and the nature of the state and its relationship to different social classes. Given the limited time available, I will not attempt a detailed analysis of these three dimensions. Nonetheless, two observations deserve emphasis. First, the average annual growth rate during the last 48 years has not been significantly higher than that achieved during the preceding period of the so-called dirigisme regime. Second, although Sri Lanka experienced two periods of relatively rapid growth (1978- 1982 and 2010- 2915), it failed to sustain the momentum generated during these periods. Consequently, these episodes were ultimately reduced to little more than infra-structure driven bubbles.
Cyclical fluctuations within a prolonged structural crisis are not uncommon in market economies. Sri Lanka is no exception. During the public debate surrounding the 2022 economic crisis, it was frequently argued that the crisis began in 2019 because of misguided economic policies. However, as data demonstrates, the current conjunctural crisis began not in 2019 but in 2016. The recession that started in 2016 culminated in negative growth in 2020. A modest recovery in 2021 was followed by a negative growth both in 2022 and 2023. The economy returned to a limited recovery in 2024, but by 2026 that recovery appears to have lost momentum. If one plots annual growth rates between 2026- 2026 a W-shaped cycle emerges, with its lowest point in 2022. The debt crisis in 2022 should therefore be viewed not as an isolated event, but as the trough of the 2016- 2025 cycle. Of course, the acceleration of the crisis in 2022 was triggered by excessive borrowing in the global capital market through ISDs (International Sovereign Bonds). Prof Prabath Patnaik depicts this specific phenomenon as a contingent crisis: a crisis that appears manageable until a sudden financial crunch exposes underlying vulnerabilities. The IMF’s own projection that annual growth will remain around 3 per cent in 1926 together with its assessment that debt sustainability remains fragile, suggests that Sri Lanka is once again approaching a tipping point.
Confronted with these three interrelated crises, the neoclassical economists, CBSL and Treasury officials and politicians representing bourgeoisie parties argued that seeking IMF support was the only available solution. According to this view, it was imperative to accept a comprehensive IMF program at any cost. The irony is that these same actors have failed to acknowledge that Sri Lanka has been operating under the IMF program for seven out of ten years under consideration. (2017- 2020 and 2022- 2026). A second group adopted a more critical position. While accepting the need for IMF engagement, they argued for greater local input, theoretical as well as practical, into the program and advocated modifications and incorporation of selected elements of the augmented-Washington consensus. Both groups, however justified IMF intervention on the grounds that the IMF is an international institution of which Sri Lanka is a member and that the country therefore has a legitimate right to seek assistance during a foreign exchange crisis.
This argument suffers from three fundamental defects. First, it overlooks that the IMF and the IBRD established in 1945 are very different institutions from those that emerged during the mid-1970s. The original purpose of the IMF and IBRD was to assist war-ravaged countries in Western Europe and Japan facing balance of payment difficulties and reconstruction needs. By the 1970s these tasks had largely been completed rendering the original mandate of the institutions increasingly redundant Following the quadrupling of oil prices and the accumulation of petro-dollars in the US banks, the IMF effectively assigned itself a new role: that of managing the interests international finance capital during the neo-liberalist phase of the capitalist development. Its primary responsibility thus shifted away from member states and towards the preservation and upholding of the interests of the global capital market and its institutions. (For a detailed discussion, see : Unholy Trinity: the IMF, World Bank and WTO by Richard Peet) 2003.
Second, the dominant approach is based on the presupposition that there is no alternative. Consequently. The magnitude of the crisis was exaggerated in order to ensure Sri Lanka’s continued integration into the global financial system and therefore its continued entrapment with a cycle of indebtedness. Third, the argument rests on a fundamental misunderstanding of the IMF’s mode of crisis management. When dealing with a crisis ridden country, the IMF typically intensifies the crisis by imposing deflationary policies designed to restore creditor confidence.
The Sri Lankan experience illustrates this pattern clearly. Although the economy achieved a modest but positive rate of growth in 2021, growth contracted sharply in 2022 and 2023 following the implementation of IMF-backed policies. Once an economy reaches the trough of the cycle, its internal dynamics tend to generate some degree of recovery because aggregate demand rarely falls to zero. Consequently, the stability achieved since 2024 should be understood as a low-level stability -an outcome of economic contraction and adjustment rather than genuine transformation.
Let me turn to my third thesis that Dehiwatte had raised in his proposal for de-dollarization. The book appears to suggest that de-dollarization is imperative if the imperialist debt trap is to be dismantled. In a different historical context, some French economists argued that replacing the franc with a currency based on labour value would provide a solution to balance-of-payments crises. Commenting on this view, Marx observed:
“In order to balance the decrease of domestic production by means of imports on the one side and the increase of industrial undertakings abroad on the other side, what would have been required were not symbols of circulation which facilitate the exchange of equivalents but the equivalents themselves, not money but capital” (Grundrisse, p. 121).
However, the context to which Gayantha Dehiwatte refers is substantially different. In 1944–45, when the advanced capitalist countries debated the design of the post-Second World War international financial architecture, they arrived at a consensus that it should be centred on the U.S. dollar. The principal reason for this decision was the overwhelming dominance and productive superiority of the U.S. economy.
By the early 1970s, however, this superiority had begun to erode. Nevertheless, as Costas Lapavitsas has argued, “dollar dominance persisted and deepened through structural dependence as global trade, finance and reserves remained locked into dollar circuits, sustained by military power and institutional inertia despite the declining share of the United States in the world economy.”
It is in this context that Gayantha Dehiwatte’s argument acquires its significance. For him, de-dollarization does not simply mean replacing the dollar with another international currency. Rather, it entails transforming the structures of power that underpin dollar hegemony and reproducing a global order based on dependence and financial subordination. In this sense, de-dollarization is not merely a monetary reform but part of a broader project of restructuring the international order itself.
Ultimately, the argument points toward the possibility of imagining a new world order founded on the principles of democracy, equality, and ecological sustainability.
The writer is a retired teacher at the University of Peradeniya
Email: sumane_l@yahoo.com
Revieved by Sumanasiri Liyanage
(Text of a recent speech.)
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