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Trump tariffs and their effect on world trade and economy with particular

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Apparels

reference to Sri Lanka – Part III

(Continued from yesterday)

Textile Industry Significance

The textile and apparel sector holds outsised importance in Sri Lanka’s economy. It accounts for approximately 40% of the country’s total exports and directly employs around 350,000 workers, predominantly women from rural areas, for whom these jobs represent a crucial pathway out of poverty. When indirect employment in supporting industries is included, the sector supports the livelihoods of over one million Sri Lankans.

The industry’s development was initially facilitated through quotas assigned by the Multi-Fiber Agreement (1974-1994), which allocated specific export volumes to developing countries. When this agreement expired, Sri Lanka managed to maintain its position in global apparel supply chains by focusing on higher-value products, ethical manufacturing practices, and reliability. The country has positioned itself as a producer of quality garments, particularly lingerie, activewear, and swimwear for major global brands.

However, this success has created a structural dependency on continued access to markets in wealthy countries, particularly the United States. As the Secretary General of the Joint Apparel Association Forum, the main representative body for Sri Lanka’s

apparel and textile exporters, bluntly stated following the tariff announcement, “We have no alternate market that we can possibly target instead of the US.”

This dependency is reinforced by the industry’s integration into global supply chains dominated by U.S. brands and retailers. Many Sri Lankan factories operate on thin margins as contract manufacturers for these international companies, with limited ability to quickly pivot to new markets or product categories. The industry has also made significant investments in compliance with U.S. buyer requirements and sustainability certifications, creating path dependencies that make rapid adaptation to new market conditions extremely challenging.

The textile and apparel sector’s significance extends beyond its direct economic contributions. It has been a crucial source of foreign exchange earnings for a country that has consistently run trade deficits and struggled with external debt sustainability. In the ten years leading up to Sri Lanka’s default on external debt (2012-2021), debt repayments amounted to an average of 41% of export earnings, highlighting how vital steady export revenues are to the country’s ability to service its international obligations.

The sector has also played an important role in Sri Lanka’s social development, providing formal employment opportunities for women and contributing to poverty reduction in rural areas. Many of the industry’s workers are the primary breadwinners for their families, and their wages support extended family networks in economically disadvantaged regions of the country.

Given this context, the imposition of a 44% tariff on Sri Lankan goods, with the textile and apparel sector likely to bear the brunt of the impact, represents not merely an economic challenge but a potential social crisis for hundreds of thousands of vulnerable workers and their dependents.

SPECIFIC IMPACT OF TRUMP TARIFFS ON SRI LANKA

The imposition of a 44% tariff on Sri Lankan exports to the United States represents a seismic shock to an economy still recovering from its worst crisis in decades. This section examines the immediate economic consequences, the implications for Sri Lanka’s debt sustainability, and the broader social and political ramifications of this dramatic policy shift.

Immediate Economic Consequences

The most immediate impact of President Trump’s tariffs will be a severe erosion of Sri Lankan goods’ competitiveness in the U.S. market. A 44% price increase effectively prices many Sri Lankan products out of reach for American consumers and businesses, particularly in price-sensitive categories like apparel, where margins are already thin and competition from other producing countries is intense.

Economic analysts project significant declines in export volumes as a result. The PublicFinance.lk think tank estimates that the new tariff rates will lead to a 20% fall in exports to America and an annual loss of approximately $300 million in foreign exchange earnings. Given that Sri Lanka’s total merchandise exports in 2024 were around $13 billion, this represents a substantial blow to the country’s trade balance and economic growth prospects.

The textile and apparel sector will bear the brunt of this impact. Industry representatives have warned that numerous factories may be forced to reduce production or close entirely if they cannot quickly find alternative markets for their products. The Joint Apparel Association Forum has indicated that smaller manufacturers with less diversified customer bases and limited financial reserves will be particularly vulnerable to closure.

These production cutbacks and potential closures would translate directly into job losses. Conservative estimates suggest that tens of thousands of workers in the textile sector could lose their livelihoods if the tariffs remain in place for an extended period. Given that many of these workers are women from rural areas with limited alternative employment opportunities, the social impact of these job losses would be particularly severe.

Beyond the direct effects on textile exports, the tariffs will have ripple effects throughout Sri Lanka’s economy. Supporting industries such as packaging, logistics, and input suppliers will face reduced demand. The loss of foreign exchange earnings will put pressure on the Sri Lankan rupee, potentially leading to currency depreciation that would increase the cost of essential imports including fuel, food, and medicine.

The timing of these tariffs is especially problematic given Sri Lanka’s fragile economic recovery. After experiencing a GDP contraction of 7.8% in 2022 during the height of the economic crisis, the country had only recently returned to modest growth. The IMF had projected GDP growth of 3.1% for 2025, but this forecast now appears overly optimistic in light of the tariff shock. Some economists are already revising their growth projections downward, with some suggesting growth could fall below 2% if the full impact of the tariffs materializes. We must hope they will be proven wrong.

Impact on Sri Lanka’s Debt Sustainability

Perhaps the most concerning aspect of Trump’s tariffs is their potential to undermine Sri Lanka’s hard-won progress on debt sustainability. After defaulting on its external debt in April 2022, the country has undergone a painful restructuring process that concluded only in December 2024. This restructuring was predicated on assumptions about Sri Lanka’s future ability to generate foreign exchange to service its remaining debt obligations.

The IMF’s debt sustainability analysis, which formed the basis for the restructuring agreement, focused almost exclusively on debt as a share of GDP while making insufficient distinction between domestic and foreign debt. This approach has been criticized for ignoring the structural trade deficit and the critical importance of foreign currency earnings to Sri Lanka’s ability to meet its external obligations.

The $300 million annual reduction in export earnings projected as a result of the tariffs directly threatens these calculations. Sri Lanka’s external debt stood at approximately $55 billion in 2023 (about 65% of its GDP), and even after restructuring, debt service payments will consume a significant portion of the country’s foreign exchange earnings in coming years.

In the decade preceding Sri Lanka’s default (2012-2021), debt repayments consumed an average of 41% of export earnings, an unsustainably high ratio that contributed directly to the eventual crisis. The loss of export revenues due to President Trump’s tariffs risks pushing this ratio back toward dangerous levels, potentially setting the stage for renewed debt distress despite the recent restructuring.

This situation highlights a fundamental flaw in the approach taken by international financial institutions to debt sustainability in developing countries. Unlike the treatment afforded to West Germany through the London Debt Agreement of 1953, where future debt repayments were explicitly linked to the country’s trade surplus and capped at 3% of export earnings—Sri Lanka and similar countries are expected to meet rigid repayment schedules regardless of their trade performance or external shocks beyond their control.

The tariffs thus expose the precariousness of Sri Lanka’s economic recovery and the fragility of the international debt architecture that underpins it. Without significant adjustments to account for this external shock, the country could find itself sliding back toward debt distress despite all the sacrifices made by its people during the recent adjustment period.

Social and Political Implications

The economic consequences of Trump’s tariffs will inevitably translate into social and political challenges for Sri Lanka. The country has already experienced significant social strain due to the austerity measures implemented under the IMF program, including tax increases, subsidy reductions, and public sector wage restraint. The additional economic pain caused by export losses and job cuts risks exacerbating social tensions and potentially triggering renewed protests.

The textile industry’s workforce is predominantly female, with many workers supporting extended family networks. Job losses in this sector would therefore have disproportionate impacts on women’s economic empowerment and household welfare, potentially reversing progress on gender equality and poverty reduction. Many of these workers come from rural areas where alternative formal employment opportunities are scarce, raising the spectre of increased rural poverty and potential migration pressures.

Politically, the tariff shock presents a significant challenge for President Anura Kumara Dissanayake’s government, which came to power promising economic revival and relief from the hardships of the crisis period. The administration has appointed an advisory committee consisting of government officials and private sector representatives to study the impact of the tariffs and develop response strategies, but its options are constrained by limited fiscal space and the conditions of the IMF programme.

The situation also raises questions about Sri Lanka’s foreign policy orientation. The country has traditionally maintained balanced relationships with major powers, including the United States, China, and India. However, the unilateral imposition of punitive tariffs by the United States may prompt some policymakers to reconsider this balance and potentially look more favourably on economic engagement with China, which has been a major infrastructure investor in Sri Lanka through its Belt and Road Initiative.

Such a reorientation would have significant geopolitical implications in the Indian Ocean region, where great power competition has intensified in recent years. It could potentially accelerate the fragmentation of the global economy into competing blocs, a trend that President Trump’s broader tariff policy seems designed to encourage despite its economic costs.

The social and political fallout from the tariffs thus extends far beyond immediate economic indicators, potentially reshaping Sri Lanka’s development trajectory and its place in the regional and global order. For a country still recovering from political instability triggered by economic crisis, these additional pressures come at a particularly vulnerable moment.

BROADER IMPLICATIONS FOR DEVELOPING ECONOMIES

Sri Lanka’s experience with Trump’s tariffs is not unique. The sweeping nature of these trade measures has created similar challenges for developing economies across the Global South, revealing structural vulnerabilities in the international economic system and raising fundamental questions about the sustainability of export-led development models in an era of rising protectionism.

Comparative Analysis with Other Affected Developing Countries

While Sri Lanka faces a punishing 44% tariff rate, it is not alone in confronting severe trade barriers. Bangladesh, another South Asian country heavily dependent on textile exports, has been hit with a 37% tariff. Like Sri Lanka, Bangladesh has built its development strategy around its garment industry, which accounts for more than 80% of its export earnings and employs approximately 4 million workers, mostly women.

Other significantly affected developing economies include Vietnam (46% tariff), Cambodia (49%), Pakistan (29%), and several African nations that had previously benefited from preferential access to the U.S. market through programs like the African Growth and Opportunity Act (AGOA). Many of these countries share common characteristics, relatively low per capita incomes, heavy reliance on a narrow range of export products, and limited domestic markets that make export-oriented growth their primary development pathway.

The pattern of tariff rates reveals a troubling dynamic, some of the highest tariffs have been imposed on countries that can least afford the economic shock. While wealthy nations like Japan or Germany certainly face challenges from these trade

barriers, they possess diversified economies, substantial domestic markets, and financial resources to cushion the impact. By contrast, countries like Sri Lanka or Bangladesh have far fewer economic buffers and face potentially devastating consequences from similar or higher tariff rates.

This disparity highlights how President Trump’s “reciprocal tariff” formula, ostensibly designed to create a level playing field, actually reinforces existing power imbalances in the global economy. By treating trade deficits as the primary metric for determining tariff rates, the policy ignores the vast differences in economic development, productive capacity, and financial resilience between countries at different stages of development.

Structural Vulnerabilities of Export-Dependent Economies

The tariff shock has exposed fundamental vulnerabilities in the export-led development model that has dominated economic thinking about the Global South for decades. Since the 1980s, international financial institutions have consistently advised developing countries to orient their economies toward export markets, specialize according to comparative advantage, and integrate into global value chains as a path to economic growth and poverty reduction.

This model has delivered significant benefits in many cases. Countries like Vietnam, Bangladesh, and, to some extent, Sri Lanka have achieved impressive poverty reduction and economic growth by expanding their manufacturing exports. However, President Trump’s tariffs reveal the precariousness of development strategies built on continued access to wealthy consumer markets, particularly the United States.

Several structural vulnerabilities have become apparent,

1. First, export concentration creates acute dependency on a small number of markets and products. When Sri Lanka sends 23% of its exports to the United States and concentrates 40% of its total exports in textiles and apparel, it becomes extraordinarily vulnerable to policy changes affecting that specific market-product combination.

Diversification, both of export markets and products, has often been acknowledged as desirable in theory but has proven difficult to implement in practice due to established trade patterns, buyer relationships, and specialized production capabilities.

2. Second, participation in global value chains often traps developing countries in lower-value segments of production with limited opportunities for upgrading. Sri Lanka’s textile industry, while more advanced than some of its regional competitors, still primarily engages in contract manufacturing rather than controlling higher-value activities like design, branding, or retail. This position in the value chain yields lower returns and creates dependency on decisions made by lead firms in wealthy countries.

3. Third, the mobility of capital relative to labour creates a fundamental power imbalance. If tariffs make production in Sri Lanka uneconomical, global brands can relatively quickly shift their sourcing to other countries with lower tariffs or costs. However, Sri Lankan workers cannot similarly relocate, leaving them bearing the brunt of adjustment costs through unemployment and wage depression.

4. Fourth, developing countries typically lack the fiscal space to provide adequate social protection during economic shocks. Unlike wealthy nations that can deploy extensive safety nets during trade disruptions, countries like Sri Lanka, already implementing austerity measures under IMF programmes, have limited capacity to support displaced workers or affected industries. This exacerbates the social costs of trade shocks and can trigger political instability. (To be continued)

(The writer served as the Minister of Justice, Finance and Foreign Affairs of Sri Lanka)

Disclaimer:

This article contains projections and scenario-based analysis based on current economic trends, policy statements, and historical behaviour patterns. While every effort has been made to ensure factual accuracy, using publicly available data and established economic models, certain details, particularly regarding future policy decisions and their impacts, remain hypothetical. These projections are intended to inform discussion and analysis, not to predict outcomes with certainty.



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Reconciliation: Grand Hopes or Simple Steps

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In politics, there is the grand language and the simple words. As they say in North America, you don’t need a $20-word or $50-word where a simple $5-world will do. There is also the formal and the functional. People of different categories can functionally get along without always needing formal arrangements involving constitutional structures and rights declarations. The latter are necessary and needed to protect the weak from the bullies, especially from the bullying instruments of the state, or for protecting a small country from a Trump state. In the society at large, people can get along in their daily lives in spite of differences between them, provided they are left alone without busybody interferences.

There have been too many busybody interferences in Sri Lanka in all the years after independence, so much so they exploded into violence that took a toll on everyone for as many as many as 26 (1983-2009) years. The fight was over grand language matters – selective claims of history, sovereignty assertions and self-determination counters, and territorial litigations – you name it. The lives of ordinary people, even those living in their isolated corners and communicating in the simple words of life, were turned upside down. Ironically in their name and as often in the name of ‘future generations yet unborn’ – to recall the old political rhetoric always in full flight. The current American anti-abortionists would have loved this deference to unborn babies.

At the end of it all came the call for Reconciliation. The term and concept are a direct outcome of South Africa’s post-apartheid experience. Quite laudably, the concept of reconciliation is based on choosing restorative justice as opposed to retributive justice, forgiveness over prosecution and reparation over retaliation. The concept was soon turned into a remedial toolkit for societies and polities emerging from autocracies and/or civil wars. Even though, South Africa’s apartheid and post-apartheid experiences are quite unique and quite different from experiences elsewhere, there was also the common sharing among them of both the colonial and postcolonial experiences.

The experience of facilitating and implementing reconciliation, however, has not been wholly positive or encouraging. The results have been mixed even in South Africa, even though it is difficult to imagine a different path South Africa could have taken to launch its post-apartheid era. There is no resounding success elsewhere, mostly instances of non-starters and stallers. There are also signs of acknowledgement among activists and academics that the project of reconciliation has more roadblocks to overcome than springboards for taking off.

Ultimately, if state power is not fully behind it the reconciliation project is not likely to take off, let alone succeed. The irony is that it is the abuse of state power that created the necessity for reconciliation in the first place. Now, the full blessing and weight of state power is needed to deliver reconciliation.

Sri Lanka’s Reconciliation Journey

After the end of the war in 2009, Sri Lanka was an obvious candidate for reconciliation by every objective measure or metric. This was so for most of the external actors, but there were differences in the extent of support and in their relationship with the Sri Lankan government. The Rajapaksa government that saw the end of the war was clearly more reluctant than enthusiastic about embarking on the reconciliation journey. But they could not totally disavow it because of external pressure. The Tamil political leadership spurred on by expatriate Tamils was insistent on maximalist claims as part of reconciliation, with a not too subtle tone of retribution rather than restoration.

As for the people at large, there was lukewarm interest among the Sinhalese at best, along with strident opposition by the more nationalistic sections. The Tamils living in the north and east had too much to do putting their shattered lives together to have any energy left to expend on the grand claims of reconciliation. The expatriates were more fortuitously placed to be totally insistent on making maximalist claims and vigorously lobbying the western governments to take a hardline against the Sri Lankan government. The singular bone of contention was about alleged war crimes and their investigation, and that totally divided the political actors over the very purpose of reconciliation – grand or simple.

By far the most significant contribution of the Rajapaksa government towards reconciliation was the establishment of the Lessons Learnt and Reconciliation Commission (LLRC) that released its Report and recommendations on December 16, 2011, which turned out to be the 40th anniversary of the liberation of Bangladesh. I noted the irony of it in my Sunday Island article at that time.

Its shortcomings notwithstanding, the LLRC Report included many practical recommendations, viz., demilitarization of the North and East; dismantling of High Security Zones and the release of confiscated houses and farmland back to the original property owners; rehabilitation of impacted families and child soldiers; ending unlawful detention; and the return of internally displaced people including Muslims who were forced out of Jaffna during the early stages of the war. There were other recommendations regarding the record of missing persons and claims for reparation.

The implementation of these practical measures was tardy at best or totally ignored at worst. What could have been a simple but effective reconciliation program of implementation was swept away by the assertion of the grand claims of reconciliation. In the first, and so far only, Northern Provincial Council election in 2013, the TNA swept the board, winning 30 out of 38 seats in provincial council. The TNA’s handpicked a Chief Minister parachuted from Colombo, CV Wigneswaran, was supposed to be a bridge builder and was widely expected to bring much needed redress to the people in the devastated districts of the Northern Province. Instead, he wasted a whole term – bandying the claim of genocide and the genealogy of Tamil. Neither was his mandated business, and rather than being a bridge builder he turned out to be a total wrecking ball.

The Ultimate Betrayal

The Rajapaksa government mischievously poked the Chief Minister by being inflexible on the meddling by the Governor and the appointment of the Provincial Secretary. The 2015 change in government and the duopolistic regime of Maithripala Sirisena as President and Ranil Wickremesinghe as Prime Minister brought about a change in tone and a spurt for the hopes of reconciliation. In the parliamentary contraption that only Ranil Wickremesinghe was capable of, the cabinet of ministers included both UNP and SLFP MPs, while the TNA was both a part of the government and the leading Opposition Party in parliament. Even the JVP straddled the aisle between the government and the opposition in what was hailed as the yahapalana experiment. The experiment collapsed even as it began by the scandal of the notorious bond scam.

The project of reconciliation limped along as increased hopes were frustrated by persistent inaction. Foreign Minister Mangala Samaraweera struck an inclusive tone at the UNHRC and among his western admirers but could not quite translate his promises abroad into progress at home. The Chief Minister proved to be as intransigent as ever and the TNA could not make any positively lasting impact on the one elected body for exercising devolved powers, for which the alliance and all its predecessors have been agitating for from the time SJV Chelvanayakam broke away from GG Ponnambalam’s Tamil Congress in 1949 and set up the Ilankai Tamil Arasu Kadchi aka the Federal Party.

The ultimate betrayal came when the TNA acceded to the Sirisena-Wickremesinghe government’s decision to indefinitely postpone the Provincial Council elections that were due in 2018, and let the Northern Provincial Council and all other provincial councils slip into abeyance. That is where things are now. There is a website for the Northern Provincial Council even though there is no elected council or any indication of a date for the long overdue provincial council elections. The website merely serves as a notice board for the central government’s initiatives in the north through its unelected appointees such as the Provincial Governor and the Secretary.

Yet there has been some progress made in implementing the LLRC recommendations although not nearly as much as could have been done. Much work has been done in the restoration of physical infrastructure but almost all of which under contracts by the central government without any provincial participation. Clearing of the land infested by landmines is another area where there has been much progress. While welcoming de-mining, it is also necessary to reflect on the madness that led to such an extensive broadcasting of landmines in the first place – turning farmland into killing and maiming fields.

On the institutional front, the Office on Missing Persons (OMP) and the Office for Reparations have been established but their operations and contributions are yet being streamlined. These agencies have also been criticized for their lack of transparency and lack of welcome towards victims. While there has been physical resettlement of displaced people their emotional rehabilitation is quite a distance away. The main cause for this is the chronically unsettled land issue and the continuingly disproportionate military presence in the northern districts.

(Next week: Reconciliation and the NPP Government)

by Rajan Philips

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The Rise of Takaichi

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Japan PM Sanae Takaichi after election (ABC News)

Her victory is remarkable, and yet, beyond the arithmetic of seats, it is the audacity, unpredictability, and sheer strategic opportunism of Sanae Takaichi that has unsettled the conventions of Japanese politics. Japan now confronts the uncharted waters of a first female prime minister wielding a super-majority in the lower house, an electoral outcome amplified by the external pressures of China’s escalating intimidation. Prior to the election, Takaichi’s unequivocal position on Taiwan—declaring that a Chinese attack could constitute an existential threat justifying Japan’s right to collective self-defence—drew from Beijing a statement of unmistakable ferocity: “If Japan insists on this path, there will be consequences… heads will roll.” Yet the electorate’s verdict on 8 February 2026 was unequivocal: a decisive rejection of external coercion and an affirmation of Japan’s strategic autonomy. The LDP’s triumph, in this sense, is less an expression of ideological conformity than a popular sanction for audacious leadership in a period of geopolitical uncertainty.

Takaichi’s ascent is best understood through the lens of calculated audacity, tempered by a comprehension of domestic legitimacy that few of her contemporaries possess. During her brief tenure prior to the election, she orchestrated a snap lower house contest merely months after assuming office, exploiting her personal popularity and the fragility of opposition coalitions. Unlike predecessors who relied on incrementalism and cautious negotiation within the inherited confines of party politics, Takaichi maneuvered with precision, converting popular concern over regional security and economic stagnation into tangible parliamentary authority. The coalescence of public anxiety, amplified by Chinese threats, and her own assertive persona produced a political synergy rarely witnessed in postwar Japan.

Central to understanding her political strategy is her treatment of national security and sovereignty. Takaichi’s articulation of Japan’s response to a hypothetical Chinese aggression against Taiwan was neither rhetorical flourish nor casual posturing. Framing such a scenario as a “survival-threatening situation” constitutes a profound redefinition of Japanese strategic calculus, signaling a willingness to operationalise collective self-defence in ways previously avoided by postwar administrations. The Xi administration’s reaction—including restrictions on Japanese exports, delays in resuming seafood imports, and threats against commercial and civilian actors—unintentionally demonstrated the effectiveness of her approach: coercion produced cohesion rather than capitulation. Japanese voters, perceiving both the immediacy of threat and the clarity of leadership, rewarded decisiveness. The result was a super-majority capable of reshaping the constitutional and defence architecture of the nation.

This electoral outcome cannot be understood without reference to the ideological continuity and rupture within the LDP itself. Takaichi inherits a party long fractured by internal factionalism, episodic scandals, and the occasional misjudgment of public sentiment. Yet her rise also represents the maturation of a distinct right-of-centre ethos: one that blends assertive national sovereignty, moderate economic populism, and strategic conservatism. By appealing simultaneously to conservative voters, disillusioned younger demographics, and those unsettled by regional volatility, she achieved a political synthesis that previous leaders, including Fumio Kishida and Shigeru Ishiba, failed to materialize. The resulting super-majority is an institutional instrument for the pursuit of substantive policy transformation.

Takaichi’s domestic strategy demonstrates a sophisticated comprehension of the symbiosis between economic policy, social stability, and political legitimacy. The promise of a two-year freeze on the consumption tax for foodstuffs, despite its partial ambiguity, has served both as tangible reassurance to voters and a symbolic statement of attentiveness to middle-class anxieties. Inflation, stagnant wages, and a protracted demographic decline have generated fertile ground for popular discontent, and Takaichi’s ability to frame fiscal intervention as both pragmatic and responsible has resonated deeply. Similarly, her attention to underemployment, particularly the activation of latent female labour, demonstrates an appreciation for structural reform rather than performative gender politics: expanding workforce participation is framed as an economic necessity, not a symbolic gesture.

Her approach to defence and international relations further highlights her strategic dexterity. The 2026 defence budget, reaching 9.04 trillion yen, the establishment of advanced missile capabilities, and the formation of a Space Operations Squadron reflect a commitment to operationalising Japan’s deterrent capabilities without abandoning domestic legitimacy. Takaichi has shown restraint in presentation while signaling determination in substance. She avoids ideological maximalism; her stated aim is not militarism for its own sake but the assertion of national interest, particularly in a context of declining U.S. relative hegemony and assertive Chinese manoeuvres. Takaichi appears to internalize the balance between deterrence and diplomacy in East Asian geopolitics, cultivating both alliance cohesion and autonomous capability. Her proposed constitutional revision, targeting Article 9, must therefore be read as a calibrated adjustment to legal frameworks rather than an impulsive repudiation of pacifist principles, though the implications are inevitably destabilizing from a regional perspective.

The historical dimension of her politics is equally consequential. Takaichi’s association with visits to the Yasukuni Shrine, her questioning of historical narratives surrounding wartime atrocities, and her engagement with revisionist historiography are not merely symbolic gestures but constitute deliberate ideological positioning within Japan’s right-wing spectrum.

Japanese politics is no exception when it comes to the function of historical narrative as both ethical compass and instrument of legitimacy: Takaichi’s actions signal continuity with a nationalist interpretation of sovereignty while asserting moral authority over historical memory. This strategic management of memory intersects with her security agenda, particularly regarding Taiwan and the East China Sea, allowing her to mobilize domestic consensus while projecting resolve externally.

The Chinese reaction, predictably alarmed and often hyperbolic, reflects the disjuncture between external expectation and domestic reality. Beijing’s characterization of Takaichi as an existential threat to regional peace, employing metaphors such as the opening of Pandora’s Box, misinterprets the domestic calculation. Takaichi’s popularity did not surge in spite of China’s pressure but because of it; the electorate rewarded the demonstration of agency against perceived coercion. The Xi administration’s misjudgment, compounded by a declining cadre of officials competent in Japanese affairs, illustrates the structural asymmetries that Takaichi has been able to exploit: external intimidation, when poorly calibrated, functions as political accelerant. Japan’s electorate, operating with acute awareness of both historical precedent and contemporary vulnerability, effectively weaponized Chinese miscalculation.

Fiscal policy, too, serves as an instrument of political consolidation. The tension between her proposed consumption tax adjustments and the imperatives of fiscal responsibility illustrates the deliberate ambiguity with which Takaichi operates: she signals responsiveness to popular needs while retaining sufficient flexibility to negotiate market and institutional constraints. Economists note that the potential reduction in revenue is significant, yet her credibility rests in her capacity to convince voters that the measures are temporary, targeted, and strategically justified. Here, the interplay between domestic politics and international market perception is critical: Takaichi steers both the expectations of Japanese citizens and the anxieties of global investors, demonstrating a rare fluency in multi-layered policy signaling.

Her coalition management demonstrates a keen strategic instinct. By maintaining the alliance with the Japan Innovation Party even after securing a super-majority, she projects an image of moderation while advancing audacious policies. This delicate balancing act between consolidation and inclusion reveals a grasp of the reality that commanding numbers in parliament does not equate to unfettered authority: in Japan, procedural legitimacy and coalition cohesion remain crucial, and symbolic consensus continues to carry significant cultural and institutional weight.

Yet, perhaps the most striking element of Takaichi’s victory is the extent to which it has redefined the interface between domestic politics and regional geopolitics. By explicitly linking Taiwan to Japan’s collective self-defence framework, she has re-framed public understanding of regional security, converting existential anxiety into political capital. Chinese rhetoric, at times bordering on the explicitly menacing, highlights the efficacy of this strategy: the invocation of direct consequences and the threat of physical reprisal amplified domestic perceptions of threat, producing a rare alignment of public opinion with executive strategy. In this sense, Takaichi operates not merely as a domestic politician but as a conductor of transnational strategic sentiment, demonstrating an acute awareness of perception, risk, and leverage that surpasses the capacity of many predecessors. It is a quintessentially Machiavellian maneuver, executed with Japanese political sophistication rather than European moral theorisation. Therefore, the rise of Sanae Takaichi represents more than the triumph of a single politician: it signals a profound re-calibration of the Japanese political order.

by Nilantha Ilangamuwa

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Rebuilding Sri Lanka’s Farming After Cyclone Ditwah: A Reform Agenda, Not a Repair Job

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Paddy field affected by floods

Three months on (February 2026)

Three months after Cyclone Ditwah swept across Sri Lanka in late November 2025, the headlines have moved on. In many places, the floodwaters have receded, emergency support has reached affected communities, and farmers are doing what they always do, trying to salvage what they can and prepare for the next season. Yet the most important question now is not how quickly agriculture can return to “normal”. It is whether Sri Lanka will rebuild in a way that breaks the cycle of risks that made Ditwah so devastating in the first place.

Ditwah was not simply a bad storm. It was a stress test for our food system, our land and water management, and the institutions meant to protect livelihoods. It showed, in harsh detail, how quickly losses multiply when farms sit in flood pathways, when irrigation and drainage are designed for yesterday’s rainfall, when safety nets are thin, and when early warnings do not consistently translate into early action.

In the immediate aftermath, the damage was rightly measured in flooded hectares, broken canals and damaged infrastructure, and families who lost a season’s worth of income overnight. Those impacts remain real. But three months on, the clearer lesson is why the shock travelled so far and so fast. Over time, exposure has become the default: cultivation and settlement have expanded into floodplains and unstable slopes, driven by land pressure and weak enforcement of risk-informed planning. Infrastructure that should cushion shocks, tanks, canals, embankments, culverts, too often became a failure point because maintenance has lagged and design standards have not kept pace with extreme weather. At farm level, production risk remains concentrated, with limited diversification and high sensitivity to a single event arriving at the wrong stage of the season. Meanwhile, indebted households with delayed access to liquidity struggled to recover, and the information reaching farmers was not always specific enough to prompt practical decisions at the right time.

If Sri Lanka takes only one message from Ditwah, it should be this: recovery spending, by itself, is not resilience. Rebuilding must reduce recurring losses, not merely replace what was damaged. That requires choices that are sometimes harder politically and administratively, but far cheaper than repeating the same cycle of emergency, repair, and regret.

First, Sri Lanka needs farming systems that do not collapse in an “all-or-nothing” way when water stays on fields for days. That means making diversification the norm, not the exception. It means supporting farmers to adopt crop mixes and planting schedules that spread risk, expanding the availability of stress-tolerant and short-duration varieties, and treating soil health and field drainage as essential productivity infrastructure. It also means paying far more attention to livestock and fisheries, where simple measures like safer siting, elevated shelters, protected feed storage, and better-designed ponds can prevent avoidable losses.

Second, we must stop rebuilding infrastructure to the standards of the past. Irrigation and drainage networks, rural roads, bridges, storage facilities and market access are not just development assets; they are risk management systems. Every major repair should be screened through a simple question: will this investment reduce risk under today’s and tomorrow’s rainfall patterns, or will it lock vulnerability in for the next 20 years? Design standards should reflect projected intensity, not historical averages. Catchment-to-field water management must combine engineered solutions with natural buffers such as wetlands, riparian strips and mangroves that reduce surge, erosion and siltation. Most importantly, hazard information must translate into enforceable land-use decisions, including where rebuilding should not happen and where fair support is needed for people to relocate or shift livelihoods safely.

Third, Sri Lanka must share risk more fairly between farmers, markets and the state. Ditwah exposed how quickly a climate shock becomes a debt crisis for rural households. Faster liquidity after a disaster is not a luxury; it is the difference between recovery and long-term impoverishment. Crop insurance needs to be expanded and improved beyond rice, including high-value crops, and designed for quicker payouts. At the national level, rapid-trigger disaster financing can provide immediate fiscal space to support early recovery without derailing budgets. Public funding and concessional climate finance should be channelled into a clear pipeline of resilience investments, rather than fragmented projects that do not add up to systemic change.

Fourth, early warning must finally become early action. We need not just better forecasts but clearer, localised guidance that farmers can act on, linked to reservoir levels, flood risk, and the realities of protecting seed, inputs and livestock. Extension services must be equipped for a climate era, with practical training in climate-smart practices and risk reduction. And the data systems across meteorology, irrigation, agriculture and social protection must talk to each other so that support can be triggered quickly when thresholds are crossed, instead of being assembled after losses are already locked in.

What does this mean in practice? Over the coming months, the focus should be on completing priority irrigation and drainage works with “build-back-better” standards, supporting replanting packages that include soil and drainage measures rather than seed alone, and preventing distress coping through temporary protection for the most vulnerable households. Over the next few years, the country should aim to roll out climate-smart production and advisory bundles in selected river basins, institutionalise agriculture-focused post-disaster assessments that translate into funded plans, and pilot shock-responsive safety nets and rapid-trigger insurance in cyclone-exposed districts. Over the longer term, repeated loss zones must be reoriented towards flood-compatible systems and slope-stabilising perennials, while catchment rehabilitation and natural infrastructure restoration are treated as productivity investments, not optional environmental add-ons.

None of this is abstract. The cost of inaction is paid in failed harvests, lost income, higher food prices and deeper rural debt. The opportunity is equally concrete: if Sri Lanka uses the post-Ditwah period to modernise agriculture making production more resilient, infrastructure smarter, finance faster and institutions more responsive, then Ditwah can become more than a disaster. It can become the turning point where the country decides to stop repairing vulnerability and start building resilience.

By Vimlendra Sharan,
FAO Representative for Sri Lanka and the Maldives

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