By Vishvanath
Sri Lanka is apparently coming under a pall of political uncertainty, again, following Tuesday’s local government (LG) elections; the government and the Opposition are jockeying for control of the hung local councils across the country.
The NPP’s victory in last year’s presidential and parliamentary elections dealt a severe blow to the morale of the Opposition, which was on the defensive for months thereafter. But a drastic decline in the ruling NPP’s vote share—from 61.56% in the 2024 general election to 43.26% in Tuesday’s LG polls—and the fact that the opponents of the government managed to improve their electoral performance significantly and won, among them, more seats in the newly elected councils than the NPP have boosted the morale of the Opposition, which is likely to go on the offensive hereafter, and even stage public protests in a bid to unsettle the government.
Members of the local council play a crucial role in mobilising support for political parties at the grassroots level. They are the political version of worker bees. Now, the NPP has 2,926 LG councillors and the Opposition 4,866. Thus, the Opposition parties can more actively engage in political activity at the grassroots level than the government although they have not been able to win enough local councils.
The NPP and the SJB are trying every trick in the book to muster working majorities in the hung councils. They refused to join forces with other political parties and independent groups and went it alone in Tuesday’s elections, but circumstances have compelled them to soften their stands and even compromise their principles for expediency. They have resorted to political horse trading, which is the name of the game in politics.
The lowest tire of government in Sri Lanka was never free from volatility and chaos. The LG institutions were characterised by leadership struggles and cloak-and-gagger intrigue, which gave their heads sleepless nights; instances abounded where the ruling party councillors sided with their opponents to defeat council budgets to settle scores with their chairpersons or mayors. But this time around the situation is likely to be even more chaotic, given the intensity of the political battle the government and the Opposition are fighting over the hung councils.
Sri Lanka finds itself in a situation where its ailing economy must take precedence over everything else, but everybody seems preoccupied with politics oblivious to what is unfolding on the economic front. Lessons learnt during the height of the current economic crisis about two years ago seem to have been forgotten.
There has been a drop in the country’s gross official foreign exchange reserves to USD 6,326 from USD 6,531 in March 2025. Concerns are being raised about a possible delay in the release of the next tranche of the IMF extended fund facility due to the government’s failure to increase electricity tariffs.
The US tariff issue is far from resolved, and there is no guarantee that President Donald Trump will lend a sympathetic ear to Sri Lanka’s appeal for relief. The Asian Development Bank has forecast a moderate economic growth rate of 3.9% for Sri Lanka in the current year. This should be viewed against the ADB growth forecasts for Bhutan and India; they 8.5% and 6.7%, respectively. SJB MP Dr. Harsha de Silva argued in the parliament on Thursday that Sri Lanka would not be able to achieve its development goals until 2070, if the current growth rate persisted; he warned that it might be even lower in 2026.
The ongoing US-China trade war and the Indo-Pakistan conflict could adversely impact the Sri Lankan economy. Worse, the repayment of bilateral debt will have to resume in 2028. The need for maintaining a higher growth cannot be overstated.
The World Bank (WB) has warned that in spite of fiscal and external buffers are being built, downside risks remain exceptionally high for Sri Lanka, and factors such as a moderating global growth, high global interest rates and unprecedented trade policy uncertainty are likely to constrain capital inflows, deter investment and weaken export demand, resulting in potential trade-related job losses. This is a disturbing proposition. At this juncture, the focus of both the government and the Opposition must be on measures that have been recommended for achieving stronger medium-term growth, such as ensuring policy consistency and pursuing structural reforms to support macro-fiscal-financial stability and enhance competitiveness and attract non-debt-creating capital inflows. WB has also cautioned that further regressive indirect taxes could worsen Sri Lanka’s poverty outlook. “The increased prevalence of stunting and malnutrition raises concerns about long-term human capital development and intergenerational poverty transmission. Limited economic opportunities and consequent increased outmigration of skilled workers pose concerns for the recovery, and the quality of public service delivery, particularly in an aging society.” If this prognosis is anything to go by, the country is likely to face far more social issues in time to come unless it improves its performance on the economic front, and allocate more funds for social security and poverty alleviation.
The debate between the government and the Opposition has been confined to the parliament, where more often than not political issues dominate its proceedings even during the annual budget debates. It is characterised by rhetoric and political statements rather than dispassionate analysis of economic issues and a concerted effort to find solutions.
Unless the debate on the economy reaches the other levels of society, with the political parties addressing crucial economic issues and challenges more vigorously, the public will not be so concerned about the country’s economic situation as to realise the need to prioritise the economy over partisan politics, and work harder towards enhancing national productivity and making more sacrifices.
After being elevated to the presidency amidst political upheavals in 2022, Ranil Wickremesinghe likened his arduous mission to save the economy to Grusha’s unnervingly shaky trek across a dilapidated rope bridge, carrying baby Michael, in the Caucasian Chalk Circle. The perilous journey is not yet over. Worryingly, the incumbent government leaders and their opponents have chosen to trade blows on the crumbling rope bridge, heedless of the screaming baby.
