Beirut (AP) — Lebanon and Sri Lanka may be globally separated, but a history of political turmoil and violence I'm sharing. In the collapse of the once prosperous economy, plagued by corruption, sponsorship, nepotism and incompetence.
Toxic combinations have caused disasters in both currency collapse, shortages, triple-digit inflation, and increased hunger. Gas meandering queue. The decimated middle class. An outflow of experts who may have helped the reconstruction.
There are usually no moments of catastrophic breakpoints in economic collapse, but there are clear signs for months, if not years.
When that happens, the unleashed hardships will consume everything, make a big difference in everyday life, and the country may never return to its original state. ..
According to experts, 12 countries, including Egypt, Tunisia, Sudan, Afghanistan and Pakistan, have seen prices soar as post-pandemic recovery and war in Ukraine cause global food shortages.
The Source of the Crisis
The crisis in Lebanon and Sri Lanka is rooted in decades of greed, corruption and conflict.
Both countries suffered a long civil war and then made a lean and rocky recovery. During that time, it was dominated by corrupt warlords and clans who had accumulated huge external debt and stubbornly seized power.
Various popular uprisings in Lebanon have failed to shake off the class nations that have long used the country's sectarian power-sharing system to perpetuate corruption and nepotism. Important decisions remain in the hands of the political dynasty, which gained power for its immense wealth or by commanding the militia during the war.
Political paralysis and government dysfunction worsened in faction conflict. As a result, Lebanon is one of the most underdeveloped Middle Eastern countries in infrastructure and development, including a major blackout that lasted 32 years after the end of the civil war.
In Sri Lanka, the Rajapaksa family has monopolized the politics of the island nation for decades. President Gotabaya Rajapaksa is still obsessed with power, despite the collapse of his family dynasty in protests since April.
Experts state that the current crisis in both countries is their own, including high levels of external debt and little investment in development.
In addition, both countries are suffering from instability and repeated bouts of terrorist attacks that disrupt the economy's mainstay tourism. In Sri Lanka, more than 260 people were killed in 2019 in Easter suicide bombings at churches and hotels.
Lebanon suffers from the consequences of the civil war in neighboring Syria, with 5 million refugees and about 1 million refugees.
After that, both economies were hit again by the onset of the coronavirus pandemic.
The Lebanese crisis is in late 2019 after the government announces a newly proposed tax, including a $ 6 monthly fee for using Whatsapp voice calls. It started in. This measure ignited a long smoldering anger at the ruling class and months of public protest. People were cut off from savings as irregular capital regulations were enforced and currencies began to skyrocket.
In March 2020, Lebanon failed to repay its huge debt. That's about $ 90 billion or 170% of GDP, one of the highest in the world at the time. In June 2021, the World Bank said the crisis was ranked as one of the worst in the world for over 150 years, with the value of the currency lost by nearly 90%.
In Sri Lanka, the economy was still fragile after the 2019 Easter bombing, so Gotabaya pushed for the largest tax cut in the country's history. It has sparked a rapid backlash, with creditors downgrading the country's rating and preventing it from borrowing more money due to a plunge in foreign exchange reserves.
On the verge of bankruptcy, we stopped paying foreign loans and introduced capital restrictions amid a serious shortage of foreign currency. The recent tax cut has been cancelled.
On the other hand, Sri Lankan rupees have weakened by nearly 80%, going from about $ 360 to $ 1, and import costs are even higher.
"Our economy has completely collapsed," the Prime Minister said Wednesday.
Prior to this latest descent, both Lebanon and Sri Lanka have middle incomes that allow most people to live somewhat comfortably. Had a population.
From the 1980s to the 1990s, many Sri Lankans worked as domestic workers in Lebanese homes. When Sri Lanka began its post-war recovery, they were replaced by workers from Ethiopia, Nepal and the Philippines.
The recent crisis has forced most Lebanese to give up their luxury, among other things. Almost overnight, people noticed that they had little access to their money, their savings evaporated, and they were paid worthless salaries. A monthly salary at the minimum wage is enough to buy 20 liters (5 1/4 gallons) of petrol or cover the bill for a private generator that powers the house for hours a day. Not.
At one point, a serious shortage of fuel, cooking gas and oil created a dispute over limited supply. Currently, the scene is being reproduced in Sri Lanka. Antineoplastics are often out of stock. Earlier this year, the government ran out of new passport paper.
Tens of thousands of professionals, including doctors, nurses and pharmacists, have left the country in search of work.
Similarly, Sri Lanka is currently running out of gasoline and is facing a serious shortage of other fuels. Authorities announced a national power outage of up to four hours a day and urged state employees not to work on Fridays, except for those needed for critical services.
According to the United Nations World Food Program, 9 out of 10 Sri Lankan families skipped meals or crouched to grow food, and 3 million received emergency humanitarian aid. increase.
Doctors have relied on social media to seek an important supply of equipment and medicine. The increase in Sri Lankans wants passports to go abroad to find a job.
In addition to political and financial turmoil, both countries are facing disasters that exacerbate the crisis.
On August 4, 2020, a catastrophic explosion struck the port of Beirut, killing at least 216 people and destroying much of the city. The explosion, widely considered one of the largest non-nuclear explosions in history, was caused by the explosion of hundreds of tonnes of ammonium nitrate that had been stored in warehouses for years. Dangerous material seems to have been contained there with the knowledge of senior politicians and security officials who did nothing about it.
There was widespread anger at the endemic corruption and mismanagement of traditional political parties blamed for the disaster.
Sri Lanka faced a disaster in early 2021 when a container ship carrying chemicals ignited on the coast of the Colombo capital. While towed into the deep sea, it burned for nearly two weeks before sinking.
The burning ship exhaled harmful smoke and spilled over 1,500 tons of plastic pellets into the Indian Ocean. These pellets were later found in dolphins and fish that died on the beach.
Due to health risks associated with underwater chemicals, fishing in the area has been banned, affecting the lives of approximately 4,300 uncompensated families.
A rise from Bangkok was reported. Contributed by Associated Press writer Krishna Francis in Colombo, Sri Lanka.