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Monday December 5th, 2022

Sri Lanka’s once-mighty nationalist party splits after failed economic policies

ECONOMYNEXT – Sri Lanka Podujana Peramuna (SLPP), the island nation’s strongest ruling coalition in over four decades, is facing an imminent split into fractions after the party’s failed economic policies led to public anger, protests and the ouster of a powerful sitting president.

The party emerged into a strong political force after the 2018 local government elections before winning the presidency in 2019 in a landslide followed by the 2020 general election which gave the ‘Pohhottuwa’ (lotus bud) a stunning two thirds majority.

But now the SLPP, led by the Rajapaksa dynasty, is struggling to survive as lawmakers that represent the party have lost support at the grassroots level, the party’s top leaders say.

Infighting between members, a blame game over the party’s ongoing downfall, and dramatic betrayals just to survive have left the once-mighty SLPP in shambles and forced its ailing supreme leader Mahinda Rajapaksa, two-term president and four-time prime minister, to reach the public in a “let’s rise together” campaign.

But many in the party are aware of its fate and are in the process deciding the next stage of their personal political career, internal sources say.

At the peak of the popularity of the party, Mahinda Rajapaksa was the prime minister, his younger brother and former war-winning defence ministry secretary Gotabaya Rajapaksa was the most powerful executive president of Sri Lanka under an amended constitution backed by a parliamentary majority. Another younger brother Basil was finance minister, while elder brother Chamal held the irrigation portfolio.

Gotabaya was also the minister of defence and digital infrastructure.

Namal Rajapaksa, the son of Mahinda Rajapaksa, was the minister of youth and sports, while Chamal’s son Shasheendra Rajapaksa was junior agriculture minister. Rajapaksa’s another nephew from the southern district of Matara was the Chairman of the District Development Committee.

All was well, until a mass anti-government movement gathered momentum around March this year, forcing the Rajapaksas down from the top of Sri Lanka’s political food chain.

Mahinda Rajapaksa was forced to step down on May 09, after which he fled to a naval base in the country’s easter coast fearing for his life. President Gotabaya Rajapaksa fled the country not long after and resigned from Singapore. Basil Rajapaksa was compelled to resign from parliament, weeks after all other Rajapaksas had stepped down after the government was ousted following the protests.

“[Mahinda] Rajapaksa’s recognition as the national leader is diminishing and his efforts to keep the SLPP together will be in vain. It’s all over,” a senior SLPP lawmaker who is in talks with an opposition political party to contest the next election told EconomyNext asking not to be named.

“The SLPP was a successful model to win the last election giving priority to national security and Sinhala Buddhist nationalism. But the failure of the Rajapaksas in economic policies led to the current situation. They (the Rajapaksas) did not listen to party members including ministers on their economic policies.”

Failed economic policies

Under the SLPP government, Sri Lanka’s rupee collapsed after excess money printing by the central bank to keep interest rates artificially low.

Inflation has skyrocketed to over 70 percent, forcing the country to join the list of failed economies in the world like Zimbabwe, Lebanon, Syria, Venezuela, and Argentina.

Gotabaya Rajapaksa’s strategy to reduce taxes to boost consumer spending backfired with record low government revenue, which also led the country to declare sovereign debt default on April 12.

President Rajapaksa’s stubborn decision to ban chemical fertilizer has also resulted in making most foods unaffordable to the average Sri Lankan amid a food shortage.

His economic experts’ decisions have led to Sri Lanka’s sovereign debt crisis and lack of foreign inflows after migrant workers switched to informal money transactions like Undiyal and Hawala after witnessing lower rates in the formal banking system.

The island nation is now facing a risk of a collapse of the local banking system in the event of a restructuring of domestic debt.

The previous Mahinda Rajapaksa administration’s (2010 to 2015) heavy Chinese borrowings for infrastructure projects that are not giving a sizable return on investment to repay such loans are also taking their toll, analysts say.

Sentiment-driven policies

The SLPP coalition was started in 2016, a year after Mahinda Rajapaksa’s surprise defeat at the 2015 presidential polls.

The new party campaigned against higher taxes, high cost of living, a perceived neglect of the majority Sinhalese Buddhist interests, and on the then government’s alleged compromises on national security.

The Easter Sunday attack, a series of suicide bombs by Islamist extremists in April 2019 targeting high-end hotels and Catholic churches, helped the SLPP prove its point on national security and prompted the Rajapaksas and their backers to launch a strong campaign against the government.

The party was overwhelmingly backed by Buddhist clergy, professionals, majority Sinhala Buddhists, and government servants who claimed that the 2015-2019 government had failed to address the key issues faced by the country.

The SLPP was silent on anti-Muslim riots after the Easter Sunday attack and backed the Gotabaya Rajapaksa-led government’s decision to cremate dead bodies of Muslim and Christian victims of COVID-19. For many months, international calls for a reversal of the decision would fall on deaf ears.

The party also disregarded a request by the West-led rights group to address past human rights violations attributed to the Sri Lankan state.

The SLPP was known for its China bend until last year before it was neutralised.

The party was seen as a group of extremists because of the racism its individual members indirectly espoused to win votes from majority Sinhala Buddhists. “Sri Lanka is a Buddhist country” seemed to be theme of the party stalwarts, with little or no concern for minorities like Tamils, Muslims and Christians.

Some of  SLPP members had a hand in peddling conspiracy theories to win votes. One of these was the false allegation that forced sterilisation of Sinhalese women was performed by a Muslim doctor. Adding sterilization chemicals to food and undergarments was also a common, unproven allegation.

Now all of this has backfired to the point that SLPP members cannot go to their voters. The Rajapaksa government’s economic failures and fabricated stories in the last election cycle have come back to haunt them.

And the blame game has already started.

“We chose Gotabaya Rajapaksa assuming he would work with our guidance to take the country on a corrective path,” Channa Jayasumana, a prominent member of Viyathmaga, a group of professionals who backed the former president at the last presidential election and also, incidentally, a key figure in the campaign of dubious news spread on forced sterilization.

“He worked like that at first, but as the months passed, Gotabaya Rajapaksa stopped listening to us. That is the reason for the current suffering,” said Jayasumana.

“Not only us, he didn’t even listen Mahinda Rajapaksa,” he said.

Speaking at a public gathering last week, Jayasumana also blamed Namal Rajapaksa for the failures of the former president.

“This damage is the result of heeding Namal Rajapaksa’s advice. Had he (Gotabaya Rajapaksa) worked the way we’d advised him, he wouldn’t be in this situation,” he said.

“Now Namal Rajapaksa is trying to blame us. The whole country is suffering due to his wrong advice. We as professionals cannot take this blame. We would like to tell him (Namal Rajapaksa) that the country would not have suffered like this if our advice was heard.”

Split into factions

The SLPP has split into at least four groups, party sources said.

“One group is with President Ranil Wickremesinghe who has given more space to young SLPP parliamentarians to prove themselves and showcase their talents with ministerial posts. Most of these young SLPP members are likely to end up in the president’s party,” an SLPP state minister told EconomyNext asking not to be named.

A second group is with Dullas Alahapperuma, former media minister who challenged Wickremesinghe at the July 19 presidential vote in parliament. Another group has become independent now, the state minister said.

“Finally, there is a group with Mahinda Rajapaksa, but they don’t see eye-to-eye because of the past differences. Some are core Basil Rajapaksa supporters while some are with Namal Rajapaksa,” he said.

“Those who are with Mahinda Rajapaksa are the people who are struggling now because they are concerned about their future in the event Mahinda Rajapaksa retires from politics.”

Two other sources who are closely aligned with the Rajapaksas said lawmakers backing Sri Lanka’s biggest political dynasty are divided because they are uncertain over their personal political future after Mahinda Rajapaksa.

“The SLPP as a political party is likely to remain only until the death of Mahinda Rajapaksa,” one source said.

“This is why the MPs backing the Rajapaksas have started separate political campaigns using Mahinda Rajapaksa. They are in a hurry to organize the grassroots level political machinery. But we hardly see real and genuine backing from lower level SLPP supporters.”

The second source said there are also SLPP lawmakers who are in discussions with the main opposition Samagi Jana Balawegaya (SJB) and the leftist Janatha Vimukthi Peremuna (JVP).

“The real split can only be seen only in the next parliamentary election,” the source said.

“Not new in Sri Lanka politics”

Namal Rajapaksa, who is seen as a potential leader of the SLPP, shrugged off the split in the party.

“Basically these kind of divisions are not new in Sri Lankan politics or even in global politics. But as long as you believe in your policies, it will not have a major impact,” Rajapaksa told EconomyNext.

“We believe we have a very strong national programme or policy framework that will cater to the national interest and the interest of Sri Lankan people,” he said.

The biggest challenge faced by the SLPP is changing itself as a party for all Sri Lankans instead of the current go-to nationalist or Sinhala Buddhist party.

“Podujana Party never accepted racism. However, it’s most unfortunate some people who were associated with SLPP worked otherwise. Some Tamil parties we worked with also had narrow agendas. I agree at times mistakes were made, considering the situation, but this has been rectified,” Namal Rajapaksa tweeted this week in response to a request to change the SLPP’s ethno-religious supremacy ideology.

Many of the SLPP members who spoke to EconomyNext said the only reason they are still in the party is Mahinda Rajapaksa who gave political leadership to win a 26-year war against Tamil Tiger separatists in one the Asia’s longest civil conflicts.

Mahinda Rajapaksa, despite many setbacks, is still hailed as a leader who saved the country from division, though his popularity is waning, analysts say.

The SLPP is exploiting the soft corner people have for Mahinda Rajapaksa in a last-ditch effort to revive its party machinery, gradually and steadily.

“We have seen a downfall in the last couple of months as a political party, but we believe that the people will also realise and we have also understood where things have gone wrong from our end and we will correct them,” Namal Rajapaksa, who is also involved with the party revival, said.

“We are also looking at formulating a think tank, especially to see what sort of changes we should bring in not only to the party’s structure but also to our policies or how we can modernise some of our policies and make it more flexible so that we can address more current needs and demands of the youth,” he said.

“Most of these groups who have broken away do not represent the policies of SLPP, even though they were claiming to do so. You can see their alliances, their groups aligning with the SJB or the JVP whose policies are totally different from SLPP’s.

“So as a political group that believes in policies, it doesn’t matter if individuals leave or not. We will reach out to the people and we will do politics with our grassroots and we will be with our people and we will be with the party and we will look at a modern approach on the national issues,” he said. Colombo/Nov04/2022)

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  1. akram mukhtar says:

    The SLPP or any other political party did not care about the country or people. If they did so, we would not be in this disastrous situation today. Indeed we have all that it would have taken to elevate ourselves among the developed nations but have failed due to our politicians. So the demise of SLPP or any other party should be welcome.

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  1. akram mukhtar says:

    The SLPP or any other political party did not care about the country or people. If they did so, we would not be in this disastrous situation today. Indeed we have all that it would have taken to elevate ourselves among the developed nations but have failed due to our politicians. So the demise of SLPP or any other party should be welcome.

Time right for elections, Sri Lanka Podujana Peramuna ready to face any poll: Basil

File photo: SLPP national organiser Basil Rajapaksa

ECONOMYNEXT — The time has come for an election in Sri Lanka and the ruling Sri Lanka Podujana Peramuna (SLPP) is ready to face any election, SLPP national organiser Basil Rajapaksa said, dismissing claims that the party has come to fear elections in the face of growing unpopularity and increased factionalisation.

Speaking to reporters at an event held in Colombo Monday December 05 morning to mark the fourth anniversary of the party’s media centre, Rajapaksa handwaved off assertions that the SLPP has splintered in the wake of the mass protests that ousted his brother and former President Gotabaya Rajapaksa.

“No, our party hasn’t fragmented, not the way this cake was cut,” he said, pointing to the cake that was cut to celebrate the media centre’s anniversary.

“There may be some [dissenters], but we are with the people,” said Rajapaksa.

Political analysts, however, note that the once mighty SLPP has indeed fractured to at least four or five distinct factions. One group, according to party sources, is with President Ranil Wickremesinghe who is keen to involve younger SLPP legislators in his economic reform agenda. The second is with former Media Minister Dullas Alahapperuma who launched an unsuccessful bid for the presidency and was roundly defeated by Wickremesinghe at the July 19 presidential vote in parliament. The third group now sits as independent MPs in parliament, while a fourth faction are with former President Mahinda Rajapaksa, the SLPP patriarch.

There is another group that remains loyal to Basil Rajapaksa, though all but one SLPP legislator voted for the 21st amendment to the constitution that prohibited dual citizens from entering parliament. Rajapaksa, a dual citizen with US passport, recently returned to the island after a private visit to his second home.

The former finance minister, who resigned after a wave of protests that demanded his departure along with that of his presidential brother, for their alleged role in Sri Lanka’s prevailing currency crisis, the worst in decades, was in a jovial mood at the anniversary event on Monday and was seen heartily indulging reporters who were throwing loaded question after loaded question at him.

Asked about future plans of the SLPP, Rajapaksa quipped that they couldn’t be revealed to the media at this stage.

“However, time has come for an election. It’s difficult to say how it will be at present, but as a party, we’re ready to face any election,” he said.

Rajapaksa’s apparent confidence in facing an election is in direct contrast to speculation that the SLPP is banking on President Wickremesinghe’s refusal to dissolve parliament anytime soon. Opposition lawmakers have accused Wickremesinghe of providing sanctuary and promising security to the deeply unpopular party by not calling early elections.

“We have won every election we faced so far. We are thankful to the Sri Lankan people for that. If we were unable to meet their expectations 100 percent, we regret that. We will correct any shortcomings and will work to fulfill the people’s aspirations,” said Rajapaksa.

Asked if he is going to remain in active politics despite the blanket ban on dual citizens, the former minister said, again with a chuckle: “Active politics… well, I’m not in governance anymore. Governance [for me] has been banned by the 21st amendment. So no, I’m not in governance, but I am in politics,” he said.

Pressed about possibly entering parliament again, he said: “How can I?”

Nor is Rajapaksa saddened by the development, he claimed. “No, I’m happy about it,” he said.

The former two-time finance minister, noted for his clash of views with Wickremesinghe when the latter was invited by then President Gotabaya Rajapaksa for a round of discussions on economic recovery, was cautiously complimentary when asked about the new president. It was the SLPP’s backing that guaranteed Wickremesinghe his lifelong ambition.

“I think that selection was the correct one. We have maintained from the start that all of us in government or opposition must be able to freely engage in politics,” he said, referring to assurances that the president has purportedly given SLPP parliamentarians that they will not face the kind of retaliatory mob violence that engulfed the nation on May 09 after alleged SLPP goons attacked peaceful anti-government protestors in Colombo.

A reporter asked if Rajapaksa believes the incumbent president is capable of taking the country on the right path to recovery?

“The first task was accomplished, by allowing us to engage in politics and to get on the streets. There are economic and other issues, and we have high hopes that they will be resolved,” he said. (Colombo/Dec05/2022)

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Sri Lanka proposed power tariff not to recover past losses: Minister

ECONOMYNEXT – The government has not proposed a power tariff increase to recover past losses, Minister of Power and Energy Kanchana Wijesekera in response to a statement attributed the head of the power regulator commission.

“The proposal that was presented was for an automatic cost reflective tariff mechanism to be implemented to supply uninterrupted power & to recover the current cost of power supply,” Minister Wijesekera said in message.

“Govt has not proposed to recover past loses of CEB from a tariff revision…”

The cabinet of ministers had given the nod tariff revisions twice a year to prevent large losses from building up as in the past.

The Public Utilities Commission has disputed costs protected for the power utility saying the petroleum utility was keeping large margins in selling fuel.

The government in a budget for 2022 also proposed to tax surcharge to recover losses.

The regulator also disputed power demand forecasts.

Also read; Sri Lanka regulator disputes CEB costs, demand projections for 2023

The PUCSL cannot increase tariffs to recover past losses, Chairman Janaka Ratnayake said. (Colombo/Dec05/2022)

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Sri Lanka’s shares gain in mid market trade

ECONOMYNEXT – Sri Lanka’s shares edged up in mid day trade on Monday (05), continuing the positive run for seven straight sessions on news over a possible debt restructuring from Paris Club, analysts said.

All Share Price Index gained by 0.69% or 60.10 points to 8,829, while the most liquid shares gained by 0.96% or 26.59 points to 2,801.

“The market was pushed up over the news of a potential 10 year debt moratorium,” analysts said.

The Paris Club group of creditor nations has proposed a 10-year debt moratorium on Sri Lankan debt and 15 years of debt restructuring as a formula to resolve the island nation’s prevailing currency crisis. 

Related – Paris Club proposes 10-year moratorium in 15-year Sri Lanka debt re-structure: report

The market generated a revenue of 2.1 billion rupees.

Top gainers during 1130 hours were Expolanka, Browns Investment and LOLC.  (Colombo/Dec05/2022)


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