By Asoka Bandarage
WASHINGTON DC, Aug 25 2023 – Sri Lanka has been faced with an unprecedented political and economic crisis since the beginning of 2022.

The dominant narrative attributes the crisis to the confluence of the COVID-19 pandemic, the Ukraine conflict, China’s ‘debt trap diplomacy’ and – most importantly – the corruption and mismanagement of the ruling Rajapaksa family.

Western mainstream media celebrated the so-called aragalaya (struggle, in Sinhala) protest movement that led to the ouster of the Rajapaksas and upholds the IMF bail-out as the only solution to the dire economic situation.

The aragalaya protests emerged from genuine economic grievances, but failed to develop an analysis beyond the ‘Gota, Go Home’ demand for Gotabaya Rajapaksa to resign. Influenced by local and external interests with their own agendas, the protestors exhibited little-to-no awareness or critique of the global political economy and the financial system at the root of the country’s crisis.

In 2022, the United Nations Conference on Trade and Development (UNCTAD) reported that 60 percent of low-income countries and 30 percent of emerging market economies are ‘in or near debt distress.’ While the details differ from country to country, the historical patterns of subordination that have given rise to global crises are the same.

The Sri Lankan crisis is an illustrative example of convergent global debt, food, fuel and energy crises facing much of the world. It is corporate media bias and narrative control that deflects from this analysis.

The island’s severe debt and economic crisis must be seen in a broader global context as the culmination of several centuries of colonial and neo-colonial developments, and the disastrous and inevitably self-destructive capitalist paradigm of endless growth and profit. Debt is not “a straightforward number but a social relation embedded in unequal power relations, discourses and moralities…and…institutionalized power.”.

Colonialism and Neocolonialism

The development of export agriculture and the import of food and other essentials under British colonialism turned Sri Lanka into a dependent ‘peripheral’ unit of the global capitalist economy.

Adopting ideologies of modernization and development and theories of comparative advantage, the capitalist imperative integrated self-sustaining indigenous, peasant, and regional economies into the growing global economy, through the appropriation of land, natural resources, and labor for export production.

Monocultural agriculture, mining, and other export-based production disturbed traditional patterns of crop rotation and small-scale subsistence production that were more harmonious with the regional ecosystems and cycles of nature.

Plantation development contributed to deforestation, loss of biodiversity and animal habitats. While a small local elite prospered through their collaboration with colonialism, most people became poor, indebted, and dependent on the vagaries of the global market for their sustenance.

Although colonized countries including Sri Lanka gained political independence following World War II, unequal exchange continued under neo-colonialism. Terms of trade disadvantaged the ‘Third World’ with their labor, resources and exports grossly undervalued and imports overvalued.

The dynamic is better understood as poorer countries being over-exploited rather than under-developed. Rising populations combined with corruption and inefficiency of local governments gave rise to endemic foreign exchange shortages and economic crises in Sri Lanka and many other countries.

The debt relief and aid given by the IMF, the World Bank and bilateral institutions from the Global North have been mere band-aids to keep the ex-colonial countries tethered to the global financial and economic structures. Post-independent Sri Lanka went to the IMF 16 times before the current 2023 bail-out which seeks to further perpetuate the county’s cycle of debt dependence.

The transfer of financial and resource wealth from poor countries in the global South to the rich countries in the North is not a new phenomenon. It has been an enduring feature throughout centuries of both classical and neo-colonialism. Between 1980 and 2017, developing countries paid out over $4.2 trillion solely in interest payments, dwarfing the financial aid they received from the developed countries during that period.

Currently, international financial institutions – notably the IMF and the World Bank – remain outside political and legal control without even ‘elementary accountability’. As critics from the Global South point out, “The overwhelming power of financial institutions makes a mockery of any serious effort for democratization and addressing the deteriorating socioeconomic living conditions of the people in Sri Lanka and elsewhere in the Global South.”

Financialization and Debt

Corporate and financial deregulation which accompanied the rise of neoliberalism starting in the 1970s has given rise to financialization, and the increasing importance of finance capital. As more and more aspects of social and planetary life are commoditized and subjected to digitalization and financial speculation, the real value of nature and human activity are further lost.

As a 2022 United Nations Report points out; food prices are soaring today not due to a problem with supply and demand but due to price speculation in highly financialized commodity markets.

A handful of the largest asset management companies, notably BlackRock (currently worth USD $ 10 trillion) control very large shares in companies operating in practically all the major sectors of the global economy: banking, technology, media, defense, energy, pharmaceuticals, food, agribusiness including seeds, and agrochemicals.

Financial liberalization advanced when interest rates dropped in the richer countries after the global 2008 financial crisis. Developing countries were encouraged to borrow from private international capital markets through International Sovereign Bonds (ISBs) which come with high interest rates and short maturation periods.

Although details are not available to the public, BlackRock is reportedly the biggest ISB creditor of Sri Lanka. Most of Sri Lanka’s foreign debt is ISBs, with over 80% of Sri Lanka’s debt owed to western creditors, and not – as projected in the mainstream narrative – to China.

IMF debt financing requires countries to meet its familiar structural adjustment conditions: privatization of state-owned enterprises (SOEs), cutbacks of social safety nets and labor rights, increased export production, decreased import substitution and alignment of local economic policy with US and other Western interests.

These are the same aims as classical colonialism, they are just better hidden in the more complex modern system and language of global finance, diplomacy and aid.

A vast array of policies exacting these aims are well under way in Sri Lanka, including the sale of state-owned energy, telecommunications and transportation enterprises to foreign owners, with grave implications for Sri Lanka’s economic independence, sovereignty, national security and the wellbeing of her people and the environment.

The IMF approach does not address long-term needs for bioregionalism, sustainable development, local autonomy and welfare. A small vulnerable country such as Sri Lanka cannot change the trajectory of global capitalist development on its own.

Regional and global solidarity and social movements are necessary to challenge the deranged global financial and economic system that is at the root of the current crisis.

Global South Resistance

Since the 1970s, major collaborative projects have been initiated by developing countries and the UNCTAD to develop a multilateral legal framework for sovereign debt restructuring. Yet they are futile in the face of the powerful opposition of creditors and the protection given to them by wealthy countries and their multilateral institutions, and the UN has failed to uphold commitment and implement a debt restructuring mechanism.

Sri Lanka was a global leader in efforts to create a New International Economic Order, the Non-Aligned Movement and the Indian Ocean as a Zone of Peace in the 1960s and 70s. In the early years of their political independence, countries throughout Asia, Africa and Latin America sought to forge their own paths of economic and political development, independent of both capitalism and communism and the Cold War.

These included African socialist projects such as Tanzania’s Ujamma, import substitution programs in Latin America and left-wing nationalism and decolonization efforts in Sri Lanka and many other countries.

Almost without exception, these nationalist efforts failed, not only due to internal corruption and mismanagement but also due to persistent external pressure and intervention. Massive efforts have been taken by the Global North to stop the Global South from moving out of the established world order.

A case in point is the nationalization of oil companies owned by western countries in Sri Lanka in 1961 and the backlash against the left-nationalist Sri Lankan government which dared to take such a bold move.

The western response included the 1962 Hickenlooper Amendment passed in the U.S. Senate stopping foreign aid to Sri Lanka and to “any country expropriating American property without compensation.” As a result, Sri Lanka lost its credit worthiness, the domestic economic situation worsened, and the left-nationalist government lost the 1965 elections (with some covert US election support).

Observing those developments, political economist Richard Stuart Olsen wrote: “…the coerciveness of economic sanctions against a dependent, vulnerable country resides in the fact that an economic downturn can be induced and intensified from the outside, with the resulting development of politically explosive ‘relative deprivation’…”

These observations resonate with Sri Lanka’s current repetition of the same vicious cycle: an externally dependent export-import economy; worsening terms of trade; foreign exchange shortage; policy mismanagement; external political pressure; debt crisis; shortages of food, fuel and other essentials; mass suffering; and political turmoil.

Geopolitical Rivalry

Sri Lanka’s present economic crisis – the worst since the country’s political independence from the British – must be seen in the context of the accelerating neocolonial geopolitical conflict between China and the USA in the Indian Ocean. Many other countries across the world are also caught in the neocolonial superpower competition to control their natural resources and strategic locations.

There is much speculation as to whether the debt default on April 12, 2022 and political destabilization in Sri Lanka were ‘staged’ or intentionally precipitated to further the US’s ‘Pivot to Asia’ policy, the Indo-Pacific Strategy and the Quadrilateral Alliance (USA, India, Australia and Japan) in its competition to confront China’s $1 trillion Belt and Road Initiative and counter China’s presence in Sri Lanka.

It is widely recognized in Sri Lanka that ‘The policy of neutrality is the best defence Sri Lanka has to deter global powers from attempting to get control of Sri Lanka because of its strategic location.’ Although President Gotabaya Rajapaksa claimed to pursue a ‘neutral’ foreign policy, the Rajapaksas were seen as closer to China than the west. After Prime Minister Mahinda Rajapaksa and President Gotabaya Rajapaksa were forced to resign, Ranil Wickramasinghe – a politician who was resoundingly rejected in the previous elections by the electorate but is a close ally of the west – was appointed as President in an undemocratic transition of power.

To what extent were Sri Lanka and her people victims of an externally manipulated ‘shock doctrine’ and a regime change operation, sold to the world as internal disintegration caused by local corruption and incapability?

While it is not possible to provide definitive answers to these issues, it is necessary to consider the available credible evidence and the geopolitics of debt and economic crises in Sri Lanka and the world at large.

Paradigm Shift

As the locus of global power shifts from the west and a multipolar world arises, new multilateral partnerships are emerging for development financing, such as the New Development Bank (NDB) – formerly referred to as the BRICS (Brazil, Russia, India, China and South Africa) Development Bank – as alternatives to the Bretton Woods and other western dominated institutions.

However, given controversial projects, such as China’s Port City and India’s Adani Company investments in Sri Lanka as well as their projects elsewhere, it is necessary to ask if the BRICS represent a genuine alternative to the prevailing political-economic model based on domination, profit and power?

Dominant political power in our era is about propaganda, control of narratives and exploiting ignorance and fear. In the face of worsening environmental and social collapse across the world, there is a practical need for a fundamental questioning of the values, assumptions and misrepresentations of the dominant neoliberal model and its manifestations in Sri Lanka and the world.

At the root of the crisis, we face is a disconnect between the exponential growth of the profit-driven economy and a lack of development in human consciousness, i.e., in morality, empathy, and wisdom.

Ultimately, dualism, domination and the unregulated market paradigm need to be questioned to find a balanced path of human development, based on interdependence, partnership and ecological consciousness. Such a path of development would uphold the ethical principles necessary for long-term survival: rational use of natural resources, appropriate use of technology, balanced consumption, equitable distribution of wealth, and livelihoods for all.

This article is derived from the author’s new book: Asoka Bandarage, CRISIS IN SRI LANKA AND THE WORLD: COLONIAL AND NEOLIBERAL ORIGINS: ECOLOGICAL AND COLLECTIVE ALTERNATIVES (Berlin: De Gruyter,2023) https://www.degruyter.com/document/isbn/9783111203454/html?lang=en]

IPS UN Bureau

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By Thalif Deen
UNITED NATIONS, Aug 25 2023 – A coalition of civil society organizations, (CSOs), including climate activists, anti-poverty campaigners and celebrity chefs, are among those calling for an emergency meeting of world leaders on the global food crisis during the UN General Assembly (UNGA) sessions in New York next month.

With 735 million people going hungry, 122 million more than before the COVID-19 pandemic, the organizers of the ‘Elephant in the Room’ campaign say the food crisis is being overlooked by world leaders, with devastating consequences.

An open letter to world leaders, signed by supporters, including climate activist Vanessa Nakate, award-winning farming advocate Wangari Kuria, musician and philanthropist Octopizzo, SDG Advocate Richard Curtis, and US celebrity chef Andrew Zimmern, says the food crisis is being ignored – “a victim of siloed approaches as it’s so multidimensional”.

The letter calls for a massive joined-up response at the highest levels of government. “You know there is a global food crisis. You are ignoring it in your budgets. You do not address it enough with the media. It is not high on your agenda for the G20, UNGA or COP28. And so, it remains an elephant in the room.” (an obvious problem that people do not want to talk about.)

“As leaders, you have allowed this emergency to unfold. The solutions to end the food crisis exist. It is your responsibility to lead the world out of disasters, not compound them.”

Launched by Hungry for Action, the campaign is supported by over 40 organizations including Save the Children, the ONE Campaign and Global Citizen and is coordinated by the SDG2 Advocacy Hub.

https://sdg2advocacyhub.org/index.php/actions/elephant-room-0

The plea for a summit of world leaders on the global food crisis coincides with three unprecedented high-level political meetings in September: the Sustainable Development Goals (SDG) Summit on September 18-19; a high-level dialogue on Financing for Development (FfD) on September 20; and a Summit of the Future on September 21.

Danielle Nierenberg, President and Founder, Food Tank told IPS the world is facing multiple emergencies–the climate crisis, the public health crisis, the biodiversity loss crisis, and the hunger crisis.

To address these challenges, she said, “we need urgent action–not by 2030–but today. I am thankful for the efforts of activists and advocates who are pushing for change.”

“But we need policymakers to treat these crises like the emergency they are and push for positive transformation of how we produce and consume food at UNGA. We can’t wait any longer.”

Joseph Chamie, a former director of the UN Population Division, and an independent consulting demographer, told IPS there is no question about an increasing and worrisome global food crisis.

“About one billion people, or nearly 12 percent of the world’s population, face severe levels of food insecurity with 735 million people going hungry,” he said.

There is plenty of food in the world. While the world’s population has doubled from 4 to 8 billion over the past fifty years, global food production has more than tripled, said Chamie, who served as the Deputy Secretary-General for the 1994 International Conference on population and development and has worked in various regions of the world.

There is a consensus on the causes of the global food crisis, he argued.

Among the major causes of the global food crisis, he singled out “armed conflict and violence; climate change with extreme weather events and emergencies; poverty and economic shocks with soaring prices for fertilizer”.

He pointed out that there is much that can be done to address the global food crisis.

“World leaders need to adopt policies, provide additional funds and take action to address the major factors creating the global food crisis. The major media outlets need to do more to inform the world community about the global food crisis”.

There are no reasons, he said, for delays in addressing the global food crisis. “It is necessary and appropriate to convene an emergency meeting of world leaders on the global food crisis at the UN General Assembly in New York next month.”

Countries, international agencies and responsible others need to act today to address the global food crisis, not in some distant future.

“Hungry people, especially children, can’t eat excuses, they need food today,” said Chamie, the author of numerous publications on population issues, including his recent book, “Population Levels, Trends, and Differentials“.

Meanwhile, the Hungry for Action campaign says the global food crisis is caused by a combination of conflict, climate change, rising food prices and the punishing debt burdens faced by many poorer countries, 21 of which now face catastrophic levels of debt distress and food insecurity.

“Admitting the scope of the problem is the first step towards solving it,” said Rev. Eugene Cho, president and CEO of the U.S.-based Christian anti-hunger organization Bread for the World.

“Several countries, including the U.S., have acknowledged there is a problem and taken steps to address it. That is a good start. But it is not enough to get us out of the crisis. The global food and malnutrition crisis is a climate crisis, a conflict crisis, and a rising costs crisis: it demands a powerful and unified global response.”

This year’s UN appeals for emergency assistance are only just over a quarter funded, much lower than for the last global food crisis in 2008, and yet there are twice as many additional people going hungry compared to 2008 levels.

“There is nothing inevitable about children dying because they don’t have enough to eat, just as there is nothing inevitable about families in rich countries queuing for food banks,” said climate activist, Vanessa Nakate.

“There is nothing inevitable about a food system that cannot withstand shocks from climate change or conflict. There is enough food in the world for everyone.”

“During the last major global food crisis, following the 2008 economic crash, we saw world leaders coming together at the G8 summit in L’Aquila, Italy, to make bold commitments,” said David McNair, Executive Director for Policy at the One Campaign

“This year, as we live through a so-called ‘polycrisis’, the food crisis seems to be getting lost, a victim of a siloed approach to tackling the world’s problems.”

According to the campaign, action to tackle the global food crisis should focus on three key elements: saving lives, building resilience of affected communities to withstand climate and food price shocks, and securing the future by reform of the global food system to make it more sustainable and equitable.

Solutions world leaders should progress at an emergency meeting include:

• Fully funding the UN’s $55bn humanitarian appeals and doubling climate adaptation funding for lower income countries, while also cancelling their debts and reforming the multilateral financial system to unlock vital funds.
• Investing in the smallholder farmers, health workers and communities on the frontlines of the food crisis, including through social protection programmes.
• Fixing the broken global food system by supporting more sustainable farming, diversifying crops, improving nutrition and access to a healthy diet, and reducing food waste.

These measures would break the cycle of crisis and could save the world billions at the same time, campaigners said.

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By Luis Brizuela
HAVANA, Aug 25 2023 – Emigrating from Cuba was an agonizing decision for Ana Iraida. She left behind family and friends; in her backpack she carried many hopes, but also the fear of facing dangers on the journey to the United States.

“My salary and that of my second job, as an editor, were insufficient. I wanted to prosper and help my parents. Nor did I want to have a child in a country where it is an ordeal to buy everything from disposable diapers to soap, not to mention food,” the 33-year-old philologist who, like the others interviewed for this story, asked to withhold her last name, told IPS.

After selling her apartment in Havana, she left for Nicaragua in December 2022.”The journey. I could have been robbed of my money, raped or even murdered. Almost two years ago, when the airports reopened after the COVID pandemic, some young women who lived near my house left and their families never heard from them again.” — Ana Iraida

“Some friends lent me the rest of the money I needed. I reached Mexico by land. I paid 1,800 dollars to be taken to the (U.S.) border. I crossed and turned myself in to the border patrol in Yuma, Arizona, on New Year’s Day,” the young woman said from Houston, Texas, where she now lives.

Estimates put the number of Cubans who emigrated in 2022 at 300,000. Of these, some 250,000 attempted to reach the United States, the country that receives the largest inflow of Cubans and that is only 167 kilometers from Cuba across the Straits of Florida.

The increase in the exodus from this Caribbean island nation of 11 million people is happening against a backdrop of a worsening economic crisis, fueled by COVID, the stiffening of the U.S. embargo, partial dollarization, waning purchasing power of salaries and pensions, shortages of essential products and inflation.

Added to this are failures and delays in the implementation of a set of reforms to modernize the country, approved in 2011, and the unsuccessful implementation of monetary reforms since January 2021.

Local officials here argue that the U.S. Cuban Adjustment Act – known as the “wet foot, dry foot policy” – in force since 1966, encourages the exodus, since it made all Cubans eligible for permanent residency a year and a day after setting foot in U.S. territory.

In the past, the rule benefited all Cubans who set foot on U.S. soil. But since January 2017 it only applies to those who have entered the country legally.

However, the flow of Cubans into the U.S. slowed after President Joe Biden’s administration adopted on Jan. 5 a temporary humanitarian residency permit program known as parole, similar to the one implemented in October 2022 for Venezuelans and previously for people of other nationalities.

As of the end of July, more than 41,000 Cubans had obtained temporary parole, 39,000 of whom had already reached the country, the U.S. Customs and Border Protection (CBP) reported on Aug. 18.

In addition, after a four-year freeze, on Jan. 4 the U.S. Embassy in Havana resumed processing immigrant visas, a decision that the Cuban government welcomed as a “necessary and correct step” aimed at guaranteeing regular, orderly and safe migration.

Women line up to buy food in Havana. The economic situation, aging population and emigration of young people and professionals are placing additional hurdles in the way of caregivers to obtain food, medicines and other supplies. Image: Jorge Luis Baños / IPS

Risks and impacts

International organizations and human rights groups warn of the risks faced by immigrants en route, especially women, children and the elderly, who are more likely to become victims of abuse, mistreatment, discrimination, extortion, kidnapping and sexual violence by organized crime groups.

“The journey was stressful,” said Ana Iraida. “I could have been robbed of my money, raped or even murdered. Almost two years ago, when the airports reopened after the COVID pandemic, some young women who lived near my house left and their families never heard from them again.”

Other migrants never reach their destinations and remain trapped in transit countries in overcrowded conditions or as victims of violence.

I was also worried “that they would detain me and send me back to Cuba, and that in the end I would have no home to return to, and be in debt,” added Iraida.

According to the International Organization for Migration (IOM), women account for 48 percent of international migrants worldwide and an increasing number are migrating independently, including as heads of households, in search of new opportunities, to join their families or to help relatives in their home countries.

Research indicates that this phenomenon, known as the feminization of migration, generates significant impacts on demographic, physical, economic, cultural and gender indicators in regions and countries.

An elderly woman walks in Havana with the help of her companion. The National Survey on Population Aging showed that about 68 percent of caregivers in Cuba are women, and most of them are over 50 years old. At the same time, more than 57 percent of people over 50 prefer to be cared for by women. CREDIT: Jorge Luis Baños / IPS

Cuba’s January 2013 immigration reform eliminated the requirement for exit permits and letters of invitation for nationals residing on the island, extended from 11 to 24 months the time they could stay abroad without losing residency, and repealed legislation that allowed the confiscation of assets of those who left the country.

Subsequent regulations have also favored increased travel abroad for personal reasons and the possibility of living temporarily or permanently outside the country, opening the doors to a better relationship with the Cuban exile community.

Women make up a majority of those seeking temporary residence abroad, while men are a majority among those who decide to live abroad permanently, revealed the report of the National Migration Survey (Enmig 2016-2017), published by the National Bureau of Statistics and Information (Onei) in January 2019.

The survey found that 59 percent of the men and 45 percent of the women who decided to live temporarily or permanently in another country did so “to improve their economic conditions.”

In the case of women, “getting closer to or visiting family”, “supporting or caring for family members” and “helping their family here” (35 percent) are the most important motives, while they were the main motives for only 21 percent of the men.

Mothers accompany their primary school children during the start of a new school year in Havana. Researchers have called for more attention to be paid to the relationship between the feminization of migration and the burden of care. CREDIT: Jorge Luis Baños / IPS

Focusing on care

Researchers have called for more attention to be paid to the relationship between the feminization of migration and the burden of care.

In the case of Cuba, they say, migration itself often becomes a complementary strategy to face the problems associated with caregiving.

The economic crisis, the aging demographic and the emigration of young people and professionals are placing additional obstacles on caregivers to provide food, buy medicines and manage supplies.

“I moved to Ecuador seven years ago,” Betsy, a 38-year-old teacher, told IPS from the city of Guayaquil. “My two children were born here. My work makes it possible for me to send money, medicines and other products to Cuba to take care of my 80-year-old father, who has senile dementia. Otherwise, it would be very difficult for my older sister to provide adequate care for him.”

In Cuba, 22.3 percent of the population is over 60 years of age, and by 2025 it is estimated that one in four of the island’s residents will be an older adult.

The National Gender Equality Survey, published in 2019, showed that Cuban women spend an average of 14 hours more than men on unpaid work per week, which includes caring for the elderly, chronically ill and dependent persons, as well as helping children and adolescents with their homework.

For its part, the 2017 National Survey of Population Aging (Enep), whose data came out in 2020, showed that about 68 percent of those who provide care are women and most are over 50 years old.

In the case of needing care, more than 57 percent of the population over the age of 50 prefers to receive it from women, according to the study.

“I chose to stay and live in Canada almost two years ago,” said Rocio from Halifax, the capital of the Canadian province of Nova Scotia. “It has been an ordeal, but I have no regrets. It’s a way to help my 11-year-old son and my retired parents, who are taking care of him until we can be together again.”

The 40-year-old translator, who lived in the eastern Cuban city of Holguín, told IPS that “with my salary, my son and I were living on a tight budget. I could hardly help my parents, whose pensions barely covered the household bills, medicines and the few foodstuffs they could afford. I am far away, I suffer from the separation, but every month I can send them money so that they can live more comfortably and eat better.”

Increasingly young and female-dominated emigration is challenging national development plans on a sustainable basis.

“This situation calls for further research and public debate on the present and future impacts of demographic dynamics such as migration and aging as they relate to the social organization of caregiving on the island,” argues Cuban sociologist Elaine Acosta.

In the opinion of Acosta, executive director of “Cuido60, Observatory of aging, care and rights”, there is an urgent need “to accelerate and deepen structural reforms so that migration ceases to be a daily survival strategy and, at the same time, to obtain the necessary resources to implement appropriate and integrated social policies to face the current and future challenges of aging.”