Sri Lankan president leaves his brother as finance minister amid crisis shakeup

  • President calls all parties to assume ministerial roles
  • President’s brother replaced as finance minister
  • Spontaneous protests continue across the country
  • Coalition partner rejects new cabinet

COLOMBO, April 4 (Reuters) – Sri Lankan President Gotabaya Rajapaksa resigned his brother as finance minister on Monday after calling for a unity government as protests against the economic crisis persisted and cracks emerged in the ruling coalition.

The indebted country, led by Rajapaksa and his brothers in top posts, is struggling to pay for imports of fuel and other goods due to a shortage of foreign exchange, causing hour-long power outages and shortages of essential items. Read more

Anti-government street protests continued on Monday with crowds gathering in several cities, including in southern Tangalle, where people holding signs and the national flag broke through police barricades, local media reported.

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“Four ministers have been appointed to ensure that parliament and other tasks can be carried out in a legal manner until a full cabinet can be sworn in,” the Rajapaksa media office said in a statement after cabinet ministers resigned in a attempt to resolve the crisis.

He said Justice Minister Ali Sabry would be the new finance minister, replacing Gotabaya’s brother Basil Rajapaksa, who was due to visit Washington this month for talks with the International Monetary Fund (IMF) about a loan program.

The previous ministers of Foreign Relations, Education and Roads will maintain their positions.

“The president invites all political parties represented in parliament to unite to accept ministerial portfolios in order to find solutions to this national crisis,” the president’s press office said, calling for a unity government.

Sri Lankan Central Bank Governor Ajith Nivard Cabraal said on Twitter that he had also offered to resign.

‘OLD WINE’

Udaya Gammanpila, head of one of the 11 political parties that make up the ruling coalition, rejected Rajapaksa’s move, calling the new cabinet “old wine in a new bottle.”

“Our demand is an interim government of all parties to restore essential services and hold parliamentary elections,” Gammanpila, of the Pivithuru Hela Urumaya party, wrote on Twitter. “The people must decide their next leaders, no one else.”

Charmara Nakandala, a protester, said the cabinet changes were temporary attempts to placate the public.

“This cabinet change is to try to fool people,” Nakandala, a marketing executive, told a protest in Colombo, the main city. “This government is over. Rajapaksas can no longer save this by playing musical chairs.”

Index of all shares of the Colombo Stock Exchange (.CSE) it turned positive briefly after the burst of ads, before turning red again. The market is down about a third this year, and the stock market discontinued trading twice on Monday morning due to sharp declines in the benchmark stock price index.

The developments come after Gotabaya Rajapaksa, whose older brother is the prime minister, declared a state of emergency on Friday, following mounting street protests in the island nation.

The country of 22 million people, on India’s southern tip, is also grappling with skyrocketing inflation after the government sharply devalued its currency last month ahead of talks with the IMF.

The country’s spending has exceeded its income under successive governments while its production of tradable goods and services has been inadequate. The twin deficits were severely exposed by the COVID-19 pandemic that crippled its economic mainstay, the tourism industry.

“If this interim government is set up and it’s with people who have some credibility, then we can instill some confidence both in the people and in the markets,” said Paikiasothy Saravanamuttu, executive director of the Center for Policy Alternatives think tank. .

But there would be some unhappiness with the president keeping his job, he said.

“The demands on the street were that Gotabaya Rajapaksa should go,” Saravanamuttu said. “He was the target.”

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Information from Uditha Jayasinghe and Devjyot Ghoshal; Additional reporting by Waruna Karunatilake; Written by Krishna N. Das; Edited by Raju Gopalakrishnan

Our standards: The Thomson Reuters Trust Principles.

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