How has Sri Lanka Been Going?

How did Sri Lanka achieve an economic turnaround, and why are its people still struggling?

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[ioshnxc]

Sri Lanka needs a more diverse economy other than tourism and agriculture because one year of drought or pandemic can have a major impact on these industries.

[abcdwxyz]

Sri Lankan here. Things certainly have changed for the better. True people are leaving in droves and government is stuck unable to issue passports due to the demand. But things are getting back to normal really fast.

[jesseinfinite]

"As an international body the last thing that they want is a governing body thinking that they can be reckless with their spending and fall back on the IMF if things go awry"
LOL what? Have ya'll heard of Pakistan who are currently on their 23rd IMF bailout? Since 1958?
They're basically had a financial crisis every 3 years on average since the beginning of their existence.
If that isn't recurring balance of payment issues, idk what is.

This isn't a dunk on Pakistan, it's rather a debunking of the notion that IMF has had measures in place that tries to ensure that countries receiving bailouts don't end up in the same situation again.

[bennett]

20-year resident of Sri Lanka here. An interesting analysis, but one thing that you neglect to mention is the astounding top-to-bottom corruption that has been the norm here for the last couple decades (at least). It is so ingrained that it has become normalized and seemingly will never go away. This is one more reason why the average person here has difficulty seeing a bright future in-country. People want change, but they don't see how it's possible.

And as far as the IMF... we could have a never-ending debate about whether it's a force for good or evil. Historically, the IMF has never been concerned about the lives of citizens in client countries; it's focus is entirely on banks and big industry. This is why the IMF is often treated with distrust and suspicion by regular people. I've heard that the IMF has been trying to reform itself, but if Sri Lanka is any example, it still has a long way to go before it can be called a friend of the people.

[lewis]

Ultimately it's not a crisis in need of a recovery if people aren't suffering. This is just simple reality. Argentina today and Britain by the end of the 70s are perfect examples of this. You can't mismanage your economy for decades and then expect to recover with an easy life

[romeromarquezmateo]

As it happened in Argentina, it will hurt in the short term, especially in a poorer country, but things will eventually improve because government surplus will increase confidence and money could start coming back if other reforms are made

[EhteshamShahzad]

Comparing Sri Lanka with USA or Portugal is unfair.
The US's internal and external debt is denominated in USD, a currency they control. If the US wants, they can print their way out of debt, the ramifications will be inflation, but that is a separate topic. Siri Lanka's external debts is denominated in USD and/or Chinese Yuan, curriencies they do not control. For them to pay off this debt they have to collect USD from either IMF (or any other loan providing org) or exports.
Portugal also had external debt in USD (and/or Euros). And they offered incentives for businesses to open shop and gave out investor visas. The thing is, Portugal is part of the EU, and people want to move to the EU. Almost no one wants to move to the Indian subcontinent. And if wealthy people don't want to move into this region, businesses like BMW and Mercedies are not interested in opening shop, as they don't have wealthy customers to sell cars to. The average local population doesn't have the buying power to buy these luxury cars.

[aroshaperera]

From Sri Lanka. So this is how the system works

The Sri Lankan Government is the gatekeeper to about Rs 2.5 Trillion of annual revenue, most of which is tax revenue.
MP’s find innovative ways to redirect this capital in to private pockets.

This causes a short fall in Social Spending for Health/Education etc.

Which causes deficits in the Budget. Which causes the Government to borrow from Financial Systems at higher and higher interest rates. (Ironically the people that took the capital out of the system, tend to be the same people that lend to the system, creating a positive feedback loop of capital!)

Which causes the Government to increase taxes to payback these loans.

Which results in a wealth transfer from the citizens who must fund the corruption.

Which results in a loss of buying power of the citizens. Which makes them justifiably angry.

This system is very beneficial to Oligarchs, Plutocrats, Corrupt Politicians and Financial Systems (who essentially fund the system) in general.

As a result Politicians and Economist will make the argument that the issue is, in fact, in government spending and that we need to privatise everything and open everything to market mechanics.

Which ironically further benefits the Oligarchs, Plutocrats, Corrupt Politicians, who sweep in with shite deals for the citizenry (Adani Wind power Deal/ Our debt restructuring deal being our most recent debacles).

End result is, In Sri Lanka the top one percent of Sri Lankans own 31 percent of the total personal wealth in the country. The next 9 percent own another 30%, while the bottom 50 percent owns less than 4 percent of the overall wealth in the country.
Now, people might think that this happens only in shithole countries, but that isn’t true. The US is worse than us with again 60% total wealth owned by the top 10 percent of earners. In comparison, the lowest 50 percent of earners only owned 2.5 percent of the total wealth. Three people own more wealth than the bottom 50% of the country!

This is happening worldwide. As oligarchs infiltrate global financial systems to game them, Neo Liberal Economics just adds fuel to the fire.

Run though this system over a period of time and you will radicalise the citizenry. That’s how people end up electing Gotabaya, Trump or Boris Johnson. Or Biden and Stammer

These guys will redirect the citizenry’s frustration towards false arguments such as government oversight, Immigration and minorities, Social Spending, climate sensitivity, being the problem for economic growth.

This is a global phenomenon brought on by the universal application of Neo Lib Capitalism.

The way out of it is through a peoples movement. The 1st country to do that was Bangladesh, although they don't have a political party that can back that movement like we have with the NPP.

We really have captured lighting in a bottle here.

[gihan.u]

I'm Sri Lankan, and the economy is recovering, it's been a hard two years for poor people.. the country will return to pre-crisis levels by this year (2025)

[justsauce]

This reminds me of Greece, the country that im coming from and im living right now. The economy is growing but we, the people, are getting poorer. How is that possible? The salaries are almost the same since 5 years ago and far behind if u compare them to 15 years ago BUT the prices of anything u can think of: groceries, houses, cars, phones, clothes ect. is 2 to 3 times the price!!!

[shanepereraedu]

0:54 This bike rickshaw part is not even a footage of Sri Lanka. Its india 😂

[ThePhiphler]

Sounds like Sri Lanka was a developing country briefly debt financing a higher standard of living than they could afford, and now are instead seen as just another developing country.

[ekmalsukarno]

Economics Explained, it would mean a lot to me if you made a video on the economy of Malaysia. That way, all your viewers and subscribers will learn about the country's GLCs (government-linked companies), ethnic-based politics, ethnic-based affirmative action policies, and how they all play a major role in Malaysia's economy. Please accept my request.

[NedJeffery]

"How does a country get better while it's people are worse off"
I think we can all relate to this.

[WilliamNeacy]

It kinda seems like when people are grouped as a nation, with a plan, progress can be made. When the burdens aren't shared equally, is when it goes off the rails. The next video I want to see is a solution to the problem that benefits everyone.

[hilaryhongkong]

I just went to Sri Lanka last month. It seemed quite normal.

[abhishek_gupta]

Greece is another example where Greeks still face the impact of austerity and I was shocked to know the wages there! I live in India and earn way more

[schnakenburg]

Very well made and informative. Thanks for sharing the data.

[SCP_X]

US can print notes out of thin air Portugal can borrow at low interest rate thanks to Euro.
Not every country has the same luxury.

[baranix]

I literally just pushed a fix regarding our Sri Lanka data that took 2 weeks and I get this on my front page.