By Jehan Perera –

Jehan Perera

The government is being judicious in reading the signs of the time. The country continues to be in the throes of the economic crisis that it inherited. It faces formidable challenges in confronting a combined opposition that governed Sri Lanka for the past 76 years. In addition, the world is in crisis with international law being openly disregarded in the joint US‑Israel bombardment of Iran’s nuclear sites. Faced with such turbulence, there is a need to tread carefully in this context and not get out of depth in experimenting with change based on ideological conviction. Governments of small and less developed countries especially need to balance their ideological visions with the structural constraints imposed by global power politics.

The government appears to be fully cognisant of international power structures. This can be seen in the manner it is seeking to overcome the economic crisis. The government leadership’s ideological roots are Marxist, yet they are not making a critique of the global capitalist system and its power structures, such as the International Monetary Fund, the global lender of last resort, in order to blaze a new path. Instead, the government is acting in conformity with the IMF prescription to overcome the economic crisis. Such strategic conformity aligns with what theorists of structural realism would describe as “balancing behavior”. There is an acknowledgement of the power of global institutions and aligning national policies accordingly.

When viewed through the lens of global finance, the IMF epitomises the prevailing international economic power structure that is led by the United States. The IMF prescription is not reducing the inequitable burden of economic hardship that the masses of Sri Lankan people are forced to bear. The government is fulfilling most of the terms of the debt restructuring agreement that the former government led by President Ranil Wickremesinghe agreed to. The government’s determination to follow through on the IMF agreement is due to its recognition that it has found no viable alternative to it. The high‑level IMF delegation that visited Sri Lanka from 15–16 June 2025 were received positively. The negotiations that took place were part of ongoing dialogue around the IMF bailout and targeted debt restructuring.

Dual Crisis

As a country that recently defaulted on its international debt repayments, declared international bankruptcy, experienced inflation peaking at around 70 percent, and saw its poverty level double to include a quarter of the population, the government cannot afford to take risks. In order to safeguard its economy and the lives of its people, it needs to have the support of the IMF. The IMF has warned that “there is no room for policy errors,” noting that about half of Sri Lanka’s sixteen past IMF programs failed prematurely due to reversals. This stark reminder underlines why the traditional Marxist critique has been sidelined as suggested by IMF’s First Deputy Managing Director Gita Gopinath in her remarks during the IMF visit.

However, the economic crisis is not the only global‑level crisis that Sri Lanka faces. It also has been facing a crisis of its international legitimacy due to accusations of human rights violations during the three‑decade‑long war. The visit of UN High Commissioner for Human Rights Volker Türk to Sri Lanka this week is the first such high level visit since 2016. The government seems to be making every effort to make the visit a positive one it did with the IMF one. The UN High Commissioner is being facilitated to visit the north and east of the country to meet with a wide cross‑section of society, and will also be visiting the latest mass grave discovered in Chemmani in the north. Indeed, it can be seen that the government is exercising a nuanced realpolitik. It is balancing its Marxist roots with global economic orthodoxy from the IMF and at the same time engaging with international human rights scrutiny led by the UN.

The visit to the Chemmani mass grave is particularly significant. The most controversial and divisive aspect of dealing with the past is that the accusation of war crimes by Sri Lankan security forces. The soldiers who fought in the three‑decade‑long war are referred to in common parlance as “war heroes” by political leaders and the majority community alike. There is strong emotional and political resistance to punishing the security forces personnel who fought in the war. Across countries, and time periods, matters such as truth commissions and prosecutions hinge on balancing collective memory, national identity, and the demands of victims. These are often a recipe for societal disagreement unless very carefully managed.

More Loaded

The visit of the UN High Commissioner to Sri Lanka will be a more politically charged and emotionally loaded event than the visit of the IMF delegation. The IMF visit was to encourage the government to stick to financial targets and engage in economic reforms. These do not engage emotional sentiment. But even here, there were some lines that the government did not cross. One of those was the issue of privatization of state assets, including the loss‑making national airline. The government has continued to stand by its policy that some state assets will not be for sale. Indeed, President Anura Kumara Dissanayake has emphasised the need to protect national assets even while acknowledging the need for reform.

The visit of the UN High Commissioner will be more divisive than that of the IMF as it is about dealing with the past, finding out the fate of those large numbers who went missing, and punishing those guilty of war crimes. A previous government tried to deal with these issues by co‑sponsoring UNHRC Resolution 30/1 of 2015, but it was unable to proceed very far with this due to the intense opposition it generated from the opposition and nationalist sections of the population. Human Rights Commissioner Türk’s visit to Chemmani to engage in site verification and cross-community dialogue suggests that the government may be following a strategy of public engagement which the international community can identify with.

In both the IMF and UN interventions in Sri Lanka, it is the Sri Lankan government and society that will need to sustain any promise made and solution reached. Those from the international global institutions will come and go but Sri Lankans will need to live with the consequences of the decisions made. It is therefore important that the Sri Lankan parties to the problems that need to be addressed and both political representatives and those from civil society should be consulted and their buy‑in obtained. Unless reform is rooted in public discussion, in parliament and in civil society, reform measures will not be sustainable. There are also immediate changes that can be made such as in land return, demilitarization and increased reparation payments that display sincerity of purpose. Sustainable solutions emerge from internal legitimacy rather than external imposition.