23rd IMCWP, Contribution by CP of Sri Lanka

10/25/23, 1:22 PM
  • Sri Lanka, Communist Party of Sri Lanka 23rd IMCWP En Asia Communist and workers' parties

The submission of Communist Party of Sri Lanka for 23rd International Meeting of the Communist and Workers Parties of the world


The Central Committee of the Communist Party of Sri Lanka conveys the warmest revolutionary greetings to the participating comrades in the important 23rd International Meeting of the Communist and Workers Parties of the world.

Overview of international situation

The year we are passing has brought profound changes to the international order. As a result of the refusal to accept the demand of Russia to not to expand NATO to Ukraine and remove strategic weapons from countries joined it after 1997, Russia had to start a limited military operation in Ukraine, where it faces the entire NATO and collective West.

The collective West imposed thousands of economic sanctions and restrictions against Russia and requested the rest of the world to follow them. Not only that the economic sanctions have boomeranged, the Global South (the countries in Asia, Africa and Latin America) has refused to be a part of the sanction war and in-fact they have increased their trade and economic activities with Russia.

The establishment of diplomatic relations between Iran and Saudi Arabia and admission of Syria to Arab League are two important developments which will have far-reaching impact in the Middle-East. It seems that a wave of anti-colonialist activities are taking place in Africa by the way of militaristic up-risings. The ant-imperialists are gaining grounds in Latin America.

While the weight of G-7 is losing, it seems that BRICS is rising in the way of BRICS + by adding Argentina, Eagypt, Saudi Arabia, United Arab Emirates, Iran and Ethiopia as members. The G-20 summit held in Delhi became more reflective of Global South by refusing to toe the line introduced by countries of Global North. New multi-lateral financial organizations such as New Development Bank and Asia Infrastructure Investment Bank are gaining grounds and countries are increasingly moving away from Dollars.

Finally the main spokespersons of the capital of the Global North have accepted these facts. It was State Secretary of United States of America Anthony Blinken who said that the Old World Order is over and they will have to find ways and means to lead the New World Order. Then it was Jake Sullivan who declared that the ‘Washington consensus is over, and a new consensus is needed’

These are profound changes happening in the world and the central to all above developments is the changes happened in the world economic order by Asia becoming its vanguard and Chinese economy becoming the engine of the growth of Asian (actually world), economy. This happened after 500 years.

It is obvious that these developments have created more favourable conditions all over the world and in all fronts to accelerate the anti-imperialist struggles and the fight against exploitation, oppression, for the social and democratic rights of workers and peoples, against militarism and war, for peace and socialism.

Sri Lanka Situation


Sri Lanka is going through the deepest and worst economic, political and social crisis in its history. I would like to briefly discuss the situation from CPSL point of view.


Current economic crisis


After the 1977 general election, the neo-liberal economic strategy was adopted by the newly elected government and the constitution was changed to create the political stability required for it. Although there were changes of government during the period from 1978 to 2022, the ‘neoliberal economic strategy' was implemented through-out, continuously.


Examining recent history, it appears that industrial capital and its modernizing effects have failed to take root in Sri Lanka, and trade and finance capital continue to dominate the economy through the estate economy, tourism and service sectors. Since liberalizing its economy in 1977, Sri Lanka has followed the terms of the Washington Consensus limited only by the political imperative to maintain a basic level of employment and social welfare in order to win elections. Sri Lanka has suffered from a massive and persistent trade deficit of around 9% of GDP due to the privatization of state-owned enterprises (SOEs), trade liberalization and the lack of an industrial policy to improve the competitiveness of domestic capital.


Composition of the crisis

The unprecedented economic crisis in Sri Lanka is essentially the crisis of neoliberalism itself. By 2022, the economic crisis had erupted into a triple crisis as financial, foreign-exchange and credit.


A local currency crisis, unseen in other countries, occurred because the treasury was empty. This trend   was gradually developed since 1978. Although government revenue was 24% of GDP in 1978, it was dropped to 6% by 2022. This negative trend was flowed through tax policies. Unlimited tax amnesties, tax limitations, tax reliefs and tax abolitions were parts of the above mentioned tax policies.


A dollar shortage emerged through the foreign exchange crisis. The reason behind this was the rapid decline in the balance of trade and balance of payments. An import economy was created instead of the expected export economy. The main feature of neoliberalism, the policy of unrestricted importation for the sake of overconsumption, was the direct cause of the collapse of the balance of payments.


The third characteristic of the crisis is the credit crisis. When the crisis was erupted in 2022, the foreign debt was $52 billion ($52,000 million). In 1978, Sri Lanka's total foreign debt was 743 million dollars. Foreign borrowing was initially limited to governments and international financial institutions.


After the 2008 global crisis, foreign borrowing expanded to international financial markets. It was an easy way for nation-states to obtain foreign loans, without any conditions or policies. Neoliberal economic strategy opened the door to free movement of capital, resulting in the emergence of smuggling capital funds outside of nation-states around the world. This opened the way to launder black money (foreign exchange). Providing foreign loans to nation-states through this new system was an international racket. The sovereign bond mechanism was instrumental in ensuring the recovery of these loans. Sri Lanka also started borrowing from sovereign bonds in 2007 and including 12 billion US dollars borrowed during 2015-19 which was totaled to 17 billion dollars by 2022.


Reflection of the crisis

The World Bank estimates that half a million Sri Lankan jobs were lost between 2021 and 2022, while those who continued to work have undergone a 15% decline in their real incomes. The World Bank also estimated that Sri Lanka’s poverty rate doubled from 13.1% in 2021 to 25.6% in 2022, corresponding to an additional 2.7 million falling into poverty within the span of one year. The urban poverty rate has tripled to 15% and more than 50% of the estate population is now below the poverty line. However, a domestic study by the Department of Economics and Statistics at the University of Peradeniya suggested that the real number of people who fell into poverty in 2022 could be over 9 million. Meanwhile, the World Food Program estimates that nearly 70% of Sri Lankan households have reduced their food intake, leading to a crisis of malnutrition.


In the above context a statement was issued by the Central Committee of CPSL after its meeting held on 23rd September 2023 and few sections of the statement are quoted below;

“In the above national and international context, a scientific, pragmatic and people-centered approach should be taken in finding solutions to our economic crisis. The first step in that direction should be to distance ourselves from the neoliberal economic strategy based on 45 years of experience. That task cannot be accomplished by the right-wing political forces, since they as a class, have neither the will nor the ability”.


“Accordingly, fulfilling that historical need and task is assigned only by a political alliance formed with a combination of center-left political forces”.


“At this critical juncture, if the progressive, left and patriotic forces neglect their historical responsibility, the country may turn into an ungovernable state of anarchy. Likewise, right-wing forces will not hesitate to allow extra-legal or even military intervention”.


“Therefore, the Communist Party of Sri Lanka emphatically expresses the imperative need for a broad-based political alliance of anti-imperialist, progressive and patriotic forces in order to accomplish the national task of building the economy based on a common minimum programme”.


The 80th Anniversary of CPSL

The CPSL celebrated the 80th anniversary of its foundation on 03rd July 2023 and grateful to Communist Party of China, Communist Party of India, Communist Party of India (Marxist), Communist Party of Nepal (United Marxist Leninist), Communist Party of Nepal (Unified Socialist) and Communist Party of Bangladesh for participating in our anniversary events.

The CPSL presented an alternative development programme to the country during the anniversary events and it has been able to gain recognition among wider population groups.

Long live the international Communist Movement!