Sri Lanka and Green Policy

Jul 21, 2022
Sri Lanka on the map in relation to Australia
Image: iStock

Sri Lanka’s food problems do not stem entirely from Green Policies or Organic Farming as is being alleged in some media outlets, but from general economic and external pressures.

Many media people (for example: [1], [2], [3]) are claiming that one failed ‘experiment’ in Sri Lanka means that we should not change to organic agriculture or follow any Green policies.

However, that Sri Lanka failed to solve a problem, does not mean the problem is unreal, or that chemical fertilisers, pesticides and weed killers are not having “adverse health and environmental impacts“ as ex-president Rajapaska said to the UN. Industrialised agriculture does degrade the soil, pollute the waterways (poisoning fish and people), and is a major contributor to greenhouse gases; it releases 13% of the total GHG in Australia.

Sri Lanka could be a dire warning, but it could also be a ‘useful’ warning about bad policies and the consequences of external pressures.

The obvious mistakes 

In terms of food production, Rajapaksa banned all imports of agricultural chemicals in April 2021 without any warning. This was likely to lead to shortfalls, but the Government did nothing to increase the production of substitutes, or make the money available for purchase of substitutes. Some people have suggested these moves were deliberate to break small farmers and leave their farms open for purchase by wealthy farmers. An organic farmer is quoted as saying

Prior to this policy, the government had unsuccessfully tried to commercialise farm land, which is the biggest commercial asset the country has. So, many of us think this was another way to try and get farmers to leave their land, or to weaken the farmers’ position and enable a land grab.

Others allege it was an attempt to greenwash the country’s inability to afford fertiliser, because of the existing financial crisis (see below).

Furthermore, the government did not put in place any educational programs to help farmers learn composting techniques, or give them time to build up soil quality after their intensive use of chemical fertilisers. Essentially it withdrew aid to small farmers. With diesel prices more than doubling, many farmers could also not use their farm equipment.

Unsurprisingly, rice yields fell by about 30%, and Sri Lanka’s primary export, tea, declined by nearly 20%.

The government eventually yielded to farmers protests and relaxed the ban on fertilisers, but removed subsidies while the price of fertilisers had increased due to the war in Ukraine “because other countries have long-term contracts that have tied up supplies,” according to a retired Indian diplomat Neelam Deo. So the strain was not released.

Background Financial Crisis 

Rajapaksa also had made the classic neoliberal error of borrowing to fund infrastructure projects while cutting tax revenue. It is hard to evaluate infrastructure projects, but it is possible some were dubious, or ended up being controlled by the lender. By 2020 Sri Lankan debt had reached 101% of its GDP. One ratings organisation remarked: “the Sri Lankan government will have to allocate around 29 billion USD between now and 2026 to service debt repayments alone.”

The resulting debt, together with currency depreciation, led to overseas organisations removing money from the country, further depleting government income. In April 2022 it was reported that:

The country barely has any foreign currency reserves left, leading to dangerous shortages of food, gas and medicines as it is unable to import foreign goods, while people are enduring power blackouts of up to eight hours a day.

As well as the debt Sri Lanka’s economy had been simultaneously affected by Covid and terrorism, with a decline in tourism. Then the war in Ukraine increased fuel prices (Russia and Ukraine are also apparently its best source of tourists), later the government defaulted on 51b of debt before negotiating anything with the IMF.

There were mass protests calling for Rajapaksa to resign and almost all the cabinet resigned, in protest. There is some evidence the government was corrupt and disconnected from the people, such as the appointment of family members to important positions. The Government suppressed criticism of their policies in general. As defense minister, Rajapaska may have overseen the death of 40,000 Tamils, while others accuse him of having stolen billions from the country.

World Crisis, not Local Crisis 

Sri Lanka is not the only place in the world likely to suffer crisis. A UN Global Crisis Response Groups brief from 8th June 2022 warns that there is a global cost of living crisis, with price shocks in the food, energy and fertiliser markets, on top of the pandemic and climate change shocks. It says:

An estimated 1.6 billion people in 94 countries are exposed to at least one dimension of the crisis, and about 1.2 billion of them live in ‘perfect-storm’ countries which are severely vulnerable to all three dimensions…

Today, about 60 percent of the world’s workforce is estimated to have lower incomes than before the pandemic. More than half of the world’s poorest countries are in debt distress or at high risk of it.

The World Bank has said almost 60% of the lowest-income countries are in debt distress. The President of the World Bank stated that developing countries:

are facing sudden price increases for energy, fertiliser, and food, and the likelihood of interest rate increases. Each one hits them hard…. People are facing reversals in development for education, health, and gender equality… They’re facing reduced commercial activity and trade. Also the debt crises and currency depreciations have a burden that falls heavily on the poor… Food crises are bad for everyone, but they are devastating for the poorest and most vulnerable.

The chances are high that other countries will default or suffer considerable food distress, Sri Lanka just happened to be the first. It was not a problem of organic agriculture but of general economic failure and external pressures. Even this badly executed process of organic transition could possibly have been met with food imports or suspension of food exports, the monetary and external crises made it impossible

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