Sri Lanka and Maldives are facing a formidable dual challenge of controlling the impact of COVID-19 on their economies amid attempts at political and economic stability.
The COVID-19 and the consequent global recession projected by the International Monetary Fund (IMF) for 2020-21, due to restrictions imposed on travel and trade globally, may hit particularly hard those countries that are struggling to have stable political and economic structure in place and those particularly depending on tourism for revenue generation due to demographic constrains. In South Asia, the island states of Sri Lanka and Maldives are examples in this regard and both the countries are facing a formidable dual challenge of controlling the impact of COVID-19 on theireconomiesamid attempts at political and economic stability. Thisissue brief touches upon the developments pertaining to COVID-19, initiatives taken at the domestic and regional level, responses and possible implications.
Sri Lanka with a population of nearly 21 million has 122 reported cases of COVID-19 up to31stMarch 2020with two deaths. For the island nation’s economy that depends greatly on tourism, the spread of COVID-19 is a major setback while still trying to recover from thirty years of ethnic warandtheEaster Sunday attacks in April 2019.Sri Lanka attained an upper middle-income country status in 2019. The new government in Sri Lanka led by GotabayaRajapaksa that came to power in November 2019 was hoping to build on this by increasing foreign investments in important sectors such as ports, transportation, communication, energy and manufacture. The spread of COVID-19 in Sri Lanka can be a setback to the government’s economic plan that talks about people-centric economic development. In this scenario, the government of Sri Lanka has taken various measures to contain the spread.
Number of persons affected by COVID-19
The first COVID-19 patient was reported in Sri Lanka on 10th March, a 52-year-old travel guide. After the outbreak, Sri Lanka has taken steps to quarantine Sri Lankans as well as foreigners arriving from Italy, South Korea and Iran. By early March around 685 people were quarantined at towncentres at Batticaloa. Visas for Europeans were suspended for two weeks on 13th March and later all incoming international flights weresuspended.Sri Lanka extended the validity period of all types of visas issued to all foreigners who are currently residing in Sri Lanka with effect from 14th March to 12th April 2020.The table below provides information on nationality of infected persons in Sri Lanka:
Nationality of Infected Persons in Sri Lanka
The government of Sri Lanka imposed ‘curfew in the districts of Colombo, Gampaha, Kalutura, Puttalam, Kandy and Jaffna and in other districts partial curfew has been imposed. The village Atalogama in the Kalutara district and the village Akurana in the Kandy district have been declared completely isolated areas as no one will be allowed to enter or leave from these two villages’. Number of reported cases as on 31st March 2020 is given below.
Steps taken to combat the pandemic
The government of Sri Lanka in response to the pandemic ‘organised awareness programmes, measures were taken to disinfect public transport, directed the public to minimise public gatherings and asked the public to utilise internet for educational and service purposes’. A case study on how China handled the pandemic has also been suggested.
Sri Lanka established a Presidential taskforce and the Army Commander Lieutenant General Shavendra Silva has been tasked to spearhead the National Operation Centre for Prevention of COVID-19 outbreak. A special taskforce has also been established under the leadership of Basil Rajapaksa to ensure the smooth delivery of essential items. Around 18 hospitals are asked to treat patients of COVID-19.
On 23rd March President Rajapaksa announced various relief measures. Notable among them are:
Notable among the initiatives taken by the government of Sri Lanka was to announce a special fund “COVID-19 Healthcare and Social Security Fund”,Rs. 100 million was set aside fromthe President’s fund and government appealed for domestic and foreign contributions/donations andlifted tax and foreign exchange control restrictions.On a positive note, COVID-19 Healthcare and Social Security Fund received up to 31st March 2020, Rs. 140 million from various associations and persons. The government also decided to free persons jailed for minor offences. It also took strict measures against curfew violators.
The panic created by the pandemic led to requests by Sri Lankan expatriates to return to their home country. But the government of Sri Lanka requested the expatriates to stay where they wereto control the spread of virus. According to Dr.HarithaAluthge of the Government Medical Officers Association (GMOA), Sri Lanka entered acluster transmission stage which requires a careful handling.
Over 17,457 Overseas Sri Lankans (OSL) had by 28 March, registered on the ‘Contact Sri Lanka’ Online Portal of the Ministry of Foreign Relations. Of these, 6773 are from the Middle East region, 1892 from Europe, 1302 from South Asia, 1028 from North America and over 6000 from other parts of the world. However, the government repatriated 1500 Buddhists pilgrims, stranded in India by 22nd March.
Support to Regional Cooperation
President of Sri Lanka participated in the video conference initiated by the Indian Prime Minister “SAARC Leaders on Combating COVID-19”. At the video conference he proposed a “collective response to combat COVID-19 and called for a SAARC Ministerial Meeting to discuss measures to overcome the health threat”. Indian Prime Minister’s call to set up a COVID-19 emergency fund by pledging $ 10 million was welcomed by Sri Lanka. Sri Lanka pledged $5 million to this fund.
Hard on fragile economy
By 15th March Sri Lanka banned tourists from 12 countries including Italy and South Korea where large number of Sri Lankans are working. This impacted tourists arrivals in Sri Lanka and ‘there has beena decline of 70 percent when compared to tourists arrivals last year, when the arrivals were 244, 328’.In 2020, March arrivals stood at 71,370. Almost 98 percent of tourists travel by air and majority of them are from Europe and Asia and Pacific. India is the largest market for Sri Lanka since the beginning of 2020.
The economic impact of COVID-19 was highlighted by the President of Sri Lanka at the video conference with SAARC leaders. The Sri Lankan President said that tourism industry which was just recovering after last year’s April 21st terrorist attacks is affected including exports. Therefore, he strongly recommended to the SAARC leaders to formulate a mechanism to assist economies to tide over this very difficult period.
Sri Lanka got considerable contributions from domestic and foreign donors’aftermath of tsunami as well as after the war ended in 2009. President of Sri Lankan also requested international donor agencies to provide a debt moratorium or debt deferment facility to all vulnerable developing nations due to the COVID-19 risk.
Out of Sri Lanka’s total labour force of 8,387,759 in 2018, those that are employed amount to 8,015,166, both male and female. Unemployment rate slightly increased from 4.4% in 2018 to 5.1% in 2019. Sri Lankan citizens departing for foreign employment mainly consists of skilled, semi-skilled and un-skilled and house-maids. The return of the labour force may create trouble for the government in creating domestic job opportunities.
Testing capacity is an issue
Sri Lanka’s well entrenched public health network and services is an asset in its fight against COVID-19. Having the highest literacy rate in South Asia, more than 95%- and good social indicators in the region with life expectancy of 74 for male and 64 for female, it is better placed in dealing with the pandemic when compared to other South Asian countries. However, according to the Global Health Security Index, at the global level, Sri Lanka ranks 145th in its preparedness and management of spread of an epidemic and ranked 122 out of 195 in category of robust health system to treat the sick and protect health workers. Availability of testing kits has been an issue and medical experts have urged the government to ‘use every available facility for Real-Time Polymerase Chain Reaction (RT PCR) in Sri Lanka rather than waiting to build new labs which cost millions of rupees and take time’. As on March 30, 2020, Sri Lanka has done nearly 2280 tests.
Politics amidst the pandemic
The government has postponed the general elections in Sri Lanka which were due in April this year.Amidst the measures taken by the government to deal with the COVID-19, the government has taken various political decisions much to the disappointment of minority communitiesand human rights organisations. Sri Lanka in late February 2020, withdrew from co-sponsorship of United Nations Human Rights Council (UNHRC) resolution of 40/1 titled, “Promoting Accountability, Human Rights and Reconciliation in Sri Lanka” which also incorporates and builds on preceding Resolutions 30/1 of October 2015 and 34/1 of March 2017.The President pardoned on 27 March 2020, the former Sgt. Sunil Ratnayake, one of the very few cases of convicted security personnel accused of serious human rights abuses during the civil war and after.He also appointed the Army Commander,Lieutenant General Shavendra Silva, also accused of human rights violations, to spearhead the National Operation Centre for Prevention of COVID-19 outbreak.The decisions taken by the Sri Lankan government may not help in bringing communities together in its fight against the current health emergency. For example, The Sri Lankan Tamil Civil Society Forum in statement issued on 28 March stated that “the act of pardon in these extraordinary times is a reminder that President Rajapaksa will not care for the sentiments of the Tamil people”.
The COVID-19 may put at risk the communities that are still battling the aftermath of the conflict and living as Internally Displaced Persons (IDPs) within Sri Lanka. More than 37,000 IDPs mostly belong to Sri Lankan Tamil and Muslim minority communities are yet to be resettled.Sri Lankan opposition leaders have also criticised the government of not taking necessary action required to stop the spread of virus,justto conduct parliamentary electionswhich were earlier scheduled in April.After the death of second COVID-19 patient in Sri Lanka on 30 March 2020, a Muslim, the Sri Lankan Muslim Congress (SLMC) leader accused the government of violating the World Health Organisation (WHO) guidelines in conducting the last rites. The patient at the Negombo Hospital had been cremated immediately after his death. According to the WHO guidelines, “the dignity of the dead, their cultural and religious traditions, and their families should be respected and protected. The WHO guidance also says that hasty disposal of a dead from COVID-19 should be avoided”.It remains to be seen how the government is going to handle such accusations by the minority community leaders.
Maldives with a population of nearly 4.36 lakhs reported its first case on 7th March and up to 30 March 2020,has reported 18 confirmed cases and two deaths. The President of Maldives Ibrahim Mohammed Solih stated that Maldives tourism industry is experiencing significant losses. Maldives is particularly vulnerable as the economy is dependent mostly on tourism both directly and indirectly. Due to the spread of COVID-19 and travel restrictions imposed around the world already ‘impacted the arrival of tourists to the country from China and Italy, two largest sources of tourists for Maldives. Due to the impact Maldives is facing a $ 450 million shortfall in foreign currency earning’.
Steps taken to minimise economic burden on people
To contain the spread of the coronavirus, the government has stopped the issuance of on-arrival visas from 27th March and asked all staff to stay in respective resorts for14 days after the departure of the last guest. In addition, the government announced various policy decisions to minimise the burden on people. Repayment of loans taken for small scale enterprises and agriculture and housing has been delayed for another six months and subsidised the electricity and water bills for the April and May. 4000 students have also been granted debt relief for the loans taken for education. MVR 2.5 billion economic stimulus packages has been announced for the businesses experiencing economic losses. Two isolation facilities have been developed to treat COVID-19 patients in Farukolhufushi and near TreeTop Hospital in Hulhumale.
One important challenge for the government of Maldives is to contain the spread of COVID-19 among migrant workers mostly from South Asia. There are nearly one lakh migrant workers in the country and two cases have been reported so far among migrants. To cater to the needs of migrant workers the government made arrangements for a ‘dedicated COVID-19 clinic in Hulhumaleisland. But the question remains about how the facility can be used by migrants scattered in islands’. Given the current situation Human Rights Watch asked the government of Maldives to ‘ratify the International Convention on the Protection of the Rights of all migrant workers and members of their families immediately’.
Another challenge is to maintain the workforce in resorts, closed temporarily due to ban on tourists to the island. 155 resorts are operating in the Maldives. Already, the impact of COVID-19 on resort workers became apparent after ‘nearly 11,000 resorts employees are forced to go on no pay leave due to shutdown of resorts.
Expecting regional and international support
Maldives also supported the initiative taken by the Indian Prime Minister and took part in SAARC video conference. In 2003, Maldives hosted the meeting of SAARC Health Ministers when the region faced the spread of SARS.
Maldives ranked 83 in its preparedness and management of spread of an epidemic and 117 out of 195 countries in category of robust health system to treat the sick and protect health workers. It needs support to deal with the pandemic, as health facilities are not equipped enough to deal with the current situation.
At the conference, the President of Maldives appreciated the help provided by India in sending medical professionals and medicines to the island. He also proposed a comprehensive regional strategy comprising three elements, which include closer cooperation ‘between the health emergency agencies to ensure that the countries in SAARC have unhindered exchange of information about the virus and best practices; economic relief package and long-term recovery plan’.
The People’s Government of Yunnan Province of People’s Republic of China has donated epidemic prevention materials.Maldives has established a COVID-19 emergency relief fund with a pledge of US $ 200,000 and also concurred with SAARC Development Fund to mobilise US $ 5 million as grant aid from its existing budget for COVID-19 emergency efforts’.
Both Sri Lanka and Maldives are expecting robust help from international actors to deal with this health emergency. The statements, given by their leaders are indicative of their expectations in this time of dire need. Generally having good social indicators in the region provide a base for both the countries to build strongpublic health system which can handle health risks arising from the pandemic. It seems that both the governments have taken timely measures to lessen the burden on their citizens. But the spread of COVID-19 globally may place unsustainable burdens on both economies. Sri Lanka having a fluid political system based on fragileethnic relations is particularly vulnerable, as it has repeatedly ignored the concerns of international actors to work on reconciliation. It remains to be seen how the regional and international cooperation can help overcome the challenge faced by both the countries.
*Dr. Samatha Mallempati, Research Fellow, Indian Council of World Affairs.
Disclaimer: The views expressed are that of the Researcher and not of the Council.
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