The dramatic events taking place in Sri Lanka are practically a mirror image of what happened to the Philippines in 1986.
The people of Sri Lanka decided that they had had enough of their president, Gotabaya Rajapaksa, who had brought their country to the brink of economic collapse.
Instead of heading to the presidential palace, they headed for the mansion where their corrupt and incompetent leader lived. Good thing that president was not there at that time, or he would have been torn to shreds by the very same people who not too long ago looked upon him as a hero and savior.
Sounds familiar, huh? But there’s more.
Their president rushed to foreign shores before even handing in his resignation, which he eventually did via email of all things.
No, he did not head for Hawaii as a certain Philippine dictator did, but to nearby Maldives then to Singapore, where he will probably stay until he finds a country which will accept him on a more permanent basis.
But while what’s happening in the country formerly known as Ceylon looks like a repeat of the Philippines’ Edsa People Power revolt of 1986, a warning has also been raised that the Philippines could potentially follow in the footsteps of Sri Lanka where the economy is concerned.
In the weeks before their leader was overthrown, the economy of Sri Lanka was in horrendous shape, with inflation exceeding the 50 percent mark.
The country’s dollar reserves which is used to pay for oil imports and other consumer essentials was depleted soon enough, and Sri Lanka has asked the World Bank and friendly countries to extend an emergency loan.
In the meantime, the people are facing serious shortages of oil and gas, and more importantly, medicine, among others. While this is happening, the value of their rupee is fading fast to the point that it will soon be the equivalent of our wartime Mickey Mouse money used during the Japanese occupation. In short, nearly worthless.
At the time of their great leader’s exit, no one was willing to extend them any credit. Not even China which uses loans to take virtual control of countries unable to pay back those loans.
Is there a lesson here for the Philippines? A message, perhaps?
You’re damn right, there is.
Inflation in our motherland may not be anywhere near that of Sri Lanka, but the trend is disturbing to say the least. The current president showed recently that he has little, if any, understanding of economics by simply denying the 6.1 percent inflation logged by the country last month.
Nobody bothered to tell him that denying a truth does not change it.
Also, the Philippine peso is fast losing its value, with no indication that the currency will regain its strength anytime soon.
As of last week, the Philippines was again seeking fresh loans because its fiscal situation was not in good shape.
The government’s debt is in trillions of pesos, and the mega projects of the Duterte regime have been exposed to be mostly fake. China, which had promised to fund the projects, has backed out of some of the bigger ones, leaving the current administration holding an empty bag.
The International Monetary Fund recently warned that the Philippines is one of the countries in real danger of following in the footsteps of Sri Lanka.
The Philippines’ current leadership should not be so smug and say that Big Brother China will come to its rescue, as they had promised former President Rodrigo Duterte. That the big loans promised to fund three major railway projects was nothing more than a pipe dream should serve as a warning: China’s Xi is not to be trusted.
Now President Bongbong Marcos wants his economic team – comprised of some outstanding bureaucrats, to be fair – to find parties willing to take over from China.
The problem is not with his potent economic team, but in his own credibility. Foreign funders are not too excited to extend loans to a country headed by the son of a dictator who earlier took the Philippines to the brink of collapse.
The Sri Lanka situation tells them that they should be more circumspect in doling out tens or hundreds of millions of dollars in loans, with no assurance that the current regime will pay them back, with interest.
This means that Marcos regime 2 will turn to the private sector.
Prior to its serious economic problems that stunned Sri Lanka this year, its economy had been considered as being in relatively good shape with a shift to developed world status in the not-too-distant future, ahead of the Philippines.
It had a growing middle class and unemployment was in single digits.
It is worth noting that the per capita income in Sri Lanka was pegged at nearly $14,000 as of last year. By comparison, the Philippines’ per capita is estimated at $3,300. In other words, Sri Lankans were by and large doing better than their Filipino counterparts.
Unless the new leadership of the island-country – yes, just like the Philippines, Sri Lanka is an island republic, with no adjoining neighbors – is able to quickly reverse the downward spiral of their economy, all the gains made in the last few decades will be eradicated in less than a year.
What’s happening there shows that electing one clueless or corrupt leader is enough to push an entire country’s economy over the edge. And this is precisely what the current Philippine president could do in the near term.
If the people of Sri Lanka learned how to depose a despised leader from the Philippine example of 1986, then the people of the Philippines must learn from the Sri Lankan example of 2022 in that granting too much power to an untested leader where the economy is concerned results in the direst of consequences.
It remains to be seen if the majority of Filipinos – specifically the D and E portion of the electorate — are capable of learning from a lesson that is staring them in the face.