Sri Lankan President Faces Biggest Street Protest over Economic Crisis

On Saturday, tens of thousands marched on the office of embattled Sri Lankan President Gotabaya Rajapaksa, in the country's largest demonstration to date over the country's catastrophic economic and political situation.

In the country's worst economic downturn since independence in 1948, Sri Lanka's 22 million citizens have experienced weeks of power outages and severe shortages of food, fuel, and other commodities.

According to AFP correspondents, Saturday's social-media-organized rally drew the greatest crowds since the crisis erupted last month.

Sri Lanka has recently experienced economic instability due to a significant scarcity of foreign currency, which has prevented the government from paying for basic imports such as fuel.

On Saturday, the Sri Lankan corporate community, which heavily sponsored the Sri Lankan President's election campaign, looked to abandon him.

"We need a cabinet and interim government within a week at most," said Rohan Masakorala, president of the Sri Lanka Association of Manufacturers and Exporters of Rubber Products.

His group joined 22 other business and industry groups in calling for a change of administration, claiming that daily losses from the fuel crisis alone had reached $50 million.

They stated they were responsible for about a quarter of the country's $80.17 billion gross domestic product and warned that millions of jobs would be jeopardised in a joint statement.

Nandalal Weerasinghe, the newly appointed governor of the central bank, said the current crisis was the result of a succession of monetary policy mistakes, with no dollars to finance many imports.

Weerasinghe imposed the country's largest-ever interest rate hike of 700 basis points on Friday in a desperate attempt to shore up the free-falling Sri Lankan currency. He stated, "We are now in damage control mode."

He noted that as he eases his predecessor's harsh foreign exchange restrictions, which he regarded as counter-productive, he expects the Sri Lankan rupee to stabilise and dollar inflows to improve.

Samagi Jana Balawegaya, Sri Lanka's major opposition alliance, demanded on Friday that the government fix the ongoing economic crisis or face a no-confidence vote.

Officials from the Finance Ministry say that sovereign bondholders and other creditors may have to take a haircut as the government prepares for bailout talks with the International Monetary Fund next week.

On Friday, new Finance Minister Ali Sabry told parliament that the IMF will provide $3 billion to maintain the island's balance of payments over the next three years.

"We aim to receive roughly a billion dollars every year for the next three years, totaling three billion dollars in support," he added, adding that Colombo will also seek a debt moratorium.