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A political crisis in Sri Lanka, where two prime ministers are fighting for power, is scaring away tourists and raising questions over foreign aid, ringing alarm bells for the economy as the currency slumps to record lows.

The turmoil in the Indian Ocean nation that has seen one premier refuse to be sacked, and another battle to prove a majority in a parliament that is banned from meeting, has caused major upheaval that Sri Lanka cannot afford.

Amidst warnings from politicians of a "bloodbath" if the dispute escalates, tourists are cancelling hotel bookings just as Sri Lankan beaches and major sites like the Temple of the Tooth prepare for peak season.

While no official figures have been given, deluxe hotels have reported cancellations and a critical decline in new bookings in the past 10 days.

"This comes at the worst possible time when people in Europe are making their holiday plans abroad," a Colombo city hotel executive told AFP. "We have had a lot of cancellations from the United States."

"With the political crisis our winter season is gone," the director of a luxury beach resort in the south of the island said.

- Tourist dollars needed -

Western nations have warned their citizens to be on their guard in Sri Lanka.

"You should exercise vigilance and avoid all demonstrations or large political gatherings," a British government advisory said.

 

It is reported that the Secretary General of Parliament Dhammika Dasanayake has been hampering Speaker Karu Jayasuriya of issuing the gazette notification to reconvene Parliament by presenting spurious legal arguments.  

Parliamentary sources said that Dhammika Dasanayake, who is a close associate of the Rajapaksa family, had once personally looked into the meal arrangements of former first lady Shiranthi Rajapaksa when she visited Parliament.

It is also reported that the Speaker had been preparing to issue the gazette notification to reconvene Parliament today (04). Joint Opposition sources, however, said that a group led by Basil Rajapaksa had met Dasanayake last night and requested the Secretary General to delay the reconvening of Parliament.

The inability of the Maithri-Mahinda faction to muster the majority in Parliament has been identified as the reason for their request to delay the issuance of the gazette notification.

The Maithri-Mahinda faction has 104 members as of now but fears of certain SLFP MPs abstaining during the vote has led the conspirators of the coup to delay the convening of Parliament until they are able to secure the majority.

SLFP MP Lasantha Alagiyawanna is currently overseas while Duminda Dissanayaka, who was recently sworn in as a Cabinet Minister, has gone into hiding, SLFP sources said. Close associates of Duminda Dissanayake said that he, together with a few SLFP MPs will act against Mahinda at a decisive moment in the future.

UNP Leader Ranil Wickremesinghe has warned that the time is running out to avert a "bloodbath" while voicing hope that Parliament will resolve a damaging constitutional crisis in the coming days.

In an interview with the AFP, Mr.Wickremesinghe has said that "desperate people" could cause chaos.

"We will be calling on our people not to resort to violence but you don't know what arises in a situation like this. A few desperate people can start off a bloodbath,” he said on Friday.

Mr.Wickremesinghe said he hoped the showdown could be ended peacefully and expressed optimism that a solution to the crisis would soon be found.

"I feel Parliament is going to prevail finally. This can't take too long. I would say in a week to 10 days at the most," he said, adding the priority was to establish Parliament's "supremacy".

Mr.Wickremesinghe said two smaller parties - the Marxist Janatha Vimukthi Peramuna and the Tamil National Alliance - were backing his call for the legislature to meet despite obstacles placed by Sirisena.

"A majority of Parliament has said all these actions (of the president) are not legitimate and not in accordance with the Constitution," he said. (Daily Mirror)

Sri Lanka’s main Tamil party today urged the president to reconvene parliament and end a worsening political crisis, as the minority ethnic community emerge as kingmakers in the power struggle.

The Tamil National Alliance (TNA) could tip the balance should parliament be recalled this week to decide between two rivals both claiming the lawful right to head Sri Lanka’s government.

Sri Lanka has been gripped by constitutional turmoil since President Maithripala Sirisena sacked his former ally, prime minister Ranil Wickremesinghe, and his cabinet on October 26.

Sri Lanka’s ousted Prime Minister Ranil Wickremesinghe arrives for an interview with Reuters at the Prime Minister’s official residence in Colombo November 3, 2018. Reuters

Wickremesinghe says his dismissal was illegal as he commands a greater majority in parliament than Mahinda Rajapaksa, the former strongman president controversially installed in his place.

The TNA has already said it would vote against Rajapaksa in a no-confidence motion when parliament reconvenes.

Both rivals have been marshalling numbers behind the scenes, worrying civil society groups who protested Sunday in the capital Colombo against the horse-trading.

TNA legislator Dharmalingam Sithadthan said the president had called the Tamil legislators to a meeting on Wednesday — the same day parliament was expected to reconvene.

“We have asked the president to immediately call parliament and end this crisis,” TNA legislator Dharmalingam Sithadthan told AFP. 

Wickremesinghe’s party risks losing legislators to Rajapaksa’s camp as the days drag by. Some members of his party have already alleged they were offered portfolios and huge amounts of money to switch allegiances.

Six MPs have already switched sides and been granted portfolios under Rajapaksa’s new administration.

The Sunday Times of Colombo newspaper described the sacking of the prime minister as “sheer political expediency” and outside the law.

The state-run Sunday Observer, now controlled by Rajapaksa-loyalists, defended the change of government but acknowledged the crisis should be resolved.

According to latest counts, Wickremesinghe has 103 MPs from the 225-seat assembly while Rajapakse and Sirisena have 101.
Most of the remaining 21 MPs — including the TNA — are set to oppose Rajapaksa, observers said.

The Sri Lanka Muslim Congress (SLMC) party, which has seven lawmakers, said its members had also rejected offers to join the Sirisena-Rajapaksa camp. — AFP

Speaker Karu Jayasuriya said he would have to continue with the previous status in Parliament until a clear majority was shown in Parliament as a majority of the MPs had requested him to accept the previous composition.

He said in a statement that MPs had pointed out that changes which had been made in Parliament were against the Constitution and the Parliamentary Tradition and they had requested him to accept the previous composition in Parliament.

He said he could not remain silent anymore on the information received by him saying that peoples’ representatives were being offered perk and privileges, violating democratic principles. (Daily Mirror)

The Central Bank of Sri Lanka’s (CBSL’s) lending to the Government of Sri Lanka (GoSL), commonly known as money printing (MP), increased by 36.61 per cent (Rs 32,014 million) to Rs 119,463.60 million since Mahinda Rajapaksa assumed duties as the country’s new Prime Minister and Finance Minister, after markets closed last Friday (26), data showed.

In contrast, a year ago on Thursday, 2 November, 2017, MP was a mere Rs 33,822.04 million; a year-on-year (YoY) increase of 253.21 per cent (Rs 85,641.56 million) since.

In related developments, in the week ended Friday (2 November), week on week, GoSL’s MP borrowing costs (BCs) increased by 24.35 per cent (Rs 550.26 million) to Rs 2,809.66 million. However, a year ago, GoSL’s MPBCs were a mere Rs 805.87 million, a YoY increase of 248.65 per cent (Rs 2,003.79 million).

MP is CBSL’s holding of Treasury (T) Bills. CBSL prints money and lends to GoSL in the absence of adequate revenue.  But MP may cause inflationary pressure while increasing GoSL’s debt.

(Ceylon Today)

It is reported that several rounds of discussions have taken place over the weekend to form a new national government between the United National Party, Joint Opposition, Sri Lanka Freedom Party and other minority parties in order to settle the current political crisis in the country.

Discussions have also centred on the possibility of dividing the Cabinet portfolios equally between the UNP, JO and the SLFP in the new national government, political sources said.

Furthermore, several senior members representing the United National Front (UNF) had met with President Sirisena for discussions but are yet to arrive at final agreement, the sources added.

They also say that the final objective is to facilitate a meeting between Sirisena and Wickremesinghe.

Sajith Premadasa, Rajitha Senarathne, John Amaratunga and Rishad Bathiudeen, with the blessing of UNP leader Ranil Wickremesinghe, had reportedly met with the president and held discussions over the past few days on the possibility of finalising an agreement.

At the same time, President Sirisena had also phoned a few UNP MPs asking for ther support to resolve the current political crisis.

The International Monetary Fund (IMF) is monitoring the present economic and political situation in the country, the IMF said in statement. 
The IMF said that they are monitoring the recent political developments while constantly being in contact with their technical counterparts and added that it is premature to assess the implications of programmes supported by the IMF. 

Sri Lanka is yet to receive the sixth tranche of about SDR 177.77 or USD 250 million of the loan facility.

With the disbursement of the sixth tranche, total disbursements under the EFF arrangement will be equivalent to SDR 893 million (approximately USD 1,264 million).

Sri Lanka is also facing a risk of the US government suspending the Millennium Challenge Corporation’s (MCC) five year assistance package worth USD 480 million.

An agreement was signed recently between Sri Lanka and the MCC recently to provide an additional LKR 413 million (USD 2.6 million) grant to finalise compact development.  

This amount supplements the LKR 1.2 billion (USD 7.4 million) grant that MCC provided last July.

The EU delegation in Sri Lanka, in a statement, urged Sri Lankan parties to follow the due institutional process and respect freedom of media.

The EU expects Sri Lanka to pursue its positive path towards reconciliation and democracy for the full benefit of the Sri Lankan people
Meanwhile, the US State Department has said it expects the teh Sri Lankan Government to uphold its Geneva commitments to human rights, reform, accountability, justice, and reconciliation.

UK and Canada continued its push for Sri Lanka’s Parliament to be convened immediately to resolve the political crisis in the country.

The British Foreign and Commonwealth office said that it was concerned by ongoing political developments in Sri Lanka and was following the political developments closely.

The Canadian Foreign Ministry said that Canada remains deeply concerned by the political situation in Sri Lanka.

Canada also called upon the Government to ensure the safety and security of journalists, activists and human rights defenders, who play a vital role in defending democracy.

President Maithripala Sirisena has issued the gazette notification to convene the prorogued Parliament.

Accordingly, the Parliament will be reconvened on the 14th of November at 10.00 am.

In a compound secured by the Sri Lankan elite special task force that protects the island nation’s top leaders, beneath framed photos of himself in army uniform, the brother of the country’s newly installed prime minister Mahinda Rajapaksa is mulling a presidential run.

“I’m not interested in actually becoming a minister,” Gotabhaya Rajapaksa, who was appointed by his brother to be Sri Lanka’s defense secretary in 2005 just before the climax of a brutal 26-year civil war, said in an interview. “But a lot of people want me to contest for the presidency.”

Gotabaya Rajapaksa.Photographer: Tharaka Basnayaka/Bloomberg

In a country where it is common to appoint family members to run key ministries, the comments aren’t much of a surprise. But they suggest the Rajapaksa clan is preparing to once again dominate politics in a nation it controlled from 2005 and 2015, when the family lost power in an election shock.

Now they are back, nearly as unexpectedly as they fell. In a surprise move last Friday, President Maithripala Sirisena fired his former ally Ranil Wickremesinghe as prime minister and appointed the mustachioed former president as his replacement.

Read more: Holed Up in Colombo Mansion, Ousted Prime Minister Vows to Fight

The move stunned everyone from officials at international ratings agencies -- who fear the chaos threatens debt repayments -- to activists who worry the return of Sri Lanka’s strongman could erode improvements in civil liberties. There’s also renewed concerns the island nation will once again tilt toward China, which holds much of the enormous debt racked up during Rajapaksa’s previous rule, even if Colombo is not as enthusiastic as before.

“Rajapaksa learned hard lessons from his last experience dealing with China on Belt and Road investments,” said Andrew Small, a senior fellow with the German Marshall Fund’s Asia program. “Although Beijing will be happy to see his return -- and was expecting it in the next round of elections anyway -- it is unlikely that the dynamic will be the same as the last time he was in power.”

Strong SupportRajapaksa could cement his return to power later this month when Sirisena reconvenes parliament, even as Wickremesinghe contests his removal as “blatantly illegal”. He’s already taken on additional duties as finance minister, and late Thursday issued a slew of populist economic measures. He cut fuel prices, slashed taxes on agricultural commodities, implemented a guaranteed price scheme for certain crops and pledged to waive interest on farmers’ loans. Rajapaksa also exempted remittances -- a key source of foreign exchange -- from income tax and cut levies on telecommunications services.

Across Colombo, freshly plastered-up posters show a smiling Rajapaksa, who had triumphed against Wickremesinghe’s administration in local elections earlier this year. Despite the controversial way in which he reclaimed power, the leader still enjoys strong domestic support for his role in ending the war, particularly among Sri Lanka’s Sinhala majority.

Motorcyclists ride past a poster of Mahinda Rajapaksa in Colombo. Photographer: Lakruwan Wanniarachchi/AFP via Getty Images

Unlike Wickremesinghe, who wears western suits and seems more comfortable in Colombo’s halls of power and foreign capitals, Rajapaksa is from the country’s rural, southern Hambantota district. He dresses in traditional Sri Lankan robes, speaks in a folksy stream-of-consciousness manner and is very superstitious, wearing rings and bracelets he believes ward off misfortune. 

As his government launched a final assault on the Tamil Tigers in 2009, his administration was condemned by human rights groups for extrajudicial killings, forced disappearances and detaining journalists and activists

There are fears that “a Rajapaksa administration will continue human rights violations in the guise of nationalism and security,” says Meenakshi Ganguly, South Asia director at Human Rights Watch.

First FamilyAt his residence on the outskirts of the capital Colombo, Gotabhaya Rajapaksa told Bloomberg many international observers don’t fully appreciate Sri Lanka’s conflict had turned Colombo and other parts of the country into a war zone, with daily car bombs and suicide attacks. Their Tamil Tiger opponents, he said, had full control over large tracts of territory and had similar weaponry to the armed forces.

“Whether it is in Sri Lanka or another country, war is not a good thing,” he said. “It’s an ugly thing. But we didn’t create the war. Mahinda Rajapaksa didn’t create the war. We ended the war.”

Read more: Inside China’s $1 Billion Port Where Ships Don’t Want to Stop

Rajapaksa’s brother denied the new government would once again lean on China to provide loans.

“We did not favor any particular country,” he said. “We want to work with anybody who wants to work with Sri Lanka, whether it’s west or east or whatever. And also we want to work with international organizations, but they have to be fair.”

‘Financial Crisis’Wickremesinghe, meanwhile, continues to fight.

He told Bloomberg he has the numbers to triumph over his rival in a vote when the suspended parliament reconvenes.

He said Rajapaksa’s administration racked up debts it couldn’t repay, and the unity government of Sirisena and Wickremesinghe had to "take the burden." Now, he added, the political crisis threatens Sri Lanka’s looming debt payments.

“Without legitimacy, how can you deal with debt?” Wickremesinghe asked. “A constitutional crisis is enough to create a financial crisis.”

‘Political Turbulence’At an intersection on the outskirts of Colombo, a billboard of the entire Rajapaksa family looms down. Mahinda and Gotabhaya are there, as is the other brother and former lawmaker Basil, and son Namal, a current lawmaker.

The sign sends “good wishes to the new prime minister,” but has an ominous message for the old one. “Keep your self respect and leave,” it warns. “Otherwise we know how to get rid of you. This battle is not over. We are alert!”

Some western diplomats are not yet engaging with any of the government’s newly-appointed cabinet ministers while Rajapaksa’s appointment is still being contested.

Namal Rajapaksa Photographer: Tharaka Basnayaka/Bloomberg

Still, Namal Rajapaksa insisted Sri Lanka would continue to pay its debts, and that his father’s Chinese-funded infrastructure projects had brought value to the country. He said their move to oust Wickremesinghe was constitutionally valid.

“It hasn’t brought instability into the country, it’s just political turbulence,” Rajapaksa said. “Our main objective in this entire process is to make sure that economic, political and social stability is brought back to the country.”

At a cafe near his father’s residence, a family presses in to get a selfie with the son of the new prime minister. Sharon Fernandes, 22, said her family are supporters of the Rajapaksa clan.

“A lot of people respect them because they actually stopped the war,” she said. “The current government hasn’t really done much -- they promised a lot, but haven’t really done anything.”

(Bloomberg)

The legislator son of Sri Lankan Prime Minister Mahinda Rajapaksa today indicated that the demand of the Tamil minority community to release all Tamil prisoners may be fulfilled soon, a move aimed at persuading the Tamil legislators to support Rajapaksa.

"President Sirisena and Prime Minister Rajapaksa would make a decision very soon," Namal Rajapaksa tweeted.

The Liberation Tigers of Tamil Eelam or LTTE had run a military campaign for a separate Tamil homeland in the northern and eastern provinces of the island nation for nearly 30 years before its collapse in 2009 after the Sri Lankan Army killed its leader Velupillai Prabhakaran.

Mahinda Rajapaksa, who was the president at the time, has repeatedly said that the war was against the LTTE and not against the Tamil community.

Since the war with the LTTE ended in 2009, the Sri Lankan government has denied that the imprisoned LTTE members are political prisoners. Tamils say some of the prisoners have been held over a long time under anti-terrorism law without even being formally charged.

Namal's comments are aimed at persuading the legislators in the Sri Lanka's main Tamil party -- Tamil National Alliance (TNA) -- to switch their allegiance to Mr Rajapaksa in his bid to prove majority in the parliament.

So far Mr Rajapaksa has 100 MPs on his side while sacked prime minister Ranil Wickremesinghe has 103 MPs in the 225-member house. Most of the 22 remaining MPs, including the TNA, are likely to oppose Mr Rajapaksa.

Mr Rajapaksa's camp had already enticed a TNA legislator to join ranks by giving him a deputy ministerial position. The TNA's parliamentary strength has been reduced to 15 as a result and there was speculation that at least four more of them were willing to support Mr Rajapaksa.

The TNA has said it will support a no-trust motion Mr Rajapaksa, amid mounting pressure on President Sirisena to let the suspended parliament hold a vote to end the political crisis.

In a statement, the TNA on Saturday said Mr Rajapaksa's appointment was a violation of the Constitution's 19th amendment. The alliance had "decided to vote in favour of the no-confidence motion against Rajapaksa," the statement said.

Mr Rajapaksa claims he has enough numbers to prove his majority and at least six of Mr Wickremasinghe's men have defected to his side. The current suspension of parliament by the president is seen as a key to Mr Rajapaksa negotiating for enough defections.

COMMENT

Mr Wickremesinghe was sacked by President Sirisena on October 26. His United National Party claims that Mr Wickremesinghe's sacking was "unconstitutional and illegal". The president's move has plunged the country into a constitutional crisis with Mr Wickremesinghe claiming he is still the prime minister.(NDTV)

A recording of a telephone conversation between Parliamentarian S.B. Dissanayake and State Minister Palitha Range Bandara, urging the latter to defect before the parliament session and join the Maithri-Mahinda government was released to media.

This was disclosed during a special press conference held at the Temple Trees today (03).

State Minister Range Bandara revealed a number of phone recordings which clearly showed how the illegal government, that was formed by the Maithri-Mahinda faction, was trying to lure Parliamentarians with promises of Cabinet portfolios and large monetary incentives of as much as LKR 500 million.

Range Bandara played a recording of a conversation between him and a person by the name of Nalin who happened to be a coordinator of S.B. Dissanayake.

A number of telephone conversations between the State Minister and a person known as Dinusha, who claimed to be a representative of Yoshitha Rajapaksa (the son of Mahinda Rajapaksa), was also played during the press conference.
 
On another occasion, Dinusha, the representative of Yoshitha Rajapaksa, had informed Range Bandara that he could provide a staggering LKR 500 million (USD 2.8 million) through Professor Ranjith Banadara if he were to crossover.

Furthermore, S.B. Dissanayake had called State Minister Bandara numerous times asking him to join the new government.

It is evident that the new government is trying to get Parliamentarians to crossover by offering huge bribes of up to millions of US dollars.
Furthermore, the State Minister intimated that he owns a few more phone recordings of VVIPs that had called him.

The Minister added that even though his life was now in grave danger due to the disclosure of these recordings, he had an obligation to come forward and tell the truth the country.

He said that all the MPs that did crossover during the past few days as well as the ones who are planning to crossover in the future are all doing it for the love of money and ministerial portfolios and not for the love of the country.