Sri Lanka’s Stock Market Shuts After 5.9 Percent Decline Triggered by Cabinet Resignations

Opposition activists protest against rising living costs at the entrance of the president's office in Colombo, Sri Lanka, on March 15, 2022. Ishara S. Kodikara/AFP via Getty Images

Sri Lanka’s cabinet ministers resigned en masse as protests over the government’s handling of the country’s worst economic crisis in decades escalated, the education minister said on April 3.

The country’s stock exchange fell by 5.9 percent following the mass resignation, prompting authorities to halt trading on April 4, AFP reported.

Education Minister Dinesh Gunawardena said all cabinet ministers submitted resignation letters to the prime minister during a late-night meeting on April 3, India-based news agency Madhyamam reported.

Namal Rajapaksa, the prime minister’s eldest son, also resigned from his role as sports minister. Prime Minister Mahinda Rajapaksa and his brother, President Gotabaya Rajapaksa, didn’t resign and will remain in office.

“I have informed the [secretary] to the president of my resignation from all portfolios with immediate effect, in the hope that it may assist [the president and prime minister’s] decision to establish stability for the people and the government of Sri Lanka,” Namal Rajapaksa wrote in a Twitter post.

The move comes after Sri Lanka declared a state of emergency following a violent protest outside of the president’s private residence on March 31. Sri Lanka’s Media Division stated that the protest was led by “a group of organized extremists” carrying “iron bars, knives, and sticks.”

More than 50 people were arrested, according to police, prompting the government to impose an indefinite curfew in and around Colombo on April 1 to quell sporadic protests that have broken out over shortages of essential items.

The military has since been given the authority to arrest suspects without warrants. Gotabaya said the decision was taken in the interests of public security, the protection of public order, and the maintenance of supplies and essential services.

The government blocked all major social media platforms on April 3 as a result of the unrest, but lifted the ban 16 hours later. The move drew criticism, with even Namal Rajapaksa calling the ban “completely useless.”

Sri Lanka is experiencing its worst economic crisis in decades, with its foreign exchange reserves plummeting by 70 percent in the past two years to about $2.31 billion, leaving it unable to pay for essential imports. Additionally, the country must settle a $4 billion debt this year.

The government imposed a 10-hour power cut on March 30 because of a lack of foreign exchange to pay for fuel imports. The power outage was extended by three hours the following day, resulting in a 13-hour rolling nationwide blackout. Some hospitals were forced to suspend routine surgeries because of acute shortages of fuel and life-saving medicines.