tv Inside Story Al Jazeera April 3, 2022 8:30pm-9:01pm AST
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change is directly related to the drug that we are witnessing now. the frequency of those climatic shock is and are increasing people who live in rural areas. their capacity to recover from those shocks. easy, extremely, extremely challenging because because of the frequency of the shocks back in the north, the herd is these animals have died a moving into camps. 2 people have survived here, hurting animals for thousands of years. as the droughts become more frequent and more severe. it's not clear if their way of life can continue or how they will survive. malcolm web al jazeera gal kaya somalia. ah, this is out, is there a lazy top stories, rushes defense ministry says images of dead bodies in a town near the capital cave. and yet another provocation, ukraine is calling on the international criminal court to visit butcher,
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where it says there's been a massacre. you can germany pledging more sanctions to punish russia limited in. indeed, this is young genocide, larger jim, jim mission united, which is not always the 1000000 elimination of the whole nation. and the people, gentlemen, we are the citizens. when you print, you have more than a 100 nationalities. this is about the data destruction and extermination of all. we are the citizens of ukraine, and we don't want to be said june to the policy of russian. all the reason we're being veterans to be destroyed and exterminated, understand it happening in the europe of the 21st century. so this is the torture of the whole nation. russia's defense ministry says its missiles strikes,
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have destroyed an oil refinery and 3 fuel storage facilities in odessa, ukraine's naval headquarters is in the port city walk as than's opposition is challenging a decision to hold a new election in the next 90 days. supreme court is hearing a petition on monday off to pakistan's, president dissolved parliament elliot, no confidence motion against prime minister miran cohen was dismissed without a vote. poles have closed in hungary selection, which has been overshadowed by the war and neighboring ukraine. prime minister victor all bound is a close ally of russian president vladimir putin and is hoping to extend his 12 year term. the race is the closest in years opposition. parties have come together to put a single candidate. as your headlines denise continues here now to they're out inside story ah,
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protests shortages and a state of emergency. what's behind the dire economic crisis in lanka? can the countries finance is the salvage? what will the political consequences b, they aren't. this is inside stored. ah hello and welcome to the show i'm sam is a than now. sure lanky is going through its worst economic crisis and morton 7 decades. the countries usable foreign currency reserves have plunged below
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$1000000000.00 limiting its ability to repay loans. and traders can't get dollars to buy imports. while over the weekend the government imposed the curfew after violent demonstrations broke out. protesters are angry over unprecedented shortages of food fuel and medicine. but opposition parliament members have defied the curfew to march in the capitol summer, calling for the president to step down. michelle fernandez has this report from columbo emergency regulations are 36 are curfew, and special new rules. preventing people from gathering in public places failed to silence people's voices and protests like this. you're hearing the holland behind me all coming together despite the curfew to express their anger and frustration against the current government. i mean, some of the signs, even within this group, it's go home, roger boxer with 225. that's an odd to the $225.00 representatives in parliament.
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it says create a we've a go home. got are. these are the sort of tag lines or slogans of this public demonstration that we're seeing across the country are not just here in the capital, colombo, but around the country. not the economic problems that brought shanker to its knees . and now directly impacting ordinary sri lankan in the form of skyrocketing prices, of their essential goods, rice doll, milk powder, as well as cooking gas of fuel. even those who have the money can't actually shows them they spend hours in long queues. and what people say is, while this is obviously not a she lanka, a sort of specific phenomenon, the world is facing problems after the corona pandemic. that the mismanagement by the sri lankan government of failure to admit that it was having problems as well as corruption, has aggravated the situation. so that's why that is this anger and she lancoste
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trying it, scrambling to try and deal with these issues, but they're in for the long haul. miller fernandez for inside story. let's examine what turns frank has foreign debt burden into an unprecedented economic crisis. it's tourism sector, major foreign exchange earner was battered by b easter attacks in 2019 and the pandemic. and now 2 countries that are vital to its tourist market are at war. russia and ukraine had been the 1st and 3rd largest source of visitors. this year, a fail drive to become the 1st country to farm entirely organically also hurts food supplies tra, lanka was forced to import rice, the tea crop. the nation's topic sport was devastated, shrank, wants china, a major lender to restructure its debt, and it secured $1000000000.00 relief package from india. the. let's bring in our gas,
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they're all in colombo. how should the silver is a member of parliament? he represents the main opposition party as j. b brovana fonseca, a senior researcher and the attorney at law with the center for policy alternatives . and w a which was dana, is a column, is that the daily financial times and a former deputy governor of the central bank of sri lanka, a welcome, a warm welcome. told me if i could start with harsha. so looking at it, what cause this economic crisis can be pinned on one specific factor? if i think it can be pinned on 2 factors, one is the president and totally unnecessary tax cut off 2019 december revenue that would have come into the treasury. they fell by about one 3rd line,
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3 london currency about 600000000000 rebates by year. and in order to fill the gap in the treasury, the central bank stock of printing money and that started a downward spiral in economic management. and we got downgraded by their credit rating agencies globally and shop their door to international financial markets that led to the government going into the reserves to pay back the debt. and that caused multiple problems in the macroeconomy. the specific decision was the banning off the import off chemical fertilizer or which then led to in some places up to 70 percent of the harvest being lost. so both put together and also
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a debt or hang problem that we had for a long period of time. created this toxic combination. ok? yes. now mass, the quantum, perhaps not an entirely a surprise since of course you have present the opposition perspective that you know you're highlighting there. the failures of government. if i could bring in both vonny, is it more deep rooted than simply the failures of this government? is it also a convergence of other factors that perhaps are outside the government's control? like, let's not forget the collapse of commodity prices. the economic fall out of the pandemic locked downs, the 70 percent fall in tourism after the 2019 bombings, the rising cost of fuel because of the war and ukraine and so on, so forth. semi i think that might be nation, but ed, roman. i mean we, i and christ board. the main reason why we have these crises
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is purely due to the mismanagement of the government. yes. there are there ethan. but the government had an indicator that we re heading down the direction they could advocate, can let me jump in here. i'm going to try and play devil's advocate to present the governments effective. what more could the government have done there when they've got all those other faxes that i mentioned going on from a war in ukraine, the pandemic, the collapse in commodity prices? i mean, there are limit to how much you can wave that magic wand when you're in government . well, so me, let's start with one of the, the tax cuts that happened was in december 2019. there was information even at the time that, that, that was not a smart mo, 2 and a half years later days now was slight realization. there was a mistake, the policy in terms of the fertilize, the band that happened also earlier on. and there was information from the expert
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saying this was not a smart move. yes, we need to transition to organize fertilizer, but you can do these things or when night. so in, in a sense that government from me so many things in 20192020 the re election cycles. but fear to be going that won't promises fail to listen to experts who are and why sing on mission is that would have been taken. granted the pandemic rece unprecedented challenges. but this was in 2020, 2022. we're still grappling with some of the basic fundamental challenges. one of the other things i would say is that governments warned decision i'm had to take back a lot of cars from parliament. so under the 20th amendment, which was enacted in 2020, it's a very executive heavy government right now. and whereas if you had a system where void the presidio and, and the parliament could work together,
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that would be also something that could have prevented on mitigated some of these things. so it's a very heavy executive given very powerful government. but they have failed to get very basic fundamental steps that they could have taken because the warning signs are very early on. so now, right too late. ok, let's bring in w way would you want to dana? so the result now is that we're looking at what power cuts, fuel shortages, food shortages, medicine, short jazz and to that, of course, things like rising inflation. i think it reach 17.5 percent in february, according to the central bank unemployment rising to, i mean, how unbearable is life becoming? for sure, lincoln's will look because you are reading correctly gone through the spoke are those sri lanka to me. but i agree with more passion by when even they say that the
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crisis has been mainly due to the police here made by the government. as a result of this one here is sheila gas now come to an explosive position and all the people in the country, not only the one man in bay street, but all the people in the country have been heat in the us as a last in their stomach, their purse has been heed because they have lost the income substantial part of the income. you wonder if it will have lost that because of the last seen deal. they are complaining that they didn't really see when week activities and their stomach has been here. we go so that i see who prices. so as a result, these type of a situation is a really, you know, further ground for the people to come with it. so they have been actually hit by via the increase in the prices. because when you say that the current in place and 8017 point one percent, you know, as you know, pretty as
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a company by the department of interest at the state. but the brew inflation is much more than that because the food inflation is about 30 percent and the but we're, we're price index accompanied by the sales department has used the very low rate for the food category on the 28 percent. so like if you take the normal football foot by get off a normal family with your master about say about 45 percent of their budget and the actual to inflation in terms of the percent percent that consumer price index is about $20.00 to ready to. but, but that is not the case, because when the people, how to scan in a queue for long hours, about a, to gain hours to get the i said to why most we are good. and because both standing in that you also do the money place that they pay. and when we did all these
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factors into account that grew in prison into the land place, there was a 100 percent. and that is why people have come to the street and the i d, d. and those are the dates and her be spontaneous. they will not be in late august, crated by any political party. so it has spread to the work of the country and we are now witnessing it as, as at the worst today, are spring and harsher again was let's talk about the solution, harsher walter lang can be forced to turn to the i m f for another loan is that where the country is heading? well, actually we should have gone to the i m f. at the end of 2020, at the very least. and perhaps earlier. now going just to the i, m f is not going to be all our problems because we are unable to pay debt. so i'm debt needs to be leave structure. our taxes need to go up. i expenditures need to
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be rationalized. our budget deficits need to be caught, then the central bank and the entire monitor. the board needs to be sacked, including the government, new appointments need to be made and money been doing needs to stop. they need to manage the exchange saved in such a way. so that people are able to purchase important. ready goods, ah, and finally we need to make sure that the poor people in this country, the low income people, be burned with disabilities. people who are, you know, finding it hard to make ends made have a social safety net so that these reforms can go through. so all of these things need to happen to stabilize the macroeconomy and then a whole at least start doing what needs to be on the deck. and so i actually stay locked that needs to be reset. all right, but even if we do those sorts of things, bonnie: i mean is it enough?
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simply sacking officials and coughing budgets and staring measures. now i'm sure lanka has something like $4000000000.00 us dollars in debt payments this year. it's going to need some money or it's going to default right. isn't that unfortunately what it's facing? yeah, i think the, the dead prepared money is a bit higher than 4000000000, but i'll leave it to the konami's to come on that. but the, the challenge is on my people and many, and actually as, as we speak as we speak to you, i'm facing a power cut. i mean, this is the new reality in sri lanka, is that the multiple challenges that people have to go through and i think it's very want to understand why it's any civilian has to fees on a day to day from looking to expand shell food items to made the sale to figuring out what time to park outside to trying to find where and one other thing that
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these very important to remember is we are now in a state of emergency. and i can't read her a, b, c. now, because of a state of emergency, mean executive has a lot of, ha, i'm so these multiple challenges, the question is always going to be deciding and coming up with proposals. if you look at the last 2 and a half years since voter bearer to park the came in to cover. as i mentioned before, there's been a strong effort to consolidate power to a point of authoritarianism in sri lanka. it's and now very important, in addition to addressing the konami challenges and the depth restructuring and structural reforms. it's all stream pointed. look at institutions, democratic processes, wider sri lanka, keep going back to this notion of emergency having to declare emergency at every any given time. because if he had systems in place,
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if he had it's 13 plays and the executive listen to these people and took note of this, we won't be in the smith. so it's a very, it's a, it's very much looking at the human side of these crises. but also looking at the structural reforms that are well and that's not going to happen in the short term in the media, so it needs to be known. definitely not when you start talking about structural reforms, of course, as we know very well, but on the you're talking much longer term w a. would you want to dana if the solution is long term structural reforms and strengthening of institutions in the short term? is there an alternative to i m f. money? how far can help an aid from india and china go and helping the country out until it makes those sorts of structural reforms? is that a possible alternative solution? well, of course the, the don't go into i, you, me right now. the long case, not in
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a position to be continuous india. mine's not the for any mystery in c lancaster, india, china, again, i feel that confidence void. now i cannot feel that because being beaten is that the help right? there is short term trade credit to senior and a pre brilliant able to land carpool. i'm the county board program, but of course, if you look at the total amount that they have a list as pretty we even just then one month in particular to the same thing is to it. china because i had it in 1000000000. you are also equal to $1500000000.00, which would have been used only for importing goods from gain, but they'll do just point doubly why, why would another i am i fly and be the solution? i think the countries had this clean. i am a loan so far. why would this one work?
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really? of course, you know, we have to go make it very clear. i am, if you send necessary condition for a country to come out of an economy economy catastrophic, but not going to that it because i am, it provides leave to the same burbank to manage it better so very much by providing a loan to the center. but for us to take it further and reach the long term economy sustainability we have to under the economy. why reform program that includes all types of the not reforming or national government issued uses by good central bank . and as i said, you know, the on the wall, these things you know, to be done by the government, us here in the past. what happened was the 3 but not going to do it. is that got the image flow and then they had just gone through the the heard of the events of payments crisis, but they failed to implement the reform program today,
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like i could be, i wrote. so this time also we run the same risk if you just do not speak to our lord from the you live and ignore all other reforms that have to be undertaken by the country. now one important reform program which the i m f. be sure that gave to see lanka now under this article focus and was that i may have recommended that when i go into banks independence should be maintained by in, in the bill that had been drafted earlier that had been presented to parliament while after that you lost the was one of the ministers there and that particular it was shared by the administration. and i am a fast now recommended that bill should be immediately inactive. we would actually insure the independence of the central bank at the depot devices on the internet activities that that is right. how city laws,
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very strong. and he said one of the people who is in the back to be set, but we don't have to sac them. what we have to do is to ensure the independence of the central bank by enacting the bill that had been shared by the administration. and by doing that, what we do is actually we will make the central bank and agent of the government. we provide people that do and construct the rest of the government right now with this happened, the central bank has become a subservient yielding hand. but what they were that, what is yes, the government is going part of that have to, that's not like that. is it? okay, let me bring in harsher though and harsh if we asked the question this way, can we? should we not also be reaching the conclusion that neo liberalism is failing? sri lanka? i understand all the faults and failures of the government in mishandling the tax reforms in less handling the farming reforms and so on. but when you've done the
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same thing 16 times in given the countries 16 different loans and you expect a different outcome. doesn't that say something about your thinking as well? if you keep giving this money and getting the same outcome? well, i need to correct one thing i want mr. be there other than i said is i am not asking the anti central man to be said. i'm asking that the entire money to a board to be replaced with money to the board that can bring in confidence. because days a crisis of confidence and all markets will fail. markets will become inefficient. markets will freeze if there is no confidence in the rest us in sri lanka. so that's what i meant. but i want to go. busy back to your question off normally, but listen, i don't agree because over the last so many years someone did the as that and, and we started going to the i'm, if in 90 and 65 you know, you had different ideologies and we have different governments around this of this
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country, so somewhere social is sound when you're limited. and so therefore, you know, you can just say it is the ideology of a particular government because various governments are not being able to build it, finds that informs mr. video identity for do ok. so therefore, one i believe is that we need to create what i call a so, so a market economy, it is a synthesis of economic liberalism and, and political liberalism, in that the markets of is when you know, you have to make, you know, you haven't, you know, agree with the fact that no politician, not a bureaucrat can direct markets so to ensure the incentive structures are present in such a way that the economy is driven on lead in
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a particular direction. and by deliberately some i hear mean social justice and that is most important because people are lot on able to survive. and it is embarrassing because we were a upper middle income country. and we don't need to back from various countries, 2c5xw5cw. understood high. so let me jump in and let me bring in von. because i think we've got about a minute left. can the ranch of punks, a government survive talking about survival? bah, bah, bonnie well, it needs to be more than so by me because i think we brought to a situation. it's not just buying a family or a particular government. and this is why it's so important, but the government forgot position for a point is to come on. what do you think the president will have down and resign? well that, that's up to the president, but there's a lot of pressure beauty even today, despite the curfew people on the streets,
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calling for his resignation for the family to leave. so they consider a buzz, significant, high anger among the people for the me see not that the country economy, the political situation by one family. and i think that needs to be very clear. mean these on the government, but the clearly the president and the family and by one person cannot address is the law. and that's why keep coming back to the needs to be systems in place and needs to be structured. otherwise, we're not going to be able to address this problem. all right, we'll leave it on friday. we are out of time, but it's been a great chat. let's thank con, guess how should the silver vonny fonseca and w way would you want dana and thank you to for watching. you can see the show again any time by visiting our website al jazeera dot com for further discussion head over to our facebook page. that's facebook dot com, forward slash ha inside story. can also join the conversation on twitter. our
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handle there is act a j inside story from a sam is a then on the whole thing here. for now, it's go by ah, in 20 a journalist lead 40 days of civic action against the armenian government, and president sockets yann's great home power. i'm going to labor cuz we're a new documentary follows his nonviolent campaign to bring down a corrupt regime, astonishing outcome with a gun, a democratic public revolution. i am not alone,
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arminius velvet revolution. coming soon on al jazeera, amid the ongoing ukraine, russia war, some neighboring countries in a russian attack on their soil. do you take that as a serious possibility of, of russia attack? i think there is serious possibility and absolute certainty. this person would like to do it out in the deputy foreign minister. i found jablonsky talks, challenges, era, harmful pathogens are increasingly affecting our lives with terrible consequences. a new documentary asks whether we've learned any lessons from the h. i. v epidemic in the fight against coven 19. 0, how we ignore the global? so to put prophets before people in war to coast? ah, time of pendant on on april 10th, we'll see french folks is go to the co,
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the with the cost of living crisis. and the war in your crane looming large him. i know my boy is widely expected to win here, but how much ground in the far, i can say, marine the pen? i know those game follow the french legs on al jazeera. oh, this is al jazeera ah hello money inside the news, our live from doha. coming up in the next 60 minutes. global outrageous threats of more sanctions off to russia is accused of possible war crimes in the korean town. a boucher moscow has denied the allegations all eyes on odessa. russian forces bomb the strategic, ukrainian port city.
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