Government and politics
The Constitution of Sri Lanka establishes a democratic, socialist republic in Sri Lanka, which is also a unitary state. The government is a mixture of the presidential system and the parliamentary system. The President of Sri Lanka is the head of state, the commander in chief of the armed forces, as well as head of government, and is popularly elected for a six-year term. In the exercise of duties, the President is responsible to the Parliament of Sri Lanka, which is a unicameral 225-member legislature. The President appoints and heads a cabinet of ministers composed of elected members of parliament. The President's deputy is the Prime Minister, who leads the ruling party in parliament and shares many executive responsibilities, mainly in domestic affairs.[21]
Members of parliament are elected by universal (adult) suffrage based on a modified proportional representation system by district to a six-year term. The primary modification is that, the party that receives the largest number of valid votes in each constituency gains a unique "bonus seat." The president may summon, suspend, or end a legislative session and dissolve Parliament any time after it has served for one year. The parliament reserves the power to make all laws. On July 1, 1960 the people of Sri Lanka elected the first-ever female head of government in Prime Minister Sirimavo Bandaranaike. Her daughter Chandrika Kumaratunga served multiple terms as prime minister and as president from 1999 to 2005. The current president and prime minister, both of whom took office on November 21, 2005, are Mahinda Rajapaksa and Ratnasiri Wickremanayake respectively.
Sri Lanka has enjoyed democracy with universal suffrage since 1931. Politics in Sri Lanka are controlled by rival coalitions led by the left-wing Sri Lanka Freedom Party, headed by President Rajapaksa, the comparatively right-wing United National Party led by former prime minister Ranil Wickremesinghe and Marxist-Nationalist JVP. There are also many smaller Buddhist, socialist and Tamil nationalist political parties that oppose the separatism of the LTTE but demand regional autonomy and increased civil rights. Since 1948, Sri Lanka has been a member of the Commonwealth of Nations and the United Nations. It is also a member of the Non-Aligned Movement, the Colombo Plan, Asia-Pacific Economic Cooperation and the South Asian Association for Regional Cooperation. Through the Cold War-era, Sri Lanka followed a foreign policy of non-alignment but has remained closer to the United States and Western Europe. The military of Sri Lanka comprises the Sri Lankan Army, the Sri Lankan Navy and the Sri Lankan Air Force. These are administered by the Ministry of Defence. Since the 1980s, the army has led the government response against the Marxist militants of the JVP and now the LTTE militant forces. Sri Lanka receives considerable military assistance from Pakistan and China.[22]
Sri Lanka was considered one of the "world's most politically unstable countries" by the World Bank and Asian Development Bank in 2004.[23] The Economist labels Sri Lanka a "flawed democracy" in its 2006 rankings (ranking 57 and positioned among 54 other flawed ranked ones)[24] and Foreign Policy ranks Sri Lanka 25th (Alert Category) in its Failed States Index[25] for 2007. However, Sri Lanka, according to the US State Department in 2005, was classified a "stable democracy" amidst a ceasefire period of the long running civil warEconomy
In the nineteenth and twentieth centuries, Sri Lanka became a plantation economy, famous for its production and export of cinnamon, rubber and Ceylon tea, which remains a trademark national export. The development of modern ports under British rule raised the strategic importance of the island as a centre of trade. During World War II, the island hosted important military installations and Allied forces. However, the plantation economy aggravated poverty and economic inequality. From 1948 to 1977 socialism strongly influenced the government's economic policies. Colonial plantations were dismantled, industries were nationalised and a welfare state established. While the standard of living and literacy improved significantly, the nation's economy suffered from inefficiency, slow growth and lack of foreign investment.
From 1977 the UNP government began incorporating privatisation, deregulation and promotion of private enterprise. While the production and export of tea, rubber, coffee, sugar and other agricultural commodities remains important, the nation has moved steadily towards an industrialised economy with the development of food processing, textiles, telecommunications and finance. By 1996 plantation crops made up only 20% of export, and further declined to 16.8% in 2005 (compared with 93% in 1970), while textiles and garments have reached 63%. The GDP grew at an average annual rate of 5.5% during the early 1990s, until a drought and a deteriorating security situation lowered growth to 3.8% in 1996. The economy rebounded in 1997-2000, with average growth of 5.3%. The year of 2001 saw the first recession in the country's history, as a result of power shortages, budgetary problems, the global slowdown, and continuing civil strife. Signs of recovery appeared after the 2002 ceasefire. The Colombo Stock Exchange reported the highest growth in the world for 2003, and today Sri Lanka has the highest per capita income in South Asia.
In April 2004, there was a sharp reversal in economic policy after the government headed by Ranil Wickremesinghe of the United National Party was defeated by a coalition made up of Sri Lanka Freedom Party and the leftist-nationalist Janatha Vimukthi Peramuna called the United People's Freedom Alliance. The new government stopped the privatization of state enterprises and reforms of state utilities such as power and petroleum, and embarked on a subsidy program called the Rata Perata economic program. Its main theme to support the rural and suburban SMEs and protect the domestic economy from external influences, such as oil prices, the World
Sri Lanka, with an income per head of $1,350, still lags behind some of its neighbors including Maldives and Mauritius but is ahead of its giant neighbor India. Its economy grew by an average of 5% during the 1990s during the 'War for Peace' era. According to the Sri Lankan central bank statistics, the economy was estimated to have grown by 7% last year, although inflation had reached 20%. It should be noted that Sri Lanka's central bank statistics have been called into question over allegations of political interference and institutional decay.[27] Parts of Sri Lanka, particularly the South and East coast, were devastated by the 2004 Asian Tsunami. The economy was briefly buoyed by an influx of foreign aid and tourists, but this was disrupted with the reemergence of the civil war resulting in increased lawlessness in the country[28] and a sharp decline in tourism