Sunday, July 21, 2024

Sri Lanka: The conjuncture in the crisis

Published 
LINKS.ORG.AU
“Anti-government protest in Sri Lanka 2022” by AntanO is licensed under CC BY-SA 4.0.

First published at Polity.

Aaranchiya Subhai!” (‘Await Good News’) read posters plastered across the country recently. It was the build-up to Ranil Wickremesinghe’s televised speech on June 26, passing off a bad deal with official creditors on debt servicing as “Sri Lanka has won”.

What is the conjuncture1 in Sri Lanka, two years after the surge and ebb of the citizens’ movement (‘Aragalaya’); and in the run-up to a presidential election scheduled for late this year – the first ballot of the people since August 2020?

The crisis is over. Or that is what we are being told. Foreign reserves rose to US$5,400 million as at the end of May 2024 – including the unusable Chinese yuan swap equivalent to nearly US$1,500 million and extended to the end of this year (CBSL 2024b: 7). The rupee has appreciated against all major currencies, exchanging now at almost LKR302 to the US dollar (CBSL 2024b: 8). Core inflation (that is, excluding fuel and food prices) is under 5%, and expected to remain at this level this year. The bank interest rate for borrowers has come down to 9.50%. After six successive quarters of contraction over 2022 and 2023, the economy is forecast to grow by 2.2% this year.

For these blessings, hosannas must be sung to the ministry of Ranil Wickremesinghe, and the gospel of the International Monetary Fund’s (IMF) reform programme. This is the narrative of the Sri Lankan crisis as financial: one that begins and ends, with a bankrupt treasury; and being excluded from commercial borrowing, following downgrading of its sovereign credit risk rating was downgraded even before the external debt default after April 2022.

Economic crisis

Except, what manifested in the realm of public finances was, and is, also an economic crisis. It is a crisis rooted in the structure of the national economy and its interrelation with the global economy: what is produced and what is consumed; what is exported and what is imported (or more precisely the terms of trade); and how income and wealth are distributed across society.

In the first five months of 2024, imports climbed to US$7,238 million; while exports crawled to US$5,067 million (CBSL 2024b: 3). The stock of usable foreign reserves is sufficient to finance under three months of imports. The balance of trade deficit is widening and not narrowing. It has been bridged through bilateral loans from India (almost US$4,000 million), and multilateral loans from the Asian Development Bank, the IMF, and the World Bank (US$3,000 million) since the external debt default in 2022.

These only add to the total external debt stock, which is now US$37,000 million (up US$5,000 million from April 2022). More than a year into Sri Lanka’s 17th  programme with the IMF, bilateral creditors last month including China deferred repayment until 2028 (i.e., the year after the current IMF agreement ends). But they have not conceded a haircut or reduction in its quantum. The private creditors who hold the largest single share of Sri Lanka’s debt are still holding out from cropping a bare minimum of 30%. The multilateral agencies consider their loans as inviolable and no attempt has been made for their reduction. In the matter of this government’s negotiation of foreign debt restructuring, Aesop’s fable comes to mind:

A mountain was in labour, uttering immense groans,
and on earth there was very great expectation.
But it gave birth to a mouse.

The export basket remains undiversified – apparel-wear; petroleum products (bunkering and aviation fuel); tea; other crops (especially coconut and coconut-related); and rubber products, in order of volume of earnings. Destinations for exports are limited too. The demand for ready-made-garments in the United States and Western Europe continues to contract over 2024, with serious implications for women’s employment, incomes, and livelihoods in Sri Lanka.

The composition of imports is constant from before the crisis. Fuel; textiles and textile articles (inputs for the garment industry); machinery and equipment; chemical products; and building materials (cement, tiles, aluminium, steel), are the four largest categories. Their top three sources are India, China, and the United Arab Emirates. Even if there is policy intention and political will (which there is not), to substitute for these imports, this is not easily done. The raw materials (oil, gas, cotton, steel, and iron, etc.) are absent; and access to the technology and know-how cannot be presumed. Other categories of lesser volume – medical and pharmaceutical goods; plastics and related products; paper, paperboard, and paper products; and vegetables – are more promising candidates for domestic production in the short-to-medium term. As the government relaxes the 2020 ban on vehicle imports in the run-up to elections, the trade deficit will only widen exponentially.

In this scenario, the growth in foreign reserves, rather than indicative of the resolution of the crisis, is accounted for by four things: Central Bank purchases of US dollars on the forex market; improved tourism receipts; increased migrant worker remittances; and the moratorium on sovereign debt repayment. Direct foreign investment flows, which IMF and World Bank policies arduously court, have been lacklustre to put it mildly. In 2023, some US$712 million from abroad made its way into logistics services, telecommunications, hotels, and manufacturing (CBSL 2024a: 41). This was under half of the government’s stated target of US$1,500 million. The delisting of ExpoLanka and NestleLanka from the Colombo Stock Exchange earlier this year suggests that multinationals are bearish on foreign portfolio investment flows into the local bourse too.

An almost doubling in the number of tourist arrivals in the first five months of this year, has propelled receipts to US$1,406 million (CBSL 2024b: 9). For comparison, gross earnings from tourism in the first quarter of this year alone, will exceed revenue from tea exports over the entirety of 2024. Meanwhile, money sent through official channels by Sri Lankan women and men working abroad between January and May 2024 amounted to US$2,624 million (CBSL 2024b: 9). The export of apparel items, which is Sri Lanka’s largest chunk of manufactured goods, will only reach two-thirds of the volume of workers’ remittances this year. It was the extreme dependence on foreign tourism and migrant remittances that amplified the shock of the COVID-19 pandemic in 2020-2021, when the former dried up and the latter dwindled. This vulnerability to external blows remains unaddressed.

Further, if not for the suspension in servicing of commercial and bilateral external debt, the government would have needed to source an average of US$6,000 million annually from 2022 onwards. It is the suspension of repayment of private creditor and bilateral debt, and the Indian and World Bank lending in 2022, that has given public finances the margin to pay for vital imports – from fuel and fertiliser to pharma and food.

If Sri Lanka is on the ‘road to recovery’, as governing politicians, economic pundits, and western diplomats reassure us, why is the public unpersuaded? The most recent poll finds that 4 out of 5 (80%) respondents in a sample of 489, think the country is “heading in the wrong direction” (IHP 2024b). The number who disagree with that assessment has remained under 5% since polling began as the crisis spiralled over the first quarter of 2022. “These negative views are widely held, with little difference by gender, income level, urban and rural areas, voting preferences, and people’s views of [the] Aragalaya. But younger Sri Lankans have been increasingly more likely than older adults to say the country is on the wrong track”, say the pollsters.

Even big business, the privileged constituency of this government and its IMF-backers, exhibit little enthusiasm. The latest Business Confidence Index records 96 points (LMD 2024). This is lower than it was a year ago (108 points), in the afterglow of the sealing of the IMF loan agreement at the end of March 2023. Sri Lanka’s big apparel companies are aggressively near-shoring production across East and North Africa, while downsizing and merging factories at home.

Social crisis

Sri Lanka’s crisis is not only an economic crisis either. It wasn’t then, it isn’t now. It is also a social one. Sri Lanka is a highly unequal society, with inequalities steeply rising with the entrenchment of neoliberalism in the past four decades. Between 2019 and 2023, the Gini coefficient measure of inequality deteriorated from 3.77 to 3.85 (World Bank 2024: 7). Before the current crisis, and during the pandemic, the bottom 50% of the population already subsisted on only 17% of the share of national income and 3.8% of the share of wealth; while the richest 10% wallowed in 40% of the income share and 65% of the wealth share (UNDP 2023: 19). These gross disparities can have only intensified in the wake of falling employment and income, higher household expenses owing to inflation, and growing insecurity, during the crisis.

The number of those in waged work has dropped to just over eight million persons. The labour force participation rate for women slumped further to 31.3%, or under half that of men (DCS 2024: 1). This indicates that more women have withdrawn from employment or given up seeking waged work; as they absorb the social costs of the crisis through increased unpaid care work. Youth unemployment has increased to 17% (DCS 2024: 4); and is particularly high among those recently out of school. Since the crisis began, 45.8% of employed individuals experienced a pay or allowance cut or income loss; 48% reported a reduction in working hours; 47.3% had a work break or temporary absence; and 14.2% lost their job.

Mostly owing to reduced hours of work, 60% of households recorded a loss in income (DCS 2023: 3). Their three top coping strategies were to limit their expenses; cutback on sustenance; and use up their savings. Around 22% of households were driven into debt by the crisis, raising national household indebtedness to 55%. The main reason given for new borrowing and credit is to buy food for own consumption (DCS 2023: 7). The flight of the middle-class to settle in the West, and the working-class for temporary employment in West Asia, East Asia, and Eastern Europe, is unabated. Several hundred ex-military personnel have enlisted as cannon fodder on both sides of Russia’s war in Ukraine, citing economic hardship at home.

Poverty shot up to nearly 26% of the population or 5.72 million people last year (World Bank 2024: 7). To be pauperised becomes plain in many ways. With rising household expenses for food, transport, health and education, more than one million households were forced off-grid, unable to afford the enormous hikes in electricity bills (de Silva 2024). Upon the devaluation of the Lankan rupee in 2022, prices of imported goods including essential foods, trebled. From Sri Lanka’s 5.6 million households, a whopping 1.7 million stopped consuming powdered milk – a longtime import staple (Ranasinghe 2024). The percentage of children under the age of five who are underweight was 16.2% in March 2024, up from 13% two years before (FHB 2024). Food insecurity had worsened to 24% of households in December 2023, compared to 17% in March of last year (WFP 2023: 1). In the estate sector, a staggering 51% of all households are food insecure. Of school-age children, 54.9% have been affected in some way (DCS 2023: 2). Principals and teachers confirm high levels of absenteeism and irregular attendance. Starkly, Sri Lanka’s population has declined: with a drop in births, a rise in deaths, and heightened out-country migration (Hannan 2024).

Political crisis

Following the Aragalaya booting out Gotabaya Rajapaksa in July 2022, the Sri Lanka Podujana Peramuna (SLPP—People’s Front) strong armed the office of the president for Ranil Wickremesinghe; in exchange for him safeguarding the personal security and political survival of la prima famiglia. Through this pact between the party of government and the leader-for-life of the United National Party (UNP) the political crisis generated by the socio-economic convulsions of 2021-2022 was submerged. It is resurfacing in the lead-up to the presidential election expected between mid-September and mid-October this year.

Two years ago, the political system experienced its greatest crisis of legitimacy since decolonisation in 1948. Public outrage over the rapid descent into socio-economic dislocation and chaos, and the floundering of those in power, was directed not only at the executive but also legislators, traditional political parties, and politicians. The government’s failure, to first prevent and later mitigate the collapse of daily life, became generalised and historicised: “225 ma epa” (in context: throw out all 225 parliamentarians – that is, not only the governing SLPP); and “Avurudu 74ka Sapaya Avasan Karamu” (in context: let us end the 74-year curse since independence – that is, of the political class).

However, Wickremesinghe’s (s)election by the largest party in parliament; his years of experience in government and thereby familiarity to the people; and his self and public image as the natural counterpart of international creditors and western powers, reassured those looking for leadership where there was none. The ouster of Gotabaya Rajapaksa and earlier his extended family from the offices of state, removed the most visceral object of rage from sight. Around the same time, the supply of imported essential goods financed by Indian and World Bank loans began increasing, which defused some of the discontent among the social classes that could afford them after the rupee devaluation.

The consensus across political and civil society (a handful aside) that an IMF loan agreement with its associated policy conditionalities is the only way out for a bankrupt country in debt default, made it seem that those at the top for once agreed on the sources of the crisis, and its solution. The repressive apparatus that was conflicted at times in its response to the uprising, returned to character armed with Wickremesinghe’s orders. State violence, arrests and intimidation, and counter-terror laws were liberally used. This confluence gave ballast to a sinking political system. It also demobilised the Aragalaya. For all the fashionable talk of Sri Lanka as a ‘failed state’, its political and bureaucratic institutions – eroded in reputation and trust as they are – weathered a mighty storm.

Nevertheless, some features of this moment indicate that the political crisis is far from resolved. These could be sketched as follows. A parliament that lost its acceptability during the economic crisis; and within which all manner of wild and unimaginable alliances are being made. A government that delivered its parliamentary majority to its arch-rival to realise his dream of the presidency, that electoral fortune kept denying him. A regime in power glued together by shallow self-interest. An opposition in parliament at one with the government on capitulation to the IMF, disagreeing only on the ways and means to subject the people to its dogmatism. And nowhere on the horizon, a mass social and political movement of the exploited, advancing on an anti-systemic path to power.

In Parliament, the distribution of seats does not reflect the sentiment of the people. Clearly the SLPP has lost the confidence of much of the 69 lakhs who voted for Gotabaya Rajapaksa. This has not stopped the rotten majority aligned with Wickremesinghe from enacting in haste 75 news laws in two years, with more in draft. One among them being the Economic Transformation Bill that codifies the quantitative fiscal targets in the ongoing IMF agreement, to bind all future governments irrespective of their manifestos to ‘fiscal consolidation’, that is austerity actions. Locking all this in place is a leader with no mandate for sweeping economic reforms, steamrolled by a legislature whose majority was elected on an economic nationalist platform.

The public has little faith or confidence in its representatives; which is not the same as them throwing out the crooks and charlatans at the next general election. The hold and working of clientelism is intact (Munasinghe & Kumara 2023: 25-28); as is the patronage politics of the right-wing parties. Curiously, even the leftists among the supporters of the National People’s Power (NPP—Jathika Jana Balawegaya) appear to believe that the genuine wave of popular support for their presidential candidate will naturally translate into a parliamentary majority – which Anura Kumara Dissanayake needs to govern, if elected president. Even if Dissanayake were to win, amounting to an upset of historic proportions; and rides on the unbridled executive authority of his office for advantage in a general election, how will a party that polled under 4% of the popular vote in 2020 winning 3 seats, reach the threshold of 113 seats to form a government, in a debased culture of money politics?

The SLPP group which had 145 seats is fractured in almost every direction. Its coalition partners began peeling away from the SLPP in 2021. Since then, several SLPP parliamentarians have joined Wickremesinghe’s cabinet of ministers. In his preference for a general election before the presidential poll, Basil Rajapaksa sought to reassert control over his parliamentary group and thereby increase his leverage over Ranil Wickremesinghe. He would have used the nomination process and the preferential voting system to weed out those whose loyalties are divided or suspect. The SLPP still tries to turn its post-Aragalaya liabilities into its assets. The blame for the catastrophe lies with Gotabaya Rajapaksa and the 2022 people’s uprising; and not the ‘war victor’, and engineer of post-war ‘mega-development’, Mahinda Rajapaksa, nor of course the president-in-waiting, Namal.

To mark themselves apart from Wickremesinghe for electoral gain, father and son make off-stage noises against privatisation of state-owned-enterprises; taxation of the poor; implementation of the 13th Amendment to the Constitution; and economic integration with India; while their party keeps providing the president with his legislative majority. If their ‘inside-outside’ approach to the Wickremesinghe regime is to continue, then they will not field their own candidate at the presidential election, to business magnate Dhammika Perera’s disappointment. The bargain will no doubt include future cabinet berths for Namal Rajapaksa and his family’s closest supporters within the SLPP (Rohitha Abeygunawardena, Johnston Fernando, etc.).

The main opposition Samagi Jana Balawegaya (SJB—United Peoples Power) which had 54 seats, has grown from SLPP defections (Nalaka Godahewa, G. L. Peiris, Chandima Weerakkody, among them). The blurring of ideological convictions and sheer political opportunism makes it possible for the SJB – positioning itself as a relentless critic of the Rajapaksa clan – and those who until recently were acolytes of Mahinda, Basil, and Gotabaya, to embrace one another. The SJB has also lost some of its numbers to the UNP from which it sprung. Others (Rajitha Senaratne, Rohini Wijeratne) are biding their time to cross over to Wickremesinghe’s camp. Field Marshal Sarath Fonseka is estranged from the party of which he is Chairman. He is unhappy that the SJB has welcomed former high ranking military commanders once associated with the Rajapaksa regime, who are his old foes in the armed services. SJB MP Champika Ranawaka is another ploughing his own furrow. This is not to say he will not align with whomever can advance his presidential aspirations in the next cycle. His political journey from chauvinist to ‘smart’ nationalist, leveraging digitalisation for the entrepreneurial aspirations of the youth, illustrates his judgement on the currently limited purchase of Sinhala racism.

The chaos of this conjuncture, perhaps also of the political expression of Sinhala Buddhist nationalism, is captured in the amalgam that is the Sarvajana Balaya (SB–‘Universal Force’). In this alliance are those betting the other way from Champika Ranawaka on Sinhala ethnonationalism – Wimal Weerawansa, Udaya Gammanpila, Channa Jayasumana and Gevindu Cumaratunga; the dregs of the parliamentary Left – the Communist Party and the Democratic Left Front; and arriviste capitalists Dilith Jayaweera and Anuradha Yahampath. These three groups were part of Gotabaya Rajapaksa’s regime: the first, because they saw him as the saviour of the Sinhala nation; the second, because they considered economic nationalism as anti-imperialism; the third, because he was not a traditional politician and promised to take counsel from professionals, technocrats, and entrepreneurs. Each of these groups were attached to successive Rajapaksa regimes. They then fell out with Gotabaya Rajapaksa at the onset of the crisis, conveniently absolving themselves of collective responsibility. In their new platform, the ‘entrepreneurial state’ for “innovation-led growth”, has been added to the stock-in-trade of Sinhala racism masked as patriotism. Beyond as a vehicle for media and advertising mogul Dilith Jayaweera in this presidential election, its constituents aim is to hang onto as many of their seats as possible.

Across the Tamil and Muslim political parties with representation in the Northern, Eastern, North-Western, Western, and Central provinces, there is disorder too.

Among Tamils in the North and East, three stances with reference to the presidential election are being canvassed by rival parties, and rival factions within parties and alliances. These are (i) boycott: as none of the three main candidates is committed to power-sharing beyond the inadequate 13th Amendment (Tamil National People’s Front); (ii) contest with a common Tamil candidate to put forward the demand for a political solution based on self-rule (Democratic Tamil National Alliance, ITAK Sritharan faction, CV Wigneswaran, some civil society organisations); and (iii) support one of the three main Southern (i.e. Sinhalese) candidates based on willingness to address Tamil grievances (ITAK Sumanthiran faction). The bottom line is that the Sinhala polity views the limited and unsatisfactory 13th Amendment as a ceiling for Tamil political aspirations; while the Tamil polity in large measure cannot consider it even to be a floor.

In the two largest Muslim parties, neither Rauff Hakeem nor Rishad Bathiudeen are in control of the parliamentary group of the Sri Lanka Muslim Congress (SLMC) and All Ceylon Makkal (Peoples) Congress (ACMC) respectively. Several of their members had previously supported the Gotabaya Rajapaksa SLPP regime, providing it the two-third parliamentary majority it lacked to pursue its Islamophobic practices. These scoundrels are now with Wickremesinghe. There should be no surprise if the SLMC and ACMC desert their SJB alliance partner to join a Wickremesinghe-led government.

Among Hill Country Tamils, the Ceylon Workers Congress (CWC) is already in government and supportive of Wickremesinghe’s presidential candidacy. Its rival the Tamil Progressive Alliance (TPA) currently aligned with the SJB has no principled difference with Wickremesinghe but is blocked from realignment with him by the CWC’s veto. Even if the TPA leadership remains with the SJB, they may not be able to prevent one or two of their number from defecting. Unlike in the South, the mood among Tamils and Muslims in the North and East and Hill Country, favours Wickremesinghe in comparison to his two main rivals. Their political parties are conscious of this too.

The UNP leader has recomposed a new bloc around him. It shares some similarities with the Rajapaksa regimes of 2010-2014 and 2019-2022. Inside the legislature, the congeries span former Rajapaksa stooges – from the SLPP (Nimal Lanza, Prasanna Ranatunga, Mahindananda Aluthgamage, S. Viyalendran and Ali Sabry among them); the Sri Lanka Freedom Party (SLFP e.g. Nimal Siripala de Silva, Duminda Dissanayake, Angajan Ramanathan), the Eelam People’s Democratic Party (EPDP); the Ceylon Workers Congress (CWC); the Thamil Makkal Viduthalai Pulikal (TMVP i.e. ‘Pillaiyan’); the National Congress (A. H. M. Athaullah) and the Tamil Progressive Alliance (Aravindh Kumar). But it also includes opponents who were in the SJB (Harin Fernando, Manusha Nanayakkara, Vadivel Suresh, A. H. M. Fowzie). Outside of parliament, the Liberation Tigers of Tamil Eelam (LTTE) former Eastern commander and ex-SLFP MP and Rajapaksa minion Vinayagamoorthi Muralitharan (‘Karuna Amman’) has endorsed Ranil Wickremesinghe.

The incumbent president looks almost certain to stand as a ‘common candidate’, on a non-UNP electoral symbol to ease the discomfort of those who were pitted against him until the other day. His pitch is clear. “Will you move forward with me, who comprehended the problem from its inception, offered practical solutions, and delivered results? Or will you align with those grappling in the dark, still struggling to grasp the issues?”, he demanded in his address to the country on June 26 (Wickremesinghe 2024).

Only to the disbelief of himself and his new champions in mainstream and social media, Wickremesinghe though is still trailing third (13%) in interviews of 17,134 voters, that has SJB leader Sajith Premadasa and NPP leader Anura Kumara Dissanayake pegged at 39% each (IHP 2024a). Hence, the suggestion by partymen that it is in the national interest to postpone the presidential election, therefore extending Wickremesinghe’s term in office for between two to five years. While so far there has been public tolerance of the indefinite deferral of provincial council and local government elections, seasoned politicians are aware of the risk in doing the same with the presidency and parliament. Wickremesinghe may rue the fact that he did not hold local government polls as scheduled, allowing people to blow off steam which will now happen at the next national election.

Though yet to declare his candidacy, Wickremesinghe is in pre-election mode, and not averse to ‘populism’ akin to the Rajapaksas to broaden his narrow social base. The ‘Urumaya’ (heritage) programme of distributing freehold land titles to two million households is administered from the Presidential Secretariat and not the Ministry of Lands. MOP fertiliser will be distributed free to paddy farmers this year, and subsidised for tea smallholders. In urban areas, 50,000 families in government housing will have its ownership transferred to them. Twenty kilos of rice are being distributed free each month to 2.7 million poor households. ‘Special allowances’ for 622,495 beneficiaries of the Aswesuma welfare benefits programme have been extended to the end of this year. Public sector ‘executive’ grades have been granted a special allowance of their own: LKR25,000 monthly from July onwards. Development funds have been allocated to each divisional secretariat which are administered by the provincial governor, who is a presidential appointee. These projects are branded with the image of the president to make the connection clear. In the estate sector, 10,000 new houses have been promised to workers and the government intervened to increase the daily wage to LKR1700 (against the protests of companies that are yet to honour the LKR1000 wage increase of 2021). In ‘Operation Yukthiya’ (justice) between December 2023 and May 2024, a staggering 130,000 drug-related arrests were made.

The only southern parliamentary party untainted by tie-up with SLPP splinters or other floor-crossers is the National People’s Power (NPP). It has not appealed to those deserting the SLPP parliamentary group. In fact, both the UNP-SLPP and the SJB have more often focussed their fire on the NPP, rather than each other. This works well for the outsider. It magnifies the divide between the discredited political establishment and itself. As this fear rises to fever pitch, the pressure grows for the pro-capitalist parties to unite around one candidate – Ranil Wickremesinghe being their preference – to secure victory against Dissanayake.

The NPP has gained support from the base and other layers of the SLPP outside of parliament now disenchanted by the Rajapaksas. Its rallies have drawn the common people who turned out for the SLPP in 2018, 2019, and 2020. Exceptionally, in comparison to other political parties and the prevailing patriarchal culture, it has mobilised women qua women in several rallies and local meetings. It has recruited among ex-military and police personnel, business people in small and medium enterprises, professionals from banking and finance, academics, and others from the public sector, retired public servants, and others, formerly attracted to the mixture of ethnonationalism and governance by experts of the Gotabaya Rajapaksa camp. Its message to the electorate is that it has zero tolerance for corruption; and stands for a domestic production-based economy. This plays well with daily-waged workers and the petit-bourgeois alike.

The NPP’s existence and continuance is the discretion of the Janatha Vimukthi Peramuna (JVP—People’s Liberation Front), which remains a Marxist-Leninist party inflected by Sinhala Buddhist nationalism. However, what the JVP-NPP now offers is not a break with capitalism, but to be an ethical substitute to the parties that have divided the spoils of power between them for 76 years. It promises to be a responsible manager of a state-directed mixed economy. Outside of the elite, it is not seen as threatening by the Sinhala nation because it does not propose changing the unitary status of the state, for power-sharing with Tamils and other numerical minorities.

This survey would be incomplete without registering an absence. As the NPP is arguably more centre than left, when all others have gravitated to the right, what of the political space to its left? The disarray among traditional political parties has not, in and of itself, created conditions for the growth of the socialist left. The People’s Struggle Alliance (PSA—Jana Aragalaya Sandanaya) announced on June 19, has staked its claim to be an authentic left alternative. Unlike the parties in parliament, it is unequivocally opposed to the IMF agreement, and for a political solution to the Tamil national question beyond what is in the current Constitution. Presently it consists of three organisations: the Frontline Socialist Party (FSP–Peratugami Samajawadi Pakshaya), the New Democratic Marxist-Leninist Party, the Samajawadi Janatha Sansadaya (SJS–Socialist People’s Forum); former student leaders, and several independent activists associated with the Aragalaya and progressive causes before and since. It brings together some who have been aligned at least since the 2022 people’s uprising, including in the formation and functioning of the ‘people’s council’ as an alternative to political power through parliament. What it does not yet bring though, is the attachment of social groups and numbers that can shift the balance of class forces in favour of the exploited and the oppressed.

Conclusion

In the wake of socio-economic catastrophe, and with the reinforcement of the dependent capitalist trajectory of Sri Lanka’s economy since then, there is no change of philosophy among the elite. There is no talk of industrial policy, or boosting national production, or expansion of the home market through redistributive taxes and investment in public services, or controls on prices of essentials including food and energy. For the rich and powerful, it is business-as-usual.

This refusal to rethink its paradigm of development – if only to avert another debt default, once international borrowing on the money market resumes after 2027 to bridge the chronic gap between import expenditure and export earnings – is also constitutive of the conjuncture. There has been no displacement of neoliberalism as the ruling ideology of the ruling class nor its publicists in think-tanks, university economics departments, and the mass media. “While the adjustment process may provoke resistance, and potential backlash from affected groups and vested interests, it is essential for the country to stay the course on reforms …” advises the World Bank (2024: 11).

Up to now the consensus in favour of the IMF agreement, and its mediation in Sri Lanka’s crisis, has not been shaken by the ongoing socio-economic crisis of the majority. The public stance of the three leading presidential contenders and their respective camps is adherence to the IMF programme (Dassanayake and Gamage 2024). Wickremesinghe is adamant that there is no alternative to, or within, the current agreement. The SJB’s Premadasa claims he will renegotiate, to reduce the tax burden on the poor and to increase social welfare. However, his economic team are evangelists for ‘fiscal consolidation’. Meanwhile Dissanayake’s NPP has said it will continue the IMF’s debt restructuring programme “… but in a manner which is not harmful to the working-class people while taking steps to enhance the manufacturing sector” (Tennekoon 2023). Neither Premadasa nor Dissanayake have said what they will do if the IMF is adamant not to revise its parameters and timelines. Outside of the modest ranks of the radical left campaigning to #ExitIMF17, there is no movement of resistance to austerity. Those who do stand up for their own rights (mostly public sector workers and unemployed graduates) and those of others, are greeted by water cannons and tear gas in public spaces, the Online Safety Act in cyberspace, and the menace of brute force and imprisonment everywhere.

In the lead-up to the presidential election, the message to the people is, “vote for whom you like, but stick with the IMF programme”.

This crisis is not over. Not for the dominated classes. Nor for the dominant.

B. Skanthakumar is a member of the Social Scientists’ Association of Sri Lanka and co-editor of Polity magazine.

References

CBSL. (2024a). Annual Economic Review 2023. April 10. Colombo: Central Bank of Sri Lanka. Available at https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/publications/aer/2023/en/Full_Text.pdf

——-. (2024b). External Sector Performance – May 2024. June 28. Colombo: Central Bank of Sri Lanka. Available at https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/press/pr/press_20240628_external_sector_performance_2024_may_e.pdf

Dassanayake, Harindra B. and Rajni Gamage. (2024). “Emerging presidential election campaigns in Sri Lanka: Liberal consensus and fringe politics”. Daily FT (Colombo), June 26. Available at https://www.ft.lk/columns/Emerging-Presidential-election-campaigns-in-Sri-Lanka-Liberal-consensus-and-fringe-politics/4-763468

DCS. (2023). Household Survey on Impact of Economic Crisis – 2023. August 17. Battaramulla: Department of Census and Statistics. Available at http://www.statistics.gov.lk/WebReleases/HECS_Bulletin_Final

——-. (2024). Sri Lanka Labour Force Survey Annual Bulletin 2023. April 2024. Battaramulla: Department of Census and Statistics. Available at http://www.statistics.gov.lk/LabourForce/StaticalInformation/Bulletins/SriLankaLabourForceSurveyAnnualBulletin-2023

De Silva, Charumini. (2024). “Record high electricity disconnections in 2023”. Daily FT (Colombo), January 17. Available at https://www.ft.lk/front-page/Record-high-electricity-disconnections-in-2023/44-757415

FHB. (2024). Nutrition Information – Family Health Bureau – M&E Unit. Available at https://fhb.health.gov.lk/events/routine-nutrition-information-dashboard/

Hall, Stuart and Doreen Massey. (2010). “Interpreting the crisis”. Soundings (London), Vol 2010, Issue 44: 57-71. Available at https://journals.lwbooks.co.uk/soundings/vol-2010-issue-44/article-7260/

Hannan, Sarah. (2024). “Sri Lanka’s shrinking population”. The Morning (Colombo), March 10. Available at https://www.themorning.lk/articles/OSJwyg41Nq2cCR2QHozR

Institute of Health Policy. (2024a). “Sajith Premadasa and AK Dissanayake tied with 39% support in Presidential Election voting intent in April 2024”. IHP SLOTS MRP Presidential Election Voting Intentions Update April 2024 (30 May 2024). Available at https://www.ihp.lk/press-releases/sajith-premadasa-and-ak-dissanayake-tied-39-support-presidential-election-voting

——-. (2024b). “Number of Sri Lankans thinking country is heading in the wrong direction continues to increase”. IHP SLOTS Opinion Poll (June 24). Available at: https://ihp.lk/research-updates/number-sri-lankans-thinking-country-heading-wrong-direction-continues-increase

LMD. (2024). “Business Sentiment: The Index Gains Ground Yet Again”. Lanka Monthly Digest, May 02. Available at https://lmd.lk/business-sentiment-100/

Munasinghe, Vidura and Prabath Hemantha Kumara. (2023). “Can we not Manage without Bosses? An Analysis of Public Opinion in the Political Context of the Aragalaya”. LST Review (Colombo), Vol. 31, Issue 341 (June 2023): 16-32. Available at https://www.lstlanka.org/wp-content/uploads/2023/08/Aragalaya-LST-review-eng.pdf

Ranasinghe, Imesh. (2024). “SL milk powder use dropped more than half”. The Morning (Colombo), March 29. Available at https://www.themorning.lk/articles/VmFwQKm9kMYv9S3c6yfQ

Tennekoon, Sahan. (2023). “Future JVP-NPP Govt. stance: ‘With IMF, will consider public’s best interest, transparency”. The Morning (Colombo), December 15. Available at https://www.themorning.lk/articles/30SAMUgZwJytGhjxeTT1

UNDP. (2023). 2024 Regional Human Development Report Making Our Future: New Directions for Human Development in the Asia-Pacific. Bangkok: United Nations Development Program. Available at https://www.undp.org/asia-pacific/publications/making-our-future-new-directions-human-development-asia-and-pacific

Wickremesinghe, Ranil. (2024). “Sri Lanka’s successful restructuring of its foreign debt is a good news for all who care about the country”. President’s Media Division, June 26. Available at https://pmd.gov.lk/news/sri-lankas-successful-restructuring-of-its-foreign-debt-is-a-good-news-for-all-who-care-about-the-country/

WFP. (2023). Household Food Security Survey: Preliminary Findings. December 2023. Available at https://reliefweb.int/report/sri-lanka/sri-lanka-household-food-security-survey-preliminary-findings-december-2023

World Bank. (2024). Sri Lanka Development Update: Bridge to Recovery. April 2024. Washington D. C.: World Bank. Available at https://openknowledge.worldbank.org/server/api/core/bitstreams/a498539d-ae15-4911-8895-fff713aa063a/content

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    “A conjuncture is a period during which the different social, political, and ideological contradictions that are at work in society come together to give it a specific and distinctive shape … A conjuncture can be long or short: it’s not defined by time or by simple things like a change of regime – though these have their own effects. As I see it, history moves from one conjuncture to another rather than being an evolutionary flow. And what drives it forward is usually a crisis, when the contradictions that are always at play in any historical moment are condensed … Crises are moments of potential change, but the nature of their resolution is not given …” (Stuart Hall interviewed by Doreen Massey, 2010: 57).

More than just an electoral upwind? Nordic left-wing parties after the EU elections


Published 
olkets Klimamarch is held in Copenhagen before the upcoming EU Parliament elections on Sunday 2 June 2024.

First published at Rosa-Luxemburg-Stiftung.

There was a moment after the European elections of 6-9 June 2024 when much of Europe was suddenly looking north, baffled. What had just happened? Some pollsters, journalists, and political parties themselves believed that there must have been a mistake, yet the numbers were correct. While across much of the rest of the European Union the traditional right was victorious and the far right came out stronger than ever, with left parties taking heavy blows, this scenario seemed to be reversed in the three Nordic EU member-states. The elections saw a record result for the Left Alliance in Finland with 17.3 percent (+11.2 compared to the last European elections and +9.1 from the last national elections), while the Greens maintained their vote share from the national elections a year ago (though losing at an EU level), and the Social Democrats kept their share at EU level (though losing somewhat compared to the 2023 Finnish parliamentary elections).

In Sweden, the Left Party Vänsterpartiet improved more than any other party in the country, winning 11.1 percent support and increasing their vote share by over 60% compared to the previous national and European elections (6.9 percent), while the Greens gained 2.3 percentage points on their 2022 national election result, winning nearly 9 points support, and outdoing the far-right Sweden Democrats as the third biggest party. The Social Democrats lost substantially (nearly 6 points) compared to the Riksdag elections however, while slightly increasing their share at the EU level to about 25 percent. In Denmark, the Centre-Left-Green parties (including Social Democrats, Socialist People’s Party, Enhedslisten, the more moderate Radikale Venstre and the green Alternativet) retained 50 percent of the country’s vote. These solid results for the Centre-Left were accompanied by losses for the (far) right. But are we really witnessing a substantial shift to the left that could translate into more progressive politics and governments in the foreseeable future?

Record results for left parties

Sure enough, results for the left parties in Finland and Sweden were truly impressive. Li Andersson, the Left Alliance’s (Vasemmistoliitto) outgoing party chair, this year’s presidential candidate and former education minister, received a staggering 13 percent of the overall Finnish vote, or nearly a quarter of a million out of 1.8 million Finnish votes, by far more than any other Finnish EP candidate has ever received. She topped the polls in all bigger cities and received a fifth of the vote in the capital Helsinki as well as a quarter of the vote in her native Turku. Her vote made up 78 percent of the overall support for Vasemmistoliitto, which emerged as Finland’s second biggest party, surpassing the Social Democrats for the second time this year, following the Presidential elections in January and February.

For the Swedish Vänsterpartiet, this election was their best result in twenty years, more than tripling the party’s share in Gothenburg and more than doubling it in Malmö, making it the second biggest party in both cities, approaching 18 and 20 percent respectively. It surpassed the Social Democrats in several districts and regions. Former party leader and MEP Jonas Sjöstsedt also received the highest number of votes among all Swedish candidates. In Denmark, it was the Socialist People’s Party, a party marginally left of the Social Democrats, internationally known as Green-Left, that went up by more than 9 percentage points from the national elections in 2022, gaining more than 4 points compared to the previous EU elections. The left Unity List or Red-Green Alliance (Enhedslisten), however, also gained, though at 7 percent less impressively with a plus of ‘only’ 1.5 percent on the last EU elections and almost 2 percentage points on the last national elections, becoming second biggest party in Copenhagen after the Socialist People’s Party.

Bucking the trend — waning support for (far-)right parties?

At least superficially, the growth of the left came at the expense of far-right parties. Yet while, in these elections, right-wing parties were unable to expand the structural majority they have enjoyed in the Nordic countries for some years, taking the national elections as a point of reference it is only in Sweden that we can observe a substantial shift. Here, the Sweden Democrats lost over 7 percentage points compared to the national elections and 2 points compared to the last EU elections. This might not sound like much, but is significant as it is the first election since 1988 that the party has lost support. In addition, the traditional right of conservative Moderates, Christian Democrats and liberals lost ground compared to the national elections of 2022, though some of them fared marginally better than in the EU elections of 2019. Taking the national level as the point of reference, we can observe a combined total of nearly 57 percent support for Social-Democrats, Greens, the Left and the Centre Party, with the traditional und far-right (together known as ‘Tidö parties’) just under 41 percent. This is almost a reversal of the 2022 results, where the Tidö parties had a 0.6 percentage point lead at 49.5 percent. At an EU level, however, the substantial gains for the left ‘bloc’ did not translate into a change in the distribution of seats between the domestic traditional blocs.

While the Finns Party faced substantial losses of 5.5 percentage points on 2019, and a whopping 9.9 percentage points compared to last year’s national elections, the traditional right in Finland actually gained, with strong increases of nearly 8 points for the conservative National Coalition Party (NCP) and a slight increase for the Christian Democrats. Taken together, the NCP and the Finns, who currently form the government, did not actually lose more than 1.5 points, despite the centre-left parties’ gains of around 6 points (disregarding the Centre and the party of the Swedish minority) and its additional two seats in the EP.

In Denmark, the picture is more complex, owing to the ongoing reconfiguration among the (far) right. Among the traditional right, Venstre (a conservative liberal party associated with ALDE/Renew at a European level), fell by almost 9 points compared to the EU elections 2019, but recovered slightly from a heavy blow it had received in the 2022 national elections. However, the Conservatives gained, as did the Liberal Alliance (a neoliberal party that is gradually shifting to the right). And while the Danish People’s Party — once at over 26 percent in the EU elections a decade ago — lost compared to 2019, and received only 6.4 percent, this was actually an increase of nearly 4 points from the 2022 national elections. The recently founded far-right Danish Democrats, led by notorious former immigration minister Inger Støjberg, was standing in European elections for the first time, and received 7.4 percent. With nearly 14 percent between the Danish People’s Party and Danish Democrats, and adding to this the 7 percent for the rightward-moving Liberal Alliance, the (far) right actually made some grounds in this election. Compared to the national elections, the combined traditional and far right (not counting the Moderates) also expanded their margin.

A vote on incumbent governments

The losses for the right in parts of the region are due at least partially to current government policies. Take Finland as the most notable example. Since April 2023, the country has been governed by a coalition of the traditional conservative National Coalition Party (NCP) with the far-right Finns Party. The past year has been characterised by government attempts to dismantle the Nordic model, with regards to both the welfare state and the collective bargaining system. The government cut 100 million Euros from the health sector and closed A&E sections; introduced numerous cuts on social welfare, mostly targeting the unemployed, low-income-earners, and part-time workers; continues to grind down conditions for workers, introducing restrictions on sick leave payment and eroding lay-off protection; and imposed restrictions on the right to strike. All of this amounts to previously unseen attacks on welfare and workers’ rights, which will cause damage for decades to come. The government has also retreated on climate and environmental legislation, including opposing the EU nature restoration law and backtracking completely on Finland’s carbon emission goals.

Despite the gains enjoyed by the NCP, there are some indications that voters’ discontent with this type of policies played a noticeable role in the elections, and that the far-right has taken the blow. Indeed, the first months of 2024 saw ‘historic’ strikes and protests against austerity and for workers’ rights. The Finns Party was very much the face of the ‘historic’ assaults, with the party chair and Finance Minister Riika Purra literally flaunting scissors, grinning, when she announced more cuts, and the Health and Social Affairs Minister Kaisa Juuso from the same party implementing these policies despite having previously promised to maintain social and health care services. Support for the Finns Party fell from 24 percent to 7 percent in the district of Kovala, where they closed an A&E section. To some extent, these government policies conflict with the historical roots of the party, which, at least before its ascendency as an outright anti-migration party over the past decade, was supportive of social policies benefiting the ‘left-behind’, mostly small farmers.

There is also a public perception of the Finns Party having pushed these policies onto the government agenda. The party has also experienced bad publicity following a number of neo-Nazi and racism scandals, displays of incompetence, and several ministers having to step down or face votes of confidence in parliament. A more mundane explanation for the losses of the Finns Party, of course, could be that its notoriously anti-EU voters simply did not take much interest in these elections; turnout for the EU elections in Finland was just over 40 percent (compared to substantially over 70 percent in the national elections), and we can traditionally observe a relatively higher support for left and green parties in EU elections.

Controversial alliances

In Sweden, the minority coalition of three conservative parties has faced criticism for implementing the policies of its kingmakers, the far-right Sweden Democrats. In office since 2022, the government has a poor record on climate policies and is unlikely to reach its emission goals in the coming years. It has also not been able to alleviate the cost-of-living crisis facing the country, plug the holes in the welfare system, or fix the economy — instead, it has turned against migrants and racialized people. Yet many point to the Sweden Democrats rather than to the government parties, holding the far-right party responsible, which may, to an extent, be reflected in the vote. Details recently revealed by a journalist who had infiltrated the party about the Sweden Democrats’ ‘troll farms’ also played a role in the relative loss in support for the party. Yet, as in Finland, the rather marginal losses for the conservative coalition partners suggest less discontent with these policies than the headlines might suggest. As in Finland, EU elections have little priority for supporters of the far-right in Sweden, again contributing to a low turnout for the Sweden Democrats.

In Denmark, the government has clearly taken the blow for a number of unpopular policies such as, prominently, the abolition of a public holiday without compensation. It appears that Danish voters do not appreciate the ‘grand coalition of the centre’ that the Social Democrats under Mette Fredericksen had chosen to form, irrespective of the (at least numerical) possibility to build a ‘red bloc’ coalition after the 2022 elections. It also seems that the Social Democrats have taken their Islamophobic rhetoric too far during the campaign. Crucially, while an anti-government vote explains the three parties’ record low, it also partially explains the gains for parties both on the hard right and left of the Social Democrats.

Was it a climate vote?

Many international commentators attribute the gains for the centre-left to certain decisive political topics or campaigns. In Denmark, for example, the great results for the Socialist People’s Party were read as a voter demand for greener politics. Some opinion polls back the idea that Danish voters considered climate policy as a priority (69 percent), or important (an additional 23 percent). Interestingly, in Denmark, it is the party even further to the left, Enhedslisten, that often presents itself — with some justification — as Denmark’s ‘greenest’ party. During the EU election campaign, it has clearly put green issues at the centre, while the Socialist People’s Party traditionally has a fairly strong profile here. Indeed, within the old ‘red bloc’ we can observe a shift to the green-left. Between them, the three centre-left parties in Denmark received 40 percent of the overall vote in both the national elections of 2022 and in the EU elections 2019 and 2024. To what extent green politics were decisive for the shift within the bloc, however, remains open for debate. The Socialist People’s Party, a close ally and supporter of numerous governments led by the Social Democrats, has historically functioned as a channel for frustrated social-democratic voters who are reluctant to vote for Enhedslisten, and this is likely what we are seeing here as well.

For Vasemmistoliitto, climate and environmental matters were also central to their campaign, as they were to Finnish voters. Yet also in Finland, it was not the Greens who made the important gains. In Sweden, climate was the most important topic for 58 percent of voters, according to one poll and consequently played a clearer role for both the gains for the ‘red bloc’ and the green-left shift within the bloc. Climate was also among the top three priorities for Vänsterpartiet during the campaign. With nearly a quarter of the vote between themselves and the Greens, as mentioned above, Vänsterpartiet no doubt benefitted from Sjöstedt’s ‘green’ profile, as well as from the endorsements of both the Greens and the Left Party made by leading environmental NGOs.

Was it a Palestine vote?

Other commentators have pointed to the importance of peace and security as potentially decisive factors in left gains during these elections, with the three left parties fully supporting Ukraine, having refined their positions on NATO, and having a clear stance on Palestine. In Sweden, this last topic featured particularly prominently. There are clear signs that Vänsterpartiet was able to substantially increase its support from among voters who themselves or whose family members had migrated to Sweden, especially from countries of the Middle East, and who — despite being traditionally more conservative — in this election made party stances on Palestine central to their decision at the ballot box. It also reflects the Left Party’s substantial membership from this community and its track record of international solidarity work, including on Palestine. According to Finnish opinion polls, Ukraine and security were important to voters, and it helped that Vasemmistoliitto had positioned itself with a pragmatic stance on NATO membership and made solidarity with Ukraine central to their policies. Palestine solidarity is also a traditionally strong focus of the Finnish Left, as it is for the Danish Enhedslisten; its role as a decisive factor during the elections, however, is less clear in these two countries.

For left voters, the left parties’ unique selling point is arguably how they connect green politics and international solidarity with social matters, focussing on the cost of living and other issues that people struggle with on a daily basis. During the campaign, they did so by strongly linking these matters to the European level, pointing both to problems with EU policies and regulations, while, despite their historically Eurosceptic positions (particularly Enhedslisten and Vänsterpartiet), simultaneously presenting the European level as a space to engage in and work towards solutions. This seems to have gone down well with voters, especially where people had direct experience of what a coalition of traditional and far-right forces might mean at the European level.

Uncertain prospects

The elephant in the room, however, is whether the gains for left-green parties can be turned into a more sustained shift to the left. Here, Vasemmistoliito might be in for some disappointment. With a high volatility of voters along the centre-left-green continuum, the party benefitted both from the oft-quoted ‘Li-effect’ and the weakness of its closest competitors. In fact, many voters might not consider themselves as having voted for the Left Alliance, but for Li Andersson personally — she is an excellent communicator, enjoys high regard from across much of the political spectrum and received votes from supporters of all political parties. Her move to Brussels, and stepping down as party chair in the autumn, means this personal effect is likely to diminish in future elections. In fact, recent opinion polls see the Left Alliance once again receiving their usual level of support, around 9-10 percent, albeit with a potential to expand this gradually (going above 11 percent in July).

Both the Greens and the Social Democrats suffered from a lack of such a personality effect, having previously enjoyed it thanks to the Green’s presidential candidate Pekka Haavisto and the Social Democrat’s political superstar, former party chair and Prime Minister, Sanna Marin — neither of whom were seen much during the European campaign. Yet all three parties have a history of working together constructively, and politically they are comparatively close. If they can keep up the momentum throughout next year’s municipal elections, this might turn the tide in the mid- to long-term. Much will also depend on how the Finns Party responds to the mounting pressure they are facing in light of government policies, questions about their competence, and ongoing scandals. However, the Finns Party has been able to hold on for much longer than was initially thought and the government as a whole has so far withstood most interpellations brought forward by the opposition in recent months.

From structural majority for the left to progressive political project?

The Danish vote can be read as a warning to the Social Democrats not to venture too far with their ‘government of the centre’, as well as their policies targeting migrants and Muslims. The grand coalition’s ‘centrist’ politics have not taken hold in Danish society and have strengthened forces both to the left and the right. The old blocs remain powerful, with the red bloc having maintained a solid 48-50 percent in opinion polls and at the ballot box between the general election of 2022 and now. Structurally, there is a ‘red’ majority, which was deliberately abandoned by the Social Democrats for their current ‘centrist’ project, yet in the most recent opinion poll by Voxmeter, the Socialist People’s Party has actually overtaken the social democrats, the first time the Social Democrats are not the most popular party in a decade.

While the traditional, (neo)liberal and far right are still in the process of reconfiguration, the left has an opportunity to translate its structural majority into a progressive political project. The Danish far right is still seeing internal shifts, with new parties emerging and others experiencing changes in support levels, but there is a consistent and substantial section of the Danish voters prepared to vote far right. Many of the far-right’s policies have also become mainstream (the Social Democrats playing a particularly shameful role here), and even influencing how parties further to the left debate policies on migration, asylum and integration. In order to turn the structural majority for parties of the centre-left into a progressive government, these parties would have to do a lot of work.

A new balance of power

Between 2006 and today, the political right has enjoyed a structural majority in Sweden. This year’s EU election constituted a sea change in this respect. Over the past year, the red bloc has gradually increased its vote share as well as its lead. However, within this bloc, more recently, the Social Democrats have lost ground in relation to both the Greens and the Left Party, while the Centre Party is also picking up after a longer decline. Although the Left party has historically polled comparatively strong in EU elections, it is at the national level that, according to opinion polls, it has gradually improved its position over the past two legislative periods to just under 10 percent.

The party is growing — having increased its membership from 11,000 to 27,000 within a decade or so — and its messages stick, thanks to an organising and communication strategy based on phone banking and targeted messages for different constituencies that appears to be working. In Sweden, we have in fact seen a shift in structural support from blue to red, which is reconfirmed in recent opinion polls. There also appears to be some rapprochement between the Left and the Social Democrats more recently, and the gradual strengthening of the Left within the bloc (as well as the Greens, putting aside for a moment their disproportionately good outcomes in European elections) could also point to a new balance of power, one that is potentially conducive to a progressive government.

The qualified success of the left

The analysis shows that despite impressive results, and significant differences with large parts of the EU, these elections were not an unqualified victory for the left across the region. While some parties do benefit domestically from their results at a European level, some qualifications must be made regarding the potential to turn that into political change at home. Unsurprisingly, the left was most successful where it had candidates that were known and popular beyond their own party and its core support; where it had clear and comprehensive communication and organising; and where it could benefit from long-term strategic choices and clear political stances.

Ada Regelmann is project manager at the Rosa-Luxemburg-Stiftung Brussels Office.


 

Sweden’s Left Party celebrates its biggest win in 20 year

Published 

First published at Rosa-Luxemburg-Stiftung.

After winning over 11 percent of the vote, and two mandates, in June’s European Parliament elections, the Swedish Left Party Vänsterpartiet is celebrating its best election results in twenty years. The historic result brought the party a step closer to fulfilling large parts of its main strategy, something it has been working towards for more than a decade. How this outcome is to be interpreted — whether as a direct result of this strategy, or a widening of it — is now up for debate.

The European election also took place mere weeks after a marathon five-day party congress, which adopted a new party programme amid intense debate. This debate also foreshadowed both the diverse entry points of the election campaign, as well as different interpretations of its outcome that were to follow.

Vänsterpartiet’s success in the European elections could be — and is being — ascribed to many factors. The party’s messaging was framed in a similar way to the 2022 national election, in what might be described as a form of class-based populism, connecting both with Sweden’s strong social democratic tradition and with calls for a state-led climate restructuring strategy. The party’s campaign was built on popular demands, such as opposing European Union-driven liberalisations limiting climate and social policies, promoting European train coordination, and a national de-linking of EU electricity prices.

However, the lead candidate was popular former party leader Jonas Sjöstedt, who has a strong a green profile, and some have interpreted the latter as the decisive factor in Vänsterpartiet’s electoral success.

Palestine solidarity

The campaign also featured solidarity with Ukraine and Palestine, but while support for Ukraine crosses Swedish party lines, solidarity with Palestine breaks down much more of a left-right divide. As the campaign went on the left’s messages on Palestine came more into focus, mirroring the strong Swedish (and international) solidarity movement that has mushroomed in recent months, and has helped change the Swedish political debate dramatically. This led to heated televised debates, and to Vänsterpartiet’s leader Nooshi Dadgostar openly describing the vote as a “Palestine election”, arguing that a decisive EU, using sanctions and political pressure, could “stop the ongoing genocide”.

The party’s stance here clearly contributed to its record results, at least with certain groups of voters. Vänsterpartiet received 20 percent support from voters born, or with at least one parent born, outside Europe, and achieved very good results in suburban working class areas (where many with this background live, and where sympathy for Palestine is high). While these areas have long been a stronghold for the left, this was an unprecedented breakthrough. In several districts and regions, Vänsterpartiet surpassed the Social Democrats as the biggest party, often for the first time, while in Sweden’s second and third cities, Gothenburg and Malmö, it came second with 17.6 and 19.8 percent of the vote, respectively.

A strengthened left, and a weakened far-right

In the years after Sweden joined the EU in 1995, Vänsterpartiet performed well in European elections (then, too, with Jonas Sjöstedt as lead candidate), articulating a strong left-wing criticism of the EU. This attracted many voters in the northern regions and other peripheral areas where the labour movement is traditionally strong. To a certain extent, this pattern repeated in this election, especially in Sjöstedt’s northern home region, Västerbotten, where the party made the biggest increase of all, going from 10.3 to 23.3 percent. Organisationally, Vänsterpartiet also made strong headway in this campaign, making some 300,000 phone calls to voters (60,000 resulting in discussions), up from 200,000 calls in the last national election.

Last, but certainly not least, this election also saw the far-right Sweden Democrats decrease their vote-share for the first time since they entered the national Parliament in 2010, while all the red and green parties saw a substantial increase. The Greens replaced the Sweden Democrats as Sweden’s third biggest party and became the biggest party in Stockholm with around 20 percent, probably mirroring the importance often attached to climate messages in Sweden’s European elections.

Vänsterpartiet, however, saw a bigger increase in vote-share than any other party, from around 6.8 percent (in both the last EU and national elections) to 11.06 percent now, making it the only Swedish party to win a new seat in the European Parliament. Symbolically, this seat came at the expense of the Christian Democrats, who were Vänsterpartiet’s main antagonist in the debates on Palestine.

Preparing for government participation?

Vänsterpartiet’s marathon party congress only wrapped up on May 12, just weeks out from the European vote. The five-day affair saw it adopt an entirely new party programme, with a more down to earth vocabulary, and make clear statements calling for solidarity with Palestine and sanctions on Israel.

For only the second time in history, the leader of the Social Democrats also attended the Left Party’s congress as guest speaker, signalling a closer bond between the parties and an opening for Vänsterpartiet to participate in a potential red-green government in 2026. After decades of negotiating budgets with Social Democratic governments from outside of government, such participation is a core demand of the party leadership for the future.

In order to understand Vänsterpartiet’s development over the last decade, however, it is important to look at one of the most important, but least debated, documents at the congress: the report on the party’s long term strategy. The first version of this strategy was adopted back in 2012, with an updated version in 2020. The Left Party has changed a great deal during this time, and the changes made in the party programme needs to be seen in that context.

Responding to a right-wing majority

Since 2006, Sweden has had a right-wing structural majority — a major change for a country that had seen near-continuous left-wing majorities since 1932 (with only a 9 year gap). In 2010, after a second win by the liberal-conservative government, a fourth poor result in a row for Vänsterpartiet, and a breakthrough for the far-right Sweden Democrats, entering Parliament for the first time, the party appointed a crisis commission, led by the current economic spokesperson, Ida Gabrielsson.

This commission drafted a new strategy, concluding that Vänsterpartiet could no longer be content with trying to drag the Social Democrats to the left, as they had lost the capacity to win elections on their own, and were unwilling to challenge neoliberal policies. The new strategy called for Vänsterpartiet to take on and reframe the Social Democrats’ own now-abandoned legacy, with a long-term view to winning both the political initiative and a broader electoral support, particularly within the working class, replacing the Social Democrats as Sweden’s main force on the left, and pushing the whole political spectrum to the left.

Long term strategies

To achieve this, several organisational and political priorities were set, many of which have since been achieved: party membership has increased from 11,000 to 27,000; a “tax” on the high incomes of the party’s MPs has significantly strengthened the party’s economy; considerably more resources have been channelled into political and organisational education; elected representatives have become much younger and majority female at most levels; the party’s campaign and communication methods have been considerably professionalised; and so on.

Vänsterpartiet has also had considerable success in setting the political agenda via a class-based populism that connects with Sweden’s strong social democratic tradition. For example, Vänsterpartiet has long campaigned for a ban on corporate profits from publicly financed welfare. Sweden‘s liberalised welfare sector facilitates public funding of private medical clinics, elderly homes, pre-schools and schools, resulting in increasingly unequal social services and growing private oligopolies in these sectors. The call for a ban has broad popular support, and Vänsterpartiet eventually forced a Social Democratic government into proposing it, but — despite having promised a similar move — corporate lobbying led the Sweden Democrats to backflip on their position, joining with the liberal and conservative parties to stop the legislation. Vänsterpartiet also pushed the Social Democrats to deliver several welfare reforms, leading to a slow but steady increase in electoral support, which reached 8 percent in the 2018 national election, and made Vänsterpartiet political kingmakers for the following four years. The party used this influence to push through progressive reforms, such as raised pensions, and, in 2021, to topple — and reinstate — the Social Democratic government in a successful bid to stop liberalisation of negotiated rents.

Unresolved challenges

So far, the successes. But the strategy has brought other challenges that are not yet resolved, not least the issue of replacing the dominant right/far-right agenda, which focuses on crime and immigration, with one focusing on economic and social issues. Despite some success in this regard during and after the struggle on rents in 2021, the momentum was lost when Russia invaded Ukraine in February 2022. This led to a national debate on NATO accession that Vänsterpartiet engaged in but did not embrace or incorporate into its core messaging. Once that debate faded away, the repressive political agenda of the far-right returned, just in time to deliver it victory in the 2022 election.

Another challenge is that the more radical and agenda-setting Vänsterpartiet’s policies became on economic and welfare issues, the more it toned down its radicalism on issues such as anti-racism, socialist rhetoric, international solidarity, and environmentalism. While this has sometimes helped place concrete class conflicts at the centre of mainstream political debates, it has also led to tensions within the party, and between the party and social movements. On issues such as climate, the party’s policies and rhetoric have been reshaped for similar purposes, with some success, but fueling similar tensions, especially among young progressive voters.

Finally, Vänsterpartiet’s attempts to strengthen support in suburban working class areas have been considerably more successful than similar ambitions in rural industrial towns. This all contributed to the party’s electoral setback in the 2022 election, where its support dropped from 8 to 6.75 percent, despite polling around or over 10 percent only a year earlier. At the same time, a right-wing government came to power by a slim majority, heavily dependent on and influenced by the far right Sweden Democrats and their 20 percent of the vote.

New party programme debated

It was in this context that Vänsterpartiet debated and adopted a new party programme in May. Perhaps due to the various challenges the party faces, and the scale of the task set out in its long-term strategy, the pre-congress debate was both complex and detailed, and at times confusing for both party members and the public. This was not helped by the contradictory arguments made about the proposed new programme, including in the mainstream media.

The chair of the party’s Program Commission, Jens Börjesson, argued the new programme should “build confidence in socialism” by showing how socialist solutions had already changed society for the better, and how this “removal of obstacles to liberty” could be continued. The commission also argued that for the party to grow and attract more people it needed to make the party programme more accessible and easier to understand, rephrasing its content quite dramatically, making the language less theoretical and more down to earth, and focused on creating a narrative around the need for cohesion and liberation.

Less ideological and more down to earth?

As a result, the draft programme replaced phrases such as “abolishing capitalism” with “liberate more parts of the production system from the chains of capital … democratise decisions that today are made behind closed doors by (corporate) boards (of directors) … this is what we think of as socialism”. In place of the demand that “Sweden shall leave the EU” the commission proposed the more pragmatic “Vänsterpartiet needs to hold on to the alternative of Sweden leaving the EU. This is not an end in itself but might become necessary to build a better society in (potential) situations where the EU is hindering this.”

Likewise, the party’s position of “dissolving NATO” was to become “we want Sweden to be independent from NATO and we work to direct military co-operations that we are a part of towards a defensive direction” in the proposed draft. Vänsterpartiet’s leader, Nooshi Dadgostar, has several times avoided answering questions on or criticised such phrases in the old party program, and many critics of the new draft programme saw in these proposals a weakening or even termination of the party’s socialist legacy. Some also argued it was a deliberate accommodation to the Social Democrats, to pave the way for Vänsterpartiet to participate in a left government after the next election.

Compromises and concessions

The commission met some of these criticisms halfway, for example by retaining the traditional ideological introduction describing the Left Party as “a socialist and feminist party, based on an ecological foundation” — something the new draft would have left out. When the congress finally adopted the new programme, the proposed draft was also amended in other respects, restoring a greater emphasis on anti-racism, anti-capitalism, and class, both in the introduction and in the analysis, compared to the commission’s text.

Likewise, the party’s critique of nuclear power and environmental problems was further developed and language asserting the possibility and value of civil disobedience was reinstated. Wholehearted support for Ukraine (including militarily — something the Left Party board opposed very briefly in the beginning of the war) seemed to enjoy broad support at the congress, but it also voted to strengthen the party’s opposition to the developing arms race and rising militarism, and a clear aim to leave NATO was eventually incorporated into the final text.

From a follower to a leader in international politics

While progressive social and economic policies, combined with public investment-led climate policies, have dominated the party’s core messaging, the Palestine solidarity movement made its importance felt both in the election campaign and in the party congress itself. Two members of the new party board — Lorena Delgado and Daniel Riazat — were elected despite not being proposed by the election committee. Both Delgado and Riazat have a strong — sometimes controversial — profile around international solidarity and anti-racism, and are high-profile participants and frequent speakers in the Palestinian solidarity movement.

In a sense, the role of Palestine solidarity this year carries echoes of the disruption caused to Vänsterpartiet’s class-based messaging by the invasion of Ukraine in the lead up to the 2022 election. Unlike in the case of Palestine and Gaza, however, Vänsterpartiet failed to play a leading role during the debate on Ukraine, trying instead to (unsuccessfully) return the debate to its preferred topics, amid a hostile political and media environment. It seems that leading the way with an independent agenda on all key debates contributed to the party’s success this year, bringing Vänsterpartiet closer to its stated strategic goal of becoming the leading party on the left, pushing the whole spectrum of politics leftwards.

Can Vänsterpartiet ride the wave?

Whether Vänsterpartiet’s latest electoral results signal a widening of its political project in the future, and if strategic decisions taken as a result of this election will benefit or harm the party’s cohesion and wider support, remains to be seen. June’s European elections carried a very different momentum to the vote in 2022, and — for now — the party seems to be riding a wave, if it can hold on to it. In this respect, it is worth noting that while Vänsterpartiet’s vote share increased in these elections, its overall number of votes remained about the same.

Swedish voter participation is always considerably lower in European elections (53.4 percent this year) than in national elections (84.2 percent in 2022), so Vänsterpartiet’s result suggests a strengthening of support for the party in general, mobilising not only its own supporters, but also attracting voters from other parties.

The first polls after the election also indicates a spill-over in support for Vänsterpartiet from the European to the national stage, with Vänsterpartiet up two points to 10 percent. They also show a boost in support for party leader Nooshi Dadgostar, whose popularity after the election surpassed the leader of the Sweden Democrats Jimmie Ã…kesson. With a 26 percent approval rating, Dadgostar is currently the third most popular party leader in Sweden.

The polls also suggest strong support for opposition parties in general, who are attracting a combined 55 percent (49 for the Social Democrats, Greens and Vänsterpartiet, without the agrarian liberal Center Party). Meanwhile the right-wing government coalition can only muster 25 percent support, and its extreme-right partner, the Sweden Democrats, 19 percent.

With the next national elections not due until 2026, there is still a long way to go, but these figures, and Vänsterpartiet’s good showing in the European election, suggest that a left coalition government, perhaps with Vänsterpartiet participation, could be possible. With the Social Democrats no longer able to win elections on their own, the conclusions Vänsterpartiet draws from this latest electoral success may be decisive.

John Hörnquist is the former head of political development and political studies, for the Left Party.