JHE TRAVELS from Bandaranaike Airport, Sri Lanka’s main international hub, to Colombo, its capital and largest city, has run smoothly since the opening of a new elevated highway nearly a decade ago . But once in the city, the latest edition of a popular guide warns, “the streets remain as crowded as ever during the day, so add plenty of time”.
Not in July. No more traffic jams and traffic jams. Instead, it was at the sides of the roads that the vehicles gathered, as if an automobile Moses had separated the great mass of cars and auto-rickshaws. They were queues for fuel, stretching as far as the eye could see.
In May, Sri Lanka ran out of foreign currency and defaulted on its external debt. Imports were severely restricted. Prices have skyrocketed. And in late June, the bankrupt country suspended fuel sales except to emergency services and others carrying out essential work. Although sales resumed in July, supplies remained tight and caps were placed on how much each customer could purchase. Some drivers waited in line for days before reaching the start of the line. Many resorted to buying fuel on the black market, where it cost five or six times the official rate.
To illustrate the extent of the crisis, The Economist asked Maxar, an American company that photographs much of the planet every day, for satellite images of central Colombo, focused on two gas stations.
This image shows a Lanka IOC petrol station in Havelock Town, an affluent commercial and residential area, on May 30. The economy was collapsing and traffic had already gone down, but the worst was yet to come. Queues had started to form, but they were still small.
On July 13, as the fuel began to flow, queues snaked around the block in all directions. Crowds gathered in the forecourt. On the same day, Gotabaya Rajapaksa, the president, fled the country, going first to the Maldives and then to Singapore before resigning. A few days earlier, on July 9, angry protesters occupied the president’s residence and office.
Nor were the queues a reflection of a shortage of pumps, rather than gasoline. Another around the corner had similar queues forming on May 30.
On July 13, every stretch of shoulder leading to the gas station was crowded with motorists waiting patiently. Elsewhere in town (not in this image), long lines of people waited for cooking gas canisters.
The shortages were the product of years of bad policy. In 2019, Mr. Rajapaksa cut taxes. The pandemic hit the following year and devastated the tourism industry, a big earner of foreign currency. An ill-conceived ban on fertilizers in 2021 has affected agricultural yields and agricultural exports. It was hastily repealed, but the damage was done. Rather than admitting its mistakes, the government insisted on pretending that all was well and spent the rest of its reserves to service the debt and support the currency.
In May, the country looked into the abyss. Mr. Rajapaksa’s brother, Mahinda, the prime minister, resigned and was replaced by Ranil Wickremesinghe (sixth time in office). When Gotabaya resigned last month, Mr. Wickremesinghe replaced him as president. Mr Wickremesinghe was honest with his citizens, admitting that the country is bankrupt and the road to recovery will be difficult.
By early August, the queues had disappeared. These images show the two gas stations on August 14. The roads around them are clear. It’s not because Sri Lanka got a big cash injection or turned its economy around. But on August 1, Mr Wickremesinghe’s government introduced an improved fuel distribution system, in which motorists register online and receive a QR code on their phone entitling them to a weekly ration. Authorities are also cracking down on hoarding and the black market. This has helped alleviate the sense of crisis, if not its root causes.
Mr. Wickremesinghe has ambitious plans. He is negotiating a bailout with the IMF, which would provide more cash for imports like gasoline. He promises a host of economic reforms. But even eliminating giant queues, if only through a more efficient rationing system, is a step forward. ■