In Sri Lanka, an island of 22 million people, the coworking community is presently facing one of its most significant challenges on record. Adding to the negative impacts of Covid-19 which many Sri Lankan business owners are still struggling to navigate, the nation is now facing a deepening economic crisis that has led to energy shortages and power cuts.
On April 1, anger against Sri Lankan President Gotabaya Rajapaksa’s handling of the deepening economic crisis spiraled into violence as protestors clashed with police for several hours. A severe shortage of foreign currency has left Rajapaksa’s government unable to pay for essential imports, including fuel, leading to debilitating power cuts lasting up to 13 hours.
Without power available at home, many entrepreneurs, remote workers, and freelancers rely on flexible workspaces in order to conduct business. However, it’s impossible to provide power without a generator, and many coworking spaces do not have one onsite.
For those that do, like WORX Co-working in Colombo, the price of diesel has increased so drastically that it’s become nearly impossible to provide electricity to members and maintain operational costs.
Managing Director of WORX Coworking Azahn Munas discussed the difficulties of Sri Lanka’s unprecedented energy crisis for the country’s flex office industry, especially when demand is higher than ever.
For those who may be unfamiliar with the current energy crisis in Sri Lanka, can you please discuss how this issue arose?
Sri Lanka has been hit hard by the Covid-19 pandemic. Prior to the pandemic, our country was already highly vulnerable to external shocks owing to inadequate external buffers and high risks to public debt sustainability, exacerbated by the Easter Sunday terrorist attacks in 2019 and major policy changes including large tax cuts at late 2019.
Consequently, Sri Lanka is currently facing an acute economic and energy crisis triggered by a shortage of foreign exchange, which has left the government unable to pay for essential imports, including food, medicine and fuel, leading to debilitating power cuts lasting up to 13 hours a day. Ordinary Sri Lankans are also dealing with soaring food prices as well.
How is the energy crisis affecting coworking operators specifically?
The energy crisis has had a crippling effect on coworking operators. Many spaces do not have a generator onsite and thus have to inform members when there will be power cuts so they can make alternate arrangements.
The few spaces that do (such as WORX) are finding it almost impossible to find diesel to run the generators due to an acute shortage of fuel. We have since had to reduce our operational hours from 24/7 access to just Mon-Fri from 9am – 6pm so we can conserve our fuel supply. Furthermore, the price of diesel has drastically increased which has impacted our operational costs.
We have also had to close down our Cloud Kitchen offering called “WORX KITCHEN” as the generators do not have the capacity to power the kitchen and workspace at the same time. As such, we’ve sadly had to cancel dozens of upcoming bookings during a very important time for Sri Lankans celebrating the upcoming New Year festival and left food companies who use our space without a place to work which will have a devastating impact on their customers and their business.
What has your space been able to do to combat this crisis and still support members?
Our Operations Team is working overtime to procure diesel anywhere we can find it so our spaces can remain open for our members. It has been an incredibly difficult process but we are trying our hardest. In the instance of a building closure due to a lack of fuel, we will not charge our members for any unused days, in a bid to support them financially.
We’ve also received an overwhelming amount of inquiries from freelancers and small business owners across the city who have simply no place to work anymore. Some are so desperate they have asked if they can sit on the ground or work outside, just so they can have access to electricity and Wi-Fi.
As such, we are doing our best to provide emergency seating for those in need and additional seats have been created from any unused spaces we have including our boardroom, break-room, and outdoor areas. However, as space is limited we still have to turn some people away, which is heartbreaking.
How can communities outside of Sri Lanka help or support local space operators during this crisis?
We desperately need international awareness of the situation so there is further pressure on the government to find a permanent solution to this crisis. If international communities can learn about the crisis and share local stories amongst their networks, that would be a great start.
Supporting local space operators is a difficult question to answer, as we’re not asking for money or financial support. What we desperately need is fuel, so we can run our spaces and provide an uninterrupted power supply for our members who depend on us.
What are your predictions for the future of the coworking industry in Sri Lanka at this time? Can a resolution of some kind will be reached and the crisis resolved?
Whilst we are currently facing significant operational issues as a result of the crisis, demand for our services has never been higher. This crisis has introduced coworking spaces to so many people who previously had never heard of the concept.
Every week, we get hundreds of inquiries for office space, meeting rooms, and hot desks as businesses are realizing the many benefits that coworking spaces can offer, especially in times of uncertainty. This is a great thing but due to the shortage of building materials, we are struggling to accommodate this demand as it’s almost impossible to complete new building work on time or within budget. However, large protests are occurring everyday and demanding change so we live in hope that we can soon figure out a proper solution to ending this crisis, quickly!