The Prime Minister of Sri Lanka is stepping up efforts to revive the country’s “completely collapsed” economy amid a lack of foreign exchange reserves and a serious shortage of essentials.
“We are now facing a far more serious situation than just a shortage of fuel, gas, electricity and food. Our economy is facing a complete collapse,” said Prime Minister Ranil Wickremesinghe. Told Congress on June 22nd.
“It’s not easy to revive a country whose economy has completely collapsed, especially ones with dangerously low foreign exchange reserves,” he said.
Sri Lanka will hold a credit aid conference on loan packages with India, China and Japan. Wickremesinghe said the goal is to reach a “general agreement” on the lending process, as each country has its own lending system.
“But recently there have been some conflicts and disagreements between us. We are working to resolve these and re-cultivate friendships,” he added.
The government will also seek help from the United States, along with a representative of the US Treasury to visit Sri Lanka next week.
Australia said it will provide Sri Lanka with the following $ 50 million development aid package: Wickremesinghe Meeting With Australian Interior Minister Clare O’Neil on Monday.
Wickremesinghe said Sri Lanka received a $ 4 billion loan facility from India and requested additional lending assistance from neighboring countries.
India’s top-level delegation will meet with Sri Lankan leaders on June 23 to discuss extending an additional $ 500 million credit line to Sri Lanka to buy oil.Local media daily mirror report.
“But even India cannot continue to support us in this way. Even their support is limited. On the other hand, we also need to plan to repay these loans. These are not charitable donations, “he added.
Wickremesinghe said negotiations with the International Monetary Fund (IMF) are underway and the government expects to reach an official level agreement with the IMF by the end of July.
“If we receive the IMF approval stamp, the world will trust us again. It will help us to secure not only low interest rate lending from other countries in the world, but also lending support.” Stated.
“The Ceylon Petroleum Corporation has a debt of $ 700 million. As a result, no country or organization in the world is ready to fuel us. They are even reluctant to provide fuel for cash. It’s a target, “said Wikla Machinha.
Sri Lanka also requested China to revise the terms of the 1.5 billion yuan swap facility signed last year. This stipulates that funds can only be used if Sri Lanka has sufficient foreign exchange reserves to survive for three months.
The country is on the verge of bankruptcy, and foreign exchange reserves have plummeted by 70% in the last two years. The government said on April 12 that it would stop repayment of external debt.
China owes about 10% of Sri Lanka’s $ 51 billion external debt. The government has asked China for help in rebuilding its debt.
Wickremesinghe said Sri Lanka would not have experienced the worst economic crisis in decades if the government had acted earlier.
“Initially, we wouldn’t have faced this difficult situation today, at least if measures were taken to delay the collapse of the economy. But we missed this opportunity. There are signs that it may fall to the bottom, “he said.
Thousands of Sri Lankans went out on the streets to protest the government’s mishandling of the country’s economic crisis and resigned then-Prime Minister Mahinda Rajapaksa on May 9.
The country’s unprecedented economic crisis has left millions of people in need of life-saving assistance, and a serious shortage of essential medicines and frequent power outages put the country’s health care system at risk.
The United Nations launched a global public call on June 9, providing $ 47.2 million in aid between June and September to 1.7 million people whose livelihoods and food security are at greatest risk. Did.