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Jun 23, 2022

Lanka PM says economy ‘collapsed’

Foreign Affairs News Desk
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Sri Lankan Prime Minister Ranil Wickremesinghe has said that the nation’s economy has “completely collapsed.” The country has been facing food, fuel and electricity shortages.

An ongoing economic crisis in the island-state of Sri Lanka that started in 2019 is the country’s worst economic crisis since the country gained independence in 1948.

Due to COVID-19 pandemic and Russia-Ukraine War, Lanka, who is currently facing a heavy burden of foreign debts, lost revenue from the tourism industry and pandemic-related challenges.

Lankan economy is almost based on tourism. Especially the Russian tourists. But due to the Russians being at War with Ukraine the Sri Lanka tourism industry has almost collapsed.

As per the Lankan Govt. report, Sri Lanka has defaulted on a multi-million-pound foreign debt payment. Thus, the prime minister Wickremesinghe who assumed power only a few days ago is appealing for foreign help to bail out the government, which has almost run out of foreign currency reserves.

Speaking at the parliament on Wednesday Lankan PM Wickremesinghe stressed the scale of the situation and said the government plans to bring together China, India and Japan at a donor conference in August to secure more foreign assistance, and hopes to present an interim budget.

Sri Lanka’s acute economic crisis has put the powerful Rajapaksa dynasty on the defensive.

However, as the politically divided opposition has failed to present a strong alternative, one of its members Nandasena Gotabaya Rajapaksa remains president since 2019.