Colombo: Sri Lanka is bankrupt and the acute pain of its unprecedented economic crisis will last at least until the end of next year, Prime Minister Ranil Wickremesinghe told Parliament on Tuesday.
The island nation’s 22 million people have endured months of galloping inflation And long power cuts after the government exhausted foreign exchange for imports of critical goods.
Wickremesinghe said the once prosperous country will go into deep recession this year and the acute shortage of food, fuel and medicine will continue.
“We will also face difficulties in 2023,” the premier said. “This is the truth. This is the truth.”
He said Sri Lanka’s ongoing bailout talks with the International Monetary Fund depend on finalizing a debt restructuring plan with creditors by August.
“We are now participating in the talks as a bankrupt country,” Wickremesinghe said.
“Our country is in a state of bankruptcy, we will have to separately present a plan on our debt stability. Only when ( International Monetary Fund) are satisfied with that plan, can we reach an agreement.”
The IMF said last week that more work needed to be done to fix the country’s finances and repair its runaway fiscal deficit before a deal could be struck on a funding arrangement to address the balance of payments crisis. .
Sri Lanka is currently almost completely without petrol and the government has closed non-essential public services in an effort to conserve fuel.
The United Nations estimates that about 80 percent of the population is giving up food to deal with lack of food and record prices.
The island nation’s 22 million people have endured months of galloping inflation And long power cuts after the government exhausted foreign exchange for imports of critical goods.
Wickremesinghe said the once prosperous country will go into deep recession this year and the acute shortage of food, fuel and medicine will continue.
“We will also face difficulties in 2023,” the premier said. “This is the truth. This is the truth.”
He said Sri Lanka’s ongoing bailout talks with the International Monetary Fund depend on finalizing a debt restructuring plan with creditors by August.
“We are now participating in the talks as a bankrupt country,” Wickremesinghe said.
“Our country is in a state of bankruptcy, we will have to separately present a plan on our debt stability. Only when ( International Monetary Fund) are satisfied with that plan, can we reach an agreement.”
The IMF said last week that more work needed to be done to fix the country’s finances and repair its runaway fiscal deficit before a deal could be struck on a funding arrangement to address the balance of payments crisis. .
Sri Lanka is currently almost completely without petrol and the government has closed non-essential public services in an effort to conserve fuel.
The United Nations estimates that about 80 percent of the population is giving up food to deal with lack of food and record prices.