Colombo: A delegation of the Sri Lankan government is headed to the US on Sunday to secure a $4 billion package with the IMF as it desperately tries to bail out the country’s beleaguered economy currently from a severe foreign exchange crisis.
The delegation, led by newly appointed Finance Minister Ali Sabri, will hold talks with the International Monetary Fund (IMF) from April 19 to April 24.
Sabri said that Sri Lanka Is seeking a $4 billion bail out package from the IMF, which had earlier resisted calls to take over the facility from the global lender.
The visit comes days after the finance ministry announced on Tuesday that it would suspend repayment of foreign debt, including bonds and government-to-government borrowings, until the completion of a debt restructuring program with the International Monetary Fund (IMF). Used to be. Sri Lanka had to repay a debt of $ 7 billion this year.
It was the first loan default by Sri Lanka in its history since 1948 and the country’s 22 million people are facing 12-hour power cuts, and extreme shortages of other essential items such as food, fuel and medicines.
Sri Lanka’s Securities and Exchange Commission (SEC) announced on Saturday that the Colombo Stock Exchange will be temporarily closed for a week from Monday to give investors an opportunity to have “greater clarity and understanding” of the current crisis-ridden economic conditions. Sri Lanka which will help them to “make informed investment decisions”.
Sri Lanka is facing its worst economic crisis since gaining independence from the UK in 1948. The economic crisis also triggered a political upheaval in the island nation, with citizens holding nationwide street protests over prolonged power cuts and shortages of fuel, food and other daily. The demand for the removal of President Gotabaya Rajapaksa is even more urgent.
Earlier this month, Sri Lanka’s entire cabinet—except President Gotabaya and his older brother, Prime Minister Mahinda Rajapaksa—resigned from their posts after thousands defied a nationwide state of emergency and curfew and condemned the government. joined the street protests.
According to sources, President Gotabaya has arranged to take oath in the small cabinet any time soon. Apart from Prime Minister Mahinda, there will be no member of the Rajapaksa family in this.
President Gotabaya removed his brother and finance minister Basil Rajapaksa from his post earlier this month and invited opposition parties to join the unity cabinet to deal with public anger against the difficulties arising out of the economic crisis. . The opposition rejected the proposal to form a unity cabinet. The opposition is to move a no-confidence motion against the government next week.
With acute shortage of foreign exchange, the Indian line of credit of $500 million for fuel imports has provided a lifeline to the island nation.
India recently announced a $1 billion line of credit to Sri Lanka as part of its financial aid to the country to tide over the economic crisis, following the previous $500 billion loan in February to help buy petroleum products. declare.
President Rajapaksa defended his government’s actions, saying the foreign exchange crisis was not his and the economic slowdown was largely driven by the island nation’s tourism revenue and inward remittances.
The delegation, led by newly appointed Finance Minister Ali Sabri, will hold talks with the International Monetary Fund (IMF) from April 19 to April 24.
Sabri said that Sri Lanka Is seeking a $4 billion bail out package from the IMF, which had earlier resisted calls to take over the facility from the global lender.
The visit comes days after the finance ministry announced on Tuesday that it would suspend repayment of foreign debt, including bonds and government-to-government borrowings, until the completion of a debt restructuring program with the International Monetary Fund (IMF). Used to be. Sri Lanka had to repay a debt of $ 7 billion this year.
It was the first loan default by Sri Lanka in its history since 1948 and the country’s 22 million people are facing 12-hour power cuts, and extreme shortages of other essential items such as food, fuel and medicines.
Sri Lanka’s Securities and Exchange Commission (SEC) announced on Saturday that the Colombo Stock Exchange will be temporarily closed for a week from Monday to give investors an opportunity to have “greater clarity and understanding” of the current crisis-ridden economic conditions. Sri Lanka which will help them to “make informed investment decisions”.
Sri Lanka is facing its worst economic crisis since gaining independence from the UK in 1948. The economic crisis also triggered a political upheaval in the island nation, with citizens holding nationwide street protests over prolonged power cuts and shortages of fuel, food and other daily. The demand for the removal of President Gotabaya Rajapaksa is even more urgent.
Earlier this month, Sri Lanka’s entire cabinet—except President Gotabaya and his older brother, Prime Minister Mahinda Rajapaksa—resigned from their posts after thousands defied a nationwide state of emergency and curfew and condemned the government. joined the street protests.
According to sources, President Gotabaya has arranged to take oath in the small cabinet any time soon. Apart from Prime Minister Mahinda, there will be no member of the Rajapaksa family in this.
President Gotabaya removed his brother and finance minister Basil Rajapaksa from his post earlier this month and invited opposition parties to join the unity cabinet to deal with public anger against the difficulties arising out of the economic crisis. . The opposition rejected the proposal to form a unity cabinet. The opposition is to move a no-confidence motion against the government next week.
With acute shortage of foreign exchange, the Indian line of credit of $500 million for fuel imports has provided a lifeline to the island nation.
India recently announced a $1 billion line of credit to Sri Lanka as part of its financial aid to the country to tide over the economic crisis, following the previous $500 billion loan in February to help buy petroleum products. declare.
President Rajapaksa defended his government’s actions, saying the foreign exchange crisis was not his and the economic slowdown was largely driven by the island nation’s tourism revenue and inward remittances.