Like Sri Lanka, These Seven Countries Have Been Devastated in the Past
Rising inflation, shortage of food and milk, long queues at shops, department store robberies, political strife and violence, anti-government protests, riots in various cities have plagued the general public of Sri Lanka. People around the world are worried about the situation in Sri Lanka. Stuck in poor economic decisions, cheap interest rates, free schemes and $50 billion in foreign debt, Sri Lanka is on the verge of bankruptcy. People’s hopes have been dashed. People are protesting on the streets. The Prime Minister has resigned. The army is firing as soon as the violence broke out. Sri Lanka, which became independent in 1948, is facing such a crisis for the first time.
Amid the escalating coronavirus crisis over the past two years, Sri Lanka has been mired in crisis as the Rajapaksa government sticks to its promise to reduce the tax burden in the 2019 elections. The cost of flour, milk and medicines has reached thousands of rupees. Despite being expensive, people who were short of goods started resorting to violence. The situation was such that there were power cuts for 12 hours, inflation exceeded 17 per cent, foreign exchange required for import of essential goods decreased and investors and tourists alike started turning away from Sri Lanka.
The Sri Lankan crisis reminded people of the days when countries like Venezuela and Greece went bankrupt. The system suddenly failed in these countries and anarchy spread. The value of the currencies of these countries fell to zero. The money lying in people’s homes was turning into a pile of paper. This situation was such that people were spending thousands of rupees for one kilo of food grains. Let us know about the crises of some such countries.
1840 19 states of America were to become defaulters
Large canal construction projects began in the United States in the 1840s. The government started work with a loan of ₹80 crore. At that time 19 states of America were stuck in debt. The financial crisis also escalated as government capital was spent on setting up new banks. People suffered when economic sanctions started.
1994 currency devaluation: Mexico shakes
In 1994, Mexico was forced to devalue its currency by 15% against the dollar. Foreign investors started selling the stock for export. As a result, the DGP fell by five per cent. The country owes 80 80 billion. Mexico’s economic situation gradually stabilized when the IMF, Canada, the United States and South American countries offered bailout packages to rescue Mexico from the crisis.
1998 When Russia also became pathetic
Russia has been in debt for many years after the collapse of the Soviet Union in 1991. By 1998, Russia was on the verge of bankruptcy. Russia had to devalue its currency. The default resulted in a loss of 5 billion in foreign exchange. The stock market fell. There was a time when it was time to close the stock market. During this time people had to face many problems.
2008 Nordic country Iceland becomes defaulter
In 2008, three banks in the Nordic country Iceland defaulted on 85 billion in debt. Iceland’s economy has been shaken by bankruptcy. With the currency crisis in the country, people started losing their jobs. People started failing to repay the loans. People’s savings ran out and there was a crisis of employment. This situation was created when these private banks were given concessions during the liberalization era. The crisis was further aggravated by the fact that private banks were lending heavily to the public on easy guarantees and terms.
2001 Hunger situation in Greece
Greece ran into trouble in 2001 when it replaced its currency with the euro currency. By the year 2004, the government was in debt due to rising wages of government employees and rising government expenditure. Greece was in trouble after spending 9 billion euros on the 2004 Athens Olympics. The 2008 global economic recession plunged Greece into inflation. The country’s employment was lost, the stock market collapsed. It took years for the Greeks to get out of this situation.
2017 Venezuela’s currency becomes like a piece of paper
In 2017 Venezuela was declared bankrupt due to the economic crisis. Due to foreign debt and wrong economic decisions, the currency position became so weak that the government had to print one million bolivar notes. The currency was so devalued that people had to pay 2.94 for 500 grams of boneless chicken and 2.93 for 12 eggs.
2020 Argentina becomes debtor
South American country Argentina suddenly went bankrupt in the year 2020. Foreign investors began demanding 1.3 billion in return for the bonds they bought for investment. Banks and financial institutions refused to repay loans. Argentina blames the United States for its actions. Argentina was also facing bankruptcy during the year 2000-01. This incident made people miserable.