Sri Lankan PM Ranil Wickremesinghe said, our economy has ‘collapsed’, ‘not from India…’
Colombo (Sri Lanka): The Prime Minister of crisis-hit Sri Lanka on Wednesday (June 22) said that he will discuss with the International Monetary Fund (IMF) and reach an agreement to get an additional credit facility. Addressing the Sri Lankan Parliament, PM Ranil Wickremesinghe said, “The only safe option before us now is to discuss it with the International Monetary Fund. In fact, it is our only option. We should take this path.”
Wickremesinghe said his country’s debt-ridden economy has “collapsed” after months of lack of food, fuel and electricity, and it cannot even buy imported oil. “The plan has already been prepared after consultations with the Central Bank, Treasury, concerned government officials, professionals and experts. I request you to inform us about better solution if available. In fact, if you have a practical and more favorable plan for the country, we call upon you to take it forward,” the Sri Lankan PM said. The PM said that a team of IMF had reached Sri Lanka on Monday. Wickremesinghe appreciated the assistance provided by India, however, he said, “the financial assistance provided by India” is not a charitable donation.
Sri Lanka is facing the worst economic crisis since independence in 1948, leaving the entire island nation with acute shortages of essential commodities such as food, medicine, cooking gas and fuel. The nearly bankrupt country, coupled with an acute foreign exchange crisis that resulted in foreign debt defaults, announced in April that it would raise foreign debt of about USD 7 billion for the year out of about USD 25 billion due by 2026. suspending repayment. The total external debt is US$51 billion. Since January this year, Indian credit lines have provided a lifeline to Sri Lanka amid growing public discontent over the deteriorating economic situation.
Wickremesinghe said a team of US Treasury Department representatives would also reach Sri Lanka next Monday. We intend to have an official level agreement with the IMF by the end of July. He pulled the island nation out of this crisis. A plan to withdraw was also laid. The Sri Lankan PM also highlighted the debt restructuring plan with the IMF.
Elaborating further, PM Wickremesinghe said that in parallel with holding talks with the IMF, Sri Lanka will also hold a credit assistance conference with India, Japan and China – the main lending countries to Sri Lanka. “We are currently in discussion with the World Bank as well. To secure interim short-term loans to the Asian Development Bank, the United States, other Allies and Heads of State until we receive IMF support. We will be able to lay the foundation for ensuring economic stability after the successful completion of these works. But it will by no means be the end. In fact, this will be the beginning of our journey. A new journey towards a stronger economy. Then we have to go ahead with our plans to consolidate and build a new Sri Lankan economy.” Wickremesinghe said.