Sri Lankan Prime Minister Ranil Wickremesinghe, who took office on Thursday, is heading towards the worst economic crisis in 70 years. Gasoline will run out on Wednesday and the central bank will have to print money to keep paying officials.
Wickremesinghe said in a televised address Monday night that the country urgently needs $75 million in foreign funds to continue importing key products. In addition, money must be printed.
“I am compelled, inadvertently, to print money so that salaries for civil servants and basic goods and services can be paid,” the new prime minister said on Monday. “Although we must be careful about it, because printing money devalues the rupee.”
Mess at gas stations
There is also the privatization of the national airline, SriLankan Airlines, on the table. It recorded losses of 45 billion Sri Lankan rupees (123 million euros) last year. With this privatization, the prime minister is hoping to raise some extra money.
Meanwhile, chaos reigned in the capital, Colombo, gas stations. “Right now we have one day gasoline, and the next few months will be the hardest of our lives,” Wickremesinghe said. According to him, deliveries from India could supply a few more people with petrol in the coming days, but then it is already done.
Inflation will rise sharply
Sri Lanka has been hit hard by the Corona pandemic. The economy declined by 3.6 percent in 2020, but recovered in 2021 with a growth of 3.7 percent. However, the inflation rate rose by 6% in 2021. In March of this year, it reached nearly 14 percent. This, combined with a lack of funds from abroad, has led to shortages of medicine, gasoline, and other essential items, among others.
According to Wickremesinghe, the situation “will get worse before it gets better”, but there will be no hunger crisis. He makes sure that every family gets three meals a day.
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