Sri Lanka will remain bankrupt until at least 2026, President Ranil Wickremesinghe told parliament on Wednesday, calling for support for his reforms to revive the country’s economy mired in historic crisis.
“Introducing new fiscal policies is a politically unpopular decision. Remember, I’m not here to be popular. I want to get this nation out of the crisis it’s in,” said Ranil Wickremesinghe, who took office last summer after the resignation. Gotabaya Rajapaksha.
The latter led the country at the height of the historic economic crisis for which he was blamed by a population exasperated by months of shortages of food, fuel, electricity and medicine.
The tax increases and the elimination of fuel and electricity subsidies decided by the current government are resented by the Sri Lankan population, which is already suffering hard from the crisis and record inflation.
Chinese creditors
“If we continue with this plan, we can get out of bankruptcy by 2026,” the president added during a speech in parliament calling for support for economic reforms.
Ranil Wickremesinghe’s political speech was made at the time of a major union strike, with strikes followed by air traffic controllers, doctors, among other sectors.
The head of state, however, estimated that the economy would grow again at the end of 2023, thanks to new measures to inflate the state coffers.
He had said last month that the economy may have contracted by as much as 11% in the last calendar year, with foreign exchange reserves running dry, banning vital imports.
The South Asian island of 22 million inhabitants, which defaulted on its external debt in April, currently valued at 46,000 million dollars, is today seeking to finalize a rescue of 2,900 million dollars with the International Monetary Fund (IMF).
The process has been delayed by debt restructuring negotiations with China, among other creditors.
In this regard, Ranil Wickremesinghe clarified that Sri Lanka was in direct talks with China about its outstanding debt, but had received “positive responses from all parties” and was working on a final agreement.
Source: BFM TV
