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President Gotabaya Rajapaksa introduced emergency regulations to control the price of basic food as private banks ran out of foreign exchange to finance imports.
Sri Lanka has declared a state of emergency due to food shortages because private banks have used up foreign exchange to finance imports.
As the country is suffering from a severe economic crisis, President Gotabaya Rajapaksa said on Tuesday that he has ordered emergency regulations to combat the hoarding of sugar, rice and other essential foods.
These regulations give officials broad powers to seize food stocks held by traders, arrest those who stock up on essential foods, and allow the government to control prices.
Rajapaksa has appointed a senior military officer to serve as a basic service commissioner to coordinate the supply of rice, rice, sugar and other consumer goods.
Workers unload basic food at a wholesale market in Colombo [Chamila Karunarathne/EPA]The move took place after the prices of sugar, rice, onions and potatoes rose sharply, and due to shortages of powdered milk, kerosene and cooking gas, even though the country imposed a 16-day curfew before next Monday, there have been queues outside the shops. Long line. The number of COVID-19 cases has increased.
Trade Minister Bandula Gunawardena (Bandula Gunawardena) said that some traders hoard stocks, leading to food shortages and inconvenience to the public.
The government has increased penalties for hoarding food, but as this country of 21 million people is fighting a wave of coronavirus that kills more than 200 people every day, food shortages have also followed.
Due to the pandemic, the economy shrank by a record 3.6% in 2020. In March last year, the government banned the import of cars and other items, including cooking oil and turmeric, which are essential spices in local cooking to save foreign exchange.
Importers still stated that they could not get U.S. dollars to pay for the food and medicines they were allowed to buy.
A Sri Lankan daily-paid worker waits for customers at the wholesale market in Colombo[Chamila Karunarathne/EPA]Two weeks ago, the Central Bank of Sri Lanka raised interest rates to support the local currency.
Bank data show that Sri Lanka’s foreign exchange reserves fell from 7.5 billion U.S. dollars when the government took office in November 2019 to 2.8 billion U.S. dollars at the end of July, when the rupee exchange rate against the U.S. dollar had depreciated by more than 20%.
Energy Minister Udaya Gammanpila called on motorists to save fuel so that the country can use foreign exchange to buy essential medicines and vaccines.
An aide to the president warned that unless consumption is reduced, a fuel rationing system may be implemented before the end of the year.
At the same time, the number of COVID-19 deaths in Sri Lanka has increased rapidly in the past few weeks. More than 200 people have died every day in the past 10 days and more than 4,500 cases have been reported every day.
According to official data, Sri Lanka has recorded 8,991 COVID-related deaths since the beginning of the pandemic.
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