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COLOMBO, 27th August (PTI) Sri Lanka should learn to manage the economy with limited foreign exchange reserves as the island nation grapples with unprecedented financial crisis.
Weerasinghe also commented that, given the current economic situation in the country, the Ministry of Finance recently suspended the import of more than 300 non-essential items.
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The Sri Lankan government on Wednesday banned the import of 300 consumer goods including chocolate, perfume and shampoo, as part of the cash-strapped island nation’s solution to foreign exchange problems.
He said on Friday it was a decision to be made between whether people wanted to buy the gas and fuel they needed for basic necessities, or a TV, fridge or car that they could put off.
According to the newsfirst.lk website, the governor said that if the money generated from the purchase of these non-essential items is diverted to buy essential items that could benefit many citizens, especially during the current economic crisis.
Vilasingh said it was important to use the limited resources available in a way that benefited all, and that the temporary import suspension would be lifted once the situation returned to normal, the report said.
Sri Lanka, a country of 22 million people, is in the midst of unprecedented economic turmoil, the worst in seven decades. The crisis has made it difficult for millions of people to buy food, medicine, fuel and other necessities.
The country announced in April that it would suspend repayments of nearly $7 billion in foreign debt due this year, compared with about $25 billion due by 2026, after the country defaulted on its foreign debt due to a severe foreign exchange crisis. Sri Lanka’s total external debt is $51 billion.
On Friday, President Raniil Wickremesinghe and a visiting IMF team held a second key round of talks to finalize a rescue package for the cash-strapped country. The first round of talks took place on Wednesday. This is the second such visit by the IMF in three months.
The visit comes as Sri Lanka is busy reaching an employee-level deal with the Washington-based global bank on a $5 billion plan that could be the antidote to the country’s current economic woes.
Sri Lanka ranks fifth in the world with the highest food price inflation, the World Bank said in its latest assessment. Sri Lanka is behind Zimbabwe, Venezuela and Turkey, while Lebanon tops the list.
A worsening foreign exchange crisis that led to shortages of essential goods sparked mass public protests that led to the ouster of Gotabaya Rajapaksa and the resignation of the presidency last month.
(This is an unedited and auto-generated story from the Syndicated News feed, the body of the content may not have been modified or edited by LatestLY staff)
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