Sri Lanka Will Need $5 Billion in Coming 6 Months for Essentials: Prime Minister

Prime Minister Wickremesinghe is currently working on an interim budget to fix Sri Lanka's shattered finances.

Sri Lankan PM Ranil Wickremesinghe

(Photo Courtesy: Hindustan Times)

Prime Minister Ranil Wickremesinghe told Sri Lanka's Parliament on Tuesday, 7 June, that the country needs at least $5 billion over the next 6 months to fund and maintain the basic living standards. This includes $3.3 billion for fuel imports, $900 million for food, $250 million for cooking gas and $600 million more for fertilisers.

“Only establishing economic stability is not enough, we have to restructure the entire economy,”

Ranil Wickremesinghe

The prime minister is currently working on an interim budget to rectify Sri Lanka's shattered finances, reported Reuters.

In a meeting of the joint chambers on 3 June, the prime minister mentioned that the country is targeting $5 billion for repayments of outstanding dues and $1 billion for bolstering the country’s reserves, as per the Business Standard.

Wickremesinghe also holds the portfolio of Finance Minister and is leading negotiations with organisations like the IMF and World Bank to restructure loans and solve the massive crisis.

PM Hints at Opting for Fuel Rationing amid Economic Crisis

Sri Lanka's prime minister cautioned on Tuesday that the next three weeks will be "tough" for the government.

"The country spends USD 500 million per month on fuel. It should be kept in mind that the current global crisis risks raising oil prices. Some estimate that global oil prices will rise by as much as 40 percent by the end of this year.

Unessential travel should be limited as much as possible. After these difficult three weeks, we are trying to ensure the shortage of fuel and gas will have ended. Let's face these difficult three weeks united and patiently,” he added.

The prime minister also spoke about how the foremost priority is stability but the ultimate goal was the economic revival. This is not something that can be done in two or three days. This challenge cannot be faced by miracles, slogans, magic, or emotions. Implementing intelligently thought-out projects requires hard work and dedication," he said

He also said that the rice requirement of the country annually is 2.5 million metric tonnes. “But we have only 1.6 million metric tonnes of rice in stock, we need $5 billion to ensure our daily lives are not disrupted for the next six months," he said.

The Lankan PM also informed the parliament that a worldwide appeal has been organised by the United Nations for Humanitarian Assistance to Sri Lanka.

“They are seeking support to provide humanitarian assistance to Sri Lanka. Through this project, they plan to provide $48 million over a four-month period to the food, agriculture and health sectors,"

Ranil Wickremesinghe

21st Amendment to the Constitution Deferred a Week

The Cabinet deferred the 21st amendment to the Constitution which shall make the parliament more powerful than the Executive President. The amendment's aim is to annul the 20A amendment that gave President Gotabaya unrestricted power. The delay is in light of major protests by the ruling party.

President Gotabaya Rajapaksa has been accused by the main opposition party – Samagi Jana Balawegaya (SJB) – of trying to delay and soften the amendment in an attempt to retain his uncontrolled power.

Worst Economic Crisis in 70 years

This is the worst economic crisis that Sri Lanka has faced in the last 70 years, due to depleted foreign exchange which caused the government to stop all its imports.

The import paralysis has caused the prices of essential goods such as food, milk, oil, and fuel to soar leading to huge protests across the country.

The depletion of Sri Lanka’s foreign reserves is attributed to the collapse of the tourism industry in light of the Covid-19 pandemic and rash economic policies implemented by the Sri Lankan Government.

(With inputs from Reuters, PTI, and Business Standard.)