Sri Lanka’s economy is at a very dangerous position – PM

(LANKAPUVATH | COLOMBO) – Sri Lanka’s newly appointed Prime Minister Ranil Wickremesinghe addressing the public in a televised speech for the first time after assuming the post said at this moment, Sri Lanka’s economy is at a very dangerous position.

Presenting the dire situation of the economy at present, the Premier said at the beginning of 2022, the previous government’s budget showed a revenue of 2.3 trillion rupees, but the real revenue forecast for this year is 1.6 trillion rupees.

Although government expenditure for 2022 is 3.3 trillion rupees, due to the increase in interest rates and additional expenditure of the previous government, the total expenditure of the government for the year 2022 is 4 trillion rupees. The budget deficit for the year is 2.4 trillion rupees, or 13 percent of GDP.

He said although approved credit limit is 3.2 trillion rupees, the government has spent 1.95 trillion rupees by the second week of May and the gross balance for the rest of the year is 1.25 trillion rupees. Therefore, the cabinet has taken a decision yesterday to submit a proposal to Parliament to increase the approval limit for issuing Treasury Bills from Rs.3 trillion to Rs.4 trillion.

“In November 2019, our foreign exchange reserves stood at US $ 7.5 billion. But today the treasury is unable to find even a million dollars. At present the Ministry of Finance is unable to find even the US $ 5 million required to pay for gas shipment.”

“In the midst of all these crises, there are some of the most serious problems we face. About US $ 75 million is urgently needed to manage the queues in the next few days. “

At present we have only one day of petrol. Due to the diesel ship that arrived yesterday, your diesel problem will get some relief from today.

“Under the Indian loan assistance program, two more diesel ships are scheduled to arrive on May 19 and June 1 and two petrol ships on May 18 and 29. Three petrol, crude oil and fuel oil tankers have been stranded in Sri Lankan waters for more than 40 days today. We are trying to get dollars from the open market to pay for it. “

He added that the government will look into purchasing foreign currency from the open market to pay for three fuel shipments.

The Prime Minister said his plan is to present a relief-based budget for this year again instead of the development budget already presented.

Wickremesinghe also stated that he proposes to privatize national carrier, SriLankan Airlines which is incurring heavy losses.

“SriLankan Airlines incurred a loss of Rs. 45 billion in the year 2020-2021 alone. As of March 31, 2021, the total loss was $ 372 billion. Even if we privatize this, we will have to bear this loss. You should know that this loss has been inflicted on the poor and innocent people of this country who have never even stepped on an airplane,” the Premier said.

“In the short term, we are going to face even more difficult times. Inflation is likely to increase,” he said.

The PM further said that he is reluctantly compelled to print money to pay wages of the public sector.

“I reluctantly have to give permission to print money at the moment. That is to pay the salaries of the public servants this month and to spend on the essential goods and services that you need. However, we must keep in mind that the rupee depreciates due to printing. Given the current situation, the Ceylon Petroleum Corporation and the Electricity Board are unable to find rupees.

“However the next few months you and I will have to go through the most difficult period of our life. We must all face it with dedication,” the Prime Minister said.

“I do not like to lie to people hiding facts. This is the real situation, whether dangerous or unpleasant. In the short term we are going to face more difficult times than ever before. At this time we have only misery. But this situation is short-lived. We will have the support and assistance of our allies in the coming months. They have already promised to help us. We have to be patient for the next few months. But we can recover from this. For that we have to go in a new direction.”

The Premier emphasized that in order to find solutions to these existing problems, a National Assembly or a Political Council should be set up immediately with the participation of all parties.

“Then we will be able to move the country up again by implementing common short-term, medium-term and long-term programs within a specific time frame that will be decided in consultation with all parties.”

“We will build a country without kerosene, gas, fuel queues, a country without power cuts, a country with facilities to carry out agriculture freely, a country where the future of the youth is safe, a country that does not want to waste human labor on protests and in queues. We are building a country where everyone can lead a free life and eat three meals a day.”

“I accepted a dangerous challenge. In the Hunuwataye Kathawa, Grusha picked up someone else’s child and crossed the vine bridge. This is an even more dangerous challenge. Precipice is deep. The bottom is not visible. The bridge is made of thin glass. No help. I have two fitted shoes on my feet. At its sole are sharp iron nails All I have to do is carry the baby safely to the other side. I accepted this challenge on behalf of the country. My purpose and commitment is not to save an individual, family or group. Saving the people of the whole country, saving the whole country, saving the future of the youth. I risk my life to face this challenge. Overcome that challenge. Give me all your support for that.”

“I am fulfilling my responsibility for the country.”

“That is my promise to you.”

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