The Prime Minister claims that Sri Lanka’s economy has “totally collapsed.”

• Sri Lanka is experiencing its worst financial crisis in seven decades.
• Millions are struggling with fuel, electricity, and food shortages.
• The country is in talks with the World Bank, Asian Development Bank, and U.S. for assistance.

The prime minister of the crisis-hit country, Ranil Wickremesinghe, declared on Wednesday that the economy of Sri Lanka has “totally collapsed” as millions of people there struggle with fuel, electricity, and food shortages.

Wickremesinghe stated to the Sri Lankan Parliament that “our economy has faced a complete collapse” and added that the government was looking to its international allies and the International Monetary Fund (IMF) for assistance in stabilising the economy.

However, Wickremesinghe cautioned that in addition to shortages, the 22 million-person island nation was “facing a far more serious problem.”

With its foreign exchange reserves at historic lows and money running out to pay for basic imports like food, medicine, and fuel, Sri Lanka is experiencing its worst financial crisis in seven decades.

The administration implemented a four-day work week for public sector employees in recent weeks to give them time to produce their own crops as part of the extraordinary measures it has taken to address the problem. The challenges encountered by many people in the nation are not being much alleviated by the measures, though.

Numerous large cities, including the commercial capital of Colombo, continue to see large crowds waiting in lines for hours to buy petrol, occasionally getting into physical altercations with police and soldiers.

Due to the decrease in train frequency, commuters are now required to cram into compartments and even perch precariously on top of them.

Due to the gasoline crisis and rising food prices, patients are unable to travel to hospitals. The South Asian nation’s basic food, rice, is no longer available on the shelves of many stores and supermarkets.

According to police officials, 11 people have already passed already this week while standing in fuel lines.
In his remarks on Wednesday, Wickremesinghe—who assumed office just days after violent protests forced his predecessor Mahinda Rajapaksa to step down—seemed to assign responsibility for the nation’s predicament to the previous administration.

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It is difficult to rebuild an economy that has entirely collapsed, especially when foreign reserves are perilously low, he said. “We wouldn’t be in this difficult situation right now if steps had at least been done to slow down the economy’s downfall at the outset.”

The country only has enough fuel on hand to last five days, the power and energy minister of Sri Lanka told reporters last week.

Although Sri Lanka has gotten $4 billion in credit lines from its neighbour India to stay afloat, Wickremesinghe acknowledged that may not be enough.

“We have asked our Indian counterparts for more financing support. However, even India won’t be able to continue helping us in this way “explained he.

He stated that reaching an agreement with the IMF was the next stage.

“Our only choice is this. This is the way we must go. Our goal is to speak with the IMF and come to an agreement to get another credit facility “said Wickremesinghe.

In order to “obtain interim short-term financing” before receiving IMF support, he continued, Sri Lanka is currently in talks with the World Bank, Asian Development Bank, and the United States.

He stated that a team from the US Department of the Treasury will travel to Sri Lanka the following week.

China and Japan, two of Sri Lanka’s “major financing countries,” would also be approached for assistance, according to Wickremesinghe.

The world would once again have faith in us if we earn the IMF seal of approval, he claimed. It will enable us to obtain low-interest loans from other nations as well as loan aid.

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