Sri Lanka’s PM says economy has ‘completely collapsed’

Sri Lanka’s PM says economy has ‘completely collapsed’
‘We are now seeing signs of a possible fall to rock bottom,’ warns Ranil Wickremesinghe

Sri Lanka’s economy has “completely collapsed”, leaving it unable to buy imported fuel, the country’s prime minister has said.

Speaking to his colleagues on Wednesday, Ranil Wickremesinghe said his nation is “facing a far more serious situation” than the gas, electricity and food shortages it has experienced in recent months. “Our economy has completely collapsed,” he explained.

Mr Wickremesinghe, who is also serving as the finance minister, admitted that the government had missed the opportunity to rectify the situation. “We are now seeing signs of a possible fall to rock bottom,” he warned.

The Ceylon Petroleum Corporation is currently in significant debt, he said. “As a result, no country or organisation in the world is willing to provide fuel to us. They are even reluctant to provide fuel for cash.”

The Sri Lankan prime minister also confirmed that his government was seeking financial assistance from countries including China, India, Japan and the US.

“We need the support of India, Japan and China who have been historic allies. We plan to convene a donor conference with the involvement of these countries to find solutions for Sri Lanka’s crisis,” Mr Wickremesinghe said.

“We will also seek help from the US,” he added.

India has already offered support to the beleaguered country, providing it with around $3bn (£2.45bn) worth of assistance. A delegation from India will arrive in Sri Lanka on Thursday for further talks, while a team from the US will hold meetings with Sri Lankan officials next week.

The nation of 22 million people has already said it will halt the repayment of £5.7 billion in foreign debt this year.

With the country’s worst financial crisis since independence deepening, people have been left struggling to buy basic commodities like food and medicine.

Widespread protests against the government’s handling of the economy broke out across Sri Lanka earlier this year, leading to the resignation of the prime minister Mahinda Rajapaksa last month.