Sri Lanka: A Country Brought On It’s Knees.

  • Political Corruption and Years of mismanagement are one of the main causes of its downfall.
  • They are looking to other countries to offer solution.
  • Sri Lanka will rise again at a cost the citizens will have to pay.
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On Saturday the head of state of Sri Lanka announced that he will resign with immediate effect alongside his Prime Minister.

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The president’s resignation leaves the country in a much worse situation with chaos everywhere from citizens to politicians.

There is a shortage in everything right now, from fuel to food, and medicine just to name a few.

The country is currently defaulting on its debt, they have run out of cash to pay for imports, fuel, and other necessities.

The prime minister of Sri Lanka just confirmed that the economy has collapsed and they are seeking help from neighboring countries.

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On Saturday is what Sri Lanka citizens called the d-day which is on the same day the President and his prime minister announced they were resigning.

Ranil Wickremesinghe who is the prime minister had a very huge task to reverse the economy to where it was but the damage is already done.

This country was growing, the middle class was going in well until this crisis happened.

Now the citizens have to skip meals to make it through the day, fuel is scarce which results in huge lines.

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Sri Lanka is not able to import gasoline, milk, and cooking gas, and now the country is slowly going into bankruptcy mode.

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The tourism sector which contributes heavily to economic growth was badly affected by the pandemic in 2019.

The country is unable to pay over $50 billion in interest payments thus defaulting on the debt.

Inflation in the country is way up, food has risen by 57% and its currency declined by 80% making the situation even worse.

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Sri Lanka has strategically located in the world’s busiest shipping lanes so it’s a shame the country is collapsing.

Don’t forget that this situation has been brought about by corruption, corrupt leaders used their country’s resources to benefit themselves.

Political corruption is the problem and it complicates any financial rescue to be offered and it also makes it hard for IMF to come in.

The Economy Has Collapsed.

This crisis was brought about by years of corruption and mismanagement of public funds.

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Terrorism is also a factor in the downfall, in 2019 there was a series of bombings that killed 260 people and hindered tourism.

The president banned foreign exchange, imports, and also chemical fertilizers which caught farmers by surprise thus skyrocketing food prices.

The war in Ukraine has also made things worse, the inflation at 40% and food prices at around 60% according to reports.

Now Sri Lankan rupee has weakened, to 360 to the U.S dollar which makes it hard to import goods to the country.

The foreign reserves are at $25 billion thus suspending loan payments since it’s too low.

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Bail-Out Plan.

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Some countries have come in handy to help Sri Lanka. U.S, Japan, and Australia have offered over a hundred million dollars in aid.

The country is in direct contact with China to get an extra boost.

The shortage of fuel, it plans to buy steeply discounted from Russia.

The government is currently in negotiation with IMF to provide a bail-out plan which will not come as soon as we thought.

United Nations requested a worldwide appeal for assistance but that will not be enough for the country to stay afloat for the next 6 months.

“Sri Lanka pins our last hopes on IMF,” read the Colombo Times.

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