Push Admin

Sri Lanka economy will 'collapse' if no new govt in 2 days: central bank

Article (news)

Agence France-Presse

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img alt=" A bus that was torched during political unrest hangs off the edge of a promenade, during an island-wide curfew amid political unrest in Colombo, Sri Lanka, 11 May 2022. Chamila Karunarathne, EPA-EFE" src="https://sa.kapamilya.com/absnews/abscbnnews/media/2022/news/05/11/bus-epa-efe.jpg"/><figcaption>A bus that was torched during political unrest hangs off the edge of a promenade, during an island-wide curfew amid political unrest in Colombo, Sri Lanka, 11 May 2022. Chamila Karunarathne, EPA-EFE</figcaption></figure></div><p>COLOMBO - Sri Lanka&#x27;s economy will &quot;collapse beyond redemption&quot; unless a new government is appointed within two days to restore political stability, the central bank chief said Wednesday.</p><p>He said the latest wave of mob violence derailed the bank&#x27;s recovery plans, and the resignation of the prime minister on Monday and the lack of a replacement were complicating matters.</p><p>He said political stability was vital to implementing economic reforms aimed at addressing the country&#x27;s debt crisis and the acute shortage of foreign exchange to import essentials.</p><p>&quot;If there is no government in the next two days, the economy will completely collapse and no one will be able to save it,&quot; Central Bank of Sri Lanka Governor Nandalal Weerasinghe said.</p><p>&quot;The country was fast going down a slope when I took over just over a month ago. I thought we were able to apply the brakes, but with events of Monday the brakes no longer work.</p><p>&quot;Within a week or two the economy will completely collapse. No one will be able to save Sri Lanka at that stage. My being here as governor will not help,&quot; he said.</p><p>&quot;I will resign if there is no immediate action to form a government.&quot;</p><p>Shortly after taking over last month as the bank&#x27;s chief, Weerasinghe announced defaulting on Sri Lanka&#x27;s $51 billion external debt saying the country had no money to pay its creditors.</p><p>He almost doubled interest rates and allowed the rupee to depreciate rapidly to ensure better foreign exchange liquidity in the commercial banks.</p><p>Sri Lanka is facing its worst economic crisis since independence from Britain in 1948 after it ran out of dollars to import even the most essentials.</p><p>There had been long queues for fuel and food causing severe hardships for the nation&#x27;s 22 million people, prompting them to protest against the government.</p><p>&quot;If we don&#x27;t have political stability, very soon we will run out of what little petrol and diesel left. At that point people will get on the streets to protest peacefully or violently,&quot; Weerasinghe added.</p><p>This week, the crisis took an ugly turn with nine people killed in violence and more than 200 injured.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/05/10/22/china-backed-projects-testament-to-sri-lankas-mismanagement">China-backed projects testament to Sri Lanka&#x27;s mismanagement</a></li>	<li><a href="https://news.abs-cbn.com/overseas/multimedia/photo/04/18/22/sri-lanka-in-crisis-over-alleged-corruption">Sri Lanka in crisis over alleged corruption</a></li></ul><div> </div><div><strong>RELATED VIDEO</strong></div><figure class="op-interactive"><iframe allow="autoplay; fullscreen" frameBorder="0" height="100%" id="ivsplayer01" scrolling="no" src="https://player.ivideosmart.com/ivsplayer/v4/dist/html/iframe-src.html?iframeid=ivsplayer01&amp;key=e8c22c015ca9eafa76f1e3edfa03c603&amp;spid=3001339&amp;vid=2032419" width="100%"></iframe></figure><div class="iwantbar">Watch more News on <a href="https://www.iwanttfc.com/#!/browse/Genres/News/tag_id_genres/id_news" target="_blank">iWantTFC</a></div>

Sri Lanka's economy will 'collapse beyond redemption' unless a new government is appointed within two days to restore political stability, the central bank chief said Wednesday.