Sri Lankans wait time as leaders seek solution to economic woes

COLOMBO, Sri Lanka (AP) — Sri Lankans who have endured months of fuel and food shortages are bracing for more pain as a new government scrambles to find a solution to the Indian Ocean nation’s economic emergency.

Like many others, fishmonger Gamini Malavallage says he is pinning his hopes on President Ranil Wickremesinghe The ability to revive the economy and restore stability after months of unrest and protests.

“It’s really, really bad right now, my life is almost ruined,” said Malavallage, who has given up selling fish because he can’t find fuel to go to the villages where he used to buy fish, and in any case his Customers are buying less and less.

Malavaragi said he considered Wickremesinghe his “last hope”.

“I think he’s going to do something. With his experience and knowledge, I’m sure he’s capable,” Maravallachi said. “However, he has to come up with something by the end of this year, otherwise, he will also have to face the protests of the people,” he said.

After months of protests and unrest, Sri Lanka is one step closer to ending the horrific economic and humanitarian crisis as Wickremesinghe’s new government was appointed on 20 July. But daunting obstacles lie ahead.

Lawmakers back him to extend state of emergency This gives the president broad powers to crack down on any violence. That could give him time to try to reach a deal with the International Monetary Fund on the requested $3 billion bailout.

By his own admission, it’s easier said than done.

On Saturday, Wickremesinghe said he was delayed by a month With talks with the International Monetary Fund stalled due to recent political turmoil, he aims to reach a deal by early August.

So far, there has been little sign of progress in talks with Sri Lanka’s other creditors over the more than $50 billion it owes lenders.

“As public debt is assessed as unsustainable,” the IMF approval will “require adequate financing guarantees from Sri Lankan creditors to restore debt sustainability,” the lender said in a statement. That would require public and private lenders to agree to accept smaller bond payouts, lower interest rates or longer repayments.

The IMF’s conditions could also involve higher taxes, better anti-corruption measures and other reforms, such as the privatization of state-owned companies such as state-owned airlines.

The World Bank issued a statement last week expressing “deep concern” about Sri Lanka and said it would not provide more funding pending a plan of “deep structural reforms” to address the root causes of the crisis.

“He’s in trouble,” said Tamanna Salikudin of the American Institute for Peace, an independent institute in Washington, D.C.

Austerity measures are hard to swallow for people who go hungry, walk or bike to work because they can’t afford fuelShe noted that higher taxes could dent support in the ruling party, which has benefited from tax cuts that have dried up the treasury.

In June, Wickremesinghe, then the sixth prime minister, suggested a meeting of major donors including India, China and Japan. Sri Lanka, whose foreign exchange reserves have largely dried up, is seeking “bridge financing” to buy fuel and other necessities to keep the economy afloat.

“We must hope that friendly countries will support Sri Lanka in the short term,” said political analyst Jehan Pereira.

When USAID Administrator Samantha Ball visited New Delhi last week, she compared India’s aid to China., and urged Beijing to do more.Indian government says it has provided more than $1.5 billion in credit to buy fuel, food, medicine and other necessities.

When asked about Sri Lanka’s debt impasse and criticism of China’s lack of transparency in lending, foreign ministry spokesman Zhao Lijian accused the US and other “western capital” of manipulating Sri Lanka’s credit rating, speculating in its market and preventing it from obtaining new financing.

“We hope that the US can truly help Sri Lanka overcome its current difficulties, reduce its debt burden and achieve sustainable development, instead of recklessly using all possible opportunities to shirk its responsibilities, smear other countries, and engage in geopolitical games,” Zhao Lijian said.

Official Chinese loans to Sri Lanka represent only about 10 percent of its debt, but the amount of additional commercial borrowing from China is unclear.

“Unless and until the rest of their debt is restructured, I don’t think the Chinese will do anything,” Salikudin said. “They never take the first step.”

As negotiations with Sri Lankan lenders dragged on, its people moved on, finding ways to weather the storm, often queuing for days for petrol and sometimes still returning empty-handed.

“Even with a deal (with the IMF), Sri Lanka still faces a tough road to economic recovery. By no means a deal, things will get back to normal soon,” Capital Economics’ Gareth Leather said in a recent online briefing .

The state-owned natural gas company has started distributing cylinders — a mix of propane and butane — but most people will have to wait at least overnight to get them, and prices have more than tripled since October.

The government has also launched an app to ration the purchase of gasoline: 4 liters (1 gallon) per week for motorcycles, 20 liters (5.3 gallons) per week for cars, and 40 liters (10.6 gallons) per week for buses.

The aim is to reduce long queues at gas stations and crack down on the black market for fuel. Prioritize school buses, agriculture, fishing, tourism and public transportation.

Many people say that the reduction Or almost give up eating fish and meat because of the high prices. Milk powder is hard to come by, and prices for most essentials, including bread and lentils, have tripled.

“As long as the serious shortages are resolved, people will be more patient and ready to wait,” Pereira said. “Otherwise, it’s like a tinderbox — you can see cars, motorcycles on the road every day. Angry people. Angry people, it’s a tinderbox situation where one spark leads to more turmoil.”

The fishmonger Marawalachi made about 6,000 rupees ($16) in the past day. Now he lives off his savings.

Office clerk Sithum Udara still goes to work, but what used to be a fast, comfortable commute on a motorcycle has become a pain in the ass of cramming on a bus or train.

“Going to the office is a nightmare now. I’m really fed up, I think it’s the worst time of my life,” Udala said. “I had no choice but to go to work.”

But Udala believes that Wickremesinghe should be given “considerable time” to revive the economy and resolve other issues. “He can’t do it overnight; people have to understand that reality.”

Currently, a large part of the president’s job is managing expectations.

“The first thing he’s going to do is cash in on the economics,” Salikudin said. “It’s the collapse of the economy that brings people to the streets,” she said.

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