Sri Lanka economy in a precarious condition: PM Ranil Wickremesinghe

Colombo, May 16: Sri Lanka's new prime minister Ranil Wickremesinghe on Monday said that the country's economy in current times is "extremely precarious".

Stating that a new "concessionary budget" needs to be planned as an alternative to the development Budget 2022, PM Wickremesinghe said, "I propose to privatise Sri Lankan Airlines which is incurring extensive losses. The loss for 2020-2021 alone amounts to SLR 45 billion. By 31st March 2021, total loss was at 372 billion. Even if we privatise Sri Lankan Airlines, this is a loss that we must bear."

Slamming the previous government, PM Wickremesinghe said, "Although the former government's budget projected revenue of SLR 2.3 trillion, SLR 1.6 trillion is the realistic projection of this year's revenue."

"The estimated govt expenditure for this year is SLR 3.3 trillion. However, due to increase in interest rates & addl expenditure of ex-govt, total govt expenditure is SLR 4 trillion. Budget deficit for the yr is SLR 2.4 trillion. This amount equals 13% of the GDP," he added.

PM Wickremesinghe said, "Approved debt ceiling is SLR 3200 bn. By 2nd week of May, we had spent 1950 bn. Therefore, remainder is SLR 1250 bn."

"In November 2019, our foreign exchange reserves were at USD 7.5 billion. However, today, it is a challenge for the treasury to find USD 1 million. The Ministry of finance is finding it difficult to raise USD 5 million required to import gas," he further said.

Addressing the public, PM Wickremesinghe said, "We're faced with several grave concerns. To ease queues, we must obtain approximately USD 75 mn within next couple of days. At the moment, we only have petrol stocks for a single day. Due to diesel shipment that arrived y'day, lack of diesel will be resolved to some extent."

"A quarter of electricity is generated through oil. Therefore, there's a possibility that daily power outages will increase to 15 hrs a day. However, we've already obtained money to avert this crisis. We must also immediately obtain USD 20 mn to provide gas to consumers," he added.