Cabinet Spokesman Minister, Dr. Bandula Gunawardhana said that the economy of Sri Lanka, which had been derailed after Independence, was put back on the right track in 2023 by the Government including President Ranil Wickremesinghe. Informing Cabinet decisions at the Cabinet press briefing yesterday (2), he said that 2024 is a very crucial year and the current economic challenge will last until 2027.
He pointed out that the crisis can be mitigated by following the programme of the International Monetary Fund (IMF) till 2024.
The Minister also said that if the programme of the IMF is not implemented, the life of the government will be limited to two weeks, regardless of who governs or who President is.
He said that the country’s economy cannot run for a day without an agreement made with the IMF, the World Bank, the Asian Development Bank and the creditors.
Dr. Gunawardhena also said that even if we as a country go to the international financial market and issue soveriegn bonds under the world standard rules and financial discipline, the maximum loan amount that can be obtained in 2027 is only USD 1,500 million.
The Minister further expressed the following views:“I see 2024 as the decisive year for our country. The economy which had been derailed has been put back on track by the government including President Ranil Wickremesinghe. But the main challenge remains for the next three to four years. Until 2027, we cannot go to the international market and get a loan to fulfill our needs, no matter which President or Government is in Sri Lanka. As a country subject to world standard financial rules and regulations, in 2027, the maximum loan amount that can be obtained is 1,500 million US dollars.
“Therefore, it is my personal opinion that if we change the IMF plan, which has been prepared for 2024 and the years 2025, 2026 and 2027, then the maximum period of a government will survive is only two weeks. The reason is that without the IMF, without the World Bank, without the Asian Development Bank, without an agreement with the creditors, the country’s economy cannot run for a day.
“In our country, whose economy is heavily dependent on imports, we need to import capital goods such as petroleum, fertilizers, pharmaceuticals, chemicals, wheat flour, sugar, onions, chillies, lentils, consumer goods, machinery, motor vehicles etc. A Letter of Credit based on state reserves should be issued for this import. “If international reserves are not enough to issue a Letter of Credit, banks of other countries of the world will not accept the Letter of Credit in the world market. Such a situation occurred in our country a year ago. We didn’t have petroleum, fertilizer and gas.There was no food. Such economy cannot go even for two weeks. Therefore, in the coming New Year, it is necessary to make maximum sacrifices for the country and work more facing all the current economic crises,” the Minister said.
Nuwan Kodikara