A joint letter from 23 Sri Lankan business chambers has warned of economic collapse, further jobs losses, social unrest a worsening hunger situation if steps are not taken urgently.
In a letter written to Sri Lankan parliamentarians and the country’s President, 23 business chambers have urged for immediate action to obtain help from the International Monetary Fund and undertake debt restructuring.
The chambers have said that political stability is necessary for this as is the urgent appointment of a full-time finance minister. In the same breath, they have welcomed the move to appoint a central bank Governor and a Treasury Secretary.
The signatories to the letter apprehend that an economic collapse, further jobs losses and hunger further aggravating prevailing social unrest if steps are not taken urgently to get IMF assistance.
“We have to act before the economy falls off a complete precipice,” Rohan Masakorale, from the island’s rubber exporters said.
Yohan Lawrence from the Joint Apparel Association Forum asked for financial advisors to be appointed fast for debt restructuring and talks with the IMF.
“We need to stop the payment of debt, it has to be done in an orderly manner,” Lawrence said.
“We accept that there will be a period of difficulty. It will get worse before it gets better. We face a total economic collapse if something is not done.”
Sandra de Soyza from the Sri Lanka Association of Software Exporters said there was business but power and connectivity problems are building up.
“Our customers globally have many concerns,” she said. “Now we are meeting delivery deadlines with utmost difficulty but we cannot sustain.”
Sabry speaks
The European Union too has urged for an initiating in-depth discussions with the IMF on the reform preconditions put forth by the lending institution.
Analysts in Colombo say that Sri Lanka is now suffering most of the post-default trade fallouts, even ahead of an actual default.
The Sri Lanka Exporters Association fears a 20 to 30 per cent export drop in exports during this month and this can must be arrested without further delay.
“Exporters are willing to export. Service sector is willing. The IMF program should have been done yesterday,” Masakorale said. “We have to move forward. We are calling for a stable political system for the world to have confidence.”
In the meanwhile, Ali Sabry, who resigned from the post of the country’s finance minister barely 24 hours after accepting the position expressed his optimism that Sri Lanka could get US$ 3 billion from the IMF over three years, besides bilateral financial support.
“I think we can get US$ 3 from IMF, over three years,” he said, adding, “From the World Bank we can get. From Japan we can get. From China. India has helped us greatly already.”
Sabry continues to officiate as finance minister since nobody has come forward to take the job.
The political instability and a dearth of leaders to steer the country’s economy is having far-reaching consequences.
The once most-developed country in all of SouthAsia is presently in the grips of an unprecedented food and fuel shortages along with record inflation and crippling power cuts.
For days on end, trading at the country’s stock exchange is getting halted for a drop in share prices beyond the five per cent threshold.
