The economic crisis in the island nation Sri Lanka turns out to be the worst with each passing day. It will become an uphill task for newly appointed Prime Minister Ranil Wickremesinghe to handle the situation. The country is depending on bridge finance from World Financial Institutions for providing necessities to the people. It is shocking to hear the news that Sri Lankan government failed to conduct annual economic examinations due to a scarcity of paper. Adding to fuel to the fire, Sri Lanka has no Dollars to pay for Petrol shipments amid the ongoing economic crisis. Sri Lanka has no money to import goods.
People are in queue for petrol from morning on every day. Sri Lanka's Power and Energy Minister appealed to people to stop queuing for the next two days, telling parliament that Sri Lanka currently has no dollars to pay for petrol shipments. Last month, World Bank offers a $160 million short-term loan to Sri Lanka with a condition of repayment within 30 days. Now, 30 days grace period for payment has come to an end. Sri Lankan Prime Minister Ranil Wickremesinghe addressed the people and he gave permission to print money currency notes for paying salaries to employees.
Printing more money and brought into circulation is not the permanent solution to overcome the crisis. When there is no productivity what is the use of more money in hands of the people. Inflation might reach peaks and prices for all commodities might shoot up. It leads to the Forex crisis and hyper-inflation. Remember Zimbabwe's financial crisis in 2008, when people brought money into bags for purchasing necessities. The Sri Lankan government has already decided to privatize Sri Lankan airlines for getting revenue. Prime Minister urged people for sacrifices meant the government is ready to impose more taxes on various commodities.
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